Registration Rights Agreement - SuperGen Inc. and HSBC James Capel Canada Inc.
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT, dated as of November 23, 1998
(this "Agreement"), is made by and between SUPERGEN, INC., a Delaware
corporation (the "Company"), and HSBC JAMES CAPEL CANADA, INC. (the
"Investor").
W I T N E S S E T H:
WHEREAS, upon the terms and subject to the conditions of the Common
Stock Purchase Agreement, dated as of November 23, 1998, between the Investor
and the Company (the "Purchase Agreement"), the Company has agreed to issue
and sell to the Investor, 460,000 shares of the common stock, $.0001 par
value per share (the "Common Stock"), of the Company (the "Shares"), and
warrants issued pursuant to Section 7.1 of the Purchase Agreement to purchase
shares of Common Stock (the "Warrants"), which Warrants will be exercisable
for shares of Common Stock (the "Warrant Shares"), for a purchase price of
$3,000,000; and
WHEREAS, to induce the Investor to execute and deliver the Purchase
Agreement, the Company has agreed to provide certain registration rights
under the Securities Act of 1933, as amended, and the rules and regulations
thereunder, or any similar successor statute (collectively, the "Securities
Act"), with respect to the Shares and Warrant Shares;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Company and the
Investor hereby agrees as follows:
1. DEFINITIONS.
(a) As used in this Agreement, the following terms shall have the
following meanings:
(i) "Investor" means the Investor and any permitted transferee or
assignee who agrees to become bound by the provisions of this Agreement in
accordance with Section 9 hereof.
(ii) "Register," "Registered," and "Registration" refer to a
registration effected by preparing and filing a Registration Statement or
Statements in compliance with the Securities Act and pursuant to Rule 415
under the Securities Act or any successor rule providing for offering
securities on a continuous basis ("Rule 415"), and the declaration or
ordering of effectiveness of such Registration Statement by the United States
Securities and Exchange Commission (the "SEC").
(iii) "Registrable Securities" means the Shares and the Warrant
Shares.
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(iv) "Registration Statement" means a registration statement of the
Company under the Securities Act.
(b) Capitalized terms used herein and not otherwise defined herein
shall have the respective meanings set forth in the Purchase Agreement.
2. REGISTRATION.
(a) MANDATORY REGISTRATION. The Company shall prepare and file
with the SEC a Registration Statement on an appropriate form for registering
for resale by the Investor a sufficient number of shares of Common Stock for
the Investor (or such lesser number as may be required by the SEC, but in no
event less than the number of shares of Common Stock which will be issued
under the Purchase Agreement and the Warrants exercisable at the time of
filing of the Registration Statement, or an amendment to any pending Company
Registration Statement, and such Registration Statement or amended
Registration Statement shall state that, in accordance with Rule 416 and 457
under the Securities Act, it also covers such indeterminate number of
additional shares of Common Stock as may become issuable upon the exercise of
the Warrants to prevent dilution resulting from stock splits, or stock
dividends), and the Company shall use its best efforts to cause the
Registration Statement shall be declared effective no later than 75 days
after the Closing Date. If at any time the number of shares of Common Stock
issuable under the Purchase Agreement exceeds the aggregate number of shares
of Common Stock then registered, the Company shall, within ten (10) business
days after receipt of a written notice from any Investor, either (i) amend
the Registration Statement filed by the Company pursuant to the preceding
sentence, if such Registration Statement has not been declared effective by
the SEC at that time, to register all shares of Common Stock issuable upon
each of the Company's Draw Downs and the Investor's Call Options, or (ii) if
such Registration Statement has been declared effective by the SEC at that
time, file with the SEC an additional Registration Statement to register the
shares of Common Stock issuable under the Purchase Agreement that exceed the
aggregate number of shares of Common Stock already registered.
(b) PAYMENTS BY THE COMPANY.
If the Registration Statement covering the Registrable
Securities required to be filed by the Company pursuant to Section 2(a)
hereof (i) has not been filed within thirty (30) days from the Closing Date,
the Company will pay the Investor liquidated damages equal to $20,000 per
week for each week (pro rated for a period which is less than an entire week)
that the Company fails to file the Registration Statement and/or (ii) has not
been declared effective by seventy-five (75) days following the Closing Date
(except as provided by the last sentence of Section 2(a)), then the Company
will pay the Investor liquidated damages equal to $20,000 per month for each
month (pro rated for a period which is less than an entire month) until the
earlier of (x) the date such Registration Statement is declared effective or
(y) the date all such Registrable Securities may be sold in reliance on Rule
144.
3. OBLIGATIONS OF THE COMPANY. In connection with the
registration of the Registrable Securities, the Company shall do each of the
following.
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(a) Prepare promptly and file with the SEC, a Registration
Statement with respect to not less than the number of Registrable Securities
provided in Section 2(a), above, and thereafter use its best efforts to cause
each Registration Statement relating to Registrable Securities to become
effective seventy-five (75) days after the Closing Date, and keep the
Registration Statement effective at all times until the earliest (the
"Registration Period") of (i) the date that is three years after the Closing
Date (ii) the date when the Investor may sell all Registrable Securities
under Rule 144 or (iii) the date the Investor no longer owns any of the
Registrable Securities, which Registration Statement (including any
amendments or supplements thereto and prospectuses contained therein) shall
not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances in which they were made,
not misleading;
(b) Prepare and file with the SEC such amendments (including
post-effective amendments) and supplements to the Registration Statement and
the prospectus used in connection with the Registration Statement as may be
necessary to keep the Registration Statement effective at all times during
the Registration Period, and, during the Registration Period, comply with the
provisions of the Securities Act with respect to the disposition of all
Registrable Securities of the Company covered by the 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 seller or
sellers thereof as set forth in the Registration Statement;
(c) The Company shall permit a single firm of counsel designated
by the Investor to review the Registration Statement and all amendments and
supplements thereto a reasonable period of time prior to their filing with
the SEC;
(d) Furnish to the Investor whose Registrable Securities are
included in the Registration Statement and its legal counsel identified to
the Company, (i) promptly after the same is prepared and publicly
distributed, filed with the SEC, or received by the Company, one (1) copy of
the Registration Statement, each preliminary prospectus and prospectus, and
each amendment or supplement thereto, and (ii) such number of copies of a
prospectus, and all amendments and supplements thereto and such other
documents, as the Investor may reasonably request in order to facilitate the
disposition of the Registrable Securities owned by the Investor;
(e) As promptly as practicable after becoming aware of such event,
the Company shall notify the Investor of (x) the issuance by the SEC of a
stop order suspending the effectiveness of the Registration Statement, (y)
the happening of any event of which the Company has knowledge as a result of
which the prospectus included in the Registration Statement, as then in
effect, includes an untrue statement of a material fact or omits to state a
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading, or (z) the occurrence or existence of any pending corporate
development that, in the reasonable discretion of the Company, makes it
appropriate to suspend the availability of the Registration Statement, and
use its best efforts promptly to prepare a supplement or amendment to the
Registration Statement to correct such untrue statement or omission, and
deliver such number of copies of such supplement
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or amendment to each Investor as such Investor may reasonably request;
provided that, for not more than twenty (20) days (or a total of not more
than forty (40) days in any twelve (12) month period, the Company may delay
the disclosure of material non-public information concerning the Company (as
well as prospectus or Registration Statement updating) the disclosure of
which at the time is not, in the good faith opinion of the Company, the best
interests of the Company and in the opinion of counsel to the Company (an
"Allowed Delay"); provided, further, that the Company shall promptly (i)
notify the Investor in writing of the existence of material non-public
information giving rise to an Allowed Delay and (ii) advise the Investor in
writing to cease all sales under the Registration Statement until the end of
the Allowed Delay. Upon expiration of the Allowed Delay, the Company shall
again be bound by the first sentence of this Section 3(f) with respect to the
information giving rise thereto, and shall be obligated to pay to the
Investors any amounts provided for in Section 2(b).
(f) As promptly as practicable after becoming aware of such event,
notify the Investor who holds Registrable Securities being sold (or, in the
event of an underwritten offering, the managing underwriters) of the issuance
by the SEC of a Notice of Effectiveness or any notice of effectiveness or any
stop order or other suspension of the effectiveness of the Registration
Statement at the earliest possible time;
(g) Provide a transfer agent and registrar, which may be a single
entity, for the Registrable Securities not later than the effective date of
the Registration Statement;
(h) Cooperate with the Investor who hold Registrable Securities
being offered to facilitate the timely preparation and delivery of
certificates for the Registrable Securