Exhibit 10.3

Execution Version

 

 

 

REGISTRATION RIGHTS AGREEMENT

among

THE EXCHANGING HOLDERS PARTY HERETO

and

ACORDA THERAPEUTICS, INC.

Dated as of December 20, 2019

 

 

 

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REGISTRATION RIGHTS AGREEMENT

REGISTRATION RIGHTS AGREEMENT (this “Agreement”), dated as of December 20, 2019,
by and among Acorda Therapeutics, Inc., a Delaware corporation, with its
principal offices at 420 Saw Mill River Road, Ardsley, NY 10502 (the “Company”),
and the undersigned exchanging holders (each, an “Exchanging Holder”, and
collectively, the “Exchanging Holders”).

WHEREAS:

A.    The Company has entered into one or more exchange agreements with the
Exchanging Holders to exchange a portion of its outstanding 1.75% Convertible
Senior Notes due 2021 for new 6.00% Convertible Senior Secured Notes due 2024
(the “Convertible Notes”) in privately negotiated transactions (the “Private
Exchange”).

B.    The Convertible Notes are to be issued pursuant to an indenture of even
date herewith (the “Indenture”) among the Company, Civitas Therapeutics, Inc.
and the trustee and collateral agent named therein relating to the issuance of
the Convertible Notes.

C.    To induce the Existing Holders to participate in the Private Exchange, the
Company has agreed to provide certain registration rights under the Securities
Act of 1933, as amended, and the rules and regulations thereunder, or any
similar successor statute (collectively, the “1933 Act”), and applicable state
securities laws. 

NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and each of the
Exchanging Holders hereby agree as follows:

1.    Definitions.

Capitalized terms used herein and not otherwise defined herein shall have the
respective meanings set forth in the Indenture. As used in this Agreement, the
following terms shall have the following meanings:

a.    “Business Day” means any day other than a Saturday, a Sunday, a Federal
holiday or any other day on which the SEC’s Washington, DC office or commercial
banks in the City of New York are authorized or required by law to remain closed
the public. 

b.    “Closing Date” means December 23, 2019.

c.    “Common Stock” means the common stock of the Company, par value $0.001 per
share.

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d.    “Effective Date” means the date on which a Registration Statement, through
which the resale of Registrable Securities by one or more Investors shall be
registered, has been declared effective by the SEC.

e.    “Effectiveness Deadline” means (i) with regard to any Registration
Statement registering the resale of all Registrable Securities issuable with
regard to the Convertible Notes up to the Authorized Share Conversion Cap, the
date that is the earlier of (A) 105 days after the Closing Date and (B) four
Trading Days following the date on which the Staff notifies the Company that
either (x) such Registration Statement is not subject to review (y) or the Staff
has no further comments to such Registration Statement, and (ii) with regard to
any Registration Statement registering the resale of Registrable Securities
issuable with regard to the Convertible Notes in excess of the Authorized Share
Conversion Cap, the date that is the earlier of (A) 105 days after the
Authorized Share Amendment Date and (B) four Trading Days following the date on
which the Staff notifies the Company that either (x) such Registration Statement
is not subject to review (y) or the Staff has no further comments to such
Registration Statement.

f.    “Filing Deadline” means (i) with regard to any Registration Statement
registering the resale of all Registrable Securities issuable with regard to the
Convertible Notes up to the Authorized Share Conversion Cap, the date that is 30
days after the Closing Date, and (ii) with regard to any Registration Statement
registering the resale of Registrable Securities issuable with regard to the
Convertible Notes in excess of the Authorized Share Conversion Cap, the date
that is 10 Business Days after the Authorized Share Amendment Date. 

g.    “Investor” means an Exchanging Holder or any transferee or assignee
thereof to whom an Exchanging Holder assigns its rights under this Agreement and
who agrees to become bound by the provisions of this Agreement in accordance
with Section 9 and any transferee or assignee thereof to whom a transferee or
assignee assigns its rights under this Agreement and who agrees to become bound
by the provisions of this Agreement in accordance with Section 9 for so long as
any of the foregoing continues to hold Registrable Securities. 

h.    “Person” means an individual, a limited liability company, a partnership,
a joint venture, a corporation, a trust, an unincorporated organization and a
government or any department or agency thereof. 

i.    “register”, “registered” and “registration” refer to a registration
effected by preparing and filing one or more Registration Statements (as defined
below) in compliance with the 1933 Act and pursuant to Rule 415 and the
declaration or ordering of effectiveness of such Registration Statement(s) by
the SEC. 

j.    “Registrable Securities” means (i) any shares of Common Stock issued or
issuable upon conversion of the Convertible Notes in accordance with the terms
of the Indenture (the “Conversion Shares”), (ii) any shares of Common Stock
issued or issuable in connection with the payment of interest on the Convertible
Notes, including (without limitation) in connection with any Interest Make-Whole
Payment (the “Interest Shares”), and (iii) any shares of capital stock issued or
issuable with respect to the Conversion Shares or the Interest Shares as a
result of any stock split, stock dividend, recapitalization, exchange or similar
event.

 

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k.    “Registration Statement” means any registration statement filed pursuant
to the terms of this Agreement under the 1933 Act covering the resale by any
Investor of any Registrable Securities, including (without limitation) the
prospectus, amendments and supplements to such registration statement or
prospectus, including (without limitation) pre- and post-effective amendments,
all exhibits thereto and all material incorporated by reference (or deemed to be
incorporated by reference) therein. 

l.    “Required Holders” means the holders of at least a majority of the
Registrable Securities.

m.    “Rule 415” means Rule 415 promulgated under the 1933 Act or any successor
rule providing for offering securities on a continuous or delayed basis. 

n.    “SEC” means the United States Securities and Exchange Commission.

o.    “Staff” means the Staff of the Division of Corporation Finance of the SEC.

2.    Registration.

a.    Mandatory Registration. The Company shall prepare, and, as soon as
practicable but in no event later than the applicable Filing Deadline, file with
the SEC a Registration Statement covering the resale of all Registrable
Securities. The Registration Statement shall contain (except if otherwise
directed by the Required Holders or required in order to address written
comments to the Registration Statement received from the Staff upon review of
such Registration Statement) the “Selling Stockholders” and “Plan of
Distribution” sections in substantially the form attached hereto as Exhibit B,
as the same may be amended in accordance with the provisions of this Agreement.
The Company shall use its reasonable best efforts to have the Registration
Statement declared effective by the SEC as soon as practicable, but in no event
later than the applicable Effectiveness Deadline, and will use its reasonable
best efforts to keep the Registration Statement (or any subsequent Registration
Statement filed to maintain the registration of the Registrable Securities
covered by the prior Registration Statement) continuously effective under the
1933 Act during the Registration Period (as defined here). By 5:30 p.m. (Eastern
time) on the second Business Day following the Effective Date, the Company shall
file with the SEC, in accordance with Rule 424 under the 1933 Act, the final
prospectus to be used in connection with sales pursuant to such Registration
Statement.

