Document:

Exhibit 10.1

 

EXECUTION

 

REGISTRATION
RIGHTS AGREEMENT

 

 

by and
between

 

 

AXCELIS
TECHNOLOGIES, INC.,

 

as
Issuer,

 

and

 

QUANTUM
PARTNERS LDC,

 

as
Purchaser

 

 

Dated as of May 2, 2006

 

 

REGISTRATION
RIGHTS AGREEMENT dated as of May 2, 2006 by and between Axcelis Technologies,
Inc., a Delaware corporation (the “Company”),
and Quantum Partners LDC, a Cayman Islands limited duration company (the “Purchaser”), pursuant to the Exchange
and Purchase Agreement dated May 2, 2006 (the “Purchase
Agreement”), between the Company and the Purchaser. In order to
induce the Purchaser to enter into the Purchase Agreement, the Company has
agreed to provide the registration rights set forth in this Agreement. The
execution of this Agreement is a condition to the closing under the Purchase
Agreement.

 

The
Company agrees with the Purchaser, (i) for its benefit as Purchaser and (ii)
for the benefit of the beneficial owners (including the Purchaser) from time to
time of the Notes (as defined herein) and the beneficial owners from time to
time of the Underlying Common Stock (as defined herein) issued upon conversion
of the Notes (each of the foregoing a “Holder” and
together the “Holders”), as follows:

 

(a)           Definitions. Capitalized terms
used herein without definition shall have their respective meanings set forth
in the Purchase Agreement. As used in this Agreement, the following terms shall
have the following meanings:

 

“Affiliate”
means with respect to any specified person, an “affiliate,” as defined in Rule
144, of such person.

 

“Amendment
Effectiveness Deadline Date” has the meaning set forth in Section 2(d) hereof.

 

“Business
Day” means each Monday, Tuesday, Wednesday, Thursday and Friday that is not a
day on which either banking institutions in The City of New York are authorized
or obligated by law or executive order to close or the SEC is closed.

 

“Common
Stock” means the shares of common stock, $0.001 par value, of the Company,
together with the rights evidenced by such common stock to the extent provided
in the Rights Agreement dated as of June 30, 2000 between the Company and
EquiServe Trust Company N.A. (or any substitute rights), and any other shares
of common stock (and accompanying rights) as may constitute “Common Stock” for
purposes of the Indenture, including the Underlying Common Stock.

 

“Conversion
Price” has the meaning assigned such term in the Indenture.

 

“Damages
Accrual Period” has the meaning set forth in Section 2(e) hereof.

 

“Damages
Payment Date” means each January 15 and July 15.

 

“Deferral
Notice” has the meaning set forth in Section 3(i) hereof.

 

“Deferral
Period” has the meaning set forth in Section 3(i) hereof.

 

“Effectiveness
Deadline Date” has the meaning set forth in Section 2(a) hereof.

 

1

 

“Effectiveness
Period” means the period commencing on the date hereof and ending on the date
that all Registrable Securities have ceased to be Registrable Securities.

 

“Event”
has the meaning set forth in Section 2(e) hereof.

 

“Event
Date” has the meaning set forth in Section 2(e) hereof.

 

“Event
Termination Date” has the meaning set forth in Section 2(e) hereof.

 

“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and
regulations of the SEC promulgated thereunder.

 

“Filing
Deadline Date” has the meaning set forth in Section 2(a) hereof.

 

“Holder”
has the meaning set forth in the second paragraph of this Agreement.

 

“Indenture”
means the Indenture, dated as of May 2, 2006, between the Company and U.S. Bank
National Association, as trustee, pursuant to which the Notes are being issued.

 

“Initial
Shelf Registration Statement” has the meaning set forth in Section 2(a) hereof.

 

“Issue
Date” means the first date of original issuance of the Notes.

 

“Liquidated
Damages Amount” has the meaning set forth in Section 2(e) hereof.

 

“Losses”
has the meaning set forth in Section 6 hereof.

 

“Material
Event” has the meaning set forth in Section 3(i) hereof.

 

“Notes”
means the 4 1/4% Convertible Senior Subordinated Notes due 2009 of the Company
to be purchased or exchanged for pursuant to the Purchase Agreement.

 

“Notice
and Questionnaire” has the meaning set forth in Section 2(d) hereof.

 

“Notice
Holder” has the meaning set forth in Section 2(a) hereof.

 

“Purchase
Agreement” has the meaning set forth in the preamble hereof.

 

“Prospectus”
means the prospectus included in any Registration Statement (including, without
limitation, a prospectus that discloses information previously omitted from a
prospectus filed as part of an effective registration statement in reliance
upon Rule 430A promulgated under the Securities Act), as amended or
supplemented by any amendment or prospectus supplement, including
post-effective amendments, and all materials incorporated by reference or
explicitly deemed to be incorporated by reference in such Prospectus.

 

“Purchaser”
has the meaning set forth in the preamble hereof.

 

“Record
Holder” means with respect to any Damages Payment Date relating to any Notes or
Underlying Common Stock as to which any Liquidated Damages Amount has accrued,
the 

 

2

 

registered
holder of such Note or Underlying Common Stock on the January 1 immediately
preceding a Damages Payment Date occurring on a January 15, and on the July 1
immediately preceding a Damages Payment Date occurring on a July 15.

 

“Registrable
Securities” means the Notes until such Notes have been converted into or
exchanged for the Underlying Common Stock and, at all times subsequent to any
such conversion or exchange the Underlying Common Stock and any securities into
or for which such Underlying Common Stock has been converted or exchanged, and
any security issued with respect thereto upon any stock dividend, split or
similar event until, in the case of any such security, (A) the earliest of (i)
its effective registration under the Securities Act and resale in accordance
with the Registration Statement covering it, (ii) expiration of the holding
period that would be applicable under Rule 144(k) to a sale by a non-Affiliate
of the Company or (iii) its sale to the public pursuant to Rule 144 (or any
similar provision then in force, but not Rule 144A) under the Securities Act,
and (B) as a result of the event or circumstance described in any of the
foregoing clauses (i) through (iii), the legend with respect to transfer
restrictions required under the Indenture are removed or removable in
accordance with the terms of the Indenture or such legend, as the case may be.

 

“Registration
Expenses” has the meaning set forth in Section 5 hereof.

 

“Registration
Statement” means any registration statement of the Company that covers any of
the Registrable Securities pursuant to the provisions of this Agreement
including the Prospectus, amendments and supplements to such registration
statement, including post-effective amendments, all exhibits, and all materials
incorporated by reference or explicitly deemed to be incorporated by reference
in such registration statement.

 

“Restricted
Securities” means “Restricted Securities” as defined in Rule 144.

 

“Rule
144” means Rule 144 under the Securities Act, as such Rule may be amended from
time to time, or any similar rule or regulation hereafter adopted by the SEC.

 

“Rule
144A” means Rule 144A under the Securities Act, as such Rule may be amended
from time to time, or any similar rule or regulation hereafter adopted by the
SEC.

 

“SEC”
means the Securities and Exchange Commission.

 

“Securities
Act” means the Securities Act of 1933, as amended, and the rules and
regulations promulgated by the SEC thereunder.

 

“Shelf
Registration Statement” has the meaning set forth in Section 2(a) hereof.

 

“Special
Counsel” means Akin Gump Strauss Hauer & Feld LLP or one such other
successor counsel as shall be specified by the Holders of a majority of the
Registrable Securities, but which may, with the written consent of the Purchaser
(which shall not be unreasonably withheld), be another nationally recognized
law firm experienced in securities law matters designated by the Company, the
reasonable fees and expenses of which will be paid by the Company pursuant to
Section 5 hereof. For purposes of determining the holders of a majority of the
Registrable Securities in this definition, Holders of Notes shall be deemed to
be the Holders 

 

3

 

of the
number of shares of Underlying Common Stock into which such Notes are or would
be convertible as of the date the consent is requested.

 

“Subsequent
Shelf Registration Statement” has the meaning set forth in Section 2(b) hereof.

 

“TIA”
means the Trust Indenture Act of 1939, as amended.

 

“Trustee”
means U.S. Bank National Association, the Trustee under the Indenture.

 

“Underlying
Common Stock” means the Common Stock into which the Notes are convertible or
issued upon any such conversion.

 

SECTION 2.           Shelf Registration. (a) The
Company shall prepare and file or cause to be prepared and filed with the SEC,
as soon as practicable but in any event by the date (the “Filing
Deadline Date”) ninety (90) days after the Issue Date, a
Registration Statement for an offering to be made on a delayed or continuous
basis pursuant to Rule 415 of the Securities Act (a “Shelf
Registration Statement”) registering the resale from time to
time by Holders thereof of all of the Registrable Securities (the “Initial Shelf Registration Statement”).
Any Shelf Registration Statement shall be on Form S-3 or another appropriate
form permitting registration of such Registrable Securities for resale by such
Holders in accordance with the methods of distribution elected by the Holders
and set forth in the Initial Shelf Registration Statement. The Company shall
use its reasonable best efforts to cause the Initial Shelf Registration
Statement to be declared effective under the Securities Act as promptly as is
practicable but in any event by the date (the “Effectiveness
Deadline Date”) that is one hundred eighty (180) days after the
Issue Date, and, subject to the exceptions provided herein, to keep the Initial
Shelf Registration Statement (or any Subsequent Shelf Registration Statement)
continuously effective under the Securities Act until the expiration of the
Effectiveness Period. At the time the Initial Shelf Registration Statement is
declared effective, each Holder that delivered a Notice and Questionnaire (each,
a “Notice Holder”) on or prior to the
date ten (10) Business Days prior to such time of effectiveness shall be named
as a selling securityholder in the Initial Shelf Registration Statement and the
related Prospectus in such a manner as to permit such Holder to deliver such
Prospectus to purchasers of Registrable Securities in accordance with
applicable law. None of the Company’s security holders (other than the Holders
of Registrable Securities) shall have the right to include any of the Company’s
securities in the Shelf Registration Statement.

 

(b)           If the Initial Shelf Registration
Statement or any Subsequent Shelf Registration Statement ceases to be effective
for any reason at any time during the Effectiveness Period (other than because
all Registrable Securities registered thereunder shall have been resold
pursuant thereto or shall have otherwise ceased to be Registrable Securities),
the Company shall use its reasonable best efforts to obtain the prompt
withdrawal of any order suspending the effectiveness thereof, and in any event shall
within thirty (30) days of such cessation of effectiveness amend the Shelf
Registration Statement in a manner reasonably expected to obtain the withdrawal
of the order suspending the effectiveness thereof, or file an additional Shelf
Registration Statement covering all of the securities that as of the date of
such filing are Registrable Securities (a “Subsequent
Shelf Registration Statement”). If a Subsequent Shelf
Registration Statement is 

 

4

 

filed, the Company shall use its
reasonable best efforts to cause the Subsequent Shelf Registration Statement to
become effective as promptly as is practicable after such filing and to keep
such Registration Statement (or subsequent Shelf Registration Statement) continuously
effective until the end of the Effectiveness Period.

 

(c)           The Company shall supplement and
amend the Shelf Registration Statement if required by the rules, regulations or
instructions applicable to the registration form used by the Company for such
Shelf Registration Statement, if required by the Securities Act or as
reasonably requested by the Purchaser or by the Trustee on behalf of the
Holders of the Registrable Securities covered by such Shelf Registration
Statement.

