Registration Rights Agreement



 Exhibit 10.101 
  
 REGISTRATION RIGHTS AGREEMENT 
  
 This Registration Rights Agreement (the “Agreement”) is made and entered into as of this 16th day of
September, 2003 by and among Incara Pharmaceuticals Corporation, a Delaware corporation (“Parent” or the “Company”), Incara, Inc. (f/k/a Incara Cell Technologies, Inc.), a Delaware corporation
(“Survivor”), and Goodnow Capital, L.L.C., a Delaware limited liability company (the “Investor”). Capitalized terms not otherwise defined herein shall have the meanings ascribed thereto in the
Debenture and Warrant Purchase Agreement, of even date herewith, by an among Parent, Survivor and the Investor (the “Purchase Agreement”). 
  
 WHEREAS, pursuant to the terms of an Agreement and Plan of Merger, dated as of September 16, 2003, by and between
Parent and Survivor (the “Merger Agreement”), Parent shall merge with and into Survivor (the “Merger”) with Survivor surviving as the surviving corporation; 
  
 WHEREAS, by virtue of the Merger, Survivor will become the successor
to all of the rights, interests, duties and obligations of Parent, including without limitation, those arising under this Agreement, and after the Merger, all references in this Agreement to the “Company” shall be deemed to be references
to Survivor; 
  
 WHEREAS, pursuant to the terms of the
Purchase Agreement, the Investor has been issued the Parent Warrant and the ICT Warrant and, upon consummation of the Closing, will be issued the Debenture; 
  
 WHEREAS, the parties hereto desire to enter into this Agreement for the purpose of establishing the registration rights of the Investor.

  
 NOW, THEREFORE, in consideration of the foregoing and
the mutual covenants and agreements hereinafter set forth, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows: 
  
 1. Certain Definitions. 
  
 As used in this Agreement, the following terms shall have the following
meanings: 
  
 “Affiliate” means, with respect to
any person, any other person which directly or indirectly controls, is controlled by, or is under common control with, such person. 
  
 “Business Day” means a day, other than a Saturday or Sunday, on which banks in New York City are open for the general transaction of
business. 
  
 “Conversion Shares” means the
Debenture Shares and the Warrant Shares. 
  
 “ICT
Warrant” means the warrant issued by Survivor to the Investor pursuant to the Purchase Agreement. 







 “Common Stock” means: (A) before consummation of the Merger, the Parent’s common
stock, par value $0.001 per share, and any securities into which such shares may thereafter be reclassified, whether by merger, consolidation or otherwise (including without limitation all shares issued in connection with the Merger), and (B) after
consummation of the Merger, the Survivor’s common stock, par value $0.001 per share, and any securities into which such shares may thereafter be reclassified, whether by merger, consolidation or otherwise (including without limitation all
shares of Parent’s common stock issued in connection with the Merger). 
  
 “Debenture Shares” means the shares of Common Stock issuable to the holder(s) of the Debentures upon conversion thereof. 
  
 “Investors” shall mean the Investor identified in the Purchase Agreement and any Affiliate or permitted
transferee of any Investor who is a subsequent holder of all or any part of (i) the Parent Warrant, (ii) the ICT Warrant, (iii) the Debentures, or (iv) Registrable Securities. 
  
 “Prospectus” shall mean 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. 
  
 “Register,” “registered” and “registration” refer to a registration made by preparing and filing a Registration Statement or similar document in compliance with the
1933 Act (as defined below), and the declaration or ordering of effectiveness of such Registration Statement or document. 
  
 “Registrable Securities” means: (A) the shares of Common Stock (i) issuable upon exercise of the Parent Warrant, and (ii) issuable in
satisfaction of the Parent’s obligations under the Parent Guaranty (as that term is defined in the Purchase Agreement), as the same may be further amended and/or restated from time to time, and (iii) issued in the Merger in exchange for shares
described in clauses (A)(i) and (A)(ii); (B) from and after consummation of the Merger, the shares of Common Stock (i) issuable upon the exercise of the ICT Warrant, (ii) issuable upon conversion of the Debentures, as the same may be amended and/or
restated from time to time, and (iii) issued to an Investor in the Merger in exchange for the shares of Parent Common Stock; and (C) in each case, the shares of Common Stock (i) held by the Investor(s), (ii) issuable upon the conversion or exercise
of any security or instrument held by an Investor which, pursuant to its terms, is convertible into or exercisable for Common Stock or (iii) issuable with respect to or in exchange for Registrable Securities. Notwithstanding the foregoing, a
security shall cease to be a Registrable Security upon sale pursuant to a Registration Statement. 
  
 “Registration Statement” shall mean any registration statement of the Company filed under the 1933 Act that covers the resale of any of
the Registrable Securities pursuant to the provisions of this Agreement, amendments and supplements 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. 
  
 “1933 Act” means the
Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder. 
  

 2 








 “1934 Act” means the Securities Exchange Act of 1934, as amended, and the rules and
regulations promulgated thereunder. 
  
 “Warrants” means the Parent Warrant and the ICT Warrant issued to the Investor pursuant to the Purchase Agreement. 
  
 “Warrant Shares” means the shares of Common Stock issuable upon the exercise of the Warrants. 
  
 2. Registration. 
  
 (a) Registration Statements. 
  
 (i) Within thirty (30) days following the earlier to occur of the
consummation of the Merger or the payment of the Break-Up Fee, but in no event later than January 31, 2004 (the “Filing Deadline”), the Company shall prepare and file with the SEC one Registration Statement on Form S-1
(unless Form S-3 or such other form of registration statement is then available to effect a registration for resale of the Registrable Securities, subject to the Investor’s consent), covering the resale of all of the Registrable Securities
without regard to any limitation on the exercise of the Warrants or the Debentures. Such Registration Statement shall comply as to form in all material respects with the requirements of the applicable form and include all financial statements
required by the SEC to be filed thereunder. Such Registration Statement also shall cover, to the extent allowable under the 1933 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 Registrable Securities. The Company shall use its reasonable best efforts to obtain from each person (other than Ruffin Woody and Elan Corporation, plc)
who has piggyback registration rights a waiver of those rights with respect to the Registration Statement. The Registration Statement (and each amendment or supplement thereto, and each request for acceleration of effectiveness thereof) shall be
provided in accordance with Section 3(c) to the Investors and their counsel prior to its filing or other submission. If a Registration Statement covering the Registrable Securities is not filed with the SEC on or prior to the Filing Deadline, the
Company will make pro rata payments to each Investor, as liquidated damages and not as a penalty, in an amount equal to 0.5% of the aggregate amount invested by such Investor for each 10-day period or pro rata for any portion thereof following the
date by which such Registration Statement should have been filed for which no Registration Statement is filed with respect to the Registrable Securities. Such payments shall be in partial compensation to the Investors, and shall not constitute the
Investors’ exclusive remedy for such events. Such payments shall be made to each Investor in cash, or, at the Investor’s election, in a number of shares of Common Stock determined by dividing the amount of such payment by $0.10. In the
case of cash payments, the amounts payable as liquidated damages pursuant to this paragraph shall be payable in lawful money of the United States, and all such amounts payable or shares deliverable as liquidated damages shall be paid or certificates
shall be delivered, as the case may be, within two (2) Business Days of the last day of each such 10-day period during which the Registration Statement should have been filed for which no Registration Statement was filed with respect to the
Registrable Securities. 
  
 (ii) Additional Registrable
Securities. Upon any change in the number of Conversion Shares issuable under the Warrants or the Debentures, such that additional shares 
  

 3 








 
of Common Stock become issuable upon the exercise of the Warrants or the conversion of the Debentures, the Company shall prepare and file with the SEC one or
more Registration Statements on Form S-1 (unless Form S-3 or such other form of registration statement is then available to effect a registration for resale of the Registrable Securities, subject to the Investor’s consent)(the
“Additional Shares”) covering the resale of the Additional Shares, but only to the extent the Additional Shares are not at the time covered by an effective Registration Statement. Such Registration Statement shall comply as
to form in all material respects with the requirements of the applicable form and include all financial statements required by the SEC to be filed thereunder. Such Registration Statement also shall cover, to the extent allowable under the 1933 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 Additional Shares. The Company shall
use its best efforts to obtain from each person (other than Ruffin Woody and Elan Corporation, plc) who has piggyback registration rights a waiver of those rights with respect to such Registration Statement. The Registration Statement (and each
amendment or supplement thereto, and each request for acceleration of effectiveness thereof) shall be provided in accordance with Section 3(c) to the Investors and their counsel prior to its filing or other submission. If a Registration Statement
covering the Additional Shares is required to be filed under this Section 2(a)(ii) and is not filed with the SEC within thirty (30) days of any change in the number of Conversion Shares issuable under the Warrants or the Debentures, the Company will
make pro rata payments to each Investor, as liquidated damages and not as a penalty, in an amount equal to 0.5% of the aggregate amount invested by such Investor for each 10-day period or pro rata for any portion thereof following the date by which
such Registration Statement should have been filed for which no Registration Statement is filed with respect to the Additional Shares. Such payments shall be made to each Investor in cash, or, at the Investor’s election, in a number of shares
of Common Stock determined by dividing the amount of such payment by $0.10. In the case of cash payments, the amounts payable as liquidated damages pursuant to this paragraph shall be payable in lawful money of the United States, and all such
amounts payable or shares deliverable as liquidated damages shall be paid or certificates shall be delivered, as the case may be, within two (2) Business Days of the last day of each such 10-day period during which the Registration Statement should
have been filed for which no Registration Statement was filed with respect to the Additional Shares. 
  
 (b) Expenses. The Company will pay all expenses associated with each registration, including filing and printing fees, counsel and accounting fees
and expenses, costs associated with clearing the Registrable Securities for sale under applicable state securities laws and listing fees, but excluding the fees and disbursements of more than one law firm serving as counsel to the Investors and
discounts, commissions, fees of underwriters, selling brokers, dealer managers or similar securities industry professionals with respect to the Registrable Securities being sold. 
  
 (c) Effectiveness. 
  
 (i) The Company shall use its best efforts to have the Registration Statement declared effective not later than the earlier to occur of (y) 60 days after
the date of filing of such Registration Statement, or (z) ten (10) Business Days following the Company’s receipt of a no-review letter from the SEC relating to the Registration Statement; provided, 
  

 4 








 
however, if the Registration Statement is not declared effective within the time period set forth above, the Company shall continue to use its best
efforts to have the Registration Statement declared effective as soon as possible thereafter. If (A) the Company does not use its best efforts to have the Registration Statement declared effective in accordance with the preceding sentence, or (B)
after a Registration Statement has been declared effective by the SEC sales cannot be made pursuant to such Registration Statement for any reason (including, without limitation, by reason of a stop order, or the Company’s failure to update the
Registration Statement), but except as excused pursuant to subparagraph (ii) below, then the Company will make pro rata payments to each Investor, as liquidated damages and not as a penalty, in an amount equal to 0.5% of the aggregate amount
invested by such Investor for each 10-day period or pro rata for any portion thereof following the date (1) by which such Registration Statement should have been effective as described in (A) above had the Company used its best efforts to have the
Registration Statement declared effective or (2) sales cannot be made pursuant to such Registration Statement after it has been declared effective as described in (B) above (the “Blackout Period”). Such payments shall be in
partial compensation to the Investors, and shall not constitute the Investors’ exclusive remedy for such events. The Blackout Period shall terminate upon (x) the effectiveness of the Registration Statement in the case of (A) above; and (y) the
Registration Statement again being available for sales by the Investors in the case of (B) above. Such payments shall be made to each Investor in cash, or, at the Investor’s election, in a number of shares of Common Stock determined by dividing
the amount of such payment by $0.10. In the case of cash payments, the amounts payable as liquidated damages pursuant to this paragraph shall be payable in lawful money of the United States, and all such amounts payable or shares deliverable as
liquidated damages shall be paid or certificates shall be delivered, as the case may be, within two (2) Business Days of the last day of each 10-day period following the commencement of the Blackout Period until the termination of the Blackout
Period. 
  
 (ii) For not more than fifteen (15) consecutive days
or for a total of not more than thirty (30) days in any twelve (12) month period, the Company may delay the disclosure of material non-public information concerning the Company, by terminating or suspending effectiveness of any registration
contemplated by this Section 2 containing such information, the disclosure of which at the time is not, in the good faith opinion of the Company, in the best interests of the Company (an “Allowed Delay”); provided,
that the Company shall promptly (a) notify the Investors in writing of the existence of (but in no event, without the prior written consent of an Investor, shall the Company disclose to such Investor any of the facts or circumstances regarding)
material non-public information giving rise to an Allowed Delay, and (b) advise the Investors in writing to cease all sales under the Registration Statement until the end of the Allowed Delay. 
  
 (d) Underwritten Offering. If any offering pursuant to a Registration
Statement filed pursuant to Section 2(a) hereof involves an underwritten offering, the Company shall have the right to select an investment banker and manager to administer the offering, which investment banker or manager shall be satisfactory to a
majority of the Investors. 
  
 (e) Exception. The Company
shall not be required to file a Registration Statement pursuant to this Section 2 if the Company shall furnish to the Investors a certificate signed by the Chief Executive Officer of the Company or the Chairman of the Board stating that, in the good
faith judgment of the Board of Directors of the Company, it would be 
  

 5 








 
seriously detrimental to the Company and its stockholders for such Registration Statement to be filed at such time, in which event the Company shall have the
right to defer such filing for a period of not more than thirty (30) days; provided that such right to delay the filing of any Registration Statement shall be exercised by the Company not more than once in any twelve (12) month period. 

 
 3. Company Obligations. The Company will use its best efforts to
effect the registration of the Registrable Securities in accordance with the terms hereof, and pursuant thereto the Company will, as expeditiously as reasonably possible: 
  
 (a) use its best efforts to cause such Registration Statement to become effective and to remain continuously effective for
a period that will terminate upon the earlier of the date on which all Registrable Securities, covered by such Registration Statement, as amended from time to time, have been sold or at such time as all Registrable Securities held by the Investors
can be sold in any three (3) month period without registration in compliance with Rule 144 of the 1933 Act; 
  
 (b) prepare and file with the SEC such amendments, supplements and post-effective amendments to the Registration Statement and the Prospectus as may be
necessary to keep the Registration Statement effective for the period specified in Section 3(a) and to comply with the provisions of the 1933 Act and the 1934 Act with respect to the distribution of all Registrable Securities; 
  
 (c) provide copies to and permit counsel designated by the Investors to
review each Registration Statement and all amendments and supplements thereto no fewer than five (5) days prior to their filing with the SEC and not file any document to which such counsel reasonably objects within four (4) days following receipt by
the Investors and counsel designated by the Investors of such Registration Statement and/or amendments and supplements thereto; 
  
 (d) furnish, without charge, to the Investors and their legal counsel (i) promptly after the same is prepared and publicly distributed, filed with the
SEC, or received by the Company (but not later than two (2) Business Days after the filing date, receipt date or sending date, as the case may be), at least five (5) copies 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 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 Investor may reasonably request in order to facilitate the disposition of the Registrable Securities owned by such Investor, which in any event, shall not exceed ten (10)
Prospectuses; 
  
 (e) in the event the Company selects an
underwriter for the offering, the Company shall enter into and perform its reasonable obligations under an underwriting 
  

 6 








 
agreement, in usual and customary form, including, without limitation, customary indemnification and contribution obligations, with the underwriter of such
offering; 
  
 (f) if required by the underwriter, the Company
shall furnish, on the effective date of the Registration Statement (i) an opinion, dated as of such date, from independent legal 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 the underwriter and (ii) 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 underwriter and the Investors; 
  