b.    Rule 415; Cutback. If at any time the Staff 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 1933 Act or requires any Investor to be named
as an “underwriter”, the Company shall use reasonable best efforts to persuade
the Staff 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 Investors is an “underwriter.” In the
event that, despite the Company’s reasonable best efforts and compliance with
the terms of this Section 2.b, the Staff 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 Staff may require to assure the

 

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Company’s compliance with the requirements of Rule 415 (collectively, the “SEC
Restrictions”); provided, however, that the Company shall not agree to name any
Investor as an “underwriter” in such Registration Statement without the prior
written consent of such Investor. Any cut-back imposed pursuant to this
Section 2.b shall be allocated among the Investors on a pro rata basis, unless
the SEC Restrictions otherwise require or provide, and any Interest Shares which
have not been previously issued shall be included as part of such Cut Back
Shares prior to the inclusion of any other Registrable Securities as Cut Back
Shares. 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 (such date, the “Restriction Termination
Date” of such Cut Back Shares). In furtherance of the foregoing, each Investor
shall provide the Company with prompt written notice of its sale of
substantially all of the Registrable Securities under the Registration Statement
such that the Company will be able to file one or more additional registration
statements covering the Cut Back Shares. From and after the Restriction
Termination Date applicable to any Cut Back Shares, all of the provisions of
this Section 2 (including (without limitation) the liquidated damages
provisions) shall again be applicable to such Cut Back Shares; provided,
however, that (i) the Filing Deadline for the Registration Statement including
such Cut Back Shares shall be 10 Business Days after such Restriction
Termination Date and (ii) the Effectiveness Deadline with respect to such Cut
Back Shares shall be the earlier of (A) 105 days after the Restriction
Termination Date and (B) four Trading Days following the date on which the Staff
notifies the Company that either (x) such Registration Statement is not subject
to review (y) or the Staff has no further comments to such Registration
Statement.

c.    Use of Form S-3. The Company undertakes to register the Registrable
Securities on Form S-3 if the Company is then eligible to register the
Registrable Securities for resale on such form. If the Company is not then
eligible to register the Registrable Securities for resale on Form S-3, the
Company undertakes to register the Registrable Securities on Form S-1 or another
appropriate form in accordance herewith.

d.    Effect of Failure to File and Obtain and Maintain Effectiveness of
Registration Statement. The parties hereto agree that the Investors will suffer
damages if the Company fails to fulfill its obligations under this Section 2 and
that, in such case, it would not be feasible to ascertain the extent of such
damages with precision. Subject to Section 2.b, if (i) a Registration Statement
covering all of the Registrable Securities required to be covered thereby and
required to be filed by the Company pursuant to this Agreement is (A) not filed
with the SEC on or before the Filing Deadline (a “Filing Failure”) or (B) not
declared effective by the SEC on or before the Effectiveness Deadline (an
“Effectiveness Failure”); or (ii) on any day after the Effective Date sales of
all of the Registrable Securities required to be included on such Registration
Statement cannot be made (other than (x) during an Allowable Grace Period (as
defined in Section 3.p) or (y) if the Registration Statement is on Form S-1, for
a period of 15 days following the date on which the Company files a
post-effective amendment to incorporate the Company’s Annual Report on Form
10-K) pursuant to such Registration Statement (including, without limitation,
because of a failure to keep such Registration Statement effective, failure to
disclose such information as is necessary for sales to be made pursuant to such
Registration Statement or failure to register a sufficient number of shares of
Common Stock) (a “Maintenance Failure” and, any Maintenance Failure, Filing
Failure or Effectiveness Failure, a “Registration Default”) then, as partial
relief for the damages to any holder of Registrable Securities by reason of any
such delay in or reduction of its ability to sell the underlying shares of
Common Stock (which remedy shall not be exclusive

 

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of any other remedies available at law or in equity) and not as a penalty, the
Company shall pay to each holder of Registrable Securities, aggregate Additional
Interest equal to 0.50% per year on all outstanding Convertible Notes (and all
outstanding shares of Common Stock to the extent any Convertible Notes have been
converted prior to the occurrence of the Registration Default and such shares of
Common Stock remain Registrable Securities); provided that any payment on shares
of Common Stock will be calculated based on the principal amount of the
Convertible Notes as a result of conversion of which such shares of Common Stock
have been issued; provided further that any such Additional Interest will cease
to accrue to holders hereunder and under the Indenture when any such
Registration Default will cease, be remedied or be cured. The Company will pay
any Additional Interest as set forth in, and subject to the terms and conditions
of, the Indenture.

e.    Piggyback Registrations. Without limiting any obligation of the Company
hereunder, if (i) there is not an effective Registration Statement covering all
of the Registrable Securities, if the prospectus contained therein is not
available for use, or if Rule 144 is not available with respect to the
Registrable Securities and (ii) the Company shall determine to prepare and file
with the Commission a registration statement or offering statement relating to
an offering for its own account or the account of others under the 1933 Act of
any of its equity securities (other than on Form S-4 or Form S-8 (each as
promulgated under the 1933 Act) or their then equivalents relating to equity
securities to be issued solely in connection with any acquisition of any entity
or business (or a business combination subject to Rule 145 under the 1933 Act)
or equity securities issuable in connection with the Company’s stock option or
other employee benefit plans), or a dividend reinvestment or similar plan or
rights offering), then the Company shall deliver to each Holder a written notice
of such determination and, if within 15 days after the date of the delivery of
such notice, any such Holder shall so request in writing, the Company shall
include in such registration statement or offering statement all or any part of
such Registrable Securities that such Holder requests to be registered;
provided, however, the Company shall not be required to register any Registrable
Securities pursuant to this Section 2.e that are the subject of a then-effective
Registration Statement; and provided further that the Company shall not be
required to include any Registrable Securities which an underwriter shall advise
the Company will materially adversely affect the Company’s ability to sell all
of the shares which the Company intended to sell. The Company may postpone or
withdraw the filing or the effectiveness of a piggyback registration at any time
in its sole discretion. The Company shall not grant piggyback registration
rights to any holders of its Common Stock or securities that are convertible
into its Common Stock that are senior to the rights of the Holders set forth in
this Section 2.e.

3.    Related Obligations.

At such time as the Company is obligated to file a Registration Statement with
the SEC pursuant to Section 2.a, 2.b or 2.c, the Company will use its reasonable
best efforts to effect the registration of the Registrable Securities in
accordance with the intended method of disposition thereof, and, pursuant
thereto, the Company shall have the following obligations:

a.    The Company shall submit to the SEC, within two Business Days after the
Company learns that no review of a particular Registration Statement will be
made by the Staff or that the Staff has no further comments on a particular
Registration Statement, as the case may be, a request for acceleration of
effectiveness of such Registration Statement to a time and date not later than
48 hours after the submission of such request. The Company shall keep each
Registration

 

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Statement effective pursuant to Rule 415 at all times until the earlier of
(i) the date as of which the Investors may sell all of the Registrable
Securities covered by such Registration Statement without restriction pursuant
to Rule 144 (or any successor thereto) promulgated under the 1933 Act, and any
legend restricting further transfer with regard to such Registrable Securities
has been removed, or (ii) the date on which the Investors shall have sold all of
the Registrable Securities covered by such Registration Statement (the
“Registration Period”). The Company shall ensure that each Registration
Statement (including, without limitation, any amendments or supplements thereto
and prospectuses contained therein) shall not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
therein, in light of the circumstances in which they were made, not misleading. 