 

(d)           Each Holder agrees that if such
Holder wishes to sell Registrable Securities pursuant to a Shelf Registration
Statement and related Prospectus, it will do so only in accordance with this
Section 2(d) and Section 3(i). Each Holder wishing to sell Registrable
Securities pursuant to a Shelf Registration Statement and related Prospectus
agrees to deliver at least three (3) Business Days prior to any intended
distribution of Registrable Securities under the Shelf Registration Statement
such information regarding such Holder, the Registrable Securities held by such
Holder and such Holder’s intended plan of distribution as the Company shall
reasonably request and as shall be required by applicable securities laws in
order to effect any registration by the Company pursuant to this Agreement (a “Notice and Questionnaire”);
provided, that a Holder shall not be required to deliver such Notice and
Questionnaire prior to any such intended distribution to the extent it has
previously provided a Notice and Questionnaire and otherwise is in compliance
with its obligations set forth in Section 4 below. The Company will provide any
desired Notice and Questionnaire to the Purchaser within 10 days of the Issue
Date and within 10 days of a request from any other Holder. From and after the
date the Initial Shelf Registration Statement is declared effective, the
Company shall, as promptly as practicable after the date a Notice and
Questionnaire is delivered, and in any event upon the later of (x) ten (10)
Business Days after such date (but no earlier than ten (10) Business Days after
effectiveness) or (y) ten (10) Business Days after the expiration of any
Deferral Period in effect when the Notice and Questionnaire is delivered or put
into effect within ten (10) Business Days of such delivery date:

 

(1)           if required by applicable law, file
with the SEC a post-effective amendment to the Shelf Registration Statement or prepare
and, if required by applicable law, file a supplement to the related Prospectus
or a supplement or amendment to any document incorporated therein by reference
or file any other required document so that the Holder delivering such Notice
and Questionnaire is named as a selling securityholder in the Shelf
Registration Statement and the related Prospectus in such a manner as to permit
such Holder to deliver such Prospectus to purchasers of the Registrable
Securities in accordance with applicable law and, if the Company shall file a post-effective
amendment to the Shelf Registration Statement, use its reasonable best efforts to
cause such post-effective amendment to be declared effective under the
Securities Act as promptly as is practicable, but in any event by the date (the
“Amendment Effectiveness Deadline Date”)
that is forty-five (45) days after the date such post-effective amendment is required
by this clause to be filed;

 

5

 

(2)           provide such Holder copies of any
documents filed pursuant to Section 2(d)(i); and

 

(3)           notify such Holder as promptly as
practicable after the effectiveness under the Securities Act of any
post-effective amendment filed pursuant to Section 2(d)(i);

 

provided
that if such Notice and Questionnaire is delivered during a Deferral Period,
the Company shall so inform the Holder delivering such Notice and Questionnaire
and shall take the actions set forth in clauses (i), (ii) and (iii) above upon
expiration of the Deferral Period in accordance with Section 3(i).
Notwithstanding anything contained herein to the contrary, (i) the Company
shall be under no obligation to name any Holder that is not a Notice Holder as
a selling securityholder in any Registration Statement or related Prospectus
and (ii) the Amendment Effectiveness Deadline Date shall be extended by up to
ten (10) Business Days from the expiration of a Deferral Period (and the
Company shall incur no obligation to pay Liquidated Damages during such
extension) if such Deferral Period shall be in effect on the Amendment
Effectiveness Deadline Date.

 

(e)           The parties hereto agree that the
Holders of Registrable Securities will suffer damages, and that it would not be
feasible to ascertain the extent of such damages with precision, if

 

(1)           the Initial Shelf Registration
Statement has not been filed on or prior to the Filing Deadline Date,

 

(2)           the Initial Shelf Registration
Statement has not been declared effective under the Securities Act on or prior
to the Effectiveness Deadline Date,

 

(3)           the Company has failed to perform its
obligations set forth in Section 2(d) within the time period required therein,

 

(4)           any post-effective amendment to a
Shelf Registration Statement filed pursuant to Section 2(d)(i) has not become
effective under the Securities Act on or prior to the Amendment Effectiveness
Deadline Date,

 

(5)           the aggregate duration of Deferral
Periods in any period exceeds the number of days permitted in respect of such
period pursuant to Section 3(i) hereof, or

 

(6)           the number of Deferral Periods in any
period exceeds the number permitted in respect of such period pursuant to
Section 3(i) hereof.

 

Each
event described in any of the foregoing clauses (i) through (vi) is
individually referred to herein as an “Event.” For purposes of this Agreement,
each Event set forth above shall begin and end on the dates set forth in the
table set forth below:

 

6

 

	
  Type of Event

  by Clause

  	
   

  	
  Beginning Date

  	
   

  	
  Ending Date

  
	
  (i)

  	
   

  	
  Filing
  Deadline Date

  	
   

  	
  the
  date the Initial Shelf Registration Statement is filed

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (ii)

  	
   

  	
  Effectiveness
  Deadline Date

  	
   

  	
  the
  date the Initial Shelf Registration Statement becomes effective under the
  Securities Act

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (iii)

  	
   

  	
  the
  date by which the Company is required to perform its obligations under
  Section 2(d)

  	
   

  	
  the
  date the Company performs its obligations set forth in Section 2(d)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (iv)

  	
   

  	
  the
  Amendment Effectiveness Deadline Date

  	
   

  	
  the
  date the applicable post-effective amendment to a Shelf Registration
  Statement becomes effective under the Securities Act

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (v)

  	
   

  	
  the
  date on which the aggregate duration of Deferral Periods in any period
  exceeds the number of days permitted by Section 3(i)

  	
   

  	
  termination
  of the Deferral Period that caused the limit on the aggregate duration of
  Deferral Periods to be exceeded

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (vi)

  	
   

  	
  the
  date of commencement of a Deferral Period that causes the number of Deferral
  Periods to exceed the number permitted by Section 3(i)

  	
   

  	
  termination
  of the Deferral Period that caused the number of Deferral Periods to exceed
  the number permitted by Section 3(i)

  

 

For
purposes of this Agreement, Events shall begin on the beginning dates set forth
in the table above and shall continue until the ending dates set forth in the
table above.

 

Commencing
on (and including) any date that an Event has begun and ending on (but
excluding) the next date on which there are no Events that have occurred and
are continuing (a “Damages Accrual Period”), the
Company shall pay, as liquidated damages and not as a penalty, to Record
Holders of Registrable Securities an amount (the “Liquidated
Damages Amount”) accruing, for each day in the Damages Accrual
Period, (i) in respect of any Note, at a rate per annum equal to 0.5% of the
aggregate principal amount of such Note and (ii) in respect of each share of
Underlying Common Stock at a rate per annum equal to 0.5% on the Conversion
Price on such date; provided that in the case of a Damages Accrual Period that
is in effect solely as a result of an Event of the type described in clause
(iii) or (iv) of the preceding paragraph, such Liquidated Damages Amount shall
be paid only to the Holders (as set forth in the succeeding paragraph) that
have delivered Notices and Questionnaires that caused the Company to incur the
obligations set forth in Section 2(d) the non-performance of which is the basis
of such Event, and only with respect to the Notes covered by such Notices and
Questionnaires. In calculating the Liquidated Damages Amount on any date on
which no Notes are outstanding, the Conversion 

 

7

 

Price
and the Liquidated Damages Amount shall be calculated as if the Notes were
still outstanding. Notwithstanding the foregoing, no Liquidated Damages Amount
shall accrue as to any Registrable Security from and after the earlier of (x)
the date such security is no longer a Registrable Security and (y) expiration
of the Effectiveness Period. The rate of accrual of the Liquidated Damages
Amount with respect to any period shall not exceed the rate provided for in
this paragraph notwithstanding the occurrence of multiple concurrent Events.

 

The
Liquidated Damages Amount shall accrue from the first day of the applicable
Damages Accrual Period, and shall be payable on each Damages Payment Date
during the Damages Accrual Period (and on the Damages Payment Date next
succeeding the end of the Damages Accrual Period if the Damages Accrual Period
does not end on a Damages Payment Date) to the Record Holders of the
Registrable Securities entitled thereto; provided that any Liquidated Damages
Amount accrued with respect to any Note or portion thereof redeemed by the
Company on a redemption date or converted into Underlying Common Stock on a
conversion date prior to the Damages Payment Date, shall, in any such event, be
paid instead to the Holder who submitted such Note or portion thereof for
redemption or conversion on the applicable redemption date or conversion date,
as the case may be, on such date (or promptly following the conversion date, in
the case of conversion); provided further, that, in the case of an Event of the
type described in clause (iii) or (iv) of the first paragraph of this Section 2(e),
such Liquidated Damages Amount shall be paid only to the Holders entitled
thereto pursuant to such first paragraph by check mailed to the address set
forth in the Notice and Questionnaire delivered by such Holder. The Trustee
shall be entitled, on behalf of registered holders of Notes or Underlying
Common Stock, to seek any available remedy for the enforcement of this
Agreement, including for the payment of such Liquidated Damages Amount.
Notwithstanding the foregoing, the parties agree that the sole damages payable
for a violation of the terms of this Agreement with respect to which liquidated
damages are expressly provided shall be such liquidated damages except to the
extent such violation relates to a violation by the Company of this Section 3 and
such violation is willful or intentional, in which case the Holder shall be
entitled to seek actual damages. Nothing shall preclude any Holder from
pursuing or obtaining specific performance or other equitable relief with
respect to this Agreement.

 

All of
the Company’s obligations set forth in this Section 2(e) that are outstanding
with respect to any Registrable Security at the time such security ceases to be
a Registrable Security shall survive until such time as all such obligations
with respect to such security have been satisfied in full (notwithstanding
termination of this Agreement pursuant to Section 8(k)).

 

The
parties hereto agree that the liquidated damages provided for in this Section
2(e) constitute a reasonable estimate of the damages that may be incurred by
Holders of Registrable Securities by reason of the failure of a Shelf
Registration Statement to be filed or declared effective or available for
effecting resales of Registrable Securities in accordance with the provisions
hereof.

 

SECTION 3.           Registration Procedures. In
connection with the registration obligations of the Company under Section 2
hereof, the Company shall:

 

(a)           Prepare and file with the SEC a
Registration Statement or Registration Statements on any appropriate form under
the Securities Act available for the sale of the Registrable 

 

8

 

Securities by the Holders
thereof in accordance with all intended methods of distribution thereof of
which the Holder has given notice to the Company (including making all requisite
filings and taking all actions to qualify the Indenture under the TIA), and use
its reasonable best efforts to cause each such Registration Statement to become
effective and remain effective as provided herein; provided that before filing
any Registration Statement or Prospectus or any amendments or supplements
thereto with the SEC, the Company shall furnish to the Purchaser and the
Special Counsel of such offering, if any, subject to an obligation of
confidentiality, copies of all such documents proposed to be filed and use its
reasonable best efforts to reflect in each such document when so filed with the
SEC such comments as the Purchaser or the Special Counsel, if any, reasonably
shall propose within five (5) Business Days of the delivery of such copies to
the Purchaser and the Special Counsel.

 

(b)           Prepare and file with the SEC such
amendments and post-effective amendments to each Registration Statement as may
be necessary to keep such Registration Statement continuously effective for the
applicable period specified in Section 2(a); cause the related Prospectus to be
supplemented by any required prospectus supplement, and as so supplemented to
be filed pursuant to Rule 424 (or any similar provisions then in force) under
the Securities Act; and use its reasonable best efforts to comply with the
provisions of the Securities Act applicable to it with respect to the
disposition of all securities covered by such Registration Statement during the
Effectiveness Period in accordance with the intended methods of disposition by
the sellers thereof set forth in such Registration Statement as so amended or
such Prospectus as so supplemented.

 

(c)           As promptly as practicable give
notice to the Notice Holders, the Purchaser and the Special Counsel, (i) when
any Prospectus, prospectus supplement, Registration Statement or post-effective
amendment to a Registration Statement has been filed with the SEC and, with
respect to a Registration Statement or any post-effective amendment, when the
same has been declared effective, (ii) of any request, following the
effectiveness of the Initial Shelf Registration Statement under the Securities
Act, by the SEC or any other federal or state governmental authority for
amendments or supplements to any Registration Statement or related Prospectus
or for additional information, (iii) of the issuance by the SEC or any other
federal or state governmental authority of any stop order suspending the
effectiveness of any Registration Statement or the initiation or threatening of
any proceedings for that purpose, (iv) of the receipt by the Company of any
notification with respect to the suspension of the qualification or exemption
from qualification of any of the Registrable Securities for sale in any
jurisdiction or the initiation or threatening of any proceeding for such
purpose, (v) of the occurrence of a Material Event and (vi) of the
determination by the Company that a post-effective amendment to a Registration
Statement will be filed with the SEC, which notice may, at the discretion of
the Company (or as required pursuant to Section 3(i)), state that it
constitutes a Deferral Notice, in which event the provisions of Section 3(i)
shall apply.