 (g) use its reasonable best efforts to prevent the issuance of any stop order or other suspension of effectiveness and, if such order is issued, use its
best efforts to obtain the withdrawal of any such order at the earliest possible moment; 
  
 (h) prior to any public offering of Registrable Securities, use its reasonable best efforts to register or qualify or cooperate with the Investors 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 jurisdictions reasonably requested by the Investors and do any and all other reasonable acts or things necessary or advisable to enable the distribution
in such jurisdictions of the Registrable Securities covered by the Registration Statement; 
  
 (i) 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; 
  
 (j) immediately notify the Investors, at any
time when a Prospectus relating to the Registrable Securities is required to be delivered under the 1933 Act, upon discovery that, or upon the happening of any event as a result of which, the Prospectus included in such Registration Statement, as
then in effect, includes an untrue statement of a material fact or omits to state 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 at the
request of any such holder, promptly prepare and furnish to such holder a reasonable number of copies of a supplement to or an amendment of such Prospectus as may be necessary so that, as thereafter delivered to the purchasers of such Registrable
Securities, 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; and 
  
 (k) otherwise use its best efforts to comply
with all applicable rules and regulations of the SEC under the 1933 Act and the 1934 Act and take such other actions as may be reasonably necessary to facilitate the registration of the Registrable Securities hereunder; and, if the Company is not
filing periodic reports with the SEC pursuant to the 1934 Act, 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 
  

 7 








 
(12) months, beginning after the effective date of each Registration Statement, which earnings statement shall satisfy the provisions of Section 11(a) of the
1933 Act (for the purpose of this subsection 3(k), “Availability Date” means the 45th day following the end of the fourth fiscal quarter that includes 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). 
  
 4. Due Diligence Review; Information. The Company shall make available, during normal business hours, for inspection
and review by the Investors, advisors to and representatives of the Investors (who may or may not be affiliated with the Investors), and any underwriter participating in any disposition of Common Stock on behalf of the Investors pursuant to a
Registration Statement or amendments or supplements thereto or any blue sky, NASD or other filing, all financial and other records, all filings with the SEC, and all other corporate documents and properties of the Company as may be reasonably
necessary for the purpose of such review, and cause the Company’s officers, directors and employees, within a reasonable time period, to supply all such information reasonably requested by the Investors or any such representative, advisor or
underwriter in connection with such Registration Statement (including, without limitation, in response to all questions and other inquiries reasonably made or submitted by any of them), prior to and from time to time after the filing and
effectiveness of the Registration Statement for the sole purpose of enabling the Investors and such representatives, advisors and underwriters and their respective accountants and attorneys to conduct initial and ongoing due diligence with respect
to the Company and the accuracy of such Registration Statement. 
  
 Notwithstanding the foregoing, the Company shall not disclose material nonpublic information to the Investors, or to advisors to or representatives of the Investors, unless prior to disclosure of such information the Company identifies such
information as being material nonpublic information and provides the Investors, such advisors and representatives with the opportunity to accept or refuse to accept such material nonpublic information for review. 
  
 5. Obligations of the Investors. 
  
 (a) Each Investor 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 fifteen (15) Business Days prior to the first anticipated filing date of any Registration Statement, the Company shall notify each Investor of the
information the Company requires from such Investor. An Investor shall provide such information to the Company at least five (5) Business Days prior to the first anticipated filing date of such Registration Statement. For purposes of the first
sentence of this Section 5(a), the methods of distribution to be specified by the Investors shall include, without limitation, the sale of the Registrable Securities through (i) options transactions relating to the Registrable Securities, whether
such options are listed on an options exchange or otherwise, or (ii) short sales of the Registrable Securities. The Registration Statement shall also provide that, for purposes of the distribution of the Registrable Securities, the Investors may (i)
enter into 
  

 8 








 
hedging transactions with broker-dealers or other financial institutions, which may in turn engage in short sales of the Registrable Securities and deliver
the Registrable Securities to close out their short positions or (ii) loan or pledge the Registrable Securities to broker-dealers or other financial institutions, which in turn may sell the Registrable Securities. 
  