b.    The Company shall (i) prepare and file with the SEC such amendments
(including without limitation post-effective amendments) and supplements to the
Registration Statement and the Rule 424 prospectus used in connection with such
Registration Statement as may be necessary to keep such Registration Statement
effective at all times during the Registration Period, and (ii) during such
period, comply with the provisions of the 1933 Act with respect to the
disposition of all Registrable Securities covered by such Registration Statement
until such time as all of such Registrable Securities shall have been disposed
of in accordance with the intended methods of disposition by the seller or
sellers as set forth in such Registration Statement.

c.    Not less than 10 Business Days prior to the filing of a Registration
Statement or any related prospectus or any amendment or supplement thereto, the
Company will furnish to each Investor named therein copies of the “Selling
Securityholders” and “Plan of Distribution” sections of such documents in the
form in which the Company proposes to file them, which sections will be subject
to the review of each such Investor. Each Investor will provide comments, if
any, within five Business Days after the date such materials are provided. The
Company will not file a Registration Statement, any prospectus or any amendments
or supplements thereto in which the “Selling Securityholders” or the “Plan of
Distribution” sections thereof differ in any material respect from the
disclosure received from an Investor in writing for inclusion in such filing.
Holders will have the right to select one legal counsel, at the Company’s
expense pursuant to Section 5, to review any Registration Statement prepared
pursuant to Section 2 or this Section 3, which will be such counsel as
designated by the Holders of a majority of the Registrable Securities then
outstanding and which counsel shall initially be King & Spalding LLP.

d.    The Company shall furnish to each Investor whose Registrable Securities
are included in any Registration Statement, without charge, (i) promptly after
the same is prepared and filed with the SEC, at least one copy of such
Registration Statement and any amendment(s) thereto, including all financial
statements and schedules, all documents incorporated therein by reference, if
requested by an Investor, all exhibits and each preliminary prospectus,
(ii) upon the effectiveness of any Registration Statement, as many copies of the
prospectus included in such Registration Statement and all amendments and
supplements thereto as such Investor may reasonably request, and (iii) such
other documents, including without limitation copies of any preliminary or final
prospectus, as such Investor may reasonably request from time to time in order
to facilitate the disposition of the Registrable Securities owned by such
Investor. The Company consents to the use of any prospectus and each amendment
or supplement thereto provided to the Investors in connection with the offer and
sale of the Registrable Securities covered by such prospectus and any amendment
or supplement thereto.

 

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e.    The Company shall notify each Investor in writing of the happening of any
event, as promptly as practicable after becoming aware of such event, as a
result of which the prospectus included in a Registration Statement, as then in
effect, includes an untrue statement of a material fact or omission to state a
material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading (provided that in no
event shall such notice contain any material, nonpublic information), and,
subject to Section 3.p, promptly prepare a supplement or amendment to such
Registration Statement to correct such untrue statement or omission, and deliver
ten copies of such supplement or amendment to each Investor (or such other
number of copies as such Investor may reasonably request).

f.    The Company will notify each Investor covered by the Registration
Statement as promptly as reasonably practicable of (i) the receipt by the
Company of any notification with respect to the suspension of the qualification
of the Registrable Securities for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose and (ii) the issuance by the SEC
of any stop order suspending the effectiveness of such Registration Statement or
the initiation of any proceedings for that purpose. The Company shall use its
reasonable best efforts to prevent the issuance of any stop order or other
suspension of effectiveness of a Registration Statement or the suspension of the
qualification of any of the Registrable Securities for sale in any jurisdiction.
If such an order or suspension is issued, the Company shall use its reasonable
best efforts to obtain the withdrawal of such order or suspension at the
earliest possible moment, and to notify each Investor who holds Registrable
Securities being sold of the issuance of such order and the resolution thereof,
or its receipt of notice of the initiation or threat of any proceeding for such
purpose.

g.    If any Investor is required under applicable securities law to be
described in the Registration Statement as an “underwriter,” at the reasonable
request of such Investor, the Company shall furnish to such Investor, on the
date of the effectiveness of the Registration Statement and thereafter from time
to time on such dates as an Investor may reasonably request, (i) a letter, dated
such date, from the Company’s independent certified public accountants in form
and substance as is customarily given by independent certified public
accountants to underwriters in an underwritten public offering, addressed to the
Investors, and (ii) an opinion, dated as of such date, of external counsel
representing the Company for purposes of such Registration Statement, in form,
scope and substance as is customarily given in an underwritten public offering,
addressed to such Investor.

h.    If any Investor is required under applicable securities law to be
described in the Registration Statement as an “underwriter,” upon the written
request of such Investor in connection with such Investor’s due diligence
requirements, if any, the Company shall make available for inspection by
(i) such Investor and its legal counsel and (ii) one firm of accountants or
other agents retained the Investors (collectively, the “Inspectors”), all
pertinent financial and other records, and pertinent corporate documents and
properties of the Company (collectively, the “Records”), as shall be reasonably
deemed necessary by each Inspector solely for the purpose of establishing a due
diligence defense under underwriter liability under the 1933 Act, and cause the
Company’s officers, directors and employees to supply all information that any
Inspector may reasonably request; provided, however, that each Inspector shall
agree to hold in strict confidence and shall not make any disclosure (except to
such Investor) or use of any Record or other information which the Company
determines in good faith to be confidential, and of which determination the

 

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Inspectors are so notified, unless (a) the disclosure of such Records is
necessary to avoid or correct a misstatement or omission in any Registration
Statement or is otherwise required under the 1933 Act, (b) the release of such
Records is ordered pursuant to a final, non-appealable subpoena or order from a
court or government body of competent jurisdiction, or (c) the information in
such Records has been made generally available to the public other than by
disclosure in violation of this or any other Transaction Document. Each Investor
agrees that it shall, upon learning that disclosure of such Records is sought in
or by a court or governmental body of competent jurisdiction or through other
means, give prompt notice to the Company and allow the Company, at its expense,
to undertake appropriate action to prevent disclosure of, or to obtain a
protective order for, the Records deemed confidential. Nothing herein (or in any
other confidentiality agreement between the Company and any Investor) shall be
deemed to limit the Investors’ ability to sell Registrable Securities in a
manner which is otherwise consistent with applicable laws and regulations.

i.    The Company shall hold in confidence and not make any disclosure of
information concerning an Investor provided to the Company unless (i) the
disclosure of such information is necessary to comply with federal or state
securities laws, (ii) the disclosure of such information is necessary to avoid
or correct a misstatement or omission in any Registration Statement, (iii) the
release of such information is ordered pursuant to a subpoena or other final,
non-appealable order from a court or governmental body of competent
jurisdiction, or (iv) such information has been made generally available to the
public other than by disclosure in violation by the Company of this Agreement or
any other agreement to which the Company is a party. The Company agrees that it
shall, upon learning that disclosure of such information concerning an Investor
is sought in or by a court or governmental body of competent jurisdiction or
through other means, give prompt written notice to such Investor and allow such
Investor, at the Investor’s expense, to undertake appropriate action to prevent
disclosure of, or to obtain a protective order for, such information.

