Document:

aeon-ex1013_17.htm

 

Exhibit 10.13

 

[***] Certain information in this document has been excluded pursuant to Regulation S-K, Item 601(b)(10).  Such excluded information is not material and would likely cause competitive harm to the registrant if publicly disclosed.  

LICENSE & SUPPLY AGREEMENT

THIS LICENSE AND SUPPLY AGREEMENT (hereinafter this “Agreement”) is entered into this 20th day of December, 2019 (the “Effective Date”), by and between Daewoong Pharmaceutical Co., Ltd, a corporation organized and existing under the laws of the Republic of Korea, having its main office at Bongeunsaro 114-gil 12, Gangnam-gu, Seoul 06170 (hereinafter “DAEWOONG”); and AEON Biopharma, Inc., a corporation organized and existing under the laws of Delaware, United States, having its main office at 4040 MacArthur Blvd, Newport Beach, CA, USA 92660 (hereinafter “AEON”).

For the purpose of this Agreement, DAEWOONG and AEON will be referred to respectively as a “Party” and collectively as “Parties.”

WITNESSETH:

WHEREAS, DAEWOONG has extensive experience in research, development and manufacture of Product and owns valuable technical information and know-how on manufacture, use, market and sale of Product;

WHEREAS, DAEWOONG has the rights for distribution, importation, drug registration, promotion, marketing and sale of Product and AEON desires to obtain an exclusive license to the same in the Territory in the Field subject to the terms and conditions set out in this Agreement and DAEWOONG desires to grant such an exclusive license in the Territory in the Field;

WHEREAS, DAEWOONG has the capability to manufacture and supply Product to AEON and AEON desires to purchase the Product for Clinical Trials and for resale in the Territory in the Field from DAEWOONG; 

WHEREAS, Evolus, Inc. (“Evolus”) paid consideration in the amount of 1,000,000 USD to DAEWOONG pursuant to that certain License and Supply Agreement dated September 30, 2013, as amended, for the exclusive option to exercise the right to expand the permitted uses of the Product to include all therapeutic uses (the “Option”) and, furthermore, the Option was exercised in consideration for the payment of 7,500,000 USD to DAEWOONG pursuant to those certain notices of exercise delivered to DAEWOONG on September 21, 2018; provided that such therapeutic use rights associated with the Option were held in trust for the benefit of AEON pending the execution of this Agreement; and 

WHEREAS, both Parties desire to ensure that Information that is disclosed to the other Party shall remain confidential during the Term and after the termination of this Agreement, for any reason whatsoever.

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NOW THEREFORE, in consideration of the foregoing premises and the mutual covenants contained herein, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto agree as Follows:

Article 1. Definitions.

Unless specifically set forth to the contrary herein, the following terms, whether used in the singular or plural, shall have the respective meanings set forth below:

	
 
	
1.1
	
“Affiliates” with respect to any Person means (a) any corporation or business entity of which fifty percent (50%) or more of the securities or other ownership interests representing the equity, the voting stock or general partnership interest are owned, controlled or held, directly or indirectly, by such Person; or (b) any corporation or business entity which, directly or indirectly, owns, controls or holds fifty percent (50%) (or the maximum ownership interest permitted by law) or more of the securities or other ownership interests representing the equity, the voting stock or if applicable, the general partnership interest, of such Person; or (c) any corporation or business entity of which fifty percent (50%) or more of the securities or other ownership interests representing the equity, the voting stock or general partnership interest are owned, controlled or held, directly or indirectly, by a Person described in (a) or (b).

	
 
	
1.2
	
“Agreement” has the meaning set forth in the preamble.

	
 
	
1.3
	
“Certificate of Analysis” means a certificate in writing, signed by an authorized employee of DAEWOONG, that certifies the conformity of Product to the relevant Technical Specifications.

	
 
	
1.4
	
“Certificate of Compliance” means a certificate in writing, signed by an authorized employee of DAEWOONG, that certifies that Product was manufactured in compliance with GMP and cGMP.

	
 
	
1.5
	
“Clinical Research Organization” or “CRO” means independent organization that provides outsourced pharmaceutical research services or Clinical Trial for drugs.

	
 
	
1.6
	
“Clinical Trial” means any research study of Product with human subjects designed to provide specific data to determine either or both of the safety and efficacy of Product for filing a regulatory application as required under Code of Federal Regulations Title 21.

	
 
	
1.7
	
“Commercial Launch” means the first commercial sale by AEON or its Affiliates of Product in the Field to a distributor, wholesaler or other person engaged in the commercial business similar thereto for distribution, or to an end user or a consumer in the Territory.

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1.8
	
“Commercialize” or “Commercialization” means any action directed to developing, marketing, promoting, distributing, importing or selling Product in the Field. Commercialize will also include post-approval Clinical Trials.

	
 
	
1.9
	
“Commercialization Plan” means, with respect to Product, any and all plans and activities directed to the development, marketing, promotion, distribution, offering for sale, and selling of Product and importing Product for sale in the Territory in accordance with this Agreement any plan for Regulatory Approval and any Marketing Plan, as set forth in Annex B hereto.

	
 
	
1.10
	
“Commercially Reasonable Efforts” means, with respect to a Party’s obligations under this Agreement, the carrying out of such obligations or tasks in a diligent manner consistent with customary practices of comparable companies in the specialty pharmaceutical industry for the development or commercialization of a comparable pharmaceutical product at a similar stage of development or commercialization in light of the intellectual property and competitive landscape relevant to such product, the safety and efficacy profile of a product, the development and regulatory approval (including any reimbursement approval) risks associated with such product, and the anticipated commercial viability.  

	
 
	
1.11
	
“Competitive Product” means any product that is classified as an injectable botulinum toxin (other than the Product) launched in the Territory after the Effective Date of this Agreement

	
 
	
1.12
	
“DAEWOONG Trademarks” has the meaning set forth in Article 3.2.

	
 
	
1.13
	
“Effective Date” has the meaning set forth in the preamble.

	
 
	
1.14
	
“Field” means all therapeutic uses, including without limitation headache, upper limb spasticity, cervical dystonia, hyperhidrosis, blepharospasm, strabismus, overactive bladder, neuropsychiatric, gastrointestinal and other therapeutic indications.

	
 
	
1.15
	
“GMP” or “GMPs” shall mean Good Manufacturing Practices as determined by applicable regulatory requirements set forth by relevant Governmental Authorities of the applicable jurisdiction and “cGMP” shall mean current Good Manufacturing Practices as determined by applicable regulatory requirements set forth by relevant Governmental Authorities of the applicable jurisdiction.

	
 
	
1.16
	
“Governmental Authority” or “Governmental Authorities” means any supranational, national, regional, state or local government, court, governmental agency, authority. board bureau, instrumentality or regulatory body.

	
 
	
1.17
	
“Governmental Authorization” means any approval, permit, license, certificate, franchise, permission, clearance, registration, qualification or other authorization issued, granted, given or otherwise made available by or under the authority of any Governmental Authority or pursuant to any law.

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1.18
	
“Information” means any and all information disclosed or otherwise made available by one Party (the “Disclosing Party”) to the other Party (the “Receiving Party”), its agents, independent contractors or employees in any manner, whether communicated in writing or orally or by any method and all copies thereof, including without limitation, any business information. such as product or marketing plans and strategies, vendor or customer relationships, finances, or business operations or affairs, any information of legal nature, any information or know-how of scientific, technical or clinical nature, related to research or development efforts, future development, trade secrets, manufacturing processes, engineering, designs. Clinical Trial, field tests, process, technique, work‐in‐process, algorithm, program, design, drawings formula or test data, formulations and methods of manufacture or use, and any other information which is or has been disclosed by the Receiving Party.

	
 
	
1.19
	
“Initial Marketing Plan” means the initial Marketing Plan of Product as set forth in the Commercialization Plan.

	
 
	
1.20
	
“Initial Term” has the meaning set forth in Article 15.1.

	
 
	
1.21
	
“Joint Steering Committee” or “JSC” has the meaning set forth in Article 11.1.

	
 
	
1.22
	
“Legal Proceeding” means any action, suit, litigation, arbitration, proceeding (including any civil, criminal, administrative, investigative or appellate proceeding), hearing, inquiry, audit, examination or investigation commenced, brought conducted or heard by or before, or otherwise involving, any court or other Governmental Authority or any arbitrator or arbitration panel.

	
 
	
1.23
	
“Manufacturing Plan” means the manufacturing plan as agreed by the Parties periodically.

	
 
	
1.24
	
“Marketing Authorization” means approval from the relevant Governmental Authority necessary to market and sell Product in the Territory as a pharmaceutical or commercial product in any formulation or dosage form, together with ah subsequent submissions, supplements and amendments thereto.

	
 
	
1.25
	
“Marketing Authorization Application” means an application for permit, report, or other regulatory submission filed in accordance with the laws or regulations of the relevant Governmental Authorities to obtain a Marketing Authorization.

	
 
	
1.26
	
“Marketing Plan” means each marketing plan of Product agreed by Parties periodically and set forth in the Commercialization Plan.

	
 
	
1.27
	
“Material” means ingredients, contents, composition, or components of Product.

	
 
	
1.28
	
“Net Sales” means the net sales on behalf of AEON and any of its Affiliates or authorized sublicensees or assignees for Product sold to third parties other than sublicensees/assignees, as determined in accordance with generally accepted accounting principles consistently applied at AEON (“Accounting Principles”). The deductions booked by AEON and its Affiliates, sublicensees and assignees to calculate the recorded net sales from gross sales include the following:

	
 
	
(a)
	
Normal trade and cash discounts;

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(b)
	
Amounts repaid or credited by reasons of defects, rejections, recalls or returns;

	
 
	
(c)
	
Rebates and chargebacks to customers and third parties (including, without limitation, Medicare, Medicaid, TriCare, Managed Healthcare);

	
 
	
(d)
	
Any amounts recorded in gross revenue associated with goods provided to customers for free – with the exception of samples;

	
 
	
(e)
	
Amounts provided or credited to customers through coupons, other discount programs and co-pay assistance programs;

	
 
	
(f)
	
Delayed ship order credits, discounts or payments related to the impact of price increases between purchase and shipping dates; and

	
 
	
(g)
	
Fee for service payments to customers for any non-separable services (including compensation for maintaining agreed inventory levels and providing information).

Provided, however, with respect to the calculation of Net Sales: (i) Net Sales only include the value charged or invoiced on the first sale to a third party and sales between or among AEON and its Affiliates and authorized sublicensees/assignees shall be disregarded for purposes of calculating Net Sales; (ii) if Product is delivered to the third party before being invoiced (or is not invoiced), Net Sales will be calculated at the time all the revenue recognition criteria under Accounting Principles are met; and (iii) distributors/resellers shall not be considered as sublicensees/assignees.

Upon the request of DAEWOONG, but not exceeding once in any one (1) year period and upon reasonable notice, AEON shall permit an independent certified accountant, selected by DAEWOONG and acceptable to AEON, which acceptance shall not be unreasonably withheld, to have access to such records of AEON as may be necessary to verify the accuracy of the Net Sales submitted to DAEWOONG hereunder.  The independent certified accountant shall verify to DAEWOONG the amount of Net Sales by country and disclose no other information revealed in its audit. Any such audit of records shall be at DAEWOONG’S expense.

	
 
	
1.29
	
“Person” means an individual, partnership, corporation, joint stock company, estate, trust (including a business trust), limited liability company, unincorporated association, joint venture or other entity or a Governmental Authority.

	
 
	
1.30
	
“Product(s)” means any pharmaceutical or biological preparation containing botulinum toxin type A with 900 kDa protein complex for therapeutic use in the Territory.

	
 
	
1.31
	
“Product Samples” mean any form of Product to be used solely for promotional purposes and identified with appropriate wording, if necessary.

	
 
	
1.32
	
“Protocol” means a document that describes the objectives, design, methodology, statistical considerations mid process of a Clinical Trial.

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1.33
	
“Purchase Order” means a written order in substantially in the form set forth in Annex C attached hereto, setting forth (a) Product to be supplied, (b) delivery dates, (c) applicable Product price, and (d) any other terms and conditions for manufacturing such Product, as set forth in Annex C.

	
 
	
1.34
	
“Regulatory Approval” means any applicable approvals of any Governmental Authorities, including without limitation, where applicable, Marketing Authorization, schedule classifications, permits, licenses, registration, necessary and relevant to market, distribute, promote and commercialize Product in the Territory.

	
 
	
1.35
	
“Technical Specification” means the set of requirements or standards to be met by Product as set forth in Annex E, as may be amended from time to time by mutual agreement of the Parties.

	
 
	
1.36
	
“Term” means the Initial Term together with any Renewal Term.

	
 
	
1.37
	
“Territory” means the United States of America and its territories and possessions, the EU, Australia, Canada, Russia, and the CIS, and South Africa. As used herein, (a) “EU” means all of the European Union member states as of the applicable time during the Term (for the avoidance of doubt, including the United Kingdom) and (b) CIS means all of the Commonwealth of Independent member states as of the applicable time during the Term. From time to time in this Agreement, all regions within the Territory other than the United States of America and its territories and possessions are sometimes referred to herein as the “Non-US Territory”, and the United States and its territories and possessions are referred to as the “US Territory.”

	
 
	
1.38
	
“Trademark” means NabotaTM.

Article 2. License; Exclusivity; Right of First Negotiation.

	
 
	
2.1
	
During the Term, DAEWOONG hereby grants to AEON an exclusive (even as to DAEWOONG and its Affiliates) right and license, to import, distribute, promote, market, develop, offer for sale and otherwise commercialize or exploit Product in the Field in the Territory. AEON shall have the right to Commercialize Product through one or more third party distributors and/or resellers, and AEON’s relationship with any such distributor-reseller shall not constitute a sublicense hereunder.

	
 
	
2.2
	
Subject to the terms and conditions of this Agreement: (a) DAEWOONG shall manufacture and supply Product for the Territory for the Field exclusively to AEON and its Affiliates; and (b) subject to Article 4.9, AEON and its Affiliates shall purchase all of its requirements of Product for the Territory for the Field exclusively from DAEWOONG.

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2.3
	
Except as specifically set forth in this Agreement AEON and its Affiliates will not acquire any license or other intellectual property interest, by implication or otherwise, in any Information disclosed to it under this Agreement or under any patent rights owned or otherwise controlled by DAEWOONG or its Affiliates.

	
 
	
2.4
	
In the event that DAEWOONG or its Affiliates intend to directly or indirectly (i) develop or commercialize, or (ii) assist any other Person to develop or commercialize, any Competitive Product, DAEWOONG shall promptly provide written notice thereof to AEON. If within [***] of receipt of such notice, AEON elects to expand the definition of Product to include a Competitive Product, DAEWOONG shall negotiate in good faith exclusively with AEON the terms and conditions of such expansion. If the Parties fail to reach a definitive agreement within [***] of AEON’s election, DAEWOONG shall be free to develop and commercialize the applicable Competitive Product itself or provide such rights to a third party, provided; however, that if DAEWOONG offers to, or is prepared to accept an offer from, any such third party on terms more favorable to such third party than those last offered to AEON, it shall notify AEON, and AEON shall have [***] to accept such terms. If within [***] following DAEWOONG’s initial notice under this Article 2.4, DAEWOONG does not commence development and commercialization activities for such Competitive Product (as evidenced by a filing for regulatory approval to begin clinical studies in the United States) or does not enter into a definitive agreement with a third party to develop and commercialize such Competitive Product, AEON’s right of first negotiation and right of first refusal under this Article 2.4 shall be re-instated.

Article 3. Trademarks.

	
 
	
3.1
	
Nothing in this Agreement shall require or oblige AEON to use the DAEWOONG Trademarks in relation to Product. However, any marketing, promotion, sale and/or distribution by AEON of Product that carries, or sold by reference to, the DAEWOONG Trademarks shall be governed by the relevant provisions of this Agreement.

	
 
	
3.2
	
DAEWOONG shall, at its own expense, register and maintain the trademark(s) used by DAEWOONG and its Affiliates in connection with Product, including, without limitation, the Trademark (collectively, the “DAEWOONG Trademarks”); provided, however, that DAEWOONG shall not change, amend or otherwise modify the DAEWOONG Trademarks in the Territory without the prior written consent of AEON. AEON shall have no rights in respect to the DAEWOONG Trademarks, designs, copyrights and other proprietary rights used on or embodied in Product except as necessary to accomplish the purpose of this Agreement.

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3.3
	
Each Party shall notify the other Party of any actual, suspected or threatened infringement, violation or misappropriation within the Territory of the DAEWOONG Trademarks (“Infringement”) that comes to its attention. DAEWOONG shall have the sole and exclusive right to send notices and bring and conduct action in relation to any Infringement in the Territory; provided, however, in the event that DAEWOONG does not take reasonable steps to prevent any individual Infringement within thirty (30) days of becoming aware or receiving written notice thereof, AEON shall thereafter have the sole right (but shall not be under any obligation in this regard) to send notices and bring and conduct actions in relation to such Infringement. The Parties will cooperate fully with each other in taking all reasonable steps requested by the other Party in connection with any Infringement action, including joining in any Legal Proceedings. DAEWOONG shall bear the costs of any such Legal Proceedings, and shall be entitled to any damages, account of profits and/or awards of costs recovered.

	
 
	
3.4
	
DAEWOONG hereby grants to AEON an exclusive, irrevocable, sub‐licensable, assignable, fully paid-up license during the Term: (a) to use the DAEWOONG Trademark(s) to import, distribute, promote, market, offer for sale and otherwise commercialize or otherwise exploit Product in the Territory in the Field, and (b) to prepare, obtain and maintain Marketing Authorization in the Territory for the Field. For the avoidance of doubt, the rights granted to AEON hereunder is limited in the Territory and only for the Field and within the limits provided by this Agreement.

	
 
	
3.5
	
AEON shall not alter or add to DAEWOONG Trademark(s) without the prior written consent of DAEWOONG. For the avoidance of doubt, AEON may use its trade name, trademarks and logos on packaging, leaflets, advertising and promotional materials for Product together with the DAEWOONG Trademarks.

	
 
	
3.6
	
During the Term, AEON shall not (a) contest the validity of the DAEWOONG Trademarks; or (b) without the prior written consent of DAEWOONG, apply, or attempt to apply, for the registration or use, in the Territory or anywhere else, of the DAEWOONG Trademarks or any trademarks identical with or confusingly similar to the DAEWOONG Trademarks.

	
 
	
3.7
	
After the Term, AEON shall refrain from any further use of the DAEWOONG Trademarks or of any marks which may cause confusion to a third party; provided, however, that DAEWOONG shall grant AEON permission to sell off Product sourced from DAEWOONG prior to the end of the Term. [***].

Article 4. Supply of Product.

	
 
	
4.1
	
DAEWOONG shall manufacture and supply Product to AEON in a primary packaged and labeled form. Product packaging shall display the logo of DAEWOONG (to the extent required by applicable law) and AEON and the outer label shall be marked using English language in accordance with applicable laws and Product’s Regulatory Approvals.

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4.2
	
AEON’s estimate sales forecast of the Product during the Term of Agreement in the Territory in the Field is set forth in Annex D. Within ninety (90) days after the Effective Date, AEON shall provide DAEWOONG with a non-binding twelve (12) month rolling forecast of its requirements of Product, which the Parties agree is not a commitment to buy any stated quantity. Thereafter, on at least a quarterly basis, AEON shall provide DAEWOONG with an updated twelve (12) month rolling forecast, together with a binding six (6) month forecast to the extent AEON has requested Safety Stock as described in Article 4.10 below. Each such forecast shah be referred to herein as a “Forecast.”

	
 
	
4.3
	
AEON may from time to time submit Purchase Orders to DAEWOONG for Product in accordance with the forecasting requirements in Article 4.2. Orders will be shipped on CIF Los Angeles port.

	
 
	
4.4
	
Once a Purchase Order for Product and Product Samples has been received by DAEWOONG, it shall be considered as irrevocable.

	
 
	
4.5
	
AEON agrees herein to place an Order for Product not later than [***] from receipt of Regulatory Approval.

	
 
	
4.6
	
Individual Purchase Orders of Product shall be placed at least [***] in advance of the required delivery date.

	
 
	
4.7
	
For the purpose of Commercialization, AEON will store and maintain the full quantity of Product in a clean, secured area in accordance with the reasonable directions and specifications provided by DAEWOONG in writing in connection thereof in the Territory. AEON will advise DAEWOONG on the applicable requirements specifically deriving from the laws and regulations in the Territory.

	
 
	
4.8
	
AEON agrees that DAEWOONG and its collaborators and agents, in DAEWOONG’s sole discretion, which collaborators and Agents will be subject to appropriate obligations of confidentiality, will have the right upon reasonable prior notice, to observe and to inspect and to audit AEON’s facility to ascertain compliance by AEON with the terms of this Agreement, including without limitation (a) the holding facilities for Product, and (b) AEON’s compliance with applicable law, including cGMP (if applicable). Following any such audit, DAEWOONG will discuss its observations and conclusions with AEON and corrective actions, if any, will be agreed upon by the Parties, and executed by AEON using Commercially Reasonable Efforts.

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4.9
	
In addition to any other rights and remedies available to AEON, AEON shall have the right to recover lost profits in the event that DAEWOONG fails to deliver at least [***] in any [***] (a “Supply Default Event”). For purposes of this provision, lost profits would be equal to [***] of AEON operating profit (sales less direct expenses and the puce paid by AEON for such Products) on Products that have not been shipped against firm Purchase Orders during the period leading up to the Supply Default Event and bona fide Purchase Orders submitted by AEON that are consistent with the Forecast during the Supply Default Period (as defined below). Such payment shall be made with respect to all Product not shipped in the period giving rise to the Supply Default and for the period until DAEWOONG is again timely shipping Product to meet AEON’s needs (the “Supply Default Period”). The first such payment shall be made within [***] of the Supply Default Event, and every [***] thereafter.

AEON agrees to permit full disclosure to DAEWOONG of AEON’s accounting records, solely related to the calculation of lost profits, for the [***] ending on the first day of the month in which the Supply Event Default occurred. 

In the event that DAEWOONG is unable to supply both AEON’s requirements of Product and its own and third parties’ requirements for Product, DAEWOONG shall allocate Product that DAEWOONG has in inventory and that DAEWOONG is able to Product, so that AEON receives its requirements of Product in priority to DAEWOONG and third parties.

	
 
	
4.10
	
At the request of AEON, DAEWOONG shall at its own cost and expense during the Term, maintain an amount of inventory of Product equal to AEON’s requirements for Product for [***] based on AEON’s most recent forecast (“Safety Stock”). The Safety Stock shall be (i) maintained for the sole benefit of AEON and its Affiliates, (ii) shall be stored at a secure facility in compliance with GMP, and (iii) shall not be used for the benefit of any other customer of DAEWOONG. DAEWOONG shall rotate the Safety Stock on a “First Expiry-First Out” basis for routine fulfillment of firm orders, subject to Article 7.9. Such Safety Stock shall be independent of any safety stock maintained for the benefit of DAEWOONG or any other customer of DAEWOONG. in the event DAEWOONG is not able to supply AEON Product pursuant to any firm Purchase Order, DAEWOONG shall draw upon the Safety Stock maintained for AEON to make up for any shortfall. Within five (5) days after the end of each calendar quarter, DAEWOONG shall deliver a report to AEON describing the quantities of the Safety Stock remaining as of the end of such quarter.

Article 5.[Intentionally Omitted].

Article 6.Price.

	
 
	
6.1
	
For Product ordered by AEON, AEON shall pay to DAEWOONG the prices set forth in Annex A hereto, calculated on CIF Los Angeles port. In the event that any Product is not timely shipped, the price for such late order shall be reduced by [***] for each full week of delay.

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6.2
	
All amounts payable and calculations made hereunder shall be in United States Dollars (“USD”) payable within [***] of invoice receipt, except to the extent such invoices, or any part thereof, are disputed in good faith by AEON; provided, that, if the invoice receipt date is prior to shipment of the applicable Products, the [***] shall instead be calculated from the shipment date.

	
 
	
6.3
	
DAEWOONG is not liable for and DAEWOONG will not reimburse, or otherwise pay, for any cost due to any possible devaluation of any local currency corresponding to the value of USD.

	
 
	
6.4
	
Unless otherwise provided by the relevant laws or treaties, any sales and similar taxes imposed by any Governmental Authorities in relation to the payments made under this Agreement shall be paid by AEON regardless to whom they are charged, and AEON shall not withhold the payment to DAEWOONG, in whole or in part, for such taxes.

	
 
	
6.5
	
AEON shall be responsible for obtaining and maintaining any and all authorizations from Governmental Authorities in the Territory and for making all the payments to DAEWOONG hereunder; provided, however, that DAEWOONG shall provide AEON with all necessary information to enable AEON to obtain and maintain any such authorization.

	
 
	
6.6
	
If any sum due and payable under this Agreement by AEON shall not have been paid on or before the applicable due date, simple interest shall accrue on the unpaid amount at the rate of [***] % per annum, calculated on a daily basis from the due date until the date actual payment is made, without prejudice to any other claim or remedy available to DAEWOONG, except to the extent such invoices, or any part thereof, are disputed in good faith by AEON. AEON also agrees to pay all collection costs, including DAEWOONG’s legal costs for the collection of any amount due and unpaid, to the extent that such amounts are determined by a court of competent jurisdiction or other applicable Governmental Authority to be due to DAEWOONG. Without prejudice to any of its other rights, DAEWOONG may withhold shipments of Product if AEON has not paid any invoice when due, except to the extent such invoices, or any part thereof, are disputed in good faith by AEON.

Article 7.Quality; Acceptance and Rejection; Indemnification.

	
 
	
7.1
	
Quality.

	
 
	
(a)
	
Product supplied hereunder by DAEWOONG shall meet the Technical Specifications. DAEWOONG shall not subcontract or delegate any portion of its obligations hereunder to a third party or Affiliate without the prior written consent of AEON. Changes to the Technical Specifications require prior written approval of AEON and in the event that compliance with such change requires additions and/or modifications to the existing product registrations of AEON or its Affiliates, the Parties will meet to decide how to implement the change.

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(b)
	
DAEWOONG warrants that (i) it shall manufacture and supply Product and carry on operations at its Product facility in full compliance with (A) cGMP and standards specified by GMP, the drug master files, and all other regulatory guidelines and requirements as applicable, and (B) all legal requirements, including, the prevailing laws and regulations on health, safety and environmental protection, and (ii) Product will not be adulterated or misbranded within the meaning of the Federal Food, Drug and Cosmetic Act, as amended from time to time.

	
 
	
(c)
	
Each time DAEWOONG ships Product to AEON, or an Affiliate or designee of AEON, it shall provide AEON with a Certificate of Analysis and a Certificate of Compliance. During the Term, DAEWOONG shall keep and maintain a drug master file for the Product and authorize AEON to incorporate by reference all information and documentation contained therein.

	
 
	
(d)
	
Following thirty (30) days prior written notice (or sooner to the extent required by any Governmental Authority), DAEWOONG shall allow AEON (or its designee) to visit the facilities where the Product is manufactured during regular business hours to assure AEON of the quality standards used. DAEWOONG shall make documentation available for on-site inspections at DAEWOONG’s site and provide to AEON information reasonably requested by AEON to (i) assist AEON in determining whether any delivery complies fully with the terms of this Agreement; (ii) assist AEON or its Affiliates in obtaining any and all regulatory approvals necessary to market proprietary products containing Product; and/or (iii) enable AEON to comply with any statutory or regulatory requirements, or with a request by any Governmental Authority.  

	
 
	
7.2
	
Promptly upon receipt of each shipment of Product, AEON shall diligently inspect each Product as to any defects or missing quantities, as far as reasonably practical.

	
 
	
7.3
	
If AEON determines that any such Product is damaged or defective, AEON will notify DAEWOONG in writing, providing a complete report on the nature, effects, possible cause and relevancy of the defect, and deliver to DAEWOONG no later than [***] after the receipt of such Product by AEON.

	
 
	
7.4
	
AEON shall not return Product to DAEWOONG without prior written consent of DAEWOONG (such consent shall not be unreasonably withheld) in connection with a claim made pursuant to Article 7.3.

	
 
	
7.5
	
When a claim of defect or damages is made by AEON, DAEWOONG shall analyze a sample of Product taken from such delivered quantity. Should DAEWOONG find the claim of AEON is justifiable, then DAEWOONG shall promptly replace, at its expense, such Product with defect with equal quantity of Product that meets the Technical Specifications.

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7.6
	
In the event that DAEWOONG does not agree with AEON that Product that has been rejected under the provisions of this Article 7 fails, the matter shall, at the request of either Party, be submitted to an independent analytical laboratory acceptable to both Parties, which will resolve the discrepancy in the analysis taking into consideration the counter-sample of the rejected Product kept by DAEWOONG. The decision of said laboratory shall be final, not subject to appeal and neither Party shall unreasonably withhold its approval of an independent laboratory proposed by the other.

	
 
	
7.7
	
Should the independent laboratory agree with the complaint, then:

	
 
	
(a)
	
The last sentence of Article 7.5 shall apply; and

	
 
	
(b)
	
The cost of the assay and any other services performed by the independent laboratory shall be borne by the Party whose opinion was not supported by the independent laboratory.

	
 
	
7.8
	
Article 7.7 shall not apply, where Parties agree or the independent laboratory declares that:

	
 
	
(a)
	
Product meets the Technical Specifications; or

	
 
	
(b)
	
the failure of such non-conforming Product results from AEON’s:

	
 
	
(i)
	
negligent or defective transportation of Product following the delivery condition by DAEWOONG; or

	
 
	
(ii)
	
negligent or defective handling, storage or use of Product by AEON.

	
 
	
7.9
	
All Product supplied by DAEWOONG to AEON shall have [***] of DAEWOONG’s shell life as approved by the FDA or any other Governmental Authority at time of receipt by AEON. Subject to the foregoing, (a) DAEWOONG shall not be responsible for any expired units of Product, including without limitation to those returned by wholesalers, pharmacists, doctors, or other Persons to whom AEON sold Product in the Territory, and (b) AEON shall not be entitled to any replacement of the expired Product or to any compensation of any kind from DAEWOONG.

	
 
	
7.10
	
Each Party will, at its own expense, carry and maintain, during the Term and a subsequent period of [***] after its expiry or termination whatever the cause and the time may be, insurance sufficient to cover its obligations and liabilities hereunder.

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7.11
	
AEON shall indemnify, defend, and hold harmless DAEWOONG and its employees, officers, directors and agents (hereinafter respectively referred to as an “DAEWOONG Indemnitee”) from and against, any and all losses, costs, expenses, liabilities and damages of every kind and nature (including, without limitation, reasonable attorney fees) (hereinafter collectively referred to as “Claims”) incurred by a DAEWOONG Indemnitee arising from: (a) willful misconduct or any grossly negligent acts or omissions on the part of AEON or its employees or agents in performing duties obligations in connection with this Agreement, or (b) AEON’s breach of this Agreement except to the extent that any such Claim is caused by DAEWOONG’s own willful misconduct or grossly negligent acts or omissions. DAEWOONG agrees to give AEON prompt written notice of any Claim, and agrees to reasonably cooperate with AEON in the defense of any Claim, provided that each DAEWOONG Indemnitee will be entitled to participate in the defense of any Claim and employ counsel at its own cost and expense.

	
 
	
7.12
	
DAEWOONG shall indemnify, defend, and hold harmless AEON and its employees, officers, directors and agents (hereinafter respectively referred to as an “AEON Indemnitee”) from and against any and all Claims arising from; (a) willfull misconduct or any grossly negligent acts or omissions on the part of DAEWOONG or its employees or agents in performing duties obligations in connection with this Agreement; (b) DAEWOONG’s breach of this Agreement, or (c) an allegation that Product or any DAEWOONG Trademark infringes or misappropriates the rights, including without limitation intellectual property rights, of a third party; except to the extent that any such Claim is caused by AEON’s own willful misconduct or grossly negligent acts or omissions. AEON agrees to give DAEWOONG prompt written notice of any Claim, and agrees to reasonably cooperate with DAEWOONG in the defense of any Claim, provided that each AEON Indemnitee will be entitled to participate in the defense of any Claim and employ counsel at its own cost and expense.

	
 
	
7.13
	
In the event and to the extent of any Recall or Seizure of any Product, as hereinafter defined, due to an improper act or omission of DAEWOONG or a third party acting on its behalf (excluding AEON or its Affiliates), DAEWOONG shall, at the written election of AEON and, without limiting DAEWOONG’s indemnity obligations under Article 7.12. [***]. For purposes of this Agreement, “Recall” means (i) any action by AEON or any of its Affiliate to recover title to or possession of any Product sold or shipped (including market withdrawal) based on Governmental Authority action or the good faith belief of AEON or such Affiliate that such action was necessity under the circumstance, and/or (ii) any decision by AEON not to sell or ship Product to third parties that would have been subject to recall if it had been sold or shipped, in each ease taken in the good faith belief that such action was necessary under the circumstances; and “Seizure” means any action by any Governmental Authority to detain or destroy any Product.

14

 

	
 
	
7.14
	
Within thirty (30) days following the Effective Date, the Parties shall agree upon and implement a (a) quality agreement specifying the responsibilities of each Party with respect to quality and regulatory requirements; and (b) procedure for the mutual exchange of adverse event reports and safety information associated with the Product. Details of the operating procedure respecting such adverse event reports and safety information exchange shall be the subject of a mutually-agreed written pharmacovigilance agreement between the Parties which shall be entered into within such thirty (30) day period.

Article 8. Technical Assistance.

	
 
	
8.1
	
If AEON requests that DAEWOONG provide AEON with technical assistance with the Commercial Plan or a Clinical Trial, including without limitation information and illustrated material, and advertising material suitable for the promotion and advertising of Products, then DAEWOONG shall provide such assistance at no cost or expense to AEON.

	
 
	
8.2
	
Any expenses of AEON’s personnel dispatched for training shall be borne by AEON. Further, if the training is completed in the Territory, AEON shall also compensate expenses incurred by DAEWOONG personnel who train AEON’s personnel.

Article 9. Drug Registration.

	
 
	
9.1
	
The Parties agree to fully cooperate in good faith under this Agreement in connection with the Marketing Authorization(s), supplying and commercialization of Product in the Territory in the Field to the extent permitted by any applicable laws. For purposes thereof, each Party shall provide (or request its Affiliates to provide) to the other Party and/or the JSC any necessary Information and such other information as may be reasonably required under this Agreement.

	
 
	
9.2
	
During the Term, AEON, at its sole cost and expense, shall use Commercially Reasonable Efforts to (i) obtain Regulatory Approvals required by Governmental Authorities in relation to the Commercial Plan of Product in Territory in the Field, including but not limited to preparing and filing all necessary applications and (ii) maintain any such Regulatory Approvals.  

	
 
	
9.3
	
During the Term, AEON agrees to use Commercially Reasonable Efforts to achieve all Regulatory Approvals necessary for Products to be marketed in the Territory in the Field. AEON shall be responsible for preparing, submitting requirements and prosecuting any study for the Marketing Authorization in the Territory in the Field. AEON shall be responsible for completing all technical non-clinical studies and Clinical Trials required for such Marketing Authorization Application(s). DAEWOONG will provide all materials and documentations requested by AEON to register the Product in the Territory. [***]. For avoidance of doubt, any documents, study results and reports made pursuant to this Article 9 or otherwise communicated between the Parties will be subject to the confidentiality provisions of Article 14. Further, AEON and its consultants shall exercise Commercially Reasonable Efforts to achieve Marketing Authorization for a Product in the Territory in the Field.

15

 

	
 
	
9.4
	
Each Party shall provide the other Party with reasonable prior notice of all material meetings, conferences and discussions scheduled with any relevant Governmental Authority concerning any Regulatory Approval relating to Products to the extent such notice is practicable and in any event shall use its reasonable efforts to provide such notice as promptly as practicable. At all such meetings, conferences or discussions, such other Party shall have the right to attend and participate (accompanied by a translator, consultants or advisors, if so decided by such Party), either in person or by telephone, to the extent permitted by the applicable Governmental Authority at such other Party’s sole cost and expense; provided, further that such other Party shall have the right to comment in timely fashion on any such approval applications or communication with Governmental Authorities, which comments such Party shall reasonably consider.

	
 
	
9.5
	
Subject to [***], AEON shall provide DAEWOONG with complete and accurate record of the dossier related to all Regulatory Approvals obtained by AEON or its Affiliates or sub-licensees that relate to Product, including copies of: (a) all the correspondence exchanged with Governmental Authorities; (b) any certificate of Marketing Authorizations in the Territory related to Product within fourteen (14) days of completion of such registration; (c) subsequent amendments or supplements thereto; and (d) any regulatory documents and certificates relating to the foregoing that DAEWOONG requests. [***].  

	
 
	
9.6
	
[***].

Article 10. Marketing and Promotion.

	
 
	
10.1
	
Upon obtaining all necessary Regulatory Approvals, AEON shall use Commercially Reasonable Efforts to Commercialize Product in the Territory in the Field. Subject to the terms and conditions of this Agreement, AEON shall be responsible for the establishment and implementation for Commercialization of Product in the Territory in the Field as set forth in Initial Marketing Plan. AEON will discuss with DAEWOONG the following:

	
 
	
(a)
	
Initial Marketing Plan for Product within [***] after obtaining Marketing Authorization in the Territory in the Field; and

	
 
	
(b)
	
Annual Marketing Plan [***] prior to the end of each calendar year.

	
 
	
10.2
	
AEON shall submit to DAEWOONG semi-annual review reports on January 1 and July 31 of each calendar year which will include, but without limitation, the following, with respect to Product in the Territory in the Field: (a) customer requirements with respect to Product; (b) market analysis; (c) competition; (d) any primary or secondary market research; (e) details of any changes in applicable laws in Territory; and (f) all in market sales data.

16

 

	
 
	
10.3
	
For the avoidance of doubt, AEON will bear all costs and expenses related to the activities related to Commercialization of Product in the Territory in the Field as well as cost related to obtaining and maintaining associated Marketing Authorizations.

	
 
	
10.4
	
AEON shall use Commercially Reasonable Efforts to Commercialize Product in the Territory in the Field and to provide physicians, practitioners and other prescribers with information and support related to Product in the Territory in the Field. AEON’s obligations in connection with Commercialization of Product in the Territory are set out in Initial Marketing Plan. Further, on at least a Calendar Year basis, AEON shall provide DAEWOONG with a written summary of AEON’s planned and completed Commercialization activities with respect to Product in the Territory, covering subject matter at a level of detail sufficient to enable DAEWOONG to determine AEON’s compliance with its diligence obligations in this Article 10.

	
 
	
10.5
	
AEON will, in implementing the Marketing Plan, use Commercially Reasonable Efforts to protect and preserve the good image and reputation of DAEWOONG and Product, and shall ensure that no marketing or promotional effort will violate any applicable laws.

Article 11. Joint Steering Committee (JSC).

	
 
	
11.1
	
The Parties shall promptly, and in any event within thirty (30) days from execution of this Agreement establish a joint steering committee (“Joint Steering Committee” or “JSC”) to review and provide input on all, Commercialization Plans of Product in the Territory. The JSC shall be comprised of an equal number of representatives from each of the Parties, including both development and commercial representatives of Parties. In addition, it is contemplated that senior executive and managerial personnel of each Party will serve as members of the JSC or will periodically participate in meetings of the JSC, when so required to assure that relevant matters are reviewed and jointly approved by the senior executive management of both Parties.

	
 
	
11.2
	
The JSC shall meet at least once each calendar quarter or as otherwise agreed to by the Parties. At least one meeting in each year shall be held in person, as face to face meetings.

	
 
	
11.3
	
The JSC shall exercise such authority in good faith in accordance with the terms of this Agreement. In the event that JSC is unable to reach a decision on any matter within thirty (30) days, the matter shall be referred to the top management of each Party for resolution.

17

 

	
 
	
11.4
	
The JSC shall review, and make recommendations with regards to Commercialization Plan to be performed by AEON hereunder. To that end, the JSC shall review; and make recommendations with regards to, the following; provided, however, that AEON shall, in its reasonable discretion, have the authority to make final decisions with respect to the following matters:

	
 
	
(a)
	
the implementation of the plan for Drug Registration and strategy for filling application for Regulatory Approval for Products in the Territory;

	
 
	
(b)
	
all regulatory aspects of Products, including but not limited to, each and every regulatory action, communication, and filing and submission including any supplements or amendments thereto to relevant Governmental Authorities in the Territory with respect to Products;

	
 
	
(c)
	
schedule and implementation strategy for all applications for Regulatory Approval;

	
 
	
(d)
	
coordinate the provision of expertise from both Parties to the JSC with respect to pre-clinical or clinical studies related to Product recommended by the JSC;

	
 
	
(e)
	
suggest updates to, and implementation of, Marketing Plan; and 

	
 
	
(f)
	
the marketing, promotion, sale and/or distribution of Product.

	
 
	
11.5
	
Each Party may attend the JSC and other meetings together with interpreters, it being also agreed that the agendas and minutes of the meetings will be written in English and that the reports and information to be reviewed or evaluated in JSC and meetings will be accompanied with their corresponding translation into English (when not originally prepared in English).

Article 12. Prohibition on Certain Activities.

	
 
	
12.1
	
During the Term, AEON and its Affiliates shall not, directly or indirectly, other than through DAEWOONG (a) purchase, import, export, sell or distribute any Competitive Product in the Territory in the Field, or assist any third party to do so; (b) sell Product outside the Territory, or (c) sell Product to any Person in the Territory who such Person knows intends to sell such Product outside the Territory.

	
 
	
12.2
	
During the initial [***] period following the Effective Date, DAEWOONG and its Affiliates shall not, directly or indirectly, (a) purchase, import, export, sell, distribute, or otherwise deal in any Competitive Product in the Territory in the Field, or assist any other third party to do so; (b) sell any Competitive Product to any Person (other than AEON and its Affiliates or designees) inside the Territory; or (c) sell any Competitive Product to any Person outside the Territory who such Person knows intends to sell such Product inside the Territory.

18

 

	
 
	
12.3
	
During the Term, DAEWOONG and its Affiliates shall not, directly or indirectly, other than through AEON, (a) purchase, import, export, sell, distribute, or otherwise deal in Product in the Territory in the Field, or assist any other third party to do so; (b) sell any Product to any Person (other than AEON and its Affiliates or designees) inside the Territory; or (c) sell any Product to any Person outside the territory who such Person knows intends to sell such Product inside the Territory.

Article 13. Other Obligations of Parties.

	
 
	
13.1
	
Each Party shall promptly inform the other Party of any relevant changes in laws and regulations that such Person becomes aware of that may affect Drug Registration (including the local regulatory requirements classification, marketing authorization and safety), and Commercialization of Product in the Territory.

	
 
	
13.2
	
In its execution of the Commercialization Plan of Product and its other obligations under this Agreement, AEON will comply with all applicable laws.

	
 
	
13.3
	
AEON shall, at DAEWOONG’s sole cost and expense, submit to DAEWOONG all texts, tapes and recordings of any printed, audio or video promotional material of Product produced in the Territory.

	
 
	
13.4
	
AEON shall commence conducting non-clinical studies and/or Clinical studies use Commercially Reasonable Efforts to follow the schedule set forth in the Commercialization Plan.

	
 
	
13.5
	
Before conducting the Clinical Trials in the Territory, AEON shall submit the Protocol to DAEWOONG and provide the interim findings and final results of non‐clinical and clinical studies to DAEWOONG promptly. DAEWOONG shall not publish or reveal non-clinical and clinical data to third parties without prior written consent of AEON. For the avoidance of doubt, any documents, study results and reports made pursuant to this Article 13 shall be the Information of AEON and subject to the confidentiality provisions of Article 14.

	
 
	
13.6
	
AEON shall use Commercially Reasonable Efforts: (a) to advance Product through completion of Clinical Trials in accordance with the Regulatory Plan; (b) to obtain Marketing Authorization in accordance with the Marketing Plan; and (c) to conduct the Commercialization Plan.

	
 
	
13.7
	
DAEWOONG shall, at its own cost and expense, develop, qualify and maintain a site for the manufacture of Product (including the active ingredient therein) so that there exists, at a minimum, sufficient capacity to meet [***] of AEON’s Forecast, and DAEWOONG shall insure that site for the manufacture of Product is in a qualified and validated state appropriate for inclusion as a manufacturing site for Product as required by the U.S. FDA and any other regulations in the Territory. [***].

19

 

Article 14. Obligation of Confidentiality.

	
 
	
14.1
	
During the Term, and for [***] thereafter, each of the Parties will keep confidential and not disclose or use any of the Information of the other Party except in the performance of its obligations and exercise of its rights under this Agreement. Each Party will treat the other Party’s Information with the same degree of confidentiality as it keeps its own confidential information (but in no event will it use less than reasonable care with such Information). Notwithstanding the foregoing, the provisions of this Article 14 shall not apply to any information that can be shown by the Receiving Party:

	
 
	
(a)
	
To have been known to or in the possession of the Receiving Party prior to the date of its actual receipt from the Disclosing Party without breaching any provision of this Agreement or any other agreement between the Parties or of any agreement between the Disclosing Party and a Third Party, by such Third Party;

	
 
	
(b)
	
To be or to have become available to the public other than through any act or omission of the Receiving Party in breach of this Agreement or any other agreement between the Parties;

	
 
	
(c)
	
To have been disclosed to the Receiving Party, other than under an obligation of confidentiality, by a Third Party that had no obligation to the Disclosing Party not to disclose such information to others; or

	
 
	
(d)
	
To have been subsequently independently developed by the Receiving Party without use of the Disclosing Party Information as demonstrated by competent contemporaneous tangible records.

	
 
	
14.2
	
Receiving Party shall ensure that its Affiliates, directors or employees, who have access to Information, shall consider and hold any of the Information as herein contemplated.

	
 
	
14.3
	
Each Party may disclose the other Party’s Information hereunder solely to the extent such disclosure is reasonably necessary in connection with complying with applicable laws; provided that in the event of any such disclosure of the Disclosing Party’s Information by the Receiving Party, the Receiving Party will, except where impracticable, give reasonable advance notice to the Disclosing Party of such disclosure requirement (so that the Disclosing Party may seek a protective order and/or other appropriate remedy or waive compliance with the confidentiality provisions of this Article 14 and will use its Commercially Reasonable Efforts to secure confidential treatment of such confidential Information required to be disclosed).

	
 
	
14.4
	
Each Receiving Party shall keep Information belonging to the Disclosing Party in appropriately secure locations. Upon expiration or termination of this Agreement, any and all Information possessed in tangible form by a Receiving Party, or its Affiliates, or its or any of their directors, officers, employees, agents, consultants, and clinical investigators and belonging to the Disclosing Party, shall, upon written request, be destroyed to the extent practicable and not used or disclosed by the Receiving Party, its Affiliates, or any of their directors, officers, employees, agents, consultants, and clinical investigators; provided, however, that a Party may retain one (1) copy of any Information in an appropriately secure location solely for use by its legal department to ensure compliance with the confidentiality provisions of this Agreement.

20

 

	
 
	
14.5
	
DAEWOONG and AEON each acknowledge the other Party’s interest in publishing the results of its scientific research in order to obtain recognition within the scientific community and to advance the state of scientific knowledge. Authorship of any publication shall be determined based on the accepted standards used in peer-reviewed, academic journals at the time of the proposed publication. Each Party also recognizes the mutual interest in obtaining valid patent protection and in protecting business interests and trade secret information. Consequently, except for disclosures permitted pursuant to Article 14.1, if either Party, its employees or consultants wishes to publish or present to any third party, during the Term, results of the scientific, preclinical and clinical studies or any information about Product, or the results of any program to discover or develop any of the above, it shall deliver to the other Party a copy of the proposed written publication or an outline of an oral disclosure at least fifteen (15) days prior to submission for publication or presentation. The reviewing Party shall notify the other Party within fifteen (15) days of receipt of such proposed publication whether such draft publication contains (i) Information of the reviewing Party, or (ii) information that if published would have an adverse effect on a patent application covering the subject matter of this Agreement, the reviewing Party shall have the right to (a) propose modifications to the publication or presentation for patent reasons, trade secret reasons, confidentiality reasons or business reasons or (b) request a reasonable delay in publication or presentation in order to protect patentable information. If the reviewing Party requests a delay to protect patentable information, the publishing Party shall delay submission or presentation for a period not to exceed thirty (30) days to enable patent applications protecting each Party’s rights in such information to be filed in accordance with the terms of this Agreement. Upon expiration of such thirty (30) days, the publishing Party shall be free to proceed with the publication or presentation. If the reviewing Party reasonably requests modifications to the publication or presentation to prevent disclosure of material trade secret or proprietary business information, the publishing Party shall edit such publication to prevent the disclosure of such information prior to submission of the publication or presentation. After the termination or expiration of this Agreement, the Parties shall continue to be obligated to adhere to the guidelines set out in Article 14.4 and this Article 14.5, but solely with respect to publications or presentations to any third party containing information about Product.

	
 
	
14.6
	
Once approval for a publication or presentation has been granted, the relevant Party shall be entitled to use the specific information contained in such publication or presentation after the date of its publication or presentation without seeking further approval. General comments made by a Party relating to the relationship between DAEWOONG and AEON established by this Agreement, including, for example, general comments made in response to inquiries at professional meetings and other similar circumstances, are not intended to be restricted by the provisions of this Article 14 provided such information has been disclosed to the public previously or cleared for such disclosure by the other Party. For the avoidance of doubt, neither Party shall be entitled to publish Information of the other in violation of Article 14.

21

 

	
 
	
14.7
	
DAEWOONG and AEON shall agree upon the timing and content of an initial press release relating to this Agreement and the transactions contemplated herein. Except to the extent already disclosed in that initial press release, no disclosure of the subject matter of this Agreement or its terms may be made by either Party, and no Party shall use the name, trademark, trade name or logo of the other Party or its employees in any publicity, news release or disclosure relating to this Agreement or its subject matter, without the prior express written permission of the other Party, except as may be required by applicable laws, regulations, or judicial order. The Party desiring to make any such public announcement shall provide the other Party with a written copy of the proposed announcement in sufficient time prior to public release to allow such other Party to comment upon such announcement, prior to public release.

Article 15. Term.

	
 
	
15.1
	
The initial term of this Agreement (the “Initial Term”) shall commence as of the Effective Date and shall expire on the later of (a) the fifth (5th) anniversary of the grant of Marketing Authorization in the Territory, or (b) the tenth (10th) anniversary of the Effective Date. This Agreement shall be automatically extended for unlimited additional three (3) year terms after the expiration of the Initial Term (each, a “Renewal Term”). For avoidance of doubt, except as otherwise provided herein, on expiration or termination of this Agreement, the licenses granted by DAEWOONG to AEON hereunder shall also expire and be revoked.

	
 
	
15.2
	
Except as otherwise required by law or any rule of any stock exchange, each Party shall keep the existence and terms of the Agreement confidential, and the negotiations relating hereto in accordance with the terms of Article 14.

Article 16. Termination.

	
 
	
16.1
	
A Party may terminate this Agreement in its entirety upon written notice of termination to the other Party, if: (a) the other Party breaches any of its duties or obligations hereunder, (such breaches will be referred to as “Default”); and (b) such Default continues without being cured or remedied within ninety (90) days (or 30 days in case of a payment default) after the defaulting Party receives written notice of such Default from the non-defaulting Party; provided, however, that if the pertinent breach is not capable of cure within ninety (90) days, but is capable of cure, and the defaulting Party has promptly commenced, and is and continues to diligently pursuing good faith the remedy of any such breach, then such cure period shall be extended for such period as may be reasonably required to effectuate such cure; provided, further, however, that if such breach is not capable of cure, the non‐defaulting Party may terminate this Agreement, or suspend performance under this Agreement, immediately by delivery of written notice thereof to such defaulting Party.

22

 

	
 
	
16.2
	
This Agreement shall terminate forthwith without notice when any of following events occurs to AEON: (a) bankruptcy or insolvency or filing of a petition therefor; (b) assignment of its business, or this Agreement in whole or in part or rights thereof, for the benefit of creditors; (c) appointment of a receiver over any of its assets not vacated in sixty (60) days thereafter; or (d) filing of any other petition based upon the alleged bankruptcy or insolvency not dismissed within ninety (90) days thereafter.

Article 17.Representations, Warranties and Covenants.

	
 
	
17.1
	
Each Party represents and warrants to the other Party that:

	
 
	
(a)
	
Such Party is duly organized and validly existing and in good standing under the laws of the jurisdiction of its organization;

	
 
	
(b)
	
Such Party has the full corporate power and is duly authorized to enter too, execute and deliver this Agreement, and to carry out and otherwise perform its obligations hereunder;

	
 
	
(c)
	
This Agreement has been duly executed and delivered by, and is the legal and valid obligation binding upon such Party and the entry into, the execution and delivery of, and the carrying out and other performance of its obligations under this Agreement by such Party (i) does not conflict with, or contravene or constitute any default under, any agreement, instrument or understanding, oral or written, to which it is a party, including its certificate of incorporation or by‐laws, and (ii) does not violate applicable law or any judgment, injunction, order or decree of any Governmental Authority having jurisdiction over it;

	
 
	
(d)
	
No government authorization, consent, approval, license, exemption of or filing or registration with any court or Governmental Authority, under any applicable law currently in effect, is or will be necessary for, or in connection with, the transaction contemplated by this Agreement or any other agreement or instrument executed in connection herewith, or for the performance by such Party of its obligations under this Agreement and such other agreements; and 

	
 
	
(e)
	
Neither such Party, nor any of its employees, officers, subcontractors, or consultants who have rendered or will render services relating to Products; (i) has ever been debarred or is subject or debarment or convicted of a crime for which an entity or person could be debarred by the FDA under 21 U.S.C. Section 335a (or subject to a similar sanction of any other Governmental Authority) or (ii) has ever been under indictment for a crime for which a person or entity could be so debarred.

	
 
	
17.2
	
DAEWOONG represents and warrants to AEON as follows;

	
 
	
(a)
	
Litigation. As of the Effective Date, there is no Legal Proceeding pending or threatened against DAEWOONG, that (i) relates to Product, or (ii) challenges, or that may have the effect of preventing, delaying, making illegal or otherwise interfering with, the transactions contemplated by this Agreement. No event has occurred, and no claim, dispute or other condition or circumstance exists, that will, or could reasonably be expected to, give rise to or serve as a basis for the commencement of any such Legal Proceeding.

23

 

	
 
	
(b)
	
Regulatory Matters.

	
 
	
(i)
	
DAEWOONG and each of its Affiliates is in compliance in all material respects with all applicable laws that relate to the manufacture, development, or Commercialization of Product;

	
 
	
(ii)
	
Neither DAEWOONG nor any of its Affiliates has received any written communication regarding, and has not been and is not now subject to, any adverse inspection, compelled or voluntary recall, investigation, regulatory enforcement action, penalty or corrective or remedial action by any Governmental Authority, in each case that relates to (i) Product, (ii) any alleged or actual violation by DAEWOONG or Product of any Governmental Authorization or other requirements of any Governmental Authority relating to the commercialization of Product, (iii) any alleged or actual failure to have or maintain in effect all Governmental Authorizations required in connection with the conduct of the manufacture, development or Commercialization of Product, or (iv) any alleged or actual failure to be in compliance with applicable laws with respect to Product, and no event has occurred. and no circumstance or condition exists, that (with or without notice or lapse of time) will, or could reasonably be expected to result in any of the foregoing.

	
 
	
(iii)
	
There has not been any occurrence of any Product recall, market withdrawal or replacement, or post-sale warning conducted by or on behalf of DAEWOONG or any of its Affiliates concerning Product or any product recall, market withdrawal or replacement conducted by or on behalf of any entity as a result of any alleged defect in Product.

	
 
	
(iv)
	
No Legal Proceeding seeking the recall, withdrawal, suspension or seizure of Product is pending with respect to DAEWOONG for any of its Affiliates), nor was any such Legal Proceeding pending at any time during the last three (3) years.

	
 
	
(v)
	
At no time during the last three (3) years has DAEWOONG (or any of its Affiliates) received any written notice that any Governmental Authority has commenced, or threatened to commence, any Legal Proceeding to withdraw its approval, registration or licensure of Product or has initiated or threatened to initiate any action to seize or enjoin the production of Product.

	
 
	
(vi)
	
The information contained in all reports filed with any Governmental Authority is accurate and complete in all material respects and there has been no adverse occurrence, event, effect, study, test, article, report, investigation, or finding that was omitted from such reports, that would require amendment, modification, updating or supplementing of such reports, or that would require disclosure in a future report.

24

 

	
 
	
(c)
	
Compliance with Laws.

	
 
	
(i)
	
DAEWOONG (and each of its Affiliates) is in compliance in all material respects with all laws applicable to it which relate materially to Product. Neither DAEWOONG nor its Affiliates has received any written notice within the past three (3) years of any asserted violation of any such laws and neither DAEWOONG nor its Affiliates has received any written notice within the past three (3) years that any investigation or review by any Governmental Authority with respect to the Product is pending or that any such investigation or review is contemplated.

	
 
	
(ii)
	
The Product is not (i) subject to the international Traffic in Arms Regulations and (ii) controlled at a level greater than EAR99/AT under the Export Administration Regulations or an equivalent level of control under non-U.S. export control laws.

	
 
	
(iii)
	
DAEWOONG is not, nor are any of its employees, customers or other business partners, in either case, in connection with the Commercialization of Product (A) located in any sanctioned countries; (B) owned or controlled by any entity located in any sanctioned country; or (C) included on any restricted parties lists, as such terms are defined under applicable U.S. and non-U.S. export control and economic sanctions laws.

	
 
	
(d)
	
Intellectual Property Rights.

	
 
	
(i)
	
The Trademark has been duly registered or filed in the Territory with the appropriate Governmental Authorities.

	
 
	
(ii)
	
There are no outstanding claims asserted in writing against DAEWOONG alleging that its manufacture, development or Commercialization of Product infringes or misappropriates any intellectual property or other proprietary rights of any other Person.

	
 
	
(iii)
	
DAEWOONG’S manufacture, development or Commercialization of Product does not infringe or misappropriate any intellectual property or other proprietary rights of any other Person,

Article 18. Effect of Termination.

	
 
	
18.1
	
Upon termination of this Agreement for any reason, AEON shall immediately cease to Commercialize Product in the Territory; and shall cease to use Information, patent rights, and Trademarks owned by or associated with DAEWOONG and its Affiliates; provided, however, that AEON shall have the right to sell off Product sourced from DAEWOONG prior to the termination of this Agreement.

25

 

	
 
	
18.2
	
Upon termination of this Agreement for any reason, each Party hereto shall also make no further use of any of the Information of the other Party and, except as required by law, each Party shall immediately send to the other Party all documents and media containing any such Information or, at the request of the Disclosing Party, destroy the same (in which case the Receiving Party shall certify such destruction in writing).

	
 
	
18.3
	
Article 3.5, Article 6.6, Article 7, Article 9.6, Article 14, Article 17, Article 18, Article 20, Article 21, and Article 25 and any other provision of this Agreement that by its terms would survive expiration or termination, shall survive expiration or termination of this Agreement.

	
 
	
18.4
	
Termination of this Agreement, for any reason, shall not affect either Party’s obligation to pay all outstanding amounts having already accrued while this Agreement remained in effect.

	
 
	
18.5
	
Termination or expiry of this Agreement, or assignment or transfer of rights or obligations under this Agreement, shall not prejudice any right or remedy having arisen before such Termination, expiry, assignment, or transfer arising from this Agreement.

Article 19. Force Majeure.

Neither Party shall be considered liable for any failure or delay to perform any obligation under this Agreement, if such failure or delay arises directly or indirectly from any act of God, war, strikes, labor conflicts, riots, fires, floods, explosions, deluge, natural calamities, wreckage of material, delayer interruption of transportation, fire, accident, civil commotion, change in law or any other cause making compliance with this Agreement practically impossible or exorbitant beyond the reasonable control of the Parties hereto. The affected Party will notify the other Party of such force majeure circumstances as soon as reasonably practical, and will promptly undertake all reasonable efforts necessary to cure such force majeure circumstances. In the event that a force majeure circumstance exists which prevents a Party from carrying out a material obligation under this Agreement, and such circumstance continues for a [***] period following the occurrence of such force majeure event, then either Party may terminate this Agreement by providing written notice to the other Party; provided, however, that the affected Party may only terminate this Agreement if the affected Party has undertaken all reasonable efforts accessary to cure such force majeure circumstances.

Article 20. Arbitration.

In case any disputes arise out of or in connection with this Agreement or any further amendment thereto, Parties shall try to resolve such dispute amicably. In the event that Parties fail to settle the dispute through amicable negotiation, such dispute shall be submitted to and finally settled by arbitration in [***] in accordance with the rules of Arbitration of the International Chamber of Commerce by one or more arbitrators appointed in accordance with such rules. The language to be used in the arbitral proceedings shall be English.

26

 

Article 21. Governing Law.

This Agreement and all rights and liabilities of Parties hereunder shall be governed and construed in accordance with the [***], without giving effect to that body of laws pertaining to conflicts of laws.

Article 22. Notice.

Any notice given by either Party to the other Party shall be in writing, and may be given by e-mail, (confirmed as received by the intended recipient), personal service, registered airmail, or by cable, telex or facsimile to the address most recently notified by such other Party. If a Party changes its address, notice thereof must be given in writing to the other Party.

Article 23. Assignment and Succession.

	
 
	
23.1
	
AEON shall not assign the same or any part thereof to any other person whatsoever without the prior written consent of DAEWOONG; provided, however, that (a) AEON may assign this Agreement, including its duties and obligations hereunder to an Affiliate; and (b) AEON may assign this Agreement in connection with any sale or transfer of the business to which this Agreement relates, whether by sale of assets, sale of stock, merger or otherwise; provided, further, however, that the successor of the business has the financial wherewithal to continue the obligations under this Agreement.

	
 
	
23.2
	
This Agreement shall be binding upon and inure to the benefit of either Party and its successors and assignees.

Article 24. Non-Competition.

	
 
	
24.1
	
AEON and its Affiliates shall not develop, register, manufacture, promote, market and sell any Product in the Territory during the term of the Agreement, other than Product acquired from DAEWOONG.

	
 
	
24.2
	
DAEWOONG shall not directly or indirectly develop, register, manufacture, promote, market and sell any Product in the Territory in the Field, or assist or enable any third party to do so, during the term of the Agreement, other than development, manufacture and sales of Product to AEON and its Affiliates under this Agreement.

Article 25. Miscellaneous.

	
 
	
25.1
	
If any term, covenant or condition of this Agreement or the application thereof to any Party or circumstance shall, to any extent, be held to be invalid or unenforceable by a court or administrative agency of competent jurisdiction, then (a) the remainder of this Agreement and the application of such term, covenant or condition to Parties or circumstances other than those as to which it is held invalid or unenforceable, shall not be affected thereby and each term, covenant or condition of this Agreement shall be valid and be enforced to the fullest extent permitted by law; and (b) the Parties covenant and agree to renegotiate any such term, covenant or application thereof in good faith in order to provide a reasonably acceptable alternative to the term, covenant or condition of this Agreement or the application thereof that is invalid or unenforceable, it being the intent of the Parties that the basic purposes of this Agreement are to be effectuated.

27

 

	
 
	
25.2
	
This Agreement, including all Annexes attached hereto, which are hereby incorporated herein by reference, sets forth all covenants, promises, agreements, warranties, representations, conditions and understandings between the Parties and supersedes and terminates all prior and contemporaneous agreements and understandings between the Parties with respect to the subject matter hereof including any confidentiality agreement entered into by the Parties prior to the Effective Date. There are no covenants, promises, agreements, warranties, representations, conditions or understandings, either oral or written, between the Parties other than as set forth herein.

	
 
	
25.3
	
The Parties hereto shall act in all matters pertaining to this Agreement as independent contractors and nothing contained herein shall be construed to place Parties in the relationship of principal and agent or employer and employee. Neither Party shall have right to enter into contracts in the name or on behalf of the other.

	
 
	
25.4
	
This Agreement shall be executed in English and may additionally be executed in other languages (including Korean). In the event of any difference or inconsistency among different language versions of this Agreement, English version shall prevail in all respect.

 

 

 

[Signature Page Follows]

28

 

IN WITNESS WHEREOF, Parties have this AGREEMENT executed by their duly authorized representatives as of the Effective Date.

Agreed and accepted for on behalf of

DAEWOONG PHARMACEUTICAL CO., LTD.

 

/s/ Sengho Jeon

	
	
 

Date: December 20, 2019

Name: Sengho Jeon

Title: President and Chief Executive Officer

 

 

Agreed and accepted for and on behalf of 

AEON BIOPHARMA, INC.,

 

/s/ Marc Forth

	
	
 

Date: December 20, 2019

Name: Marc Forth

Title: President and Chief Executive Officer

 

 

 

 

29

 

 

Attachment

Annex A:Product Price 

Annex B:Commercialization Plan

Annex C:Purchase Order

Annex D:Sales Forecast

Annex E:Technical Specifications

 

 

30

 

 

Annex A

Product Price 

	
 
	
•
	
[***] USD per [***] IU vial

	
 
	
•
	
[***] USD per [***] IU vial

	
 
	
•
	
[***] USD per [***] IU vial

31

 

	
 
		

Annex B

Commercialization Plan 

 

[***]

32

 

[***]

33

 

[***]

34

 

[***]

35

 

[***]

36

 

[***]

37

 

[***]

 

 

 

38

 

 

Annex C

PURCHASE ORDER

THIS PURCHASE ORDER, entered into pursuant to the terms of that certain License & Supply Agreement dated ____________________ (the “Agreement”), is made by and between Daewoong Pharmaceutical Co., Ltd. (for itself and its subsidiaries) and AEON Biopharma, Inc. (including its Affiliates). All capitalized terms not otherwise defined heroin will have the meaning so attributed to such terms in the Agreement.

Product and Ordered Quantity: 

Delivery Date:

Packaging Specification (if any):

Payment:

 

 

 

39

 

 

Annex D

SALES FORECAST

 

[***]

 

 

 

 

40

 

 

Annex E

TECHNICAL SPECIFICATIONS

 

					
	
Test items
	
Acceptance criteria
	
Method
	
Analytical procedure
	
Specification

	
1. Appearance
	
[***]
	
[***]
	
[***]
	
[***]

	
2. pH
	
[***]
	
[***]
	
[***]
	
[***]

	
3. Sterility
	
[***]
	
[***]
	
[***]
	
[***]

	
4. Bacterial

endotoxins
	
[***]
	
[***]
	
[***]
	
[***]

	
5. Water
	
[***]
	
[***]
	
[***]
	
[***]

	
6. Potency
	
[***] of labeled activity
	
[***]
	
[***]
	
[***]

	
7. Identification
	
[***]
	
[***]
	
[***]
	
[***]

	
8. Solubility
	
[***]
	
[***]
	
[***]
	
[***]

	
9. Foreign

insoluble matter
	
[***]
	
[***]
	
[***]
	
[***]

	
10. Insoluble

particulate matter
	
[***] particles/vial
[***] particles/vial
	
[***]
	
[***]
	
[***]

 

 

41aeon-ex1014_9.htm

 

Exhibit 10.14

 

REGISTRATION RIGHTS AGREEMENT

This REGISTRATION RIGHTS AGREEMENT (this “Agreement”) is dated as of June 21, 2021 (the “Effective Date”) by and among AEON Biopharma, Inc., a Delaware corporation (the “Company”), and Medytox, Inc., a company duly organized and existing under the laws of South Korea (the “Investor”), and each other party who hereafter executes and delivers a Joinder Agreement (together with the Investor, the “Holder”) in the form attached as Exhibit A hereto (a “Joinder Agreement”) agreeing to be bound by the terms hereof.

RECITALS

WHEREAS, the Company and the Investor are parties to that certain Share Issuance Agreement, dated as of the date hereof (the “Issuance Agreement”), pursuant to which the Investor will be issued an aggregate of 26,680,511 shares of Common Stock of the Company (the “Issued Shares”); and

WHEREAS, to induce the Investor to consummate the transactions contemplated by the Issuance Agreement, the Company has agreed to provide certain registration rights for the Issued Shares under the Securities Act and applicable state securities laws.

NOW, THEREFORE, in consideration of the premises and respective covenants and agreements set forth in this Agreement and other good and valuable consideration the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, agree as follows:

Article I

REGISTRATION RIGHTS

Section 1.1Definitions.  For purposes of this Agreement:

“Affiliate” or “Affiliated” means, with respect to any Person, any other Person who directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, such Person.  For purposes of this definition of Affiliate, “control” means the possession, directly or indirectly, of the power to direct, or cause the direction of, the management or policies of a Person, whether through the ownership of voting securities, by contract or otherwise.

“beneficial ownership” (and related terms such as “beneficially owned” or “beneficial owner”) has the meaning set forth in Rule 13d-3 under the Exchange Act.

“Board” means the Board of Directors of the Company or any authorized committee thereof.

“Business Day” means any day except a Saturday, Sunday or other day on which commercial banks in Los Angeles, California (and, solely in the case of Section 2.3, Seoul, Korea) are authorized or required by law to be closed.

 

 

“Commission Guidance” means (i) any publicly available written guidance or rule of general applicability of the Commission staff or (ii) written comments, requirements or requests of the Commission staff to the Company in connection with the review of a Registration Statement.

“Common Stock” means shares of the Company’s common stock, par value of $0.0001 per share.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder, or any similar or successor statute.

“Existing Stockholders’ Agreement” means that certain Third Amended and Restated Investors’ Rights Agreement, dated as of April 19, 2017, as amended, by and among the Company (formerly known as ALPHAEON Corporation) and each of the investors party thereto.

“FINRA” means the Financial Industry Regulatory Authority, Inc., or any successor entity thereof.

“Full Cooperation” means, in addition to the cooperation otherwise required by this Agreement, (a) in connection with any underwritten offering, members of senior management of the Company (including the chief executive officer and chief financial officer) reasonably cooperate with the underwriter(s) in connection therewith and make themselves reasonably available during regular business hours to participate in “road show” and other customary marketing activities in such locations (domestic and foreign) as reasonably recommended by the underwriter(s) (including one-on-one meetings with prospective purchasers of the Registrable Securities) and (b) the Company prepares preliminary and final prospectuses (preliminary and final prospectus supplements in the case of an offering pursuant to a Shelf Registration Statement) for use in connection therewith containing such additional information as reasonably requested by the underwriter(s) (in addition to the minimum amount of information required by law, rule or regulation)

“Holder” means a Person that becomes a party to this Agreement in accordance with Section 2.2 hereof.  The term Holder shall not include any registered owner of Registrable Securities that holds such Registrable Securities in “street name” on behalf of beneficial owners thereof.

“Initial Public Offering” means the closing of the issuance and sale of shares of Common Stock of the Company or its Subsidiary or parent company (provided that the parties agree that Strathspey Crown Holdings Group LLC shall not be considered a parent company of Company) or their respective successors or assigns pursuant to an effective registration statement under the Securities Act, including as a result of a merger or combination involving a special purpose acquisition company or “blank check” company.  For purposes of clarification, the term Initial Public Offering shall only apply to the first to occur of the consummation of any of the foregoing transactions.

“Majority in Interest of Participating Holders” means Participating Holders owning a majority of the Registrable Securities included in a Registration Statement.

“Other Stockholders” means any Person (other than the Holders) who has a right to participate as a seller in any underwritten offering of Common Stock by the Company (whether for the account of the Company, the Holders or otherwise) pursuant to a registration rights agreement or other similar arrangements (other than this Agreement) with the Company.

2

 

“Participating Holders” means Holders participating, or electing to participate, in an offering of Registrable Securities pursuant to the terms of this Agreement.

“Person” means any individual, firm, corporation, company, partnership, trust, incorporated or unincorporated association, limited liability company, joint venture, joint stock company, government (or an agency or political subdivision thereof) or other entity of any kind, and shall include any successor (by merger or otherwise) of any such entity.

“Registrable Securities” means (a) any Issued Shares, and (b) any capital stock or other securities of the Company issued or issuable with respect to the Issued Shares:  (i) upon any conversion or exchange thereof, (ii) by way of stock dividend or other distribution, stock split or reverse stock split, or (iii) in connection with a combination of shares, recapitalization, merger, consolidation, exchange offer, reorganization or other similar event; provided, however, that Issued Shares or other securities that are considered to be Registrable Securities shall cease to be Registrable Securities (A) upon the sale thereof pursuant to and in accordance with an effective Registration Statement, (B) upon the sale thereof to the public through a broker, dealer or market maker pursuant to Rule 144 under the Securities Act (or any similar rule promulgated by the Commission then in force), (C) when any such securities held by a Holder are sold or disposed of under circumstances in which all of the applicable conditions of Rule 144 (or any similar provision then in force) under the Securities Act are met, or (D) when they cease to be outstanding.

“Registration Expenses” mean all expenses (other than Selling Expenses) arising from or incident to the performance of, or compliance with, this Article I, including, without limitation, (i) SEC, stock exchange, FINRA and other registration and filing fees, (ii) all fees and expenses incurred in connection with complying with any securities or blue sky laws (including, without limitation, fees, charges and disbursements of counsel in connection with blue sky qualifications of Registrable Securities), (iii) all printing, messenger and delivery expenses, (iv) the fees, charges and disbursements of counsel to the Company and of its independent public accountants and any other accounting and legal fees, charges and expenses incurred by the Company (including, without limitation, any expenses arising from any special audits or “comfort letters” required in connection with or incident to any registration) , (v) the fees, charges and disbursements of any special experts retained by the Company in connection with any registration pursuant to the terms of this Agreement, (vi) all internal expenses of the Company (including, without limitation, all salaries and expenses of its officers and employees performing legal or accounting duties), (vii) the fees and expenses incurred in connection with the listing of the Registrable Securities on any securities exchange or over-the-counter trading market and (viii) Securities Act liability insurance (if the Company elects to obtain such insurance), (ix) all rating agency fees, regardless of whether any Registration Statement filed in connection with such registration is declared effective by the Commission.  “Registration Expenses” shall exclude any fees or expenses related to counsel for the Participating Holders.

“Registration Statement” shall mean any Registration Statement of the Company filed with the SEC on the appropriate form pursuant to the Securities Act which covers any of the Issued Shares and any other equity securities of the Company pursuant to the provisions of this Agreement and all amendments and supplements to any such Registration Statement, including post-effective amendments, in each case including the prospectus contained therein, all exhibits thereto and all materials incorporated by reference therein.

“Requesting Holder” means any Holder making a request for a Demand Registration pursuant to Section 1.2(a) hereof.

3

 

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

“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder, or any similar or successor statute.

“Selling Expenses” shall mean the underwriting fees, discounts, selling commissions, and transfer taxes applicable to any Registrable Securities.

“Subsidiary” shall mean any other Person that the Company directly or indirectly owns or has the power to vote or control more than 50.0% of (i) any class or series of capital stock of such Person, (ii) in the case of a partnership or limited liability company, the interest in the capital or profits of such partnership or limited liability company or (iii) in the case of a trust, estate, association, joint venture or other entity, the beneficial interest in such trust, estate, association or other entity business is, at the time of determination, owned or controlled directly or indirectly through one or more intermediaries, by the Company.

“underwritten registration, underwritten offering or underwritten public offering” means an offering in which securities of the Company are sold to or through one or more underwriters (as defined in Section 2(a)(11) of the Securities Act) for resale to the public.

Section 1.2Demand Registration.

(a)Request by Holders.  Subject to the terms and conditions set forth in this Agreement, including without limitation the priority of any rights set forth in the Existing Stockholders’ Agreement, Holders of Registrable Securities may make a written request to the Company (a “Demand Notice”) at any time after the one year anniversary of the Company’s Initial Public Offering, to register all or part of their Registrable Securities for resale under the Securities Act (a “Demand Registration”).  In connection with each such Demand Registration, the Company shall provide its Full Cooperation.

Each Demand Notice shall (A) specify the number of Registrable Securities that the Requesting Holders intend to sell or dispose of and (B) state the intended method or methods of sale or disposition of the Registrable Securities.  In connection with any Demand Registration, the Requesting Holders may request the Company file a Shelf Registration Statement, provided, that the Company is then eligible to use Form S-3 (or any successor form) under the Securities Act for such intended resale.

(b)Demand Registration.  Following receipt of a Demand Notice, the Company shall (subject to any rights set forth in the Existing Stockholders’ Agreement):

(i)give written notice of such request for registration to all Holders of Registrable Securities within ten (10) days after receipt of a Demand Notice;

(ii)cause to be filed, as soon as practicable, but in any event within, for the filing of a Shelf Registration Statement, thirty (30) days of the date of delivery of the Demand Notice, a Registration Statement covering such Registrable Securities that the Company has been so requested to register by the Requesting Holders and other Holders of Registrable Securities who make a request to the Company, within fifteen (15) days of the mailing of the Company’s notice referred to in Section 1.2(b)(i) hereof, that their Registrable Securities also be registered, providing for the 

4

 

registration under the Securities Act of such Registrable Securities to the extent necessary to permit the disposition of such Registrable Securities in accordance with the intended method of distribution specified in such Demand Notice;

(iii)use its commercially reasonable efforts to have such Registration Statement declared effective by the SEC as soon as practicable thereafter, but in no event later than thirty (30) days or, if a Registration Statement is reviewed by the staff of the SEC, the Company shall use its commercially reasonable efforts to have such Registration Statement declared effected not later than sixty (60) days following the date of initial filing thereof with the SEC; and

(iv)if the Company shall have previously effected a Demand Registration pursuant to this Section 1.2, the Company shall not be required to effect any registration pursuant to Section 1.2 until a period of one hundred eighty (180) days shall have elapsed from the effective date of such previous registration statement.

(c)Selection of Underwriters; Priority for Demand Registrations.

(i)In the event that the Requesting Holders intend to distribute the Registrable Securities covered by the Demand Notice by means of an underwriting, they shall so advise the Company as part of the Demand Notice and the Company shall include such information in the notice it provides to all Holders pursuant to Section 1.2(b)(i) hereof.  The managing underwriter for such underwriting shall be one or more reputable nationally recognized investment banks selected by a Majority in Interest of the Participating Holders, subject to the consent of the Company, which consent shall not be unreasonably withheld, delayed or conditioned.  In such event, the right of any Holder to include such Holder’s Registrable Securities in such registration shall be conditioned upon such Holder’s participation in such underwriting and the inclusion of such Holder’s Registrable Securities in the underwriting to the extent provided in this Section 1.2(c).

(ii)The Company may include securities other than Registrable Securities in an underwritten offering of Registrable Securities pursuant to a Demand Notice, for any accounts (including for the account of the Company) on the terms provided below.  With respect to such underwritten offering, if the managing underwriter of such offering advises the Company that, in its good faith view, that the number of Registrable Securities and other securities, if any, to be included in such offering exceeds the largest number of securities which can reasonably be sold in an orderly manner without having a significant and adverse effect on such offering (the “Maximum Offering Amount”), then the Company shall include in such registration the number which can be so sold in the following order of priority (subject to any rights set forth in the Existing Stockholders’ Agreement:

(A)first, any securities requested to be included in such registration under the Existing Stockholders’ Agreement;

(B)second, to the extent that the number of Registrable Securities to be included in such registration is less than the Maximum Offering Amount,the Registrable Securities requested to be included by the Participating Holders allocated pro rata among the Participating Holders on the basis of the amount of Registrable Securities held by the Participating Holders (and eligible for inclusion in such offering under this Agreement) as of the date of the Demand Notice;

5

 

(C)third, to the extent that the number of Registrable Securities to be included in such registration is less than the Maximum Offering Amount, any securities requested to be included therein by the Company; and

(D)fourth, any Common Stock requested to be included by the Other Stockholders (not referenced in Subsection (A) above) allocated pro rata among the such Other Stockholders on the basis of the amount of Common Stock held by the Other Stockholders (and eligible for inclusion in such offering under an agreement between such Other Stockholders and the Company) as of the date of the Demand Notice after including the Registrable Securities and the securities requested to be included by the Company in such registration.

(d)Limitations on Demand Registrations.

(i)Notwithstanding anything herein to the contrary, the Company may suspend the registration process and/or delay any Holder’s ability to use a prospectus or delay making a filing of a Registration Statement or taking any other action in connection therewith for a period of up to ninety (90) days when the Board has determined in good faith that it would be in the best interest of the Company if such Registration Statement (or an amendment or supplement thereto) were filed, such Registration Statement (or amendment or supplement thereto) were to become effective or remain effective for the time otherwise required for such Registration Statement to remain effective or any other action either would (A) materially adversely affect a significant financing, acquisition, disposition, merger or other material transaction, (B) require premature disclosure of material information that the Company has a bona fide business purpose for preserving as confidential or (C) render the Company unable to comply with requirements under the Securities Act or the Exchange Act (each, a “Valid Business Reason”); provided, however, that such right to delay shall be exercised by the Company not more than twice in any 12-month period and the Company shall only have the right to delay so long as such Valid Business Reason exists (but in no event for a period longer than ninety (90) days in the aggregate in any twelve month period).  The Company shall give notice to each Participating Holder that the registration process has been delayed and upon notice duly given, each Holder agrees not to sell any Registrable Securities pursuant to any Registration Statement until such Holder’s receipt of copies of the supplemented or amended prospectus, 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 shall not specify the nature of the event giving rise to a suspension in any notice to the Holders.

(ii)The Company shall not be required to effect more than three (3) Demand Registrations, provided that, if the Company is eligible to use Form S-3 (or any successor form) under the Securities Act for such intended resale of Registrable Securities, then the limit shall be three (3) per year Demand Registrations that are Shelf Registrations not involving an underwritten offering that the Company may be required to effect.  A Demand Registration shall not be deemed to have been effected and shall not count as one of the Demand Registrations referenced in the immediately preceding sentence (i) unless a Registration Statement with respect thereto has become effective and remained effective in compliance with the provisions of the Securities Act with respect to the disposition of all Registrable Securities covered by such Registration Statement until such time as all of such Registrable Securities have been disposed of in accordance with the intended methods of disposition by the Holders thereof set forth in such Registration Statement; provided, however, that such period shall not exceed twelve (12) months (except in the case of a Shelf Registration); (ii) (A) if, after it has become effective, such registration is interfered with by any stop order, injunction or other 

6

 

order or requirement of the SEC or other governmental agency or court for any reason and has not thereafter become effective; or (B) if the offering of Registrable Securities is not consummated because the underwriters of an underwritten public offering advise the Participating Holders that the Registrable Securities cannot be sold at a net price per share equal to or above the minimum net price acceptable to the Holders of a Majority in Interest of Participating Holders; provided, however, that this clause (ii)(B) shall not apply to an underwritten offering conducted on a “firm commitment basis” which is not consummated following the commencement of a roadshow; (iii) if the conditions to closing specified in the underwriting agreement, if any, entered into in connection with such registration are not satisfied or waived (unless the cause of such conditions to closing not being satisfied shall be attributable to one or more Participating Holders or the underwriter); (iv) if the amount of Registrable Securities of Requesting Holders included in the registration are reduced to fewer than fifty percent (50%) of the Registrable Securities originally requested to be registered; or (v) if there is not Full Cooperation in connection therewith.

(iii)Notwithstanding anything herein to the contrary, the Company will not be required to effect any Demand Registration during the period starting on the date thirty (30) days prior to the Company’s estimated date of filing of, and ending on the date one-hundred eighty (180) days immediately following the effective date of, any Registration Statement (other than on Form S-4 or S-8 under the Securities Act, or any successor form) pertaining to the securities of the Company, provided that the Company is employing in good faith all commercially reasonable efforts to cause such Registration Statement to become effective.

(e)Withdrawal of Registration.  Any Participating Holder that has requested its Registrable Securities be included in a Demand Registration pursuant to Section 1.2(a) may withdraw all or any portion of its Registrable Securities from a Demand Registration at any time.  Upon receipt of a notice to such effect from a Majority in Interest of the Participating Holders with respect to all of its Registrable Securities, the Company shall cease all efforts to secure effectiveness of the applicable Demand Registration Statement and such Registration nonetheless shall be deemed a Demand Registration for purposes of Section 1.2 unless (i) the withdrawing Participating Holders shall have paid or reimbursed the Company for its pro rata share of all reasonable and documented out-of-pocket fees and expenses incurred by the Company in connection with the Registration of such Participating Holder’s withdrawn Registrable Securities (based on the number of securities the Participating Holder sought to register, as compared to the total number of securities included on such Registration Statement) or (ii) the withdrawal is based upon (x) the Company’s failure to comply in any material respect with its obligations hereunder, (y) the institution by the Company of suspension or delay of the registration process pursuant to Section 1.2(d)(i) or (z) the reasonable determination of the Participating Holders that there has been, since the date of the Demand Notice, a material adverse change in the business or prospects of the Company.

Section 1.3Piggyback Registration.

(a)Right to Include Registrable Securities.  Each time after the one year anniversary of the Company’s Initial Public Offering that the Company proposes for any reason to register any of its securities of the same class as the Registrable Securities under the Securities Act, either for its own account or for the account of a stockholder or stockholders exercising demand registration rights (other than Demand Registrations pursuant to Section 1.2 hereof) (a “Proposed Registration”), the Company shall promptly give written notice (which notice shall be given not less than thirty (30) days prior to the expected filing date of the Proposed Registration and shall describe the intended method of distribution for the offering relating to the Proposed Registration) of such 

7

 

Proposed Registration to all Holders of Registrable Securities and shall offer such Holders the right to request inclusion of any of such Holder’s Registrable Securities in the Proposed Registration (a “Piggyback Registration”); provided, however, that the Holders shall have no right to include Registrable Securities in a registration (i) pursuant to a Registration Statement on Form S-8 (or any successor form) (or other registration solely relating to an offering or sale to employees or directors of the Company pursuant to any employee stock plan or other employee benefit arrangement), (ii) pursuant to a Registration Statement on Form S-4 (or any successor form), (iii) that relates to a transaction subject to Rule 145 under the Securities Act (or any successor rule thereto), (iv) pursuant to a registration statement initiated under the Existing Stockholders’ Agreement or (v) in connection with any dividend or distribution reinvestment or similar plan.  No registration pursuant to this Section 1.3 shall relieve the Company of its obligation to effect a Demand Registration, as contemplated by Section 1.2 hereof.  The rights to Piggyback Registration may be exercised on an unlimited number of occasions.

(b)Piggyback Procedure.  Each Holder shall have fifteen (15) days from the date of receipt of the Company’s notice referred to in Section 1.3(a) above to deliver to the Company a written request specifying the number of Registrable Securities such Piggyback Holder intends to register and sell in the offering relating to such Piggyback Registration (any Holder so requesting to have any of their Registrable Securities included in the Proposed Registration, a “Piggyback Holder”).  Any Piggyback Holder shall have the right to withdraw such Piggyback Holder’s request for inclusion of such Holder’s Registrable Securities in any Registration Statement pursuant to this Section 1.3 by giving written notice to the Company of such withdrawal; provided, however, that the Company may ignore a notice of withdrawal made within 48 hours of the time the Registration Statement is to become effective.  Subject to Section 1.3(c) below, the Company shall use commercially reasonable efforts to include in such Registration Statement all such Registrable Securities requested to be included therein (subject to any rights under the Existing Stockholders’ Agreement); provided, further, that the Company may at any time withdraw or cease proceeding with any such Proposed Registration if it shall at the same time withdraw or cease proceeding with the registration of all other securities of the same class as the Registrable Securities originally proposed to be registered, without prejudice, however, to the rights of any Holder to request that a Demand Registration be effected; and provided, further, that no registration effected under this provision will relieve the Company from its obligations to effect a Demand Registration upon a Demand Notice, subject to the express terms and conditions set forth in this Agreement.

(c)Priority for Piggyback Registration.  If any Proposed Registration involves an underwritten offering and the managing underwriter of such offering advises the Company that, in its good faith view, that the number of securities requested to be included in such offering exceeds the Maximum Offering Amount, then the Company shall include in such registration the number of securities which can be so sold in the following order of priority (subject to any rights set forth in the Existing Stockholders’ Agreement):

(i)first, all securities that the Company proposes to register for its own account (the “Company Securities”) and any rights set forth in the Existing Stockholders’ Agreement);

(ii)second, to the extent all securities referenced in subsection (i) above are collectively less than the Maximum Offering Amount, the remaining securities to be included in such registration will be allocated on a pro rata basis among all Piggyback Holders requesting that Registrable Securities be included in such Registration; and

8

 

(iii)third, any remaining securities allocated on a pro rata basis among all Other Stockholders (not referenced in Subsection (i) above) requesting Common Stock be included in such Registration.

For purposes of this Section 1.3(c), (i) the pro rata portion of each Piggyback Holder shall be the product of (A) the total number of Registrable Securities which the managing underwriter agrees to include in the public offering and (B) the ratio which such Piggyback Holder’s total Registrable Securities bears to the total number of Registrable Securities then outstanding, and (ii) the pro rata portion of each Other Stockholder shall be the product of (X) the total number of Common Stock which the managing underwriter agrees to include in the public offering and (Y) the ratio which such Other Stockholder’s total Common Stock bears to the total number of Common Stock then outstanding.

(d)Underwritten Offering.  If any Piggyback Registration is an underwritten offering, any notice from the Company to the Holders under this Section 1.3 shall offer Holders the right to include any Registrable Securities covered by the Proposed Registration in the underwriting on the same terms and conditions as the securities, if any, otherwise being sold through underwriters under such Proposed Registration.

(e)Cancellation and Delay of Registration.  If at any time after giving written notice of its Proposed Registration and prior to the effective date of the Registration Statement filed in connection with the Proposed Registration or, in the case of a Shelf Registration Statement, prior to the consummation of such offering, the Company shall determine for any reason not to register or to delay registration of such offering, the Company may, at its election, give written notice of such determination to each Piggyback Holder and (i) in the case of a determination not to register, the Company shall be relieved of its obligation to register any Registrable Securities in connection with such Proposed Registration, without prejudice, however, to the rights of any Holder to include Registrable Securities in any future registrations pursuant to this Section 1.3 and (ii) in the case of a determination to delay registering, shall be permitted to delay registering any Registrable Securities, for the same period as the delay in registering other securities in the Proposed Registration.

Section 1.4Shelf Registration Statement.

(a)Filing of Shelf Registration Statement.  No later than the two year anniversary of the Company’s Initial Public Offering (subject to any rights under the Existing Stockholders’ Agreement), the Company shall (subject to any rights set forth in the Existing Stockholders’ Agreement) (i) prepare and file with the Commission a Shelf Registration Statement on Form S-3 that covers all Registrable Securities then outstanding for an offering to be made on a delayed or continuous basis pursuant to Rule 415 under the Securities Act or any successor rule thereto (a “Shelf Registration”) and (ii) use its commercially reasonable efforts to cause such Shelf Registration Statement to be declared effective by the Commission as soon as practicable thereafter; provided, that following a registered offering of Company Securities (other than a registration (i) pursuant to a Registration Statement on Form S-8 (or any successor form) (or other registration solely relating to an offering or sale to employees or directors of the Company pursuant to any employee stock plan or other employee benefit arrangement), (ii) pursuant to a Registration Statement on Form S-4 (or any successor form), (iii) that relates to a transaction subject to Rule 145 under the Securities Act (or any successor rule thereto) or (iv) in connection with any dividend or distribution reinvestment or similar plan), the Company shall not be required to file a Shelf Registration Statement pursuant to this Section 1.3 until ninety (90) days following the effective date of such Registration Statement covering 

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the Company Securities.  The Company shall use its commercially reasonable efforts to cause such Shelf Registration Statement to remain effective for as long as any Registrable Securities are outstanding.

(b)SEC Limitations.  Notwithstanding any other provision of this Agreement, if any Commission Guidance sets forth a limitation of the number of Registrable Securities to be registered on a particular Registration Statement (notwithstanding the Company’s commercially reasonable efforts to advocate with the Commission for the registration of all or a greater number of Registrable Securities), then, the amount of Registrable Securities to be registered on such Registration Statement will be reduced pro rata among the Holders based on the total number of unregistered Registrable Securities held by such Holders (subject to any rights set forth in the Existing Stockholders’ Agreement).

(c)Expiration of Shelf Registration Statement.  If (i) the Company has filed a Shelf Registration Statement (the “Initial Registration Statement”) with the Commission that covers Registrable Securities (the “Initial Registrable Securities”), (ii) pursuant to Rule 415(a)(5) under the Securities Act or any successor rule thereto, the Initial Registration Statement may no longer be used for offers and sales of any of the Initial Registrable Securities, and (iii) any of the Initial Registrable Securities are Registrable Securities at the time that (ii) above occurs, the Company shall (subject to any rights set forth in the Existing Stockholders’ Agreement) prepare and file with the Commission within the time limits required by Rule 415 under the Securities Act or any successor rule thereto a new Shelf Registration Statement covering any Initial Registrable Securities that have not ceased to be Registrable Securities for an offering to be made on a delayed or continuous basis pursuant to Rule 415 under the Securities Act or any successor rule thereto (a “New Shelf Registration Statement”) and shall use its commercially reasonable efforts to cause such New Shelf Registration Statement to be declared effective by the Commission as soon as reasonably practicable thereafter.

(d)Shelf Takedowns.  Upon the demand of one or more Holders of Registrable Securities beneficially owning in the aggregate not less than 10% of the Registrable Securities then outstanding, the Company shall facilitate up to three (3) “takedowns” of Registrable Securities in the form of an underwritten offering utilizing the Shelf Registration Statement filed in connection with the Shelf Registration, in the manner and subject to the conditions described in Sections 1.2(b)(iv), 1.2(c), 1.2(e) and 1.2(f) of this Agreement.

Section 1.5Holdbacks.

(a)Restrictions on Public Sale by Holders.  Each Holder hereby agrees that, if and whenever the Company (i) proposes to register any of its equity securities under the Securities Act, whether or not for its own account, or (ii) is required to use its commercially reasonable efforts to effect the registration of any Registrable Securities under the Securities Act pursuant to a Demand Registration, such Holder, if requested by the managing underwriter in an underwritten offering, agrees to enter into a “lock-up agreement” containing terms (including the duration of the lock-up period, which, for the avoidance of doubt shall commence no earlier than ten (10) days prior to the effectiveness of the registration statement and shall not exceed ninety (90) days (one hundred eighty (180) days in the case of an Initial Public Offering) in the case of any registration under the Securities Act) that are customary at the time of such agreement is entered into for offerings of similar size and type, and the Company shall cause all of the Company’s directors and executive officers and shall use its commercially reasonable efforts to cause any stockholders owning more than five (5) percent of the Company’s then outstanding Common Stock to sign lock-up agreements on comparable terms in 

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connection therewith (or on such terms as may be required by the managing underwriter).  Any such lock-up agreements signed by the Holders shall contain reasonable and customary exceptions, including, without limitation, the right of a Holder to make transfers to certain Affiliates, subject to such Affiliates entering into such lock-up agreement.  The Company may impose stop-transfer instructions with respect to the shares of Common Stock or other securities subject to the foregoing restrictions until the end of the relevant lock-up period.  For purposes of the forgoing, the term “lock-up agreement” refers to an agreement by the undersigned thereto not to effect for a specified period of time any public sale or distribution (other than in connection with the public offering for which such lock-up agreement is being requested and other customary exceptions), including, without limitation, any sale pursuant to Rule 144 under the Securities Act, of any Registrable Securities, any other equity securities of the Company or any securities convertible into or exchangeable or exercisable for any equity securities of the Company, without the prior consent of the managing underwriter.

(b)Restrictions on Public Sale by the Company.  The Company agrees not to effect (other than a registration (i) pursuant to a Registration Statement on Form S-8 (or any successor form) or other registration solely relating to an offering or sale to employees or directors of the Company pursuant to any employee stock plan or other employee benefit arrangement), (ii) pursuant to a Registration Statement on Form S-4 (or any successor form), (iii) that relates to a transaction subject to Rule 145 under the Securities Act (or any successor rule thereto) or (iv) in connection with any dividend or distribution reinvestment or similar plan) any public sale or distribution, or to file any Registration Statement under the Securities Act covering any, of its equity securities, or any securities convertible into or exchangeable or exercisable for such securities during the period beginning fifteen (15) days prior to the effective date of the Registration Statement, and ninety (90) days after the effective date of the Registration Statement for any Demand Registrations, to the extent reasonably requested by the managing underwriter thereto (except for securities being sold by the Company for its own account under such Registration Statement and subject to any other rights set forth in any agreement providing for registration rights to any Other Stockholder entered into by the Company prior to the Effective Date).

Section 1.6Registration Procedures.

(a)Obligations of the Company.  Whenever registration of Registrable Securities is required pursuant to this Agreement, the Company shall use commercially reasonable efforts to effect the registration and sale of such Registrable Securities in accordance with the intended method of distribution thereof as promptly as possible (subject to compliance with any rights under the Existing Stockholders’ Agreement), and in connection with any such request, the Company shall, as expeditiously as possible:

(i)Preparation of Registration Statement; Effectiveness.  Prepare and file with the SEC (in any event, with respect to a Demand Registration under Section 1.2, not later than the time permitted under Section 1.2(b)(ii)), a Registration Statement on any form on which the Company then qualifies, which counsel for the Company shall deem appropriate and pursuant to which such offering may be made in accordance with the intended method of distribution thereof (except that the Registration Statement shall contain such information as may reasonably be requested for marketing or other purposes by the managing underwriter), and use commercially reasonable efforts to cause any registration required hereunder to become effective as soon as practicable (and, in any event, with respect to a Demand Registration under Section 1.2, not later than the time permitted under Section 1.2(b)(iii)) and, with respect to a Demand Registration or Shelf Registration, remain effective for a period of not less than twelve (12) months (or such shorter period in which all Registrable 

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Securities have been sold in accordance with the methods of distribution set forth in the Registration Statement); provided, however, that, in the case of any Shelf Registration of Registrable Securities which are intended to be offered on a continuous or delayed basis, such twelve (12) months period shall be extended, if necessary, to keep the Registration Statement effective until such time as Rule 144 or another similar exemption under the Securities Act is available for the sale of all of the Registrable Securities then held by the Holders without limitation during a three-month period without registration;

(ii)Participation in Preparation and Full Cooperation.  Upon the reasonable request of any Participating Holder, any underwriter participating in any disposition pursuant to a Registration Statement, and any attorney, accountant or other agent retained by any Participating Holder or underwriter (each, an “Agent” and, collectively, the “Agents”), provide the opportunity to participate (including, but not limited to, reviewing, commenting on and attending all meetings) in the preparation of such Registration Statement, each prospectus included therein or filed with the SEC and each amendment or supplement thereto.  In connection with each Demand Registration pursuant to Section 1.2 and any Shelf Registration pursuant to Section 1.4, cause there to occur Full Cooperation;

(iii)Due Diligence.  For a reasonable period prior to the filing of any Registration Statement pursuant to this Agreement, make available, to any Participating Holder and, if applicable, any Agent, upon reasonable notice and during normal business hours, for inspection all pertinent financial and other records, corporate documents and properties of the Company as shall be reasonably necessary to enable them to exercise their due diligence responsibility, and cause the Company’s officers, directors, employees and independent accountants to supply all information reasonably requested by any such Participating Holder, underwriter, or Agent in connection with such Registration Statement; provided, however, that if requested by the Company, each Agent, underwriter and each Participating Holder shall enter into a confidentiality agreement with the Company prior to participating in the preparation of the Registration Statement or the Company’s release or disclosure of confidential information to such Agent;

(iv)Counsel Review.  The Company shall permit the Participating Holder and its counsel, at the Participating Holder’s sole cost and expense, to participate (including, but not limited to, reviewing, commenting on and attending all meetings) in the preparation of the Registration Statement and all amendments and supplements thereto (as well as all requests for acceleration or effectiveness thereof) in advance of their filing with the SEC, and will not file any document in a form to which such counsel reasonably objects and will not request acceleration of the Registration Statement without prior notice to such counsel;

(v)General Notifications.  Promptly notify in writing the Participating Holders, the sales or placement agent, if any, therefor and the managing underwriter of the securities being sold, if applicable, (A) when such Registration Statement or the prospectus included therein or any prospectus amendment or supplement or post-effective amendment has been filed, and, with respect to any such Registration Statement or any post-effective amendment, when the same has become effective, (B) when the SEC notifies the Company whether there will be a “review” of such Registration Statement, (C) of the receipt of any comments (oral or written) by the SEC and by the blue sky or securities commissioner or regulator of any state with respect thereto and (D) of any request by the SEC for any amendments or supplements to such Registration Statement or the prospectus or for additional information;

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(vi)10b-5 Notification.  Promptly notify in writing the Participating Holders, the sales or placement agent, if any, therefor and the managing underwriter of the securities being sold pursuant to any Registration Statement at any time when a prospectus relating thereto is required to be delivered under the Securities Act upon discovery that, or upon the happening of any event as a result of which, any prospectus included in such Registration Statement (or amendment or supplement thereto) contains an untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances under which they were made, and the Company shall promptly prepare a supplement or amendment to such prospectus and file it with the SEC (in any event no later than ten (10) Business Days following notice of the occurrence of such event to each Participating Holder, the sales or placement agent and the managing underwriter) so that after delivery of such prospectus, as so amended or supplemented, to the purchasers of such Registrable Securities, such prospectus, as so amended or supplemented, shall not contain an 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 in light of the circumstances under which they were made;

(vii)Notification of Stop Orders; Suspensions of Qualifications and Exemptions.  Promptly notify in writing the Participating Holders, the sales or placement agent, if any, therefor and the managing underwriter of the securities being sold of (A) any stop order issued or, to the knowledge of the Company, threatened to be issued by the SEC with respect to a Registration Statement filed pursuant to this Agreement, or (B) 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, to the knowledge of the Company, the initiation or threatening of any proceeding for such purpose and the Company agrees to use commercially reasonable efforts to (x) prevent the issuance of any such stop order, and in the event of such issuance, to obtain the withdrawal of any such stop order, (y) obtain the withdrawal of any order suspending or preventing the use of any related prospectus or suspending the qualification of any Registrable Securities included in such Registration Statement for sale in any jurisdiction at the earliest practicable date and (z) if necessary to satisfy (x) and (y) hereof, the Company shall promptly prepare a supplement or amendment to such prospectus or Registration Statement and file it with the SEC, and, in connection with any of the foregoing events which has resulted in a suspension of a Participating Holder’s ability to dispose of securities under a Registration Statement, the Company shall promptly advise, in writing, any such Participating Holders that the use of the prospectus may be resumed;

(viii)Amendments and Supplements; Acceleration.  (A) Prepare and file with the SEC such amendments and supplements to each Registration Statement filed pursuant to this Agreement as may be necessary to comply with the provisions of the Securities Act, including post-effective amendments to each Registration Statement as may be necessary to keep such Registration Statement continuously effective for the applicable time period required hereunder and if applicable, file any Registration Statements pursuant to Rule 462(b) under the Securities Act; (B) 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) promulgated under the Securities Act; and (C) comply with the provisions of the Securities Act and the Exchange Act with respect to the disposition of all securities covered by such Registration Statement during such period in accordance with the intended methods of disposition by the sellers thereof set forth in such Registration Statement as so amended or in such prospectus as so supplemented;

(ix)Copies.  Furnish as promptly as reasonably practicable to each Participating Holder and Agent prior to filing a Registration Statement pursuant to this Agreement or 

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any supplement or amendment thereto with respect to the Registrable Securities, copies of such Registration Statement, supplement or amendment as it is proposed to be filed, and after such filing such number of copies of such Registration Statement, each such amendment and supplement thereto (in each case including all exhibits thereto), the prospectus included in such Registration Statement (including each preliminary prospectus) and such other documents as each such Participating Holder or underwriter may reasonably request in order to facilitate the disposition of the Registrable Securities owned by such Participating Holder;

(x)Blue Sky.  If applicable, use commercially reasonable efforts to, prior to any public offering of the Registrable Securities, register or qualify (or seek an exemption from registration or qualifications) such Registrable Securities under such other securities or blue sky laws of such jurisdictions as any Participating Holder or underwriter may reasonably request, and to continue such qualification in effect in each such jurisdiction for as long as is permissible pursuant to the laws of such jurisdiction, or for as long as a Participating Holder or underwriter reasonably requests or until all of such Registrable Securities are sold, whichever is shortest, and do any and all other acts and things which may be reasonably necessary or advisable to enable any Participating Holder to consummate the disposition in such jurisdictions of the Registrable Securities; provided, however, that the Company shall not be required in connection therewith or as a condition thereto to qualify to do business or to file a general consent of process in any such states or jurisdictions or subject itself to taxation in any such state or jurisdiction, but for this subparagraph;

(xi)Other Approvals.  Use commercially reasonable efforts to obtain all other approvals, consents, exemptions or authorizations from such governmental agencies or authorities as may be necessary upon the advice of counsel of the Company to enable the Participating Holders and underwriters to consummate the disposition of Registrable Securities, including, subject to reasonable Company priorities, causing officers and members of the management of the Company as the lead or managing underwriter of such offering may reasonably request to participate in the selling efforts relating to an underwritten offering of Registrable Securities to the extent customary for such offering (including, to the extent customary, telephonic, video or recorded participation in road shows);

(xii)Agreements.  Enter into and perform customary agreements (including any underwriting agreements in customary form), and take such other actions as may be reasonably required in order to expedite or facilitate the disposition of Registrable Securities;

(xiii)FINRA.  Reasonably cooperate with each Participating Holder and each underwriter participating in the disposition of such Registrable Securities and underwriters’ counsel in connection with any filings required to be made with the FINRA;

(xiv)”Cold Comfort” Letters.  If such registration is in connection with an underwritten offering, obtain “cold comfort” letters, dated the dates of the pricing and the closing under the underwriting agreement and addressed to the underwriters and signed by the Company’s independent public accountants in customary form and covering such matters of the type customarily covered by “cold comfort” letters as the managing underwriter of such offering may reasonably request;

(xiv)Legal Opinion and 10b-5 Letter.  If such registration is in connection with an underwritten offering, furnish, at the request of the managing underwriter of such offering on the date such securities are delivered to the underwriters for sale pursuant to such registration, an opinion and 10b-5 letter, dated such date, of counsel representing the Company for the purposes of 

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such registration, addressed to the Holders, and the placement agent or sales agent, if any, thereof and the underwriters, if any, thereof, covering such legal matters with respect to the registration in respect of which such opinion is being given as such underwriter may reasonably request and as are customarily included in such opinions and 10b-5 letters;

(xv)SEC Compliance, Earnings Statement.  Use commercially reasonable efforts to comply with all applicable rules and regulations of the SEC and make available to its shareholders, as soon as practicable, but no later than fifteen (15) months after the effective date of any Registration Statement, an earnings statement covering a period of twelve (12) months beginning after the effective date of such Registration Statement, in a manner which satisfies the provisions of Section 11(a) of the Securities Act and Rule 158 thereunder and which requirement will be deemed satisfied if the Company timely files complete and accurate information on Forms 10-Q and 10-K and Current Reports on Form 8-K under the Exchange Act and otherwise complies with Rule 158 under the Securities Act;

(xvi)Certificates, Closing.  If such registration is in connection with an underwritten offering, provide officers’ certificates and other customary closing documents as the managing underwriter of such offering may reasonably request;

(xvii)Listing.  Use commercially reasonable efforts to cause all such Registrable Securities to be listed or quoted on each securities exchange or market system on which similar securities issued by the Company are so listed or quoted (or, in the case of an Exchange Act Registration, to become so listed or quoted if requested);

(xviii)Transfer Agent, Registrar and CUSIP.  Provide a transfer agent and registrar for all Registrable Securities registered pursuant hereto and a CUSIP number for all such Registrable Securities, in each case, no later than the effective date of such registration;

(xix)Efforts.  Subject to all other provisions in this Agreement, use commercially reasonable efforts to take all other actions necessary to effect the registration of the Registrable Securities contemplated hereby.

(b)Seller Information.  The Company may require each Participating Holder as to which any registration of such Holder’s Registrable Securities is being effected to furnish to the Company such information regarding such Participating Holder and such Participating Holder’s method of distribution of such Registrable Securities as the Company may from time to time reasonably request in writing or as may be required by law.  If a Participating Holder refuses to provide the Company with any of such information, the Company may exclude such Participating Holder’s Registrable Securities from the Registration Statement if the Company determines, based on the advice of counsel, that such information is necessary to effect the Registration Statement and such Participating Holder continues thereafter to withhold such information.  The exclusion of a Participating Holder’s Registrable Securities shall not affect the registration of the other Registrable Securities to be included in the Registration Statement.

(c)Notice to Discontinue.  Each Participating Holder whose Registrable Securities are covered by a Registration Statement filed pursuant to this Agreement agrees that, upon receipt of written notice from the Company of the happening of any event of the kind described in Section 1.2(d) and/or Section 1.6(a)(v), such Participating Holder shall forthwith discontinue the disposition of Registrable Securities until such Participating Holder’s receipt of the copies of the supplemented or 

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amended prospectus contemplated by Section 1.2(d) and/or Section 1.6(a)(v) or until it is advised in writing by the Company that the use of the prospectus may be resumed and has received copies of any additional or supplemental filings which are incorporated by reference into the prospectus, and, if so directed by the Company in the case of an event described in Section 1.2(d) and/or Section 1.6(a)(v), such Participating Holder shall deliver to the Company (at the Company’s expense) all copies, other than permanent file copies then in such Participating Holder’s possession, of the prospectus covering such Registrable Securities which is current at the time of receipt of such notice.  If the Company shall give any such notice, the Company shall extend the period during which such Registration Statement is to be maintained effective by the number of days during the period from and including the date of the giving of such notice pursuant to Section 1.2(d) and/or Section 1.6(a)(v) to and including the date when the Participating Holder shall have received the copies of the supplemented or amended prospectus contemplated by, and meeting the requirements of Section 1.2(d) and/or Section 1.6(a)(v).  Each Participating Holder whose Registrable Securities are covered by a Registration Statement filed pursuant to this Agreement agrees that as of the date that a final prospectus is made available to it for distribution to prospective purchasers of Registrable Securities, it shall cease to distribute copies of any preliminary prospectus prepared in connection with the offer and sale of Registrable Securities.

Section 1.7Registration Expenses and Selling Expenses.  Except as otherwise provided herein, (a) all Registration Expenses shall be borne by the Company and (b) the Selling Expenses relating to Registrable Securities registered shall be borne by the Participating Holders of such Registrable Securities pro rata on the basis of the number of Registrable Securities sold.

Section 1.8Indemnification.

(a)Indemnification by the Company.  In the event any Registrable Securities are included in a Registration Statement, the Company will indemnify and hold harmless to the fullest extent permitted by law each Participating Holder, its Affiliates, any underwriter and each of their respective directors, officers, employees, advisors, agents, stockholders, members, general partners and limited partners and each Person who controls (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) any of such Persons (collectively, “Company Indemnified Parties”) from and against any and all losses, claims, damages, expenses (including, without limitation, reasonable costs of investigation and fees, disbursements and other charges of counsel, any amounts paid in settlement effected with the Company’s consent, and any costs incurred in enforcing the Company’s indemnification obligations hereunder) or other liabilities (collectively, “Losses”) to which any such Company Indemnified Party may become subject under the Securities Act, the Exchange Act, any other federal, state or foreign law or any rule or regulation promulgated thereunder, or under any common law or otherwise, insofar as such Losses (or actions or proceedings, whether commenced or threatened, in respect thereof) are resulting from or arising out of or based upon any untrue, or alleged untrue, statement of a material fact contained in such Registration Statement, including any prospectus or preliminary prospectus contained therein or any amendments or supplements thereto, any free writing prospectuses or any document incorporated by reference in any of the foregoing or resulting from 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 (in the case of a prospectus, preliminary prospectus or free writing prospectus, in the light of the circumstances under which they were made), not misleading, and the Company will promptly reimburse each such Company Indemnified Party for any reasonable and documented legal fees and expenses and any other Losses reasonably incurred in connection with investigating, preparing or defending any such claim, loss, damage, liability, action or investigation or proceeding; provided, however, that the Company shall not be liable to any Company Indemnified Party for any Losses that result from or arise out of or are 

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based upon any untrue statement or omission made in conformity with written information provided by, or on behalf of, a Company Indemnified Party. Such indemnity obligation shall remain in full force and effect regardless of any investigation made by or on behalf of the Company Indemnified Parties and shall survive the transfer of Registrable Securities by such Company Indemnified Parties in accordance with the terms hereof.

(b)Indemnification by Participating Holders.  In connection with any proposed registration in which a Holder is participating pursuant to this Agreement, each such Participating Holder agrees, severally and not jointly, to indemnify and hold harmless the Company, each other Participating Holder, their respective directors and officers, and each Person who controls (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) the Company or any other Participating Holder (collectively, “Holder Indemnified Parties”) to the same extent as the foregoing indemnity from the Company to the Holders as set forth in Section 1.8(a) (subject to the exceptions set forth in the foregoing indemnity, the proviso to this sentence and applicable law), but only with respect to any such untrue statement or omission made in conformity with information relating to such Participating Holder furnished in writing to the Company by such Participating Holder; provided, however, that the liability of any Participating Holder under this Section 1.8(b) shall be limited to the amount of the net proceeds (after underwriting fees, commissions or discounts) received by such Participating Holder in the offering giving rise to such liability.  Such indemnity obligation shall remain in full force and effect regardless of any investigation made by or on behalf of the Holder Indemnified Parties and shall survive the transfer of Registrable Securities by such Participating Holder.

(c)Conduct of Indemnification Proceedings.  Any Person entitled to indemnification hereunder (the “Indemnified Party”) agrees to give prompt written notice to the indemnifying party (the “Indemnifying Party”) after the receipt by the Indemnified Party of any written notice of the commencement of any action, suit, proceeding or investigation or threat thereof for which the Indemnified Party intends to claim indemnification or contribution pursuant to this Agreement; provided, however, that the failure so to notify the Indemnifying Party shall not relieve the Indemnifying Party of any liability that it may have to the Indemnified Party hereunder unless and to the extent such Indemnifying Party is materially prejudiced by such failure.  If notice of commencement of any such action is given to the Indemnifying Party as above provided, the Indemnifying Party shall be entitled to participate in and, to the extent it may wish, jointly with any other Indemnifying Party similarly notified, to assume the defense of such action at its own expense, with counsel chosen by it and reasonably satisfactory to such Indemnified Party.  Notwithstanding anything herein to the contrary, the Indemnified Party shall have the right to employ separate counsel in any such action and participate in the defense thereof, but the fees and expenses of one such counsel shall be paid by the Indemnified Party unless (i) the Indemnifying Party agrees to pay the same, (ii) the Indemnifying Party fails to assume the defense of such action with counsel reasonably satisfactory to the Indemnified Party within thirty (30) days after receiving notice from such Indemnified Party that the Indemnified Party believes it has failed to do so or (iii) the Indemnified Party reasonably believes that the joint representation of the Indemnified Party and any other party in such proceeding (including but not limited to the Indemnifying Party) would be inappropriate under applicable standards of professional conduct.  No Indemnifying Party shall be liable for any settlement entered into without its written consent, which consent shall not be unreasonably withheld, conditioned or delayed.  No Indemnifying Party shall, without the written consent of the Indemnified Party, effect the settlement or compromise of, or consent to the entry of any judgment with respect to, any pending or threatened action or claim in respect of which indemnification or contribution may be sought hereunder (whether or not the Indemnified Party is an actual or potential party to such action or claim) unless such 

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settlement, compromise or judgment (A) includes an unconditional release of the Indemnified Party from all liability arising out of such action or claim and (B) does not include a statement as to, or an admission of, fault, culpability or a failure to act by or on behalf of any Indemnified Party.  The rights afforded to any Indemnified Party hereunder shall be in addition to any rights that such Indemnified Party may have at common law, by separate agreement or otherwise.

(d)Contribution.  If the indemnification provided for in this Section 1.8 from the Indemnifying Party is unavailable to an Indemnified Party in respect of any Losses referred to herein, then the Indemnifying Party, in lieu of indemnifying the Indemnified Party, shall contribute to the amount paid or payable by the Indemnified Party as a result of such Losses in such proportion as is appropriate to reflect the relative fault of the Indemnifying Party and the Indemnified Party, as well as any other relevant equitable considerations.  The relative faults of the Indemnifying Party and Indemnified Party shall be determined by reference to, among other things, whether any action in question, including any untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact, was made by, or relates to information supplied by, such Indemnifying Party or Indemnified Party, and the Indemnifying Party’s and Indemnified Party’s relative intent, knowledge, access to information and opportunity to correct or prevent such action; provided, however, that the liability of any Holder under this Section 1.8(d) shall be limited to the amount of the net proceeds (after underwriting fees, commissions or discounts) received by such Holder in the offering giving rise to such liability.  The amount paid or payable by a party as a result of the Losses or other liabilities referred to above shall be deemed to include, subject to the limitations set forth in Section 1.8(a), Section 1.8(b) and Section 1.8(c), any legal or other fees, charges or expenses reasonably incurred by such party in connection with any investigation or proceeding.  The parties hereto agree that it would not be just and equitable if contribution pursuant to this Section 1.8(d) were determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations referred to in the immediately preceding paragraph.  No Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution pursuant to this Section 1.8(d) from any Person who was not guilty of such fraudulent misrepresentation.

(e)The obligations of the Company and Holders under this Article I shall survive the completion of any offering of Registrable Securities pursuant to a registration statement under this Article I, and shall survive the termination of this Agreement.

Section 1.9Rule 144; Other Exemptions.  With a view to making available to the Holders the benefits of Rule 144 promulgated under the Securities Act and other rules and regulations of the SEC that may at any time permit a Holder to sell securities of the Company to the public without registration, the Company covenants that it will use commercially reasonable efforts to (i) if and when it is subject to the periodic reporting requirement under the Exchange Act, file in a timely manner all reports and other documents required to be filed by it under the Securities Act and the Exchange Act and the rules and regulations adopted by the SEC thereunder and (ii) at all times take any and all action as each Holder may reasonably request (including, but not limited to providing any information necessary to comply with Rule 144, in each case in connection with resales of the Registrable Securities under the Securities Act), 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 (if available with respect to resales of the Registrable Securities) under the Securities Act, as such rules may be amended from time to time.  Upon the written request of a Holder, the Company shall deliver to the Holder a written statement as to whether it has complied with the covenants set forth above.

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Section 1.10Certain Limitations On Registration Rights; Subordination.  No Holder may participate in any Registration Statement hereunder involving an underwritten public offering unless such Holder completes and executes all questionnaires, powers of attorney, indemnities, underwriting agreements, and other documents reasonably required under the terms of the underwriting arrangements made in connection with such Registration Statement and agrees to sell such Holder’s Registrable Securities on the basis provided in any underwriting agreement approved by the Holder or Holders entitled hereunder to approve such arrangements; provided, however, that no such Holder shall be required to make any representations or warranties to the Company or the underwriters in connection with any such registration other than representations and warranties as to (i) such Holder’s ownership of its Registrable Securities to be sold or transferred, (ii) such Holder’s power and authority to effect such transfer and (iii) such matters pertaining to compliance with securities laws as may be reasonably requested.  Additionally, notwithstanding anything in this Agreement to the contrary, the rights of the Holders hereunder are expressly subordinated and subject to any and all rights set forth in the Existing Stockholders’ Agreement.

Section 1.11Transfer of Registration Rights.  Without the consent of the Company, the rights of a Holder hereunder may be transferred or assigned in connection with any transfer of Registrable Securities if (i) such transfer or assignment is made to an Affiliate of such Holder, (ii) the transferee or assignee becomes a party to this Agreement as a “Holder” in accordance with Section 2.2 of this Agreement, and (iii) the Company is given written notice by such Holder of such transfer or assignment, stating the name and address of the transferee or assignee and identifying the Registrable Securities with respect to which such rights are being transferred or assigned; provided, that the rights and obligations that are assigned shall apply only to the Registrable Securities sold or transferred by a Holder, including any shares issued in respect of such Registrable Securities pursuant to clause (c) of the definition of “Registrable Securities,” but expressly excluding any other securities of the Company acquired by such assignee.

Section 1.12Number of Registrable Securities Outstanding.  In order to determine the number of Registrable Securities outstanding at any time, upon the written request of the Company to the Holders, each Holder shall promptly inform the Company of the number of Registrable Securities that such Holder owns and that the Company may conclusively rely upon any certificate provided under this Agreement for the purpose of determining the number of such Registrable Securities.

Article II

GENERAL PROVISIONS

Section 2.1Entire Agreement.  This Agreement, together with the Issuance Agreement and any certificates, documents, instruments and writings that are delivered pursuant hereto and thereto, as applicable, constitute the entire agreement and understanding of the parties in respect of the subject matter hereof and supersede all prior understandings, agreements or representations by or among the parties, written or oral, to the extent they relate in any way to the subject matter hereof or thereof.

Section 2.2Assignment; Binding Effect.  The Holder’s obligations under is Agreement may not be assigned, except as permitted in this Section 2.2.  Subject to the limitations on transfer set forth in Section 1.11, a Holder may assign all or a portion of its rights hereunder to an Affiliate of such Holder, and the Holder may obligate all or a portion of its obligations under this Agreement to any transferee, provided that such assignment shall not be deemed effective until the Holder has delivered 

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to the Company a Joinder Agreement, in substantially the form attached hereto as Exhibit A, duly executed by such transferee.  This Agreement is not assignable by the Company (except by merger or in connection with another entity acquiring all or substantially all of the Company’s assets).  All of the terms, agreements, covenants, representations, warranties and conditions of this Agreement are binding upon, and inure to the benefit of and are enforceable by, the parties and their respective successors and permitted assigns.

Section 2.3Notices.  All notices, requests and other communications provided for or permitted to be given under this Agreement must be in writing and be given by personal delivery, by certified or registered United States mail (postage prepaid, return receipt requested), by a nationally recognized overnight delivery service for next day delivery, or by electronic mail, as follows (or to such other address as any party may give in a notice given in accordance with the provisions hereof):

If to any Holder, at its last known address appearing on the books of the Company maintained for such purpose.

If to the Company, at

AEON Biopharma, Inc.
4040 MacArthur Boulevard, Suite 260
Newport Beach, California  92660
mf@aeonbiopharma.com

All notices, requests or other communications will be effective and deemed given only as follows:  (i) if given by personal delivery, upon such personal delivery, (ii) if sent by certified or registered mail, on the fifth (5th) Business Day after being deposited in the United States mail, (iii) if sent for next day delivery by overnight delivery service, on the date of delivery as confirmed by written confirmation of delivery, (iv) if sent by electronic mail, upon the senders receipt of a read receipt or delivery confirmation, except that if such confirmation is received after 5:00 p.m. (in the recipient’s time zone) on a Business Day, or is received on a day that is not a Business Day, then such notice, request or communication will not be deemed effective or given until the next succeeding Business Day.  Notices, requests and other communications sent in any other manner will not be effective.

Section 2.4Specific Performance; Remedies.  Each party acknowledges and agrees that the other parties would be damaged irreparably if any provision of this Agreement were not performed in accordance with its specific terms or were otherwise breached and the Company agrees that it shall not oppose any such demand for specific performance on the basis that monetary damages are available.  Accordingly, the parties will be entitled to an injunction or injunctions to prevent breaches of the provisions of this Agreement and to enforce specifically this Agreement and its provisions in any action or proceeding instituted in any court of the United States or any state thereof having jurisdiction over the parties and the matter, in addition to any other remedy to which they may be entitled, at law or in equity.  Except as expressly provided herein, the rights, obligations and remedies created by this Agreement are cumulative and in addition to any other rights, obligations or remedies otherwise available at law or in equity.  Except as expressly provided herein, nothing herein will be considered an election of remedies.

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Section 2.5Submission to Jurisdiction; Waiver of Jury Trial.

(a)Submission to Jurisdiction.  Any action, suit or proceeding seeking to enforce any provision of, or based on any matter arising out of or in connection with, this Agreement or the transactions contemplated hereby shall only be brought in any federal court located in the State of Delaware or any state court in the State of Delaware, and each party consents to the exclusive jurisdiction and venue of such courts (and of the appropriate appellate courts therefrom) in any such action, suit or proceeding and irrevocably waives, to the fullest extent permitted by law, any objection that it may now or hereafter have to the laying of the venue of any such, action, suit or proceeding in any such court or that any such action, suit or proceeding brought in any such court has been brought in an inconvenient forum.  Process in any such action, suit or proceeding may be served on any party anywhere in the world, whether within or without the jurisdiction of any such court.

(b)Waiver of Jury Trial.  EACH PARTY ACKNOWLEDGES THAT ANY DISPUTE THAT MAY ARISE OUT OF OR RELATING TO THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE SUCH PARTY HEREBY EXPRESSLY WAIVES ITS RIGHT TO JURY TRIAL OF ANY DISPUTE BASED UPON OR ARISING OUT OF THIS AGREEMENT OR ANY OTHER AGREEMENTS RELATING HERETO OR ANY DEALINGS AMONG THEM RELATING TO THE TRANSACTIONS CONTEMPLATED HEREBY.  THE SCOPE OF THIS WAIVER IS INTENDED TO ENCOMPASS ANY AND ALL ACTIONS, SUITS AND PROCEEDINGS THAT RELATE TO THE SUBJECT MATTER OF THE TRANSACTIONS CONTEMPLATED HEREBY, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS.  EACH PARTY REPRESENTS THAT (i) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT IN THE EVENT OF ANY ACTION, SUIT OR PROCEEDING, SEEK TO ENFORCE THE FOREGOING WAIVER, (ii) SUCH PARTY UNDERSTANDS AND WITH THE ADVICE OF COUNSEL HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (iii) SUCH PARTY MAKES THIS WAIVER VOLUNTARILY, AND (iv) SUCH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND REPRESENTATIONS IN THIS SECTION 2.5(b).

Section 2.6Governing Law.  This Agreement will be governed by and construed in accordance with the laws of the State of Delaware, without giving effect to any choice of law principles.

Section 2.7Headings.  The article and section headings contained in this Agreement are inserted for convenience only and will not affect in any way the meaning or interpretation of this Agreement.

Section 2.8Amendments; Waivers.  An amendment, modification or waiver to any provision of this Agreement will require the written consent of the Company and the Holders of a majority of the Registrable Securities outstanding on the date of such amendment, modification or amendment, except in the case of any amendment, modification or waiver of any warranty, covenant, obligation or other provision of this Agreement relating only to a particular Registration Statement which has been filed with the SEC, which will require the written consent of Holders representing a Majority in Interest of Participating Holders relating to that Registration Statement.

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No waiver by any party of any default, misrepresentation or breach of warranty or covenant hereunder, whether intentional or not, may be deemed to extend to any prior or subsequent default, misrepresentation or breach of warranty or covenant hereunder or affect in any way any rights arising because of any prior or subsequent such occurrence.  Neither the failure nor any delay on the part of any party to exercise any right or remedy under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any right or remedy preclude any other or further exercise of the same or of any other right or remedy.

Section 2.9Severability.  The provisions of this Agreement will be deemed severable and the invalidity or unenforceability of any provision will not affect the validity or enforceability of the other provisions hereof; provided, that if any provision of this Agreement, as applied to any party or to any circumstance, is judicially determined not to be enforceable in accordance with its terms, the parties agree that the court judicially making such determination may modify the provision in a manner consistent with its objectives such that it is enforceable, and/or to delete specific words or phrases, and in its modified form, such provision will then be enforceable and will be enforced.

Section 2.10Counterparts; Effectiveness.  This Agreement may be executed in two or more counterparts, each of which will be deemed an original but all of which together will constitute one and the same instrument.  This Agreement will become effective when one or more counterparts have been signed by each of the parties and delivered to the other parties.

Section 2.11Construction.  This Agreement has been freely and fairly negotiated among the parties.  If an ambiguity or question of intent or interpretation arises, this Agreement will be construed as if drafted jointly by the parties and no presumption or burden of proof will arise favoring or disfavoring any party because of the authorship of any provision of this Agreement.  Any reference to any law will be deemed to refer to such law as in effect on the date hereof and all rules and regulations promulgated thereunder, unless the context requires otherwise.  The words “include,” “includes,” and “including” will be deemed to be followed by “without limitation.” Pronouns in masculine, feminine, and neuter genders will be construed to include any other gender, and words in the singular form will be construed to include the plural and vice versa, unless the context otherwise requires.  The words “this Agreement,” “herein,” “hereof,” “hereby,” “hereunder,” and words of similar import refer to this Agreement as a whole and not to any particular subdivision unless expressly so limited.  The parties intend that each representation, warranty, and covenant contained herein will have independent significance.  If any party has breached any covenant contained herein in any respect, the fact that there exists another covenant relating to the same subject matter (regardless of the relative levels of specificity) which the party has not breached will not detract from or mitigate the fact that the party is in breach of the first covenant.

Section 2.12Termination of Registration Rights.  This Agreement, including, without limitation, the Company’s obligations under Sections 1.2 and 1.3 hereof to register Registrable Securities for sale under the Securities Act, shall terminate on the first date on which Rule 144 or another similar exemption under the Securities Act is available for the sale of all of the Registrable Securities then held by the Holders without limitation during a three-month period without registration.  Notwithstanding any termination of this Agreement pursuant to this Section 2.12, the parties’ rights and obligations under Section 1.7 and 1.8 and Article II hereof shall continue in full force and effect.

Section 2.13Adjustments for Stock Splits, Etc.  Wherever in this Agreement there is a reference to a specific number of shares of the Company’s capital stock of any class or series, then, upon the occurrence of any subdivision, combination or stock dividend of such class or series of stock, 

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the specific number of shares so referenced in this Agreement will automatically be proportionally adjusted to reflect the effect of such subdivision, combination or stock dividend on the outstanding shares of such class or series of stock.

Section 2.14Aggregation of Stock.  All shares of Registrable Securities owned or acquired by any Holder or its Affiliated entities or persons (assuming full conversion, exchange and exercise of all convertible, exchangeable and exercisable securities into Registrable Securities) shall be aggregated together for the purpose of determining the availability of any right under this Agreement.

[SIGNATURE PAGES FOLLOW]

 

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

 

	
COMPANY:

	
 

	
AEON BIOPHARMA, INC.

	
 

	
 
	
 

	
By:
	
/s/ March Forth

	
Name:
	
Marc Forth

	
Title:
	
President and Chief Executive Officer

 

 

 

	
INVESTOR:

	
 

	
MEDYTOX, INC.

	
 

	
 
	
 

	
By:
	
/s/ Hyn Ho Jung

	
Name:
	
Hyun Ho Jung

	
Title:
	
CEO & President

 

 

 

 

Signature Page to Registration Rights Agreement

 

 

EXHIBIT A

FORM OF JOINDER AGREEMENT

This JOINDER AGREEMENT to the Registration Rights Agreement (the “Joinder Agreement”) is made and entered into as of ___________________ by and among AEON Biopharma, Inc., a Delaware corporation (the “Company”), and the undersigned (the “Joining Party”), and related to that certain Registration Rights Agreement dated as of June 21, 2021 (as amended from time to time, the “Registration Rights Agreement”), by and between the Company and Medytox, Inc. (“Investor”).  Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Registration Rights Agreement.

WHEREAS, the Joining Party is acquiring the Company’s Common Stock, and in connection therewith the Company has agreed to grant certain registration rights to such Joining Party as provided for in the Registration Rights Agreement; and

WHEREAS, the Joining Party has agreed to become a party to the Registration Rights Agreement on the terms set forth herein.

NOW, THEREFORE, in consideration of the foregoing and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agrees as follows:

1.The Joining Party hereby acknowledges that it has received a copy of the Registration Rights Agreement and all other documents it deems fit to enter into this Joinder Agreement, and acknowledges and agrees to (i) join and become a party to the Registration Rights Agreement as indicated by its signature below, (ii) be bound by all covenants, agreements, representations, warranties, indemnities and acknowledgements attributable to the Holder as if the Joining Party was a party thereto as of the date of the Registration Rights Agreement; (iii) perform all obligations and duties required and be entitled to all of the benefits of an Investor pursuant to the Registration Rights Agreement and (iv) agree to be deemed a “Holder”“ under the Registration Rights Agreement.

2.The Joining Party hereby represents and warrants to the Company that it has all the requisite [corporate] power and authority to execute, deliver and perform such Joining Party’s obligations under this Joinder Agreement.

3.This Joinder Agreement shall be binding upon and shall inure to the benefit of, and be enforceable by, the Company, the Investor and the Joining Party and their respective heirs, representatives, successors and assigns.

4.This Joinder Agreement may be signed in two or more counterparts (which may be delivered in original form or in electronic format), each of which shall constitute an original when so executed and delivered and all of which together shall constitute one and the same agreement.

5.No amendment or waiver of any provision of this Joinder Agreement, nor any consent or approval to any departure therefrom, shall in any event be effective unless the same shall be in writing signed by the parties to the Registration Rights Agreement.

A-1

 

 

6.The validity and interpretations of this Joinder Agreement, and the terms and conditions set forth herein, shall be governed by and construed in accordance with the laws of the State of Delaware.

[Signatures on Next Page]

A-2

 

 

 

IN WITNESS WHEREOF, the undersigned has executed and delivered this Joinder Agreement as of the date written below.

	
JOINING PARTY:
	
COMPANY:

	
 
	
Acknowledged and Accepted:

	
Print Name:
	
AEON BIOPHARMA, INC.

	
 
	
By:

	
Signature:
	
Name:

	
 
	
Title

	
Address:
	
 

	
 
	
INVESTOR

	
 
	
Acknowledged and accepted for itself and on behalf of the other Holders, if any:

	
Telephone:
	
MEDYTOX, INC.

	
Facsimile
	
By:

	
E-Mail
	
Name:

	
Common Stock Held:
	
Title

 

A-3

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