 (b) Each Investor, 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. 
  
 (c) Each Investor agrees that, upon receipt of any notice from the Company of the happening of any event rendering a Registration Statement no longer
effective, such Investor will immediately discontinue disposition of Registrable Securities pursuant to the Registration Statement covering such Registrable Securities, until the Investor’s receipt of the copies of the supplemented or amended
Prospectus filed with the SEC and declared effective and, if so directed by the Company, the Investor shall deliver to the Company (at the expense of the Company) or destroy (and deliver to the Company a certificate of destruction) all copies in the
Investor’s possession of the Prospectus covering the Registrable Securities current at the time of receipt of such notice. 
  
 (d) No Investor may participate in any third party underwritten registration hereunder unless it (i) agrees to sell the Registrable Securities on the
basis provided in any underwriting arrangements in usual and customary form entered into by the Company, and (ii) completes and executes all questionnaires, powers of attorney, indemnities, underwriting agreements and other documents reasonably
required under the terms of such underwriting arrangements. Notwithstanding the foregoing, no Investor shall be required to make any representations to such underwriter, other than those with respect to itself and the Registrable Securities owned by
it, including its right to sell the Registrable Securities, and any indemnification in favor of the underwriter by the Investors shall be several and not joint and limited in the case of any Investor, to the proceeds received by such Investor from
the sale of its Registrable Securities. The scope of any such indemnification in favor of an underwriter shall be limited to the same extent as the indemnity provided in Section 6(b) hereof. 
  
 6. Indemnification. 
  
 (a) Indemnification by the Company. The Company will indemnify and
hold harmless each Investor and their respective Affiliates, officers, directors, members, employees and agents, successors and assigns, against any losses, claims, damages or liabilities, joint or several, to which such Investor, Affiliate,
officer, director, member, or controlling person may become subject under the 1933 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 of any material fact contained in any Registration Statement, any preliminary prospectus or final prospectus contained therein, or any amendment or supplement thereof; (ii) the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements therein not misleading; (iii) 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 
  

 9 








 
such application, document or information herein called a “Blue Sky Application”); (iv) any violation by the Company or its agents of
any rule or regulation promulgated under the 1933 Act applicable to the Company or its agents and relating to action or inaction required of the Company in connection with such registration; or (v) any failure to register or qualify the Registrable
Securities included in any such Registration 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 an Investor’s behalf (the
undertaking of any underwriter chosen by the Company being attributed to the Company) and will reimburse such Investor, Affiliate 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 in writing by such Investor, Affiliate or any such controlling person
specifically for use in such Registration Statement or Prospectus; provided, further, however, that the foregoing indemnity agreement with respect to any Registration Statement or Prospectus shall not inure to the benefit of any
Investor or underwriter, or any person controlling such Investor or underwriter, from whom the person asserting any such losses, claims, damages or liabilities purchased shares in the offering (the “Shares”), if a copy of the
Prospectus (as then amended or supplemented if the Company shall have furnished to such Investor or underwriter any amendments or supplements thereto prior to such purchase) was furnished to such Investor or underwriter by the Company in accordance
with Section 3(d) hereof and not sent or given by or on behalf of such Investor or underwriter to such person, if required by law so to have been delivered, at or prior to the written confirmation of the sale of the Shares to such person, and if the
Prospectus (as so amended or supplemented) would have completely cured the defect giving rise to such loss, claim, damage or liability. 
  
 (b) Indemnification by the Investors. Each Investor, severally but not jointly, will indemnify and hold harmless, to the fullest extent permitted
by law, the Company, its Subsidiaries and its and their respective directors, officers, employees, shareholders and each person who controls the Company (within the meaning of the 1933 Act) against any losses, claims, damages, liabilities and
expenses (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 Investor to the Company
specifically for inclusion in such Registration Statement or Prospectus or amendment or supplement thereto and will reimburse the Company, its Subsidiaries and its and their respective directors, officers, employees, shareholders and each person who
controls the Company for any legal or other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage, liability or action. In no event shall the liability of an Investor be greater in amount
than the aggregate dollar amount of the proceeds (net of all expense paid by such Investor and the amount of any damages such Investor has otherwise been required to pay by reason of such untrue statement or omission) received by such Investor upon
the sale of the Registrable Securities included in the Registration Statement giving rise to such indemnification obligation. 
  

 10 








 (c) Conduct of Indemnification Proceedings. Any person entitled to indemnification hereunder
shall (i) give prompt written 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, or (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 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 prior written consent of the indemnified party, 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. 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 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 aggregate dollar amount of the proceeds (net of all expenses paid by such holder 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. 
  
 (e) Notwithstanding the foregoing, to the extent that the provisions on indemnification and contribution contained in the underwriting agreement entered
into in connection with the underwritten public offering are in conflict with the foregoing provisions, the provisions in the underwriting agreement shall control, except with respect to the limitations on liability of the Investors contained in
Section 6(b). 
  

 11 








 (f) The obligations of the Company and the Investors under this Section 6 shall survive the completion
of any offering of Registrable Securities in a Registration Statement and shall also survive the termination of this Agreement, and otherwise. 
  
 7. Miscellaneous. 
  
 (a) Amendments and Waivers. This Agreement may be amended only by a writing signed by the parties hereto. 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 Investor. 
  
 (b) Notices. All notices and other communications provided for or
permitted hereunder shall be made as set forth in Section 11.4 of the Purchase Agreement. 
  
 (c) Assignments and Transfers by Investors. The provisions of this Agreement shall be binding upon and inure to the benefit of the Investors and their respective successors and assigns. An Investor may transfer
or assign, in whole or from time to time in part, to one or more persons it rights hereunder in connection with the transfer of Registrable Securities by such Investor to such person, provided that such Investor complies with all applicable laws
thereto and provides written notice of assignment to the Company promptly after such assignment is effected. 
  
 (d) Assignments and Transfers by the Company; Effect of the Merger. This Agreement shall not be assigned by the Company without the prior written
consent of each Investor, except that without the prior written consent of the Investors, but after notice duly given, the Company shall assign its rights and delegate its duties hereunder to any successor-in-interest corporation, and such
successor-in-interest shall assume such rights and duties, in the event of a merger or consolidation of the Company with or into another corporation or the sale of all or substantially all of the Company’s assets. By virtue of the Merger,
Survivor will become the successor to all of the rights, interests, duties and obligations of Parent, including without limitation, those arising under this Agreement, and after the Merger, all references in this Agreement to the “Company”
shall be deemed to be references to Survivor. 
  
 (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. 
  

 12 








 (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) Applicable Law. This Agreement and all matters arising directly or indirectly hereunder shall be governed by, and construed in accordance with, the internal laws of the State of New York, without reference
to the choice of law principles thereof. Any legal action, suit or proceeding arising out of or relating to this Agreement or the transactions contemplated hereby shall only be instituted, heard and adjudicated (excluding appeals) in a state or
federal court located in the Southern District of New York, and each party hereto knowingly, voluntarily and intentionally waives any objection which such party may now or hereafter have to the laying of the venue of any such action, suit or
proceeding, and irrevocably submits to the exclusive personal jurisdiction of any such court in any such action, suit or proceeding. Service of process in connection with any such action, suit or proceeding may be served on each party hereto
anywhere in the world by the same methods as are specified for the giving of notices under this Agreement. 
  
 [SIGNATURES ON NEXT PAGE] 
  

 13 








 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. 
  

	 INCARA PHARMACEUTICALS CORPORATION

	
	 By:


	 Name:
	 	 
	 Title:
	 	 
	
	 INCARA, INC.

	
	 By:


	 Name:
	 	 
	 Title:
	 	 
	
	 GOODNOW CAPITAL, L.L.C.

	
	 By:


	 Name:
	 	 
	 Title:
	 	 


  
 [Registration
Rights Agreement - Signature Page]