j.    The Company shall use its reasonable best efforts to cause all of the
Registrable Securities covered by a Registration Statement to be listed on each
securities exchange on which securities of the same class or series issued by
the Company are then listed, if any. The Company shall pay all fees and expenses
in connection with satisfying its obligation under this Section 3.j.

k.    The Company shall cooperate with the Investors who hold Registrable
Securities being offered and, to the extent applicable, facilitate the timely
preparation and delivery of certificates (not bearing any restrictive legend)
representing the Registrable Securities to be offered pursuant to a Registration
Statement and enable such certificates to be in such denominations or amounts,
as the case may be, as the Investors may reasonably request and registered in
such names as the Investors may request.

l.    If requested by an Investor, the Company shall (i) as soon as practicable,
incorporate in a prospectus supplement or post-effective amendment such
information as an Investor reasonably requests to be included therein relating
to the sale and distribution of Registrable Securities, including, without
limitation, information with respect to the number of Registrable Securities
being offered or sold, the purchase price being paid therefor and any other
terms of the offering of the Registrable Securities to be sold in such offering;
(ii) as soon as practicable, make all required filings of such prospectus
supplement or post-effective amendment after being notified of the matters to be
incorporated in such prospectus supplement or post-effective amendment; and
(iii) as soon as practicable, supplement or make amendments to any Registration
Statement if reasonably requested by an Investor holding any Registrable
Securities.

 

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m.    The Company shall use its reasonable best efforts to cause the Registrable
Securities covered by a Registration Statement to be registered with or approved
by such other governmental agencies or authorities as may be necessary to
consummate the disposition of such Registrable Securities, including without
limitation the securities or blue sky laws of any jurisdiction within the United
States requested in writing by any selling Investor.

n.    The Company shall otherwise use its reasonable best efforts to comply with
all applicable rules and regulations of the SEC in connection with any
registration hereunder.

o.    The Company will notify each Investor covered by the Registration
Statement as promptly as reasonably practicable (i) when the prospectus or any
prospectus supplement or post-effective amendment has been filed, and with
respect to the Registration Statement or any post-effective amendment, when the
same has become effective, and (ii) of any request by the SEC for any amendments
or supplements to the Registration Statement or for additional information.
Within two Business Days after a Registration Statement which covers Registrable
Securities is ordered effective by the SEC, the Company shall deliver, and shall
cause legal counsel for the Company to deliver, to the transfer agent for such
Registrable Securities (with copies to the Investors whose Registrable
Securities are included in such Registration Statement) confirmation that such
Registration Statement has been declared effective by the SEC in the form
attached hereto as Exhibit A.

p.    Notwithstanding anything to the contrary herein, at any time after the
Effective Date, the Company may delay the disclosure of material, non-public
information concerning the Company the disclosure of which at the time is not,
in the good faith opinion of the board of directors of the Company and its
counsel, in the best interest of the Company, would reasonably be likely to
materially and adversely affect the Company and, in the opinion of counsel to
the Company, is not otherwise required to be disclosed other than as a result of
the effectiveness of the Registration Statement (a “Grace Period”); provided,
that the Company shall promptly (i) notify the Investors in writing of the
existence of material, non-public information giving rise to a Grace Period
(provided that in each notice the Company will not disclose the content of such
material, non-public information to the Investors) and the date on which the
Grace Period will begin, and (ii) notify the Investors in writing of the date on
which the Grace Period ends; provided further, such Grace Periods shall not
exceed an aggregate of 30 days during any 365 day period and the first day of
any Grace Period must be at least five trading days after the last day of any
prior Grace Period (each, an “Allowable Grace Period”). For purposes of
determining the length of a Grace Period above, the Grace Period shall begin on
and include the date the Investors receive the notice referred to in clause
(i) and shall end on and include the later of the date the Investors receive the
notice referred to in clause (ii) or the date referred to in such notice.
Notwithstanding anything to the contrary, the Company shall cause its transfer
agent to deliver unlegended shares of Common Stock to a transferee of an
Investor in connection with any sale of Registrable Securities with respect to
which an Investor has entered into a contract for sale prior to the Investor’s
receipt of the notice of a Grace Period and for which the Investor has not yet
settled, and deliver a copy of the prospectus included as part of the applicable
Registration Statement (unless an exemption from such prospectus delivery
requirement exists).

 

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q.    The Company and the Investors will cooperate and assist in any filings
required to be made with the Financial Industry Regulatory Authority, Inc. or
any successor organization performing similar functions.

4.    Obligations of the Investors.

a.    At least five Business Days prior to the first anticipated filing date of
a Registration Statement, the Company shall notify each Investor in writing of
the information the Company requires from each such Investor if such Investor
elects to have any of such Investor’s Registrable Securities included in such
Registration Statement. It shall be a condition precedent to the obligations of
the Company to complete the registration pursuant to this Agreement with respect
to the Registrable Securities of a particular Investor that (i) such Investor
furnish 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
effectiveness of the registration of such Registrable Securities, and (ii) the
Investor execute such documents in connection with such registration as the
Company may reasonably request.

b.    Each Investor, by such Investor’s participation in the Private Exchange,
agrees to cooperate with the Company as reasonably requested by the Company in
connection with the preparation and filing of any Registration Statement
hereunder, unless such Investor has notified the Company in writing of such
Investor’s election to exclude all of such Investor’s Registrable Securities
from such Registration Statement.

c.    Each Investor agrees that, upon receipt of any notice from the Company of
the happening of any event of the kind described in Section 3.f or 3.e, such
Investor will immediately discontinue disposition of Registrable Securities
pursuant to any Registration Statement(s) covering such Registrable Securities
until such Investor’s receipt of the copies of the supplemented or amended
prospectus contemplated by Section 3.f or 3.e or receipt of notice that no
supplement or amendment is required. Notwithstanding anything to the contrary,
the Company shall cause its transfer agent to deliver unlegended shares of
Common Stock to a transferee of an Investor in connection with any sale of
Registrable Securities with respect to which an Investor has entered into a
contract for sale prior to the Investor’s receipt of a notice from the Company
of the happening of any event of the kind described in Section 3.f or 3.e, and
for which the Investor has not yet settled.

d.    Each Investor covenants and agrees that it will comply with the prospectus
delivery requirements of the 1933 Act as applicable to it or an exemption
therefrom in connection with sales of Registrable Securities pursuant to the
Registration Statement.

5.    Expenses of Registration.

All reasonable expenses, other than underwriting discounts and commissions
incurred in connection with registrations, filings or qualifications pursuant to
this Agreement, including, without limitation, all registration, listing and
qualifications fees, printers and accounting fees, and fees and disbursements of
counsel for the Company, shall be paid by the Company.

 

10

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6.    Indemnification.