 

(d)           Use its reasonable best efforts to
obtain the withdrawal of any order suspending the effectiveness of a
Registration Statement or the lifting of any suspension of the qualification
(or exemption from qualification) of any of the Registrable Securities for sale
in any jurisdiction in which they have been qualified for sale, in either case
at the earliest possible moment, and provide immediate notice to each Notice
Holder and the Purchaser of the withdrawal of any such order.

 

9

 

(e)           If reasonably requested by the Purchaser
or any Notice Holder, as promptly as practicable incorporate in a prospectus
supplement or post-effective amendment to a Registration Statement such
information as the Purchaser and the Special Counsel, or such Notice Holder
shall on the basis of a written opinion of nationally-recognized counsel
experienced in such matters, determine to be required to be included therein by
applicable law and make any required filings of such prospectus supplement or
post-effective amendment.

 

(f)            Upon request, as promptly as practicable
furnish to each Notice Holder, the Special Counsel and the Purchaser, without
charge, at least one (1) conformed copy of the Registration Statement and any
amendment thereto, including exhibits and all documents incorporated or deemed
to be incorporated therein by reference.

 

(g)           During the Effectiveness Period,
deliver to each Notice Holder, the Special Counsel, if any, and the Purchaser,
in connection with any sale of Registrable Securities pursuant to a
Registration Statement, without charge, as many copies of the Prospectus or
Prospectuses relating to such Registrable Securities (including each
preliminary prospectus) and any amendment or supplement thereto as such Notice
Holder may reasonably request; and the Company hereby consents (except during
such periods that a Deferral Notice is outstanding and has not been revoked) to
the use of such Prospectus or each amendment or supplement thereto by each
Notice Holder in connection with any offering and sale of the Registrable
Securities covered by such Prospectus or any amendment or supplement thereto in
the manner set forth therein.

 

(h)           Prior to any public offering of the
Registrable Securities pursuant to a Registration Statement, use its reasonable
best efforts to register or qualify or cooperate with the Notice Holders and
the Special Counsel in connection with the registration or qualification (or
exemption from such registration or qualification) of such Registrable
Securities for offer and sale under the securities or Blue Sky laws of such jurisdictions
within the United States as any Notice Holder reasonably requests in writing
(which request may be included in the Notice and Questionnaire); prior to any
public offering of the Registrable Securities pursuant to the Shelf
Registration Statement, use its reasonable best efforts to keep each such
registration or qualification (or exemption therefrom) effective during the
Effectiveness Period in connection with such Notice Holder’s offer and sale of
Registrable Securities pursuant to such registration or qualification (or
exemption therefrom) and do any and all other acts or things reasonably
necessary or advisable to enable the disposition in such jurisdictions of such
Registrable Securities in the manner set forth in the relevant Registration Statement
and the related Prospectus; provided that the Company will not be required to
(i) qualify as a foreign corporation or as a dealer in securities in any
jurisdiction where it would not otherwise be required to qualify but for this
Agreement or (ii) take any action that would subject it to general service of
process in suits or to additional taxation in any such jurisdiction.

 

(i)            Upon (A) the issuance by the SEC of
a stop order suspending the effectiveness of the Shelf Registration Statement
or the initiation of proceedings with respect to the Shelf Registration
Statement under Section 8(d) or 8(e) of the Securities Act, (B) the occurrence
of any event or the existence of any fact (a “Material Event”) as a result of which any
Registration Statement shall contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary to
make the statements therein not misleading, or any 

 

10

 

Prospectus shall contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading, or (C) the
occurrence or existence of any pending corporate development that, in the
reasonable discretion of the Company, makes it appropriate to suspend the
availability of the Shelf Registration Statement and the related Prospectus for
a discrete period of time:

 

(1)           in the case of clause (B) above,
subject to the next sentence, as promptly as practicable prepare and file, if
necessary pursuant to applicable law, a post-effective amendment to such
Registration Statement or a supplement to the related Prospectus or any
document incorporated therein by reference or file any other required document
that would be incorporated by reference into such Registration Statement and
Prospectus so that such Registration Statement does not contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein not misleading, and
such Prospectus does not contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading, as thereafter delivered to the purchasers of the
Registrable Securities being sold thereunder, and, in the case of a post-effective
amendment to a Registration Statement, subject to the next sentence, use its
reasonable best efforts to cause it to be declared effective as promptly as is
practicable, and

 

(2)           give notice to the Notice Holders,
and the Special Counsel, if any, that the availability of the Shelf Registration
Statement is suspended (a “Deferral Notice”)
and, upon receipt of any Deferral Notice, each Notice Holder agrees not to sell
any Registrable Securities pursuant to the Registration Statement until such
Notice Holder’s receipt of copies of the supplemented or amended Prospectus provided
for in clause (i) above, or until it is advised in writing by the Company that
the Prospectus may be used, and has received copies of any additional or
supplemental filings that are incorporated or deemed incorporated by reference
in such Prospectus.

 

The
Company will use its reasonable best efforts to ensure that the use of the
Prospectus may be resumed (x) in the case of clause (A) above, as promptly as
is practicable, (y) in the case of clause (B) above, as soon as, in the sole
judgment of the Company, public disclosure of such Material Event would not be
prejudicial to or contrary to the interests of the Company or, if necessary to
avoid unreasonable burden or expense, as soon as practicable thereafter and (z)
in the case of clause (C) above, as soon as in the reasonable discretion of the
Company, such suspension is no longer appropriate. The Company shall be
entitled to exercise its right under this Section 3(i) to suspend the availability
of the Shelf Registration Statement or any Prospectus, without incurring or
accruing any obligation to pay liquidated damages pursuant to Section 2(e), no
more than one (1) time in any three month period or three (3) times in any
twelve month period, and any such period during which the availability of the
Registration Statement and any Prospectus is suspended (the “Deferral Period”) shall, without
incurring any obligation to pay liquidated damages pursuant to Section 2(e),
not exceed 30 days; provided that the aggregate duration of any Deferral
Periods shall not exceed 30 days in any three month period (or 60 days in any
three month period in the event of a Material Event pursuant to which the
Company has delivered a second notice as required below) or 90 days in any
twelve (12) 

 

11

 

month
period; provided that in the case of a Material Event relating to an
acquisition or a probable acquisition or financing, recapitalization, business
combination or other similar transaction, the Company may, without incurring
any obligation to pay liquidated damages pursuant to Section 2(e), deliver to
Notice Holders a second notice to the effect set forth above, which shall have
the effect of extending the Deferral Period by up to an additional 30 days, or
such shorter period of time as is specified in such second notice.

 

(j)            If requested in writing in
connection with a disposition of Registrable Securities pursuant to a
Registration Statement, make reasonably available for inspection during normal
business hours by a representative for the Notice Holders of such Registrable
Securities, any broker-dealers, attorneys and accountants retained by such
Notice Holders, and any attorneys or other agents retained by a broker-dealer
engaged by such Notice Holders, all relevant financial and other records and
pertinent corporate documents and properties of the Company and its
subsidiaries, and cause the appropriate officers, directors and employees of
the Company and its subsidiaries to make reasonably available for inspection
during normal business hours on reasonable notice all relevant information
reasonably requested by such representative for the Notice Holders, or any such
broker-dealers, attorneys or accountants in connection with such disposition,
in each case as is customary for similar “due diligence” examinations; provided
that such persons shall first agree in writing with the Company that any
information that is reasonably and in good faith designated by the Company in
writing as confidential at the time of delivery of such information shall be
kept confidential by such persons and shall be used solely for the purposes of
exercising rights under this Agreement, unless (i)  disclosure of such information is required by
court or administrative order or is necessary to respond to inquiries of
regulatory authorities, (ii) disclosure of such information is required by law
(including any disclosure requirements pursuant to federal securities laws in
connection with the filing of any Registration Statement or the use of any
prospectus referred to in this Agreement), (iii) such information becomes
generally available to the public other than as a result of a disclosure or
failure to safeguard by any such person or (iv) such information becomes
available to any such person from a source other than the Company and such
source is not bound by a confidentiality agreement, and provided further that
the foregoing inspection and information gathering shall, to the greatest
extent possible, be coordinated on behalf of all the Notice Holders and the
other parties entitled thereto by the Special Counsel.

 

(k)           Comply with all applicable rules and
regulations of the SEC and make generally available to its securityholders
earning statements (which need not be audited) satisfying the provisions of
Section 11(a) of the Securities Act and Rule 158 thereunder (or any similar
rule promulgated under the Securities Act) for a 12-month period commencing on
the first day of the first fiscal quarter of the Company commencing after the
effective date of a Registration Statement, which statements shall be made
available no later than 45  days after
the end of the 12-month period or 90 days if the 12-month period coincides with
a fiscal year of the Company.

 

(l)            Cooperate with each Notice Holder to
facilitate the timely preparation and delivery of certificates representing
Registrable Securities sold or to be sold pursuant to a Registration
Statement,  which certificates shall not
bear any restrictive legends, and cause such Registrable Securities to be in
such denominations as are permitted by the Indenture and registered in such
names as such Notice Holder may request in writing at least one (1) Business
Day prior to any sale of such Registrable Securities.

 

12

 

(m)          Provide a CUSIP number for all
Registrable Securities covered by each Registration Statement not later than
the effective date of such Registration Statement and provide the Trustee and
the transfer agent for the Common Stock with printed certificates for the
Registrable Securities that are in a form eligible for deposit with The
Depository Trust Company.

 

(n)           Cooperate and assist in any filings
required to be made with the National Association of Securities Dealers, Inc.

 

(o)           Upon (i) the filing of the Initial
Shelf Registration Statement and (ii) the effectiveness of the Initial Shelf
Registration Statement, announce the same, in each case by release to Reuters
Economic Services and Bloomberg Business News.

 

(p)           If for any reason from time to time
the Company shall not be eligible under applicable SEC regulations to use a Shelf
Registration Statement, at the request of the Purchaser, the Company shall use
its reasonable best efforts to file, have declared effective and maintain
continuously effective a registration statement on such form as the SEC
regulations shall permit and the provisions of this Agreement shall, to the
extent relevant, apply to such registration statement; provided, that the Holders
shall additionally be entitled to the Liquidated Damages Amount as contemplated
by Section 2(e) during the period the Shelf Registration Statement is not
effective as otherwise contemplated by this Agreement.

 

SECTION 4.           Holder’s Obligations. Each
Holder agrees, by acquisition of the Registrable Securities, that no Holder
shall be entitled to sell any of such Registrable Securities pursuant to a
Registration Statement or to receive a Prospectus relating thereto, unless such
Holder has furnished the Company with a Notice and Questionnaire as required
pursuant to Section 2(d) hereof (including the information required to be
included in such Notice and Questionnaire) and the information set forth in the
next sentence. Each Notice Holder agrees promptly to furnish to the Company all
information required to be disclosed in order to make the information
previously furnished to the Company by such Notice Holder not misleading and
any other information regarding such Notice Holder and the distribution of such
Registrable Securities as the Company may from time to time reasonably request.
Any sale of any Registrable Securities by any Holder shall constitute a
representation and warranty by such Holder that the information relating to
such Holder and its plan of distribution is as set forth in the Prospectus
delivered by such Holder in connection with such disposition, that such
Prospectus does not as of the time of such sale contain any untrue statement of
a material fact relating to or provided by such Holder or its plan of
distribution and that such Prospectus does not as of the time of such sale omit
to state any material fact relating to or provided by such Holder or its plan
of distribution necessary to make the statements in such Prospectus, in the
light of the circumstances under which they were made, not misleading. The
Holder’s liability for any breach of this Section 4 shall be limited to the dollar
amount of the proceeds received by such Holder upon the sale of the Registrable
Securities pursuant to the Registration Statement affected by such breach and
giving rise to such liability (without duplicating any liability of the Holder
otherwise payable under Section 6(b)).