In the event any Registrable Securities are included in a Registration Statement
under this Agreement:

a.    To the fullest extent permitted by law, the Company will, and hereby
agrees to, indemnify, hold harmless and defend each Investor, the directors,
officers, members, partners and employees of, and each Person, if any, who
controls any Investor within the meaning of the 1933 Act or the Securities
Exchange Act of 1934 Act, as amended (the “Exchange Act”) (each, an “Indemnified
Person”), against any losses, claims, damages, liabilities, judgments, fines,
penalties, charges, costs, reasonable attorneys’ fees, amounts paid in
settlement or expenses, joint or several, (collectively, “Claims”) incurred in
investigating, preparing or defending any action, claim, suit, inquiry,
proceeding, investigation or appeal taken from the foregoing by or before any
court or governmental, administrative or other regulatory agency, body or the
SEC, whether pending or threatened, whether or not an indemnified party is or
may be a party thereto, to which any of them may become subject insofar as such
Claims (or actions or proceedings, whether commenced or threatened, in respect
thereof) arise out of or are based upon: (i) any untrue statement or alleged
untrue statement of a material fact in a Registration Statement or any
post-effective amendment thereto or in any filing made in connection with the
qualification of the offering under the securities or other “blue sky” laws of
any jurisdiction in which Registrable Securities are offered, or the omission or
alleged omission to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, (ii) any untrue
statement or alleged untrue statement of a material fact contained in any
preliminary prospectus if used prior to the effective date of such Registration
Statement, or contained in the final prospectus (as amended or supplemented, if
the Company files any amendment thereof or supplement thereto with the SEC) or
the omission or alleged omission to state therein any material fact necessary to
make the statements made therein, in light of the circumstances under which the
statements therein were made, not misleading, or (iii) any violation or alleged
violation by the Company of the 1933 Act, the 1934 Act, any other law,
including, without limitation, any state securities law, or any rule or
regulation thereunder relating to the offer or sale of the Registrable
Securities pursuant to a Registration Statement (the matters in the foregoing
clauses (i) through (iii) being, collectively, “Violations”). Subject to
Section 6.c, the Company shall reimburse the Indemnified Persons, promptly as
such expenses are incurred and are due and payable, for any legal fees or other
reasonable expenses incurred by them in connection with investigating or
defending any such Claim. Notwithstanding anything to the contrary contained
herein, the indemnification agreement contained in this Section 6.a shall not
apply to (A) a Claim by an Indemnified Person arising out of or based upon a
Violation which occurs in reliance upon and in conformity with information
furnished in writing to the Company by such Indemnified Person for such
Indemnified Person expressly for use in connection with the preparation of the
Registration Statement or any such amendment thereof or supplement thereto,
(B) a Claim by an Indemnified Person arising out of or based the use by an
Investor of an outdated or defective prospectus after the Company has notified
such Investor in writing that the prospectus is outdated or defective or (C) a
Claim by an Indemnified Person arising out of or based an Investor’s (or any
other Indemnified Person’s) failure to send or give a copy of the prospectus or
supplement (as then amended or supplemented), if required (and not exempted) to
the Persons asserting an untrue statement or omission or alleged untrue
statement or omission at or prior to the written confirmation of the sale of
Registrable Securities or (D) amounts paid in settlement of any Claim if such
settlement is effected without the prior written consent of the Company, which
consent shall not be unreasonably withheld or delayed.

 

11

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b.    In connection with any Registration Statement in which an Investor is
participating, each such Investor agrees to severally and not jointly indemnify,
hold harmless and defend, to the same extent and in the same manner as is set
forth in Section 6.a, the Company, each of its directors and officers, each of
the other holders of the Company’s securities covered by such Registration
Statement, each Person who controls the Company or any other such Person within
the meaning of the 1933 Act or the 1934 Act (each, an “Indemnified Party”),
against any Claim to which any of them may become subject, under the 1933 Act,
the 1934 Act or otherwise, insofar as such Claim arise out of or are based upon
any Violation that occurs in reliance upon and in conformity with written
information furnished to the Company by such Investor expressly for use in
connection with such Registration Statement; and, subject to Section 6.c, such
Investor will reimburse any legal or other expenses reasonably incurred by an
Indemnified Party in connection with investigating or defending any such Claim;
provided, however, that the indemnity agreement contained in this Section 6.b
and the agreement with respect to contribution contained in Section 7 shall not
apply to amounts paid in settlement of any Claim if such settlement is effected
without the prior written consent of such Investor, which consent shall not be
unreasonably withheld or delayed; provided, further, however, that the Investor
shall be liable under this Section 6.b for only that amount of a Claim as does
not exceed the net proceeds to such Investor as a result of the sale of
Registrable Securities pursuant to such Registration Statement.

c.    Promptly after receipt by an Indemnified Person or Indemnified Party under
this Section 6 of notice of the commencement of any action or proceeding
(including, without limitation, any governmental action or proceeding) involving
a Claim, such Indemnified Person or Indemnified Party shall, if a Claim in
respect thereof is to be made against any indemnifying party under this
Section 6, deliver to the indemnifying party a written notice of the
commencement thereof, and the indemnifying party shall have the right to
participate in, and, to the extent the indemnifying party so desires, jointly
with any other indemnifying party similarly noticed, to assume control of the
defense thereof with counsel mutually satisfactory to the indemnifying party and
the Indemnified Person or the Indemnified Party, as the case may be; provided,
however, that an Indemnified Person or Indemnified Party shall have the right to
retain its own counsel with the fees and expenses of not more than one counsel
and one more local counsel (if necessary) for such Indemnified Person or
Indemnified Party to be paid by the indemnifying party, if, in the reasonable
opinion of counsel retained by the indemnifying party, the representation by
such counsel of the Indemnified Person or Indemnified Party and the indemnifying
party would be inappropriate due to actual or potential differing interests
between such Indemnified Person or Indemnified Party and any other party
represented by such counsel in such proceeding. In the case of an Indemnified
Person, legal counsel referred to in the immediately preceding sentence shall be
selected by the Investors holding at least a majority in interest of the
Registrable Securities included in the Registration Statement to which the Claim
relates. The Indemnified Party or Indemnified Person shall reasonably cooperate
with the indemnifying party in connection with any negotiation or defense of any
such action or Claim by the indemnifying party and shall furnish to the
indemnifying party all information reasonably available to the Indemnified Party
or Indemnified Person which relates to such action or Claim. The indemnifying
party shall keep the Indemnified Party or Indemnified Person reasonably apprised
at all times as to the status of the defense or any settlement negotiations with
respect thereto. No indemnifying party shall be liable for any settlement of any
action, claim or proceeding effected without its prior written consent;
provided, however, that the indemnifying party shall not unreasonably withhold,
delay or condition its consent. No indemnifying party shall, without the prior
written consent of the Indemnified Party

 

12

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or Indemnified Person, consent to entry of any judgment or enter into any
settlement or other compromise which does not include as an unconditional term
thereof the giving by the claimant or plaintiff to such Indemnified Party or
Indemnified Person of a release from all liability in respect to such Claim or
litigation, and such settlement shall not include any admission as to fault on
the part of the Indemnified Party. Following indemnification as provided for
hereunder, the indemnifying party shall be subrogated to all rights of the
Indemnified Party or Indemnified Person with respect to all third parties, firms
or corporations relating to the matter for which indemnification has been made.
The failure to deliver written notice to the indemnifying party within a
reasonable time of the commencement of any such action shall not relieve such
indemnifying party of any liability to the Indemnified Person or Indemnified
Party under this Section 6, except to the extent that the indemnifying party is
prejudiced in its ability to defend such action.

d.    The indemnification required by this Section 6 shall be made by periodic
payments of the amount thereof during the course of the investigation or
defense, as and when bills are received.

The indemnity agreements contained herein shall be in addition to any
liabilities the indemnifying party may be subject to pursuant to the law.

7.    Contribution.

To the extent any indemnification contemplated hereby by an indemnifying party
is prohibited or limited by applicable law, the indemnifying party shall to the
extent permitted by applicable law contribute to the amount paid or payable by
such Indemnified Person or Indemnified Party as a result of such Claim in such
proportion as is appropriate to reflect the relative fault of the indemnifying
party, on the one hand, and of the Indemnified Person or Indemnified Party, on
the other, in connection with such Violation. The relative fault of the
indemnifying party, on the one hand and of the Indemnified Person or Indemnified
Party, on the other hand, shall be determined by a court of law by reference to,
among other things, whether the Violation relates to information supplied or
actions undertaken by the indemnifying party, on the one hand, or by the
Indemnified Person or Indemnified Party, on the other hand, and the parties’
relative intent, knowledge, access to information and opportunity to correct or
prevent such Violation; provided, that in no event shall any contribution by an
Investor hereunder exceed the amount of net proceeds to such Investor of the
Registrable Securities sold in any such Registration Statement. The amount paid
or payable by a party as a result of any Claim shall be deemed to include,
subject to the limitations set forth in this Agreement, any reasonable
attorneys’ or other reasonable fees or expenses incurred by such party in
connection with any proceeding to the extent such party would have been
indemnified for such fees or expenses if the indemnification provided for in
Section 6 was available to such party in accordance with its terms. No Person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the 1933 Act) shall be entitled to contribution from any Person who was not
guilty of such fraudulent misrepresentation. The Investors’ obligations to
contribute pursuant to this Section 7 are several and not joint. The parties
hereto agree that it would not be just and equitable if contribution pursuant to
this Section 7 were determined by pro rata allocation or by any other method of
allocation that does not take into account the equitable considerations referred
to in this Section 7.

 

13

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8.    Reports Under the 1934 Act.

With a view to making available to the Investors the benefits of Rule 144
promulgated under the 1933 Act or any other similar rule or regulation of the
SEC that may at any time permit the Investors to sell securities of the Company
to the public without registration (“Rule 144”), the Company agrees to: 

a.    make and keep public information available, as those terms are understood
and defined in Rule 144, during the Registration Period;

b.    file with the SEC in a timely manner all reports and other documents
required of the Company under the 1934 Act, during the Registration Period; and

c.    furnish to each Investor so long as such Investor owns Registrable
Securities, promptly upon request during the Registration Period, (i) a written
statement by the Company, if true, that it has complied with the reporting
requirements of Rule 144, the 1933 Act and the 1934 Act, (ii) a copy of the most
recent annual or quarterly report of the Company and such other reports and
documents so filed by the Company and (iii) such other information as may be
reasonably requested to permit the Investors to sell such securities without
registration pursuant to Rule 144.

9.    Assignment of Registration Rights.

The rights under this Agreement shall be automatically assigned by the Investors
to any transferee of all or any portion of such Investor’s Registrable
Securities. Notwithstanding anything in this Agreement to the contrary, no
Registration Default will be deemed to have occurred with regard to any
Registrable Securities held by any transferee prior to the date that is 10
Business Days after such transferee notifies the Company of its acquisition of
Registrable Securities and provides any information and documentation reasonably
requested by the Company for the registration of such Registrable Securities
pursuant to this Agreement. The Company may not assign its rights or obligations
hereunder (whether by operation of law or otherwise) without the prior written
consent of the Required Holders.

10.    Amendment of Registration Rights.

Provisions of this Agreement may be amended and the observance thereof may be
waived (either generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the Company and the Required
Holders; provided that no amendment may disproportionately affect the rights of
any holder of Registrable Securities compared to any other holder of Registrable
Securities without the consent of such holder. Any amendment or waiver effected
in accordance with this Section 10 shall be binding upon each Investor and the
Company. No such amendment shall be effective if it applies to less than all of
the holders of the Registrable Securities. No consideration shall be offered or
paid to any Person to amend or consent to a waiver or modification of any
provision of any of this Agreement unless the same consideration also is offered
to all of the parties to this Agreement.

 

14

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11.    Miscellaneous.

a.    A Person is deemed to be a holder of Registrable Securities whenever such
Person owns or is deemed to own of record such Registrable Securities. If the
Company receives conflicting instructions, notices or elections from two or more
Persons with respect to the same Registrable Securities, the Company shall act
upon the basis of instructions, notice or election received from the such record
owner of such Registrable Securities.

b.    Any notices, consents, waivers or other communications required or
permitted to be given under the terms of this Agreement must be in writing and
will be deemed to have been delivered: (i) upon receipt, when delivered
personally; (ii) upon receipt, when sent by electronic mail (provided
confirmation of transmission is electronically generated and kept on file by the
sending party); or (iii) one Business Day after deposit with a nationally
recognized overnight delivery service, in each case properly addressed to the
party to receive the same. The addresses and facsimile numbers for such
communications shall be:

If to the Company:

Acorda Therapeutics, Inc.

420 Saw Mill River Road

Ardsley, NY 10502

E-mail:                     

Attention: Chief Executive Officer

        General Counsel

with a copy (for informational purposes only) to:

Covington & Burling LLP

The New York Times Building

620 Eighth Avenue

New York, NY 10018

E-mail:                     

Attention: Eric W. Blanchard

If to an Investor, to its physical and electronic mail address set forth on the
Schedule of Exchanging Holders attached hereto, with copies to such Investor’s
representatives as set forth on the Schedule of Exchanging Holders, or to such
other physical or electronic mail address and/or to the attention of such other
Person as the recipient party has specified by written notice given to each
other party five days prior to the effectiveness of such change. Written
confirmation of receipt (A) given by the recipient of such notice, consent,
waiver or other communication, (B) electronically generated by the sender’s
electronic mail containing the time, date, recipient electronic mail address of
such transmission or (C) provided by an overnight courier service shall be
rebuttable evidence of personal service, receipt by electronic mail or receipt
from an overnight courier service in accordance with clause (i), (ii) or
(iii) above, respectively.

 

15

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c.    Failure of any party to exercise any right or remedy under this Agreement
or otherwise, or delay by a party in exercising such right or remedy, shall not
operate as a waiver thereof.

d.    All questions concerning the construction, validity, enforcement and
interpretation of this Agreement shall be governed by the internal laws of the
State of New York, without giving effect to any choice of law or conflict of law
provision or rule (whether of the State of New York or any other jurisdictions)
that would cause the application of the laws of any jurisdictions other than the
State of New York. Each party hereby irrevocably submits to the exclusive
jurisdiction of the state and federal courts sitting in The City of New York,
Borough of Manhattan, for the adjudication of any dispute hereunder or in
connection herewith or with any transaction contemplated hereby or discussed
herein, and hereby irrevocably waives, and agrees not to assert in any suit,
action or proceeding, any claim that it is not personally subject to the
jurisdiction of any such court, that such suit, action or proceeding is brought
in an inconvenient forum or that the venue of such suit, action or proceeding is
improper. Each party hereby irrevocably waives personal service of process and
consents to process being served in any such suit, action or proceeding by
mailing a copy thereof to such party at the address for such notices to it under
this Agreement and agrees that such service shall constitute good and sufficient
service of process and notice thereof. Nothing contained herein shall be deemed
to limit in any way any right to serve process in any manner permitted by law.
If any provision of this Agreement shall be invalid or unenforceable in any
jurisdiction, such invalidity or unenforceability shall not affect the validity
or enforceability of the remainder of this Agreement in that jurisdiction or the
validity or enforceability of any provision of this Agreement in any other
jurisdiction. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND
AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE
HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY
TRANSACTION CONTEMPLATED HEREBY.

e.    This Agreement, the other Transaction Documents and the instruments
referenced herein and therein constitute the entire agreement among the parties
hereto with respect to the subject matter hereof and thereof. There are no
restrictions, promises, warranties or undertakings, other than those set forth
or referred to herein and therein. This Agreement, the other Transaction
Documents and the instruments referenced herein and therein supersede all prior
agreements and understandings among the parties hereto with respect to the
subject matter hereof and thereof.

f.    Subject to the requirements of Section 9, this Agreement shall inure to
the benefit of and be binding upon the permitted successors and assigns of each
of the parties hereto.

g.    The headings in this Agreement are for convenience of reference only and
shall not limit or otherwise affect the meaning hereof.

h.    This Agreement may be executed in identical counterparts, each of which
shall be deemed an original but all of which shall constitute one and the same
agreement. This Agreement, once executed by a party, may be delivered to the
other party hereto by facsimile transmission of a copy of this Agreement bearing
the signature of the party so delivering this Agreement.

 

16

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i.    Each party shall do and perform, or cause to be done and performed, all
such further acts and things, and shall execute and deliver all such other
agreements, certificates, instruments and documents, as any other party may
reasonably request in order to carry out the intent and accomplish the purposes
of this Agreement and the consummation of the transactions contemplated hereby.

j.    All consents and other determinations required to be made by the Investors
pursuant to this Agreement shall be made, unless otherwise specified in this
Agreement, by the Required Holders.

k.    The language used in this Agreement will be deemed to be the language
chosen by the parties to express their mutual intent and no rules of strict
construction will be applied against any party.

l.    This Agreement is intended for the benefit of the parties hereto and their
respective permitted successors and assigns, and is not for the benefit of, nor
may any provision hereof be enforced by, any other Person.

m.    The obligations of each Investor hereunder are several and not joint with
the obligations of any other Investor, and no Investor shall be responsible in
any way for the performance of the obligations of any other Investor hereunder.
Nothing contained herein, and no action taken by any Investor pursuant hereto,
shall be deemed to constitute the Investor as, and the Company acknowledges that
the Investors do not so constitute, a partnership, an association, a joint
venture or any other kind of entity, or create a presumption that the Investors
are in any way acting in concert or as a group, and the Company will not assert
any such claim with respect to such obligations or the transactions contemplated
herein.

* * * * * *

 

17

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IN WITNESS WHEREOF, each Exchanging Holder and the Company have caused their
respective signature page to this Registration Rights Agreement to be duly
executed as of the date first written above. 

 

ACORDA THERAPEUTICS, INC.

By:  

/s/ Ron Cohen

Name:   Ron Cohen, M.D. Title:   President, Chief Executive Officer

 

[Signature Page to Registration Rights Agreement]

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IN WITNESS WHEREOF, each Exchanging Holder and the Company have caused their
respective signature page to this Registration Rights Agreement to be duly
executed as of the date first written above. 

 

EXCHANGING HOLDER

By:  

 

Name:  

 

Title:  

 

Address:   Email:  

 

[Signature Page to Registration Rights Agreement]

[EXECUTED SIGNATURE PAGES OF EXCHANGING HOLDERS INTENTIONALLY OMITTED]

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EXHIBIT A

FORM OF NOTICE OF EFFECTIVENESS

OF REGISTRATION STATEMENT

[ ]

[ ]

Attention: [ ]

Re: [ ]

Ladies and Gentlemen:

We are counsel to Acorda Therapeutics, Inc., a Delaware corporation, with its
principal offices at 420 Saw Mill River Road, Ardsley, NY 10502 (the “Company”),
and have represented the Company in connection with the issuance of $[●] in
aggregate principal amount of its [●]% Convertible Senior Secured Notes due 2024
(the “Notes”) pursuant to that certain Indenture (the “Indenture”), entered into
by and among the Company, Civitas Therapeutics, Inc. and the trustee and
collateral agent named therein. Pursuant to the Indenture, the Company also has
entered into a Registration Rights Agreement with the holders (collectively, the
“Holders”) of the Notes (the “Registration Rights Agreement”) pursuant to which
the Company agreed, among other things, to register the resale of the
Registrable Securities (as defined in the Registration Rights Agreement) under
the Securities Act of 1933, as amended (the “1933 Act”). In connection with the
Company’s obligations under the Registration Rights Agreement, on [●], the
Company filed a Registration Statement on Form [●] (File No. 333-[●]) (the
“Registration Statement”) with the Securities and Exchange Commission (the
“SEC”) relating to the Registrable Securities which names each of the Holders as
a selling stockholder thereunder.

In connection with the foregoing, we advise you that a member of the SEC’s staff
has advised us by telephone that the SEC has entered an order declaring the
Registration Statement effective under the 1933 Act at [●] [AM/PM] on [●], and
we have no knowledge, after telephonic inquiry of a member of the SEC’s staff,
that any stop order suspending its effectiveness has been issued or that any
proceedings for that purpose are pending before, or threatened by, the SEC and
the Registrable Securities are available for resale under the 1933 Act pursuant
to the Registration Statement.

This letter shall serve as our standing instruction to you that the shares of
the Company’s common stock, par value $0.001 per share (the “Common Stock”), are
freely transferable by the Holders pursuant to the Registration Statement. You
need not require further letters from us to effect any future legend-free
issuance or reissuance of shares of Common Stock to the Holders as contemplated
by the Company’s [Irrevocable Transfer Agent Instructions] dated [●] provided at
the time of such reissuance, the Company has not otherwise notified you that the
Registration Statement is unavailable for the resale of the Registrable
Securities.

Very truly yours,

CC: [Holders]

 

A-1

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EXHIBIT B

SELLING STOCKHOLDERS

The shares of common stock being offered by the selling stockholders are those
previously issued to the selling stockholders and those issuable to the selling
stockholders upon conversion of or payment of interest with respect to the
senior secured convertible notes. For additional information regarding the
issuances of common stock and the senior secured convertible notes, see “Private
Exchange” above. We are registering the shares of common stock in order to
permit the selling stockholders to offer the shares for resale from time to
time. [Except for the ownership of the shares of common stock, the senior
secured convertible notes and the [2021 notes], the selling stockholders have
not had any material relationship with us within the past three years.]

The table below lists the selling stockholders and other information regarding
the beneficial ownership of the shares of common stock by each of the selling
stockholders. The second column lists the number of shares of common stock
beneficially owned by each selling stockholder, based on its ownership of the
shares of common stock and the senior secured convertible notes, as of [●],
assuming conversion of the senior secured convertible notes held by the selling
stockholders on that date, without regard to any limitation on conversion.

The third column lists the shares of common stock being offered by this
prospectus by the selling stockholders.

In accordance with the terms of registration rights agreement with the holders
of the shares of common stock and the senior secured convertible notes, this
prospectus generally covers the resale of that number of shares of common stock
equal to the number of shares of common stock issued and the shares of common
stock issuable upon conversion of the related senior secured convertible notes,
determined as if the outstanding senior secured convertible notes were
converted, as applicable, in full, in each case as of the trading day
immediately preceding the date this registration statement was initially filed
with the SEC. The fourth column assumes the sale of all of the shares offered by
the selling stockholders pursuant to this prospectus.

 

Name of Selling

Stockholder

 

Number of Shares

Owned Prior to

Offering

 

Maximum Number of

Shares to be Sold

Pursuant to the

Prospectus

  

Number of Shares

Owned After

Offering

 

B-1

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PLAN OF DISTRIBUTION

We are registering the shares of common stock previously issued and those
issuable upon conversion of or payment of interest with respect to the senior
secured convertible notes to permit the resale of these shares of common stock
by the holders of the common stock and the senior secured convertible notes from
time to time after the date of this prospectus. We will not receive any of the
proceeds from the sale by the selling stockholders of the shares of common
stock. We will bear all fees and expenses incident to our obligation to register
the shares of common stock.

The selling stockholders may sell all or a portion of the shares of common stock
beneficially owned by them and offered hereby from time to time directly or
through one or more underwriters, broker-dealers or agents. If the shares of
common stock are sold through underwriters or broker-dealers, the selling
stockholders will be responsible for underwriting discounts or commissions or
agent’s commissions. The shares of common stock may be sold in one or more
transactions at fixed prices, at prevailing market prices at the time of the
sale, at varying prices determined at the time of sale, or at negotiated prices.
These sales may be effected in transactions, which may involve crosses or block
transactions,

 

  •  

on any national securities exchange or quotation service on which the securities
may be listed or quoted at the time of sale;

 

  •  

in the over-the-counter market;

 

  •  

in transactions otherwise than on these exchanges or systems or in the
over-the-counter market;

 

  •  

through the writing of options, whether such options are listed on an options
exchange or otherwise;

 

  •  

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;

 

  •  

sales pursuant to Rule 144;

 

  •  

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

 

B-2

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  •  

a combination of any such methods of sale; and

 

  •  

any other method permitted pursuant to applicable law.

If the selling stockholders effect such transactions by selling shares of common
stock to or through underwriters, broker-dealers or agents, such underwriters,
broker-dealers or agents may receive commissions in the form of discounts,
concessions or commissions from the selling stockholders or commissions from
purchasers of the shares of common stock for whom they may act as agent or to
whom they may sell as principal (which discounts, concessions or commissions as
to particular underwriters, broker-dealers or agents may be in excess of those
customary in the types of transactions involved). In connection with sales of
the shares of common stock or otherwise, the selling stockholders may enter into
hedging transactions with broker-dealers, which may in turn engage in short
sales of the shares of common stock in the course of hedging in positions they
assume. The selling stockholders may also sell shares of common stock short and
deliver shares of common stock covered by this prospectus to close out short
positions and to return borrowed shares in connection with such short sales. The
selling stockholders may also loan or pledge shares of common stock to
broker-dealers that in turn may sell such shares.

The selling stockholders may pledge or grant a security interest in some or all
of the senior secured convertible notes or shares of common stock owned by them
and, if they default in the performance of their secured obligations, the
pledgees or secured parties may offer and sell the shares of common stock from
time to time pursuant to this prospectus or any amendment to this prospectus
under Rule 424(b)(3) or other applicable provision of the Securities Act of
1933, as amended, amending, if necessary, the list of selling stockholders to
include the pledgee, transferee or other successors in interest as selling
stockholders under this prospectus. The selling stockholders also may transfer
and donate the shares of common stock in other circumstances in which case the
transferees, donees, pledgees or other successors in interest will be the
selling beneficial owners for purposes of this prospectus.

The selling stockholders and any broker-dealer participating in the distribution
of the shares of common stock may be deemed to be “underwriters” within the
meaning of the Securities Act, and any commission paid, or any discounts or
concessions allowed to, any such broker-dealer may be deemed to be underwriting
commissions or discounts under the Securities Act. At the time a particular
offering of the shares of common stock is made, a prospectus supplement, if
required, will be distributed which will set forth the aggregate amount of
shares of common stock being offered and the terms of the offering, including
the name or names of any broker-dealers or agents, any discounts, commissions
and other terms constituting compensation from the selling stockholders and any
discounts, commissions or concessions allowed or reallowed or paid to
broker-dealers.

Under the securities laws of some states, the shares of common stock may be sold
in such states only through registered or licensed brokers or dealers. In
addition, in some states the shares of common stock may not be sold unless such
shares have been registered or qualified for sale in such state or an exemption
from registration or qualification is available and is complied with.

 

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There can be no assurance that any selling stockholder will sell any or all of
the shares of common stock registered pursuant to the registration statement, of
which this prospectus forms a part.

The selling stockholders and any other person participating in such distribution
will be subject to applicable provisions of the Securities Exchange Act of 1934,
as amended, and the rules and regulations thereunder, including, without
limitation, Regulation M of the Securities Exchange Act of 1934, as amended,
which may limit the timing of purchases and sales of any of the shares of common
stock by the selling stockholders and any other participating person. Regulation
M may also restrict the ability of any person engaged in the distribution of the
shares of common stock to engage in market-making activities with respect to the
shares of common stock. All of the foregoing may affect the marketability of the
shares of common stock and the ability of any person or entity to engage in
market-making activities with respect to the shares of common stock.

We will pay all expenses of the registration of the shares of common stock
pursuant to the registration rights agreement, estimated to be $[●] in total,
including, without limitation, Securities and Exchange Commission filing fees
and expenses of compliance with state securities or “blue sky” laws; provided,
however, that a selling stockholder will pay all underwriting discounts and
selling commissions, if any. We will indemnify the selling stockholders against
liabilities, including some liabilities under the Securities Act, in accordance
with the registration rights agreements, or the selling stockholders will be
entitled to contribution. We may be indemnified by the selling stockholders
against civil liabilities, including liabilities under the Securities Act, that
may arise from any written information furnished to us by the selling
stockholder specifically for use in this prospectus, in accordance with the
related registration rights agreement, or we may be entitled to contribution.

Once sold under the registration statement, of which this prospectus forms a
part, the shares of common stock will be freely tradable in the hands of persons
other than our affiliates.

 

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