 

SECTION 5.           Registration Expenses. The
Company shall bear all fees and expenses incurred in connection with the
performance by the Company of its obligations under Sections 2 

 

13

 

and 3 of this Agreement whether
or not any Registration Statement is declared effective. Such fees and expenses
shall include, without limitation, (i) all registration and filing fees
(including, without limitation, fees and expenses (x) with respect to filings
required to be made with the National Association of Securities Dealers, Inc.
and (y) of compliance with federal and state securities or Blue Sky laws
(including, without limitation, reasonable fees and disbursements of the
Special Counsel in connection with Blue Sky qualifications of the Registrable
Securities under the laws of such jurisdictions as Notice Holders of a majority
of the Registrable Securities being sold pursuant to a Registration Statement
may designate), (ii) printing expenses (including, without limitation, expenses
of printing certificates for Registrable Securities in a form eligible for
deposit with The Depository Trust Company), (iii) duplication expenses relating
to copies of any Registration Statement or Prospectus delivered to any Holders
hereunder, (iv) fees and disbursements of counsel for the Company and the
Special Counsel in connection with the Shelf Registration Statement (provided
that the Company shall not be liable for the fees and expenses of more than one
separate firm for all parties participating in any transaction hereunder), (v)
reasonable fees and disbursements of the Trustee and its counsel and of the
registrar and transfer agent for the Common Stock and (vi) Securities Act
liability insurance obtained by the Company in its sole discretion. In
addition, the Company shall pay the internal expenses of the Company
(including, without limitation, all salaries and expenses of officers and
employees performing legal or accounting duties), the expense of any annual
audit, the fees and expenses incurred in connection with the listing by the
Company of the Registrable Securities on any securities exchange on which
similar securities of the Company are then listed and the fees and expenses of
any person, including special experts, retained by the Company. Notwithstanding
the provisions of this Section 5, each seller of Registrable Securities shall
pay selling expenses and, to the extent, but only to the extent, required by
applicable law, all registration expenses.

 

SECTION 6.           Indemnification.

 

(a)           Indemnification by the Company.
The Company shall indemnify and hold harmless each Notice Holder and each
person, if any, who controls any Notice Holder (within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act) from and
against any losses, liabilities, claims, damages and expenses (including,
without limitation, any legal or other expenses reasonably incurred in
connection with defending or investigating any such action or claim)
(collectively, “Losses”),
arising out of or based upon any untrue statement or alleged untrue statement
of a material fact contained in any Registration Statement or Prospectus or in
any amendment or supplement thereto or in any preliminary prospectus, or
arising out of or based upon any omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading, provided that the Company shall not be
liable in any such case to the extent that any such Losses arise out of or are
based upon an untrue statement or alleged untrue statement contained in or
omission or alleged omission from any of such documents in reliance upon and
conformity with any of the information relating to the Holders furnished to the
Company in writing by a Holder expressly for use therein; provided further,
that the indemnification contained in this paragraph shall not inure to the
benefit of any Holder (or to the benefit of any person controlling such Holder)
on account of any such Losses arising out of or based upon an untrue statement
or alleged untrue statement or omission or alleged omission made in any
preliminary prospectus or Prospectus provided in each case the Company has
performed its obligations under Section 3(a) hereof if (A) (i) such Holder
failed to send or deliver a copy of the Prospectus with or prior to the 

 

14

 

delivery of written confirmation
of the sale by such Holder to the person asserting the claim from which such
Losses arise and (ii) the Prospectus would have corrected such untrue statement
or alleged untrue statement or such omission or alleged omission, (B) (x) such
untrue statement or alleged untrue statement, omission or alleged omission is
corrected in an amendment or supplement to the Prospectus and (y) having
previously been furnished by or on behalf of the Company with copies of the
Prospectus as so amended or supplemented, such Holder thereafter fails to
deliver such Prospectus as so amended or supplemented, with or prior to the
delivery of written confirmation of the sale of a Registrable Security to the
person asserting the claim from which such Losses arise, or (C) such untrue or
alleged untrue statement or omission is contained in a preliminary prospectus
or Prospectus used during a Deferral Period.

 

(b)           Indemnification by Holders.
Each Holder agrees severally and not jointly to indemnify and hold harmless the
Company and its respective directors and officers, and each person, if any, who
controls the Company (within the meaning of either Section 15 of the Securities
Act or Section 20 of the Exchange Act) or any other Holder, from and against
all Losses arising out of or based upon any untrue statement or alleged untrue
statement of a material fact contained in any Registration Statement or
Prospectus or in any amendment or supplement thereto or in any preliminary
prospectus, or arising out of or based upon any omission or alleged omission to
state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, to the extent, but only to the
extent, that such untrue statement or alleged untrue statement or omission or
alleged omission was made in reliance upon and in conformity with information
furnished to the Company by such Holder expressly for use in such Registration
Statement or Prospectus or amendment or supplement thereto. In no event shall
the liability of any Holder hereunder be greater in amount than the dollar
amount of the proceeds received by such Holder upon the sale of the Registrable
Securities pursuant to the Registration Statement giving rise to such
indemnification obligation.

 

(c)           Conduct of Indemnification
Proceedings. In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of which
indemnity may be sought pursuant to Section 6(a) or 6(b) hereof, such person
(the “indemnified party”)
shall promptly notify the person against whom such indemnity may be sought (the
“indemnifying party”)
in writing and the indemnifying party, upon request of the indemnified party,
shall retain counsel reasonably satisfactory to the indemnified party to
represent the indemnified party and any others the indemnifying party may
designate in such proceeding and shall pay the reasonable fees and
disbursements of such counsel related to such proceeding. In any such
proceeding, any indemnified party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of
both parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. It is understood that the
indemnifying party shall not, in respect of the legal expenses of any
indemnified party in connection with any proceeding or related proceedings in
the same jurisdiction, be liable for the fees and expenses of more than one
separate firm (in addition to any local counsel) for all indemnified parties,
and that all such fees and expenses shall be reimbursed as they are incurred.
Such separate firm shall be designated in writing by, in the case of parties
indemnified pursuant to Section 6(a), the Holders of a majority (with Holders
of Notes deemed 

 

15

 

to be the Holders, for purposes
of determining such majority, of the number of shares of Underlying Common
Stock into which such Notes are or would be convertible as of the date on which
such designation is made) of the Registrable Securities covered by the
Registration Statement held by Holders that are indemnified parties pursuant to
Section 6(a) and, in the case of parties indemnified pursuant to Section 6(b),
the Company. The indemnifying party shall not be liable for any settlement of
any proceeding effected without its written consent, but if settled with such
consent or if there be a final judgment for the plaintiff, the indemnifying
party agrees to indemnify the indemnified party from and against any loss or
liability by reason of such settlement or judgment. Notwithstanding the
foregoing sentence, if at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and expenses of
counsel as contemplated by the second and third sentences of this paragraph,
the indemnifying party agrees that it shall be liable for any settlement of any
proceeding effected without its written consent if (i) such settlement is
entered into more than 60 days after receipt by such indemnifying party of the
aforesaid request and (ii) such indemnifying party shall not have reimbursed the
indemnified party in accordance with such request prior to the date of such
settlement; provided that the indemnifying party shall not be so liable for a
settlement effected without its written consent so long as it is reasonably
contesting in good faith the amount of the fees and expenses of counsel of the
indemnified party that must be reimbursed. No indemnifying party shall, without
the prior written consent of the indemnified party, effect any settlement of
any pending or threatened proceeding in respect of which any indemnified party
is or could have been a party and indemnity could have been sought hereunder by
such indemnified party, unless such settlement includes an unconditional
release of such indemnified party from all liability on claims that are the
subject matter of such proceeding.

 

(d)           Contribution. To the extent
that the indemnification provided for in this Section 6 is unavailable to an
indemnified party under Section 6(a) or 6(b) hereof in respect of any Losses or
is insufficient to hold such indemnified party harmless, then each applicable
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such Losses (i) in such proportion as is appropriate to reflect the relative
benefits received by the indemnifying party or parties on the one hand and the
indemnified party or parties on the other hand or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the indemnifying party or
parties on the one hand and of the indemnified party or parties on the other
hand in connection with the statements or omissions that resulted in such
Losses, as well as any other relevant equitable considerations. Benefits
received by the Company shall be deemed to be equal to the total net proceeds
from the initial placement pursuant to the Purchase Agreement (before deducting
expenses) of the Registrable Securities to which such Losses relate. Benefits
received by any Holder shall be deemed to be equal to the value of receiving
Registrable Securities that are registered under the Securities Act. The
relative fault of the Holders on the one hand and the Company on the other hand
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by the Holders or by
the Company, and the parties’ relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The Holders’
respective obligations to contribute pursuant to this paragraph are several in
proportion to the respective 

 

16

 

number of Registrable Securities
they have sold pursuant to a Registration Statement, and not joint.

 

The
parties hereto agree that it would not be just and equitable if contribution
pursuant to this Section 6(d) were determined by pro rata allocation or by any
other method or allocation that does not take into account the equitable
considerations referred to in the immediately preceding paragraph. The amount
paid or payable by an indemnified party as a result of the Losses referred to
in the immediately preceding paragraph shall be deemed to include, subject to
the limitations set forth above, any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or
defending any such action or claim. Notwithstanding this Section 6(d), an
indemnifying party that is a selling Holder shall not be required to contribute
any amount in excess of the amount by which the total price at which the
Registrable Securities sold by such indemnifying party and distributed to the
public were offered to the public exceeds the amount of any damages that such
indemnifying party has otherwise been required to pay by reason of such untrue
or alleged untrue statement or omission or alleged omission. No person guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not guilty
of such fraudulent misrepresentation.

 

(e)           The indemnity, contribution and
expense reimbursement obligations of the parties hereunder shall be in addition
to any liability any indemnified party may otherwise have hereunder, under the
Purchase Agreement or otherwise.

 

(f)            The indemnity and contribution
provisions contained in this Section 6 shall remain operative and in full force
and effect regardless of (i) any termination of this Agreement, (ii) any
investigation made by or on behalf of any Holder or any person controlling any
Holder, or the Company, or the Company’s officers or directors or any person
controlling the Company and (iii) the sale of any Registrable Securities by any
Holder.

 

17

 

SECTION 7.           Information Requirements. The
Company covenants that, if at any time before the end of the Effectiveness
Period the Company is not subject to the reporting requirements of the Exchange
Act, it will cooperate with any Holder and take such further reasonable action
as any Holder may reasonably request in writing (including, without limitation,
making such reasonable representations as any such Holder may reasonably
request), all to the extent required from time to time to enable such Holder to
sell Registrable Securities without registration under the Securities Act
within the limitation of the exemptions provided by Rule 144 and Rule 144A
under the Securities Act and customarily taken in connection with sales
pursuant to such exemptions. Upon the written request of any Holder, the
Company shall deliver to such Holder a written statement as to whether it has
complied with such filing requirements, unless such a statement has been
included in the Company’s most recent report filed pursuant to Section 13 or
Section 15(d) of Exchange Act. Notwithstanding the foregoing, nothing in this
Section 7 shall be deemed to require the Company to register any of its
securities (other than the Common Stock) under any section of the Exchange Act.

 

SECTION 8.           Miscellaneous.

 

(a)           No Conflicting Agreements. The
Company is not, as of the date hereof, a party to, nor shall it, on or after
the date of this Agreement, enter into, any agreement with respect to its
securities that conflicts with the rights granted to the Holders in this
Agreement. The Company represents and warrants that the rights granted to the
Holders hereunder do not in any way conflict with the rights granted to the
holders of the Company’s securities under any other agreements.

 

(b)           Amendments and Waivers. The
provisions of this Agreement, including the provisions of this sentence, may
not be amended, modified or supplemented, and waivers or consents to departures
from the provisions hereof may not be given, unless the Company has obtained
the written consent of Holders of a majority of the then outstanding
Registrable Securities (with Holders of Notes deemed to be the Holders, for
purposes of this Section, of the number of shares of Underlying Common Stock
into which such Notes are or would be convertible as of the date on which such
consent is requested). Notwithstanding the foregoing, a waiver or consent to
depart from the provisions hereof with respect to a matter that relates
exclusively to the rights of Holders whose securities are being sold pursuant
to a Registration Statement and that does not directly or indirectly affect the
rights of other Holders may be given by Holders of at least a majority of the
Registrable Securities being sold by such Holders pursuant to such Registration
Statement; provided, that the provisions of this sentence may not be amended,
modified, or supplemented except in accordance with the provisions of the
immediately preceding sentence. Each Holder of Registrable Securities
outstanding at the time of any such amendment, modification, supplement, waiver
or consent or thereafter shall be bound by any such amendment, modification,
supplement, waiver or consent effected pursuant to this Section 8(b), whether
or not any notice, writing or marking indicating such amendment, modification,
supplement, waiver or consent appears on the Registrable Securities or is
delivered to such Holder.

 

(c)           Notices. All notices and other
communications provided for or permitted hereunder shall be made in writing by
hand delivery, by telecopier, by courier guaranteeing overnight delivery or by
first-class mail, return receipt requested, and shall be deemed given 

 

18

 

(i) when made, if made by hand
delivery, (ii) upon confirmation, if made by telecopier, (iii) one (1) Business
Day after being deposited with such courier, if made by overnight courier or
(iv) on the date indicated on the notice of receipt, if made by first-class
mail, to the parties as follows:

 

(1)           if to a Holder, at the most current
address given by such Holder to the Company in a Notice and Questionnaire or
any amendment thereto;

 

(2)           if to the Company, to:

 

Axcelis
Technologies, Inc.

108
Cherry Hill Drive

Beverly,
Massachusetts 01915

Attention:
General Counsel

Telecopy
No.: (978) 787-4200

 

with a copy
to (which shall not constitute notice):

 

Edwards Angell Palmer & Dodge LLP

111 Huntington Avenue

Boston, MA  02199-7613

Attention:  Matthew Dallett

Telecopy No.: (617) 227-4420

 

(3)           if to the Purchaser, to:

 

Quantum Partners LDC

c/o Soros Fund Management LLC

888 Seventh Avenue

New York, NY  10106

Attention:  Cynthia Paul

Telecopy No.: (646) 731-5431

 

with a copy to:

 

Akin, Gump, Strauss, Hauer and Feld, LLP

590 Madison Avenue

New York, NY  10022

Attention:  Patrick J. Dooley,
Esq.

Telecopy No.: (212) 872-1002

 

or to
such other address as such person may have furnished to the other persons
identified in this Section 8(c) in writing in accordance herewith.

 

(d)           Approval of Holders. Whenever
the consent or approval of Holders of a specified percentage of Registrable
Securities is required hereunder, Registrable Securities held by the Company or
its affiliates (as such term is defined in Rule 405 under the Securities Act)
(other than the Purchaser or subsequent Holders if such subsequent Holders are
deemed to be such 

 

19

 

affiliates solely by reason of
their holdings of such Registrable Securities) shall not be counted in
determining whether such consent or approval was given by the Holders of such
required percentage.

 

(e)           Successors and Assigns. Any
person who purchases any Registrable Securities from the Purchaser shall be
deemed, for purposes of this Agreement, to be an assignee of the Purchaser.
This Agreement shall inure to the benefit of and be binding upon the successors
and assigns of each of the parties and shall inure to the benefit of and be
binding upon each Holder of any Registrable Securities.

 

(f)            Counterparts. This Agreement
may be executed in any number of counterparts and by the parties hereto in
separate counterparts, each of which when so executed shall be deemed to be
original and all of which taken together shall constitute one and the same
agreement.

 

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

 

(h)           Governing Law. THIS AGREEMENT
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK, WITHOUT REFERENCE TO ITS CHOICE OF LAW RULES.

 

(i)            Severability. If any term, provision,
covenant or restriction of this Agreement is held to be invalid, illegal, void
or unenforceable, the remainder of the terms, provisions, covenants and
restrictions set forth herein shall remain in full force and effect and shall
in no way be affected, impaired or invalidated thereby, and the parties hereto
shall use their reasonable best efforts to find and employ an alternative means
to achieve the same or substantially the same result as that contemplated by
such term, provision, covenant or restriction, it being intended that all of
the rights and privileges of the parties shall be enforceable to the fullest
extent permitted by law.

 

(j)            Entire Agreement. This
Agreement is intended by the parties as a final expression of their agreement
and is 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 and the registration rights granted by the Company with respect to the
Registrable Securities. Except as provided in the Purchase Agreement, there are
no restrictions, promises, warranties or undertakings, other than those set
forth or referred to herein, with respect to the registration rights granted by
the Company with respect to the Registrable Securities. This Agreement
supersedes all prior agreements and undertakings among the parties with respect
to such registration rights. No party hereto shall have any rights, duties or
obligations other than those specifically set forth in this Agreement. In no
event will such methods of distribution take the form of an underwritten
offering of the Registrable Securities without the prior agreement of the
Company.

 

(k)           Termination. This Agreement
and the obligations of the parties hereunder shall terminate upon the end of
the Effectiveness Period, except for any liabilities or obligations under
Section 4, 5 or 6 hereof and the obligations to make payments of and provide
for liquidated 

 

20

 

damages under Section 2(e)
hereof to the extent such damages accrue prior to the end of the Effectiveness
Period, each of which shall remain in effect in accordance with its terms.

 

[signature page follows]

 

21

 

IN
WITNESS WHEREOF, the parties have executed this Agreement as of the date first
written above.

 

	
   

  	
  AXCELIS TECHNOLOGIES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   /s/ Mary G. Puma

  
	
   

  	
   

  	
  Name:

  	
  Mary G. Puma

  
	
   

  	
   

  	
  Title:

  	
  Chairman, CEO, and President

  

 

 

Confirmed and accepted as of

the date first above written:

 

	
  QUANTUM
  PARTNERS LDC

  
	
   

  
	
   

  
	
  By

  	
   /s/
  Jay Schoenfarber

  	
   

  
	
   

  	
  Name:

  	
  Jay
  Schoenfarber

  
	
   

  	
  Title:

  	
  Attorney-in-fact

  
				

 

[Registration Rights Agreement]Exhibit 10.1

 

United Therapeutics Corporation Supplemental

Executive Retirement Plan

 

(Effective
as of July 1, 2006)

 

 

Contents

 

	
   

  	
  Page

  
	
   

  	
   

  
	
  Article 1.
  The Plan

  	
  4

  
	
  1.1 Establishment of the Plan

  	
  4

  
	
  1.2 Purpose of the Plan

  	
  4

  
	
  1.3 Applicability of the Plan

  	
  4

  
	
   

  	
   

  
	
  Article 2.
  Definitions

  	
   

  
	
  2.1 Actuarial Equivalent

  	
  5

  
	
  2.2 Affiliate

  	
  5

  
	
  2.3 Beneficiary

  	
  6

  
	
  2.4 Benefit Commencement Date

  	
  6

  
	
  2.5 Board

  	
  7

  
	
  2.6 Change in Control

  	
  7

  
	
  2.7 Code

  	
  7

  
	
  2.8 Committee

  	
  7

  
	
  2.9 Company

  	
  7

  
	
  2.10 Compensation

  	
  7

  
	
  2.11 Competing Product

  	
  7

  
	
  2.12 Competing Organization

  	
  7

  
	
  2.13 Confidential Information

  	
  8

  
	
  2.14 Disability

  	
  9

  
	
  2.15 Disability Retirement Date

  	
  9

  
	
  2.16 Employer

  	
  9

  
	
  2.17 Employment Commencement
  Date

  	
  9

  
	
  2.18 ERISA

  	
  9

  
	
  2.19 Executive

  	
  9

  
	
  2.20 Final Average Compensation

  	
  9

  
	
  2.21 Normal Retirement Date

  	
  9

  
	
  2.22 Participant

  	
  9

  
	
  2.23 Plan

  	
  9

  
	
  2.24 Plan Year

  	
  10

  
	
  2.25 Social Security Benefit

  	
  10

  
	
  2.26 Termination of Service

  	
  10

  
	
  2.27 Years of Service

  	
  10

  

 

i

 

	
  Article 3.
  Participation

  	
   

  
	
  3.1 Eligibility

  	
  12

  
	
  3.2 Duration

  	
  12

  
	
   

  	
   

  
	
  Article 4. Retirement
  Benefits

  	
   

  
	
  4.1 Normal Retirement Benefits

  	
  13

  
	
  4.2 Disability Retirement Benefits

  	
  14

  
	
  4.3 Form of Payment

  	
  15

  
	
  4.4 Change in Control

  	
  17

  
	
  4.5 Competing Activity
  Covenant

  	
  18

  
	
   

  	
   

  
	
  Article 5.
  Preretirement Death Benefits

  	
   

  
	
  5.1 Eligibility

  	
  20

  
	
  5.2 Amount

  	
  20

  
	
  5.3 Commencement

  	
  20

  
	
  5.4 Form of Payment

  	
  20

  
	
   

  	
   

  
	
  Article 6. Financing

  	
   

  
	
  6.1 Financing

  	
  21

  
	
  6.2 Unsecured Interest

  	
  21

  
	
   

  	
   

  
	
  Article 7.
  Administration

  	
   

  
	
  7.1 Administration

  	
  22

  
	
  7.2 Assistance

  	
  22

  
	
  7.3 Appeals from Denial of Claims

  	
  22

  
	
  7.4 Tax Withholding

  	
  23

  
	
  7.5 Expenses

  	
  23

  
	
   

  	
   

  
	
  Article 8. Adoption
  by an Affiliate; Amendment and Termination

  	
   

  
	
  8.1 Adoption by an Affiliate

  	
  24

  
	
  8.2 Amendment and Termination

  	
  24

  
	
   

  	
   

  
	
  Article 9.
  Miscellaneous Provisions

  	
   

  
	
  9.1 No Contract of Employment

  	
  25

  
	
  9.2 Nonalienation

  	
  25

  
	
  9.3 Severability

  	
  25

  
	
  9.4 Applicable Law

  	
  25

  
	
  9.5 Successors

  	
  25

  
	
  9.6 Facility of Payment

  	
  25

  

 

ii

 

	
  Appendix A. Participating Executives as of July 1, 2006

  	
  24

  

 

iii

 

Article 1. The Plan

 

1.1 Establishment of the Plan

 

United
Therapeutics Corporation (the “Company”) hereby establishes this supplemental
retirement plan for eligible Executives of the Company and its participating
Affiliates. This plan shall be known as the United Therapeutics Corporation
Supplemental Executive Retirement Plan (the “Plan”).

 

1.2 Purpose of the Plan

 

The
Plan provides supplemental retirement income to selected Executives. The Plan
is intended to provide deferred compensation to a “select group of management
or highly compensated employees” within the meaning of ERISA section 201(2).
In addition, Plan benefits will be paid solely from the general assets of the
Company. This Plan, therefore, is intended to be exempt from the participation,
vesting, funding, and fiduciary requirements of Title I of ERISA. The Plan is
also intended to constitute a “nonqualified deferred compensation plan” for
purposes of Code section 3121(v)(2) and 4 U.S.C. 114.

 

1.3 Applicability of the Plan

 

This
Plan applies only to eligible Executives who are in the active employ of the
Company or a participating Affiliate on or after July 1, 2006.

 

 

Article 2. Definitions

 

Whenever used in the Plan, the following terms shall have the meanings
set forth below unless otherwise expressly provided. When the defined meaning
is intended, the term is capitalized. The definition of any term in the
singular shall also include the plural, whichever is appropriate in the
context.

 

2.1 Actuarial Equivalent

Actuarial Equivalent means a benefit having the same value as
the benefit that it replaces, computed on the basis of—

 

(a)             the “applicable
mortality table” as determined under Code section 417(e)(3)(A)(ii)(I) on
the date on which the present value is being determined; and

 

(b)             an
annual interest rate equal to the Moody’s AA corporate bond rate, rounded to
the nearest 25 basis points, as of November 30 (or the immediately
preceding business day if November 30 is not a business day) of the
calendar year preceding the year in which the distribution is made.

 

2.2 Affiliate

Affiliate means—

 

(a)             any
corporation while it is a member of the same “controlled group” of corporations
(within the meaning of Code section 414(b)) as the Company;

 

(b)             any
other trade or business (whether or not incorporated) while it is under “common
control” (within the meaning of Code section 414(c)) with the Company;

 

(c)             any
organization during any period in which it (along with the Company) is a member
of an “affiliated service group” (within the meaning of Code section 414(m));
or

 

(d)             any
other entity during any period in which it is required to be aggregated with
the Company under Code section 414(o).

 

 

2.3 Beneficiary

Beneficiary means the person or persons designated by the
Participant to receive any benefits due after his or her death under a joint
and survivor annuity option described in section 4.3(c)(2) or a
preretirement death benefit under Article 5. If a preretirement death
benefit becomes payable under Article 5, and the Participant had not
previously designated a Beneficiary (or the Beneficiary designated by the
Participant is not living at the time of his or her death), the preretirement
death benefit shall be paid to the Participant’s estate.

 

2.4 Benefit Commencement Date

Benefit Commencement Date means the date on which a
Participant’s retirement benefit shall commence under Article 4 or the
date on which a preretirement death benefit shall be paid under Article 5.
Except as otherwise provided under section 4.3(b), the Benefit Commencement
Date shall be determined as follows:

 

(a)             Normal Retirement. For a Participant who is eligible for a
benefit under section 4.1, the Benefit Commencement Date shall be the
first day of the sixth month after the Participant’s Normal Retirement Date.

 

(b)             Disability Retirement. For a Participant who becomes
entitled to a benefit under section 4.2, the Benefit Commencement Date
shall be the first day of the sixth month following the Participant’s
Disability Retirement Date.

 

(c)             Change in Control. For a Participant who becomes entitled to
a benefit under section 4.4, the Benefit Commencement Date shall be as
soon as administratively practicable following a Change in Control.

 

(d)             Death Benefit. For a Beneficiary who becomes entitled to a
preretirement death benefit under Article 5, the Benefit Commencement Date
shall be as soon as administratively practicable following the Participant’s
death.

 

 

2.5 Board

Board means the Company’s Board of Directors.

 

2.6 Change in Control

Change in Control means any transfer of control of the
Company by acquisition, merger, hostile takeover or for any other reason
whatsoever which also qualifies as a “change in the ownership or effective
control of the corporation, or in the ownership of a substantial portion of the
assets of the corporation” under Code section 409A(a)(2)(A)(v).

 

2.7 Code

Code means the Internal Revenue Code of 1986, as amended, or
as it may be amended from time to time. A reference to a particular section of
the Code shall also be deemed to refer to the regulations under that section.

 

2.8 Committee

Committee means the Compensation Committee of the Board.

 

2.9 Company

Company means United Therapeutics Corporation, or any
successor thereto that agrees to adopt and continue this Plan.

 

2.10 Compensation

Compensation means the Participant’s gross base salary from
the Company and its Affiliates.

 

2.11 Competing Product

Competing Product means any product, system, or service, in
existence or under development, of any person or organization other than the Company
which is the same as, similar to, competes with, or has a usage allied to a
product, process, system, or service offered by the Company during the
three-year period preceding the Participant’s Termination of Service, or which
was under development by the Company at the time of the Participant’s
Termination of Service.

 

2.12 Competing Organization

Competing Organization means any person or organization which
is engaged in, or about to become engaged in, research on, or development,
production, marketing, leasing, selling, licensing, or servicing of, a
Competing Product.

 

 

2.13 Confidential Information

Confidential Information means any information of whatever
kind or form, including without limitation: an idea, invention, concept,
formula, computer program, algorithm, research, device, method, technique,
design, manufacturing process, know how, internal procedure or method of
operation, process, plan, project, picture, drawing, lists of customers,
contracts, contractors or vendors, business or financial data, plans or
accounts, pricing strategies, purchasing data and/or reports, marketing data
and/or reports, business relationships, contractual rights, lists of actual or
prospective investors, industrial or strategic partners and consultants, trade secrets,
and other proprietary information of the Company that became known to the
Participant, or was developed, examined, enhanced, or modified by the
Participant as a result of or during the course of the Participant’s employment
with the Company. However, Confidential Information shall not include:

 

(a)             information
that is or becomes known to the general public in a manner other than
disclosure by the Participant;

 

(b)             information
that is customarily disclosed to others without restriction on subsequent disclosure;

 

(c)             information
that is obtained by the Participant from a third party without an accompanying
disclosure by the Participant of Confidential Information and without
restriction on subsequent disclosure; or

 

(d)             information
to the limited extent that disclosure is expressly required by judicial or
administrative order, or as otherwise required by law, provided that the
Participant gives immediate notice to the Company prior to the disclosure of
such information.

 

 

2.14 Disability

Disability means any physical or mental condition that
qualifies a Participant for a disability benefit under any long-term disability
plan sponsored by the Company or an Affiliate.

 

2.15 Disability Retirement Date

Disability Retirement Date means the first day of the month
coinciding with or next following a Participant’s Termination of Service on
account of Disability.

 

2.16 Employer

Employer means the Company and each Affiliate that has
adopted this Plan for the benefit of its eligible Executives.

 

2.17 Employment Commencement Date

Employment Commencement Date means the Executive’s first day
of active employment with the Company or one of its Affiliates.

 

2.18 ERISA

ERISA means the Employee Retirement Income Security Act of
1974, as amended, or as it may be amended from time to time. A reference
to a particular section of ERISA shall also be deemed to refer to the
regulations under that section.

 

2.19 Executive

Executive means any individual employed by the Company or an
Affiliate at a level of vice president or above.

 

2.20 Final Average Compensation

Final Average Compensation means the monthly average of the
total Compensation received by the Participant over his or her last 36 months
of active employment. (However, for a Participant who transfers into a Senior
Advisor role after becoming eligible for a benefit under section 4.1(a),
Final Average Compensation shall be determined using the average of the
Compensation received by the Participant over the 36-month period immediately
preceding such transfer.)

 

2.21 Normal Retirement Date

Normal Retirement Date means the first day of the month
coinciding with or next following a Termination of Service which occurs on or
after the date on which the Participant reaches age 60.

 

2.22 Participant

Participant means an Executive who has met, and continues to
meet, the eligibility requirements under section 3.1.

 

2.23 Plan

Plan means this United Therapeutics Corporation Supplemental
Executive Retirement Plan, as amended from time to time.

 

 

2.24 Plan Year

Plan Year means initially the period beginning July 1,
2006 and ending December 31, 2006. Thereafter, Plan Year means the
calendar year.

 

2.25 Social Security Benefit

Social Security Benefit means the estimated monthly primary
insurance amount that a Participant is entitled to receive under the federal
Social Security Act commencing as of the later of the Participant’s Normal
Retirement Date or the first day of the month coinciding with or next following
the date on which the Participant reaches age 62. This estimated benefit shall be
determined—

 

(a)             under
the Social Security Act in effect on January 1 of the Plan Year in which
the Participant’s incurs a Termination of Service (without regard to
legislative changes made after that date);

 

(b)             assuming
that the Participant’s wages before he or she commenced employment with the
Company or an Affiliate increased at a rate equal to the rate of increase in
the average national wage as reported by the Social Security Administration;

 

(c)             in the
case of a Participant who incurs a Termination of Service before reaching
age 62, assuming that the Participant has no wages for the period from his
or her Termination of Service to the date on which he or she reaches
age 62; and

 

(d)             assuming
no change in the primary insurance amount after the later of the Participant’s
Normal Retirement Date or the first day of the month coinciding with or next
following the date on which the Participant reaches age 62 (either by amendment
of the Social Security Act or by application of the provisions of that Act).

 

2.26 Termination of Service

Termination of Service means the last date on which the
Executive is compensated as an employee of the Company or an Affiliate.

 

In
addition, for the purpose of determining the Normal Retirement Date of a
Participant who exercises an option (on or after age 60) under an employment
agreement to resign from his or her Executive position and transfer into a “Senior
Advisor” role, a Termination of Service shall generally be deemed to have
occurred as of the date on which the Senior Advisor role ends. However, if such
transfer is (or becomes) a “separation from service” within the meaning of Code
section 409A(a)(2)(A)(i), the Participant’s Termination of Service shall
be deemed to have occurred as of the date on which the “separation from service”
has occurred.

 

2.27 Years of Service

Years of Service are used to determine the amount of a
Participant’s benefit under Article 4.

 

(a)             General Rule. A Participant shall be credited with Years of
Service equal to the full years and completed months of employment with the
Company and its Affiliates beginning on the Participant’s Employment
Commencement Date and ending on the date on which the Participant incurs a
Termination of Service.

 

 

(b)             Leaves of Absence. Any period during which the Participant
is on leave of absence authorized by the Committee shall be included in the
Participant’s Years of Service under this Plan.

 

(c)             Reemployment. If an Executive incurs a Termination of
Service prior to becoming eligible for a retirement benefit under Article 4,
but is subsequently reemployed by the Company or an Affiliate, the Compensation
Committee shall determine in its sole and absolute discretion whether such
Executive shall again become a Participant hereunder and the extent to which
Years of Service earned by such Executive during his or her first period of
employment shall be reinstated if the Executive again becomes a Participant.

 

 

Article 3. Participation

 

3.1 Eligibility

The Executives named in
Appendix A shall become Participants in this Plan as of July 1, 2006 and
shall continue to be active Participants in this Plan until participation is
terminated under section 3.2.

 

Thereafter,
an Executive shall first be recommended for participation by the Company’s
Chief Executive Officer and shall become a Participant on the first day of the
month coinciding with or next following the date on which he or she is
designated by the Committee as eligible to participate in this Plan.

 

However,
notwithstanding the above, an Executive shall not be eligible to become a
Participant (or remain a Participant) unless he or she is a member of a “select
group of management or highly compensated employees” within the meaning of
ERISA section 201(2).

 

3.2 Duration

An Executive who becomes a Participant under section 3.1
shall remain an active Participant until the earlier of—

 

(a)           the
Executive’s Termination of Service;

 

(b)           the
Executive’s death; or

 

(c)             the date
on which the Committee declares that the Executive is no longer eligible to
participate in this Plan.

 

An
individual whose active participation has been terminated under this section 3.2
shall continue to be an inactive Participant until all benefits to which he or
she is entitled to under this Plan have been paid.

 

 

Article 4. Retirement Benefits

 

4.1 Normal Retirement Benefits

 

(a)             Eligibility. A Participant who incurs a Termination of
Service on or after attaining age 60 shall be eligible for a normal
retirement benefit under this section 4.1. However, notwithstanding the
above, a Participant who exercises a right under his or her employment
agreement to transfer into a Senior Advisor role before reaching age 60 will
not be eligible for a benefit under this section 4.1.

 

(b)             Amount. The normal retirement benefit calculated under this section 4.1(b) represents
the amount payable as a single life annuity commencing on the Participant’s
Benefit Commencement Date. However, the benefit payable under this section 4.1
shall actually be distributed to the Participant in the form determined
under section 4.3. The amount payable in the form of a single life
annuity under this section 4.1 shall be calculated as follows:

 

(i)          Original
Participants. A
Participant who is listed on Appendix A, and who becomes entitled to a normal
retirement benefit under section 4.1(a), shall be entitled to a monthly
single life annuity equal to 100 percent of the Participant’s Final
Average Compensation reduced by the Participant’s Social Security Benefit.

 

(ii)         Future
Participants. An
Executive who becomes a Participant after July 1, 2006, and who becomes
entitled to a normal retirement benefit under section 4.1(a), shall be
entitled to monthly single life annuity equal to:

 

(A)      100 percent of the Participant’s Final Average Compensation reduced by
the Participant’s Social Security Benefit; multiplied by

 

(B)       a fraction (not to exceed one) having—

 

(i)         a numerator
equal to the Participant’s Years of Service; and

 

(ii)        a denominator
equal to 15.

 

When calculating benefits payable under this section 4.1(b),
the offset for the Social Security Benefit shall be applied only as of the
first day of the month coinciding with or next following the date on which the
Participant reaches age 62 (or the Participant’s actual Benefit Commencement
Date, if later).

 

(c)             Commencement. Payment of benefits under this section 4.1
shall begin on the Participant’s Benefit Commencement Date (as determined under
section 2.4(a)). However, if a Participant incurs a Termination of
Employment after satisfying the eligibility requirements described in section 4.1(a),
and a Change in Control occurs before the Benefit Commencement Date determined
under section 2.4(a), the

 

 

Participant’s benefit shall be paid as soon as
administratively practicable following such Change in Control.

 

4.2 Disability Retirement Benefits

 

(a)             Eligibility. A Participant who incurs a Termination of
Service on account of Disability before satisfying the eligibility requirements
for a normal retirement benefit under section 4.1(a) shall be
eligible for a disability retirement benefit under this section 4.2.

 

(b)             Amount. The disability retirement benefit calculated under
this section 4.2(b) represents the amount payable as a single life
annuity commencing on the Participant’s Benefit Commencement Date. However, the
benefit payable under this section 4.2 shall actually be distributed to
the Participant in the form determined under section 4.3. The amount
payable in the form of a single life annuity under this section 4.2
shall be calculated as follows:

 

(1)         Original
Participants. A
Participant who is listed on Appendix A, and who becomes entitled to a
disability retirement benefit under section 4.2(a), shall be entitled to a
monthly single life annuity equal to—

 

(A)      100 percent of the Participant’s Final Average Compensation reduced
by the Participant’s Social Security Benefit; multiplied by

 

(B)       a fraction (not to exceed one) having—

 

(i)        a numerator
equal to the Participant’s Years of Service as of the date on which the
Participant incurs a Termination of Service on account of Disability; and

 

(ii)       a denominator
equal to the Years of Service the Participant would have had if the Participant
had remained in active employment with the Company or an Affiliate from his or
her original Employment Commencement Date through the date on which the
Participant would have attained age 60.

 

(2)         Future
Participants. An
Executive who becomes a Participant after July 1, 2006, and who becomes
entitled to a disability retirement benefit under section 4.2(a), shall be
entitled to a monthly single life annuity equal to—

 

(A)      100 percent of the Participant’s Final Average Compensation reduced by
the Participant’s Social Security Benefit; multiplied by

 

(B)       a fraction (not to exceed one) having—

 

(i)        a numerator
equal to the Participant’s Years of Service as of the date on which the
Participant incurs a Termination of Service on account of Disability; and

 

 

(ii)       a denominator
equal to the greater of (I) the Years of Service the Participant would have had
if the Participant had remained in active employment with the Company or an
Affiliate from his or her original Employment Commencement Date through the
date on which the Participant would have attained age 60 or (ii) 15.

 

When calculating
benefits payable under this section 4.2(b), the offset for the Social
Security Benefit shall be applied only as of the first day of the month
coinciding with or next following the date on which the Participant reaches age
62.

 

(c)             Commencement. Payment of benefits under this section 4.2
shall begin on the Participant’s Benefit Commencement Date (as determined under
section 2.4(b)). However, if a Participant incurs a Termination of
Employment after satisfying the eligibility requirements described in section 4.2(a),
and a Change in Control occurs before the Benefit Commencement Date determined
under section 2.4(b), the Participant’s benefit shall be paid as soon as
administratively practicable following such Change in Control.

 

4.3 Form of Payment

The normal retirement benefit payable to a Participant under section 4.1,
and the disability retirement benefit payable to the participant under section 4.2,
shall be paid in the form elected by the Participant under this section 4.3.

 

(a)           Initial Election of a Form of Payment.

 

(1)         Original Participants. A Participant who is
listed on Appendix A must make an initial election regarding the form of
payment for normal or disability retirement benefits no later than December 31,
2006. This election must be made in a manner prescribed by the Committee. If
such Participant does not make a timely election under this section 4.3(a)(1),
the Participant shall be deemed to have elected to receive his or her normal or
disability retirement benefit in the form a lump sum payment.

 

(2)         Future Participants. An Executive who becomes
a Participant after July 1, 2006 must make an initial election regarding
the form of payment for normal or disability retirement benefits on or
before the date on which such Executive first becomes a Participant (or by December 31,
2006, if later). This election must be made in a manner prescribed by the
Committee. If such Participant does not make a timely election under this section 4.3(a)(2),
the Participant shall be deemed to have elected to receive his or her normal or
disability retirement benefit in the form a lump sum payment.

 

(b)             Subsequent Election Change. A Participant can change the form of
payment elected (or deemed elected) under section 4.3(a) to any other
form available to the Participant under section 4.3(c). This election
can be made by the Participant at a time and in a manner prescribed by the
Committee. However, if a Participant moves

 

 

from a lump sum payment to any of the annuity options
described in section 4.3(c), or if the Participant moves from an annuity
option to a lump sum payment, such election must:

 

(1)         be made at least one year
in advance of the Benefit Commencement Date in effect immediately before the
new election is made; and

 

(2)         result in a new Benefit
Commencement Date that is at least five years after the Benefit Commencement
Date in effect immediately before the new election is made.

 

(The restrictions described and subsections (b)(1) and
(b)(2) above do not apply in cases where a Participant is changing his or
her payment form from one of the annuity options described in section 4.3(c)(1) or
4.3(c)(2) to another annuity option that is also described in section 4.3(c)(1) or
4.3(c)(2).)

 

(c)             Forms of Payment. The payment forms available to the
Participant under this section 4.3 include the following:

 

(1)         Single Life
Annuity: A single
life annuity is a monthly retirement benefit payable to the Participant for
life, with no payments made after the Participant’s death.

 

(2)         Joint and
Survivor Annuity: A
joint and survivor annuity is a reduced monthly retirement benefit payable to
the Participant for life, with a survivor annuity payable to the Participant’s
Beneficiary if such Beneficiary is still living at the time of the Participant’s
death. The monthly amount payable to the surviving Beneficiary shall equal 50
percent, 75 percent, or 100 percent (as elected by the Participant) of the
monthly annuity amount payable during the lifetime of the Participant.

 

(3)         Lump Sum: The total Plan benefit
is distributed to the Participant in the form of a single lump sum
payment.

 

The joint and survivor
annuity and lump sum payment options described above shall be the Actuarial
Equivalent of the single life annuity payable over the lifetime of the
Participant. In addition the Actuarial Equivalent present value of a lump sum
that becomes payable before age 60 under section 4.2 shall be calculated
on a deferred-to-age 60 basis. In all other cases, the Actuarial Equivalent
present value of a lump sum payment shall be calculated on an immediate basis.

 

(d)           Change in Control Overide.

 

(1)         Notwithstanding anything
in this section 4.3 to the contrary, if a former Executive is entitled to
a benefit under section 4.1 or 4.2, and a Change in Control occurs before
the Benefit Commencement Date determined under

 

 

section 2.4(a) or
(b),  the benefit will be distributed to
such former Executive in the form of a lump sum.

 

(2)         Notwithstanding anything in this section 4.3
to the contrary, if a Change in Control occurs while a former Executive is
receiving annuity payments under the Plan, the annuity payments shall cease
upon the change in control and the Actuarial Equivalent value of all remaining
annuity payments shall be paid to such former Executive in a single lump sum
value as soon as administratively practicable following such Change in Control.

 

4.4  Change
in Control

 

(a)             Eligibility. Notwithstanding any provision in this Plan to
the contrary, a Participant will be entitled to a benefit under this section 4.4
if he or she is actively employed on the date of a Change in Control.

 

(b)             Amount. The change in control benefit calculated
under this section 4.4(b) represents the amount payable as a single
life annuity commencing on the Participant’s Benefit Commencement Date.
However, this change in control benefit shall actually be distributed to the
Participant in the form described in section 4.4(d). This Change in
Control benefit, when expressed as a monthly single life annuity, shall equal:

 

(1)         100 percent of the Participant’s Final
Average Compensation (determined as if the Participant incurred a Termination
of Service on the Change in Control date), reduced by the Participant’s Social
Security Benefit (also determined as if the Participant incurred a Termination
of Service on the Change in Control date); multiplied by

 

(2)         a fraction (not to exceed one) having—

 

(A)          a numerator equal to the Participant’s Years of Service; and

 

(B)           a denominator equal to 15.

 

When calculating
benefits payable under this section 4.4(b), the offset for the Social
Security Benefit shall be applied only as of the first day of the month
coinciding with or next following the date on which the Participant reaches age
62.

 

(c)             Commencement. Payment of benefits under this section 4.4
shall begin on the Participant’s Benefit Commencement Date (as determined under
section 2.4(c)).

 

(d)             Form of Payment.
The change in control benefit described in this section 4.4 shall be paid
in a single lump sum payment that is equal to the Actuarial Equivalent present
value of the monthly single life annuity calculated under section 4.4(b).
This present value shall be calculated on—

 

 

(1)         a
deferred-to-age 60 basis if the Participant is younger than age 60 as of his or
her Benefit Commencement Date; or

 

(2)         an
immediate basis if the Participant is age 60 or older as of his or her Benefit
Commencement Date.

 

(e)             Effect on Other Benefits. The benefit payable to a Participant who
satisfies the eligibility requirements described in this section 4.4(a) shall
be determined and paid under this section 4.4. Such Participant shall not
become entitled to any additional future benefits under section 4.1 or
4.2.

 

 4.5 Competing Activity Covenant

 

(a)             General Rule. Except as provided in section 4.5(b), a
former Participant who enters into competing activity (as defined in section 4.5(c))
with the Company or its Affiliates during the one-year period that begins on
the day following the date on which the Participant incurs a Termination of
Service shall return to the Company all payments received by the Participant
pursuant to section 4.1 or 4.2, and shall permanently forfeit the right to
any future Plan payments.

 

(b)             Attainment of Age 65. The restriction related to competing
employment ceases to apply when a Participant attains age 65. As a result, section 4.5(a) does
not apply to a Participant who incurs a Termination of Service upon or after reaching
age 65. In addition, if a Participant incurs a Termination of Service after
reaching age 64, but before reaching age 65, such Participant is subject to the
restriction described in section 4.5(a) only until he or she reaches
age 65.

 

(c)             Competing Activity Defined. A Participant shall be deemed to
be engaged in competing activities under this section 4.5 if he or she:

 

(1)         accepts employment from, or renders services
to, in any capacity whatsoever within the United States, to any Competing
Organization, or otherwise engages in any business activity in which it would
be helpful to the Participant or others with whom the Participant is
associated, to use or disclose any Confidential Information; except, however,
the Participant may accept employment with a Competing Organization
without violating this section 4.5 to the extent that the Compensation
Committee determines, in its sole and absolute discretion, that such employment
will not cause the Participant to be engaged in any way with the development,
production, marketing, or selling of a Competing Product, and would not
necessitate or benefit from the Participant’s use or disclosure of any
Confidential Information;

 

(2)         accepts employment from, or renders services
to, any Competing Organization in connection with the development, manufacture,
marketing, sale, merchandising, leasing, licensing, servicing, or promotion of
any Competing Product to any customer or potential customer of the Company with
which the

 

 

Participant
dealt personally, or with respect to which the Participant rendered services,
during his or her period of employment with the Company;

 

(3)         hires, attempts to hire, assists in hiring,
or causes to be hired by another person or organization any person who was an
employee of the Company at any time after the Participant first had contact
with such other person or organization (without regard to whether such contact
was initiated by the Participant) concerning the possible employment of Company
employees; and/or

 

(4)         identifies or furnishes any information about
any Company employee to any other person or organization for the purpose of
assisting or facilitating the hiring efforts of such other person or
organization.

 

 

Article 5. Preretirement Death Benefits

 

5.1 Eligibility

If a Participant dies
before his or her Benefit Commencement Date, the Participant’s Beneficiary
shall be entitled to the preretirement death benefit determined under this Article 5.

 

5.2 Amount

The preretirement death benefit calculated under this section 5.2
represents the amount payable to the Participant’s Beneficiary as a single life
annuity commencing on the Beneficiary’s Benefit Commencement Date. However,
this preretirement death benefit shall actually be distributed to the
Participant in the form described in section 5.4 below. The single
life annuity value of this preretirement death benefit shall be determined as
follows:

 

(a)             Death after Qualifying for Normal Retirement. In the case of
a Participant who dies after having met the eligibility requirements for a
normal retirement benefit under section 4.1, the Beneficiary shall be
entitled to a benefit, when expressed as a single life annuity, equal to the
survivor portion of the joint and 75 percent survivor annuity that would have
been payable to the Participant had the Participant retired and began receiving
a retirement benefit in the form of a joint and 75 percent survivor
annuity on the day before his or her death.

 

(b)             Death before Qualifying for Normal Retirement. In the case
of a Participant who dies before having met the eligibility requirements for a
normal retirement benefit under section 4.1, the Beneficiary shall be
entitled to a benefit, when expressed as a single life annuity, equal to the
survivor portion of the joint and 75 percent survivor annuity that would have
been payable to the Participant had the Participant retired under section 4.2
and began receiving a disability retirement benefit in the form of a joint
and 75 percent survivor annuity on the day before his or her death.

 

5.3 Commencement

Payment of benefits under this section 4.1 shall begin
on the Beneficiary’s Benefit Commencement Date (as determined under section 2.4(d)).

 

5.4 Form of Payment

The preretirement death
benefit described in this Article 5 shall be paid in a single lump sum
payment that is equal to the Actuarial Equivalent present value of the monthly
single life annuity calculated under section 5.2.

 

 

Article 6. Financing

 

6.1 Financing

The Plan is intended to
constitute an unfunded plan maintained for a “select group of management or
highly compensated employees” within the meaning of ERISA section 201(2).
The benefits under this Plan shall be paid either from general assets of the
Company, or from a trust fund whose assets would remain available to the
general creditors of the Company in the event of the Company’s insolvency. The
decision whether to establish and fund such a trust shall be made by the
Committee in its sole and absolute discretion.

 

6.2 Unsecured Interest

No Participant or Beneficiary shall have any interest
whatsoever in any specific asset of the Company or an Affiliate. To the extent
that any person acquires a right to receive payments under this Plan, such
right shall be no greater than the right of any unsecured general creditor of
an Employer.

 

 

Article 7. Administration

 

7.1 Administration

The Plan shall be
administered by the Committee. The Committee shall have all powers necessary or
appropriate to carry out the provisions of the Plan. It may, from time to time,
establish rules for the administration of the Plan and the transaction of
the Plan’s business.

 

The
Committee shall have the exclusive right to make any finding of fact necessary
or appropriate for any purpose under the Plan including, but not limited to,
the determination of eligibility for and amount of any benefit. Benefits under
this Plan shall be paid only if the Committee decides in its discretion that a
Participant or Beneficiary is entitled to them.

 

The
Committee shall have the exclusive right to interpret the terms and provisions
of the Plan and to determine any and all questions arising under the Plan or in
connection with its administration, including, without limitation, the right to
remedy or resolve possible ambiguities, inconsistencies, or omissions by
general rule or particular decision, all in its sole and absolute
discretion.

 

To
the extent permitted by law, all findings of fact, determinations,
interpretations, and decisions of the Committee shall be conclusive and binding
under all persons having or claiming to have any interest or right under the
Plan.

 

7.2 Assistance

The Committee may, in its sole and absolute discretion,
delegate any of its powers and duties under this Plan to one or more
individuals. In such a case, every reference in the Plan to the Committee shall
be deemed to include such individuals with respect to matters within their
jurisdiction.

 

7.3 Appeals from Denial of Claims

If any claim for benefits under the Plan is wholly or
partially denied, the claimant shall be given notice of the denial. The Committee
shall give this notice in writing within a reasonable period of time after
receipt of the claim. This period will not exceed 90 days after receipt of
the claim, except that if the Committee determines that special circumstances
require an extension of time, the period may be extended up to an
additional 90 days. Written notice of the extension shall be furnished to
the claimant prior to termination of the initial 90-day period, and it shall
indicate the special circumstances requiring an extension of time and the date
by which the benefit determination is expected.

 

Notice
of any claim denial shall be written in a manner calculated to be understood by
the claimant and shall set forth the following information:

 

(a)           the
specific reason or reasons for the denial;

 

(b)           specific
reference to pertinent Plan provisions on which the denial is based;

 

(c)             a
description of any additional material or information necessary for the
claimant to perfect the claim and an explanation of why this material or
information is necessary;

 

 

(d)             an
explanation that a full and fair review by the Committee of the decision
denying the claim may be requested by the claimant or his authorized
representative by filing with the Committee, within 60 days after such
notice has been received, a written request for review; and

 

(e)             a
statement of the claimant’s right to bring a civil action under ERISA section 502(a) following
an adverse decision upon review.

 

If
a claimant files a written request for review of a denied claim, the claimant
or his or her authorized representative may request, free of charge,
reasonable access to and copies of all documents, records, and other
information relevant to the claim and may submit written comments,
documents, records, and other information relevant to the claim within the 60-day
period specified in subsection (d) above. The notice of claim denial
shall include a statement of the claimant’s rights to review and submit
information pursuant to this paragraph.

 

The
review by the Committee shall take into account all comments, documents,
records, and other information submitted by the claimant relating to the claim
without regard to whether such material was submitted or considered as part of
the initial determination. The decision of the Committee upon review shall be
made promptly, and not later than 60 days after the Committee’s receipt of
the request for review. However, if the Committee determines that special
circumstances require an extension of time, this period may be extended up
to an additional 60 days. Written notice of the extension shall be
furnished to the claimant prior to termination of the initial 60-day period,
and it shall indicate the special circumstances requiring an extension of time
and the date by which the decision on review is expected.

 

If
the claim is denied, wholly or in part, the claimant shall be given a copy of
the decision promptly. The decision shall be in writing and shall be written in
a manner calculated to be understood by the claimant. The decision shall
include specific reasons for the denial; specific references to the pertinent
Plan provisions on which the denial is based; a statement that the claimant may request,
free of charge, reasonable access to and copies of all documents, records, and
other information relevant to the claim; and a statement of the claimant’s
right to bring a civil action under ERISA section 502(a).

 

7.4 Tax Withholding

The Company may withhold from any payment under this
Plan any federal, state, or local taxes required by law to be withheld with
respect to the payment and any sum the Company may reasonably estimate as
necessary to cover any taxes for which they may be liable and that may be
assessed with regard to the payment. Employment taxes with respect to amounts
deferred hereunder shall be payable in accordance with Code section 3121(v)(2) and
may be withheld from a Participant’s compensation if due prior to the time
of a distribution hereunder.

 

7.5 Expenses

The Company shall pay all expenses incurred in the
administration of the Plan.

 

 

Article 8. Adoption by an Affiliate; Amendment and Termination

 

8.1 Adoption by an Affiliate

An Affiliate may adopt the Plan by action of its board
of directors or authorized officers or representatives, subject to the approval
of the Committee.

 

8.2 Amendment and Termination

The Company hereby reserves the right to amend, modify, or
terminate the Plan at any time, and for any reason; provided that no such
amendment, modification or termination may reduce a Participant’s benefit
that accrued before the date of such amendment, modification, or termination.
Any such amendment, modification, or termination must be approved and adopted
by the Committee.

 

After
a Change in Control, any Plan termination or material modification or amendment
shall require the consent of a majority of the Participants, with weighted
voting based on their relative accrued benefits. Any other provision of this
Plan to the contrary notwithstanding, the Plan may be amended by the
Company at any time, and retroactively if required to the extent that, in the
opinion of the Company, such amendment shall be necessary in order to ensure
that the Plan will be characterized as a plan maintained for a select group of
management or highly compensated employees, as described in ERISA sections 201(2),
301(a)(3) and 401(a)(1), or to conform the Plan to the requirements
of any applicable law, including without limitation ERISA and the Code. No such
amendment shall be impermissible even if it reduces the amount of the
Participant’s accrued benefit.

 

Notwithstanding
any other provision hereof, the Plan shall be administered in a manner
consistent with the requirements of Code section 409A. In addition, if any
provision of this Plan would cause Participants to incur any additional tax or
interest under Code section 409A or any regulations or Treasury guidance
promulgated thereunder, the Company may reform such provision to
maintain to the maximum extent practicable the original intent of the
applicable provision without violating the provisions of Code section 409A.

 

 

Article 9. Miscellaneous Provisions

 

9.1 No Contract of Employment

Nothing contained in the
Plan shall be construed to give any Executive the right to be retained in the
service of the Company or an Affiliate or to interfere with the right of the
Company or an Affiliate to discharge an Executive at any time.

 

9.2 Nonalienation

No benefit payable under the Plan shall be subject in any
manner to anticipation, alienation, sale, transfer, assignment, pledge,
encumbrance, or charge. Any attempt to anticipate, alienate, sell, transfer,
assign, pledge, encumber, or charge shall be void. Benefits shall not be in any
manner subject to the debts, contracts, liabilities, engagements, or torts of,
or claims against, any Participant or Beneficiary, including claims of
creditors, claims for alimony or support, and any other like or unlike claims;
provided, however, that a qualified domestic relations order may assign
benefits to a former spouse of a Participant.

 

9.3 Severability

If any provisions of this Plan shall be held illegal or
invalid, the illegality or invalidity shall not affect its remaining parts. The
Plan shall be construed and enforced as if it did not contain the illegal or
invalid provision.

 

9.4 Applicable Law

Except to the extent preempted by applicable federal law,
this Plan shall be governed by and construed in accordance with the laws of the
State of Maryland.

 

9.5 Successors

The provisions of
this Plan shall bind and inure to the benefit of the Company and its successors
and assigns and the Participants and the Participants’ Beneficiaries.

 

9.6 Facility of Payment

If a distribution is
to be made to a minor, or to a person who is otherwise incompetent, then the
Committee may, in its discretion, make such distribution (a) to the legal
guardian, or if none, to a parent of a minor payee with whom the payee
maintains his or her residence, or (b) to the conservator or committee or,
if none, to the person having custody of an incompetent payee. Any such
distribution shall fully discharge the Committee, the Company and Plan from
further liability on account thereof.

 

 

In
Witness Whereof,
the authorized officers of the Company have signed this document on May 3,
2006, but effective as of July 1, 2006.

 

 

	
   

  	
  United
  Therapeutics Corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
  Attest:

  	
   

  
	
   

  	
   

  
	
   

  	
  By 

  	
        /s/ Roger Jeffs, Ph.D.

  	
   

  
	
   

  	
   

  	
  President & COO

  
	
   

  	
   

  
	
  By

  	
        /s/ Paul Mahon

  	
   

  	
   

  
	
   

  	
  Secretary

  	
   

  
						

 

 

Appendix A.
Participating Executives as of July 1, 2006

 

	
  Executive

  	
   

  	
  Employment
  Commencement Date

  
	
   

  	
   

  	
   

  
	
  Martine
  Rothblatt

  	
   

  	
  September 1,
  1997

  
	
   

  	
   

  	
   

  
	
  Roger
  Jeffs

  	
   

  	
  September 15,
  1998

  
	
   

  	
   

  	
   

  
	
  Fred
  Hadeed

  	
   

  	
  January 31,
  2000

  
	
   

  	
   

  	
   

  
	
  Paul
  Mahon

  	
   

  	
  June 16,
  2001

  
	
   

  	
   

  	
   

  
	
  [Two other officers are designated to participate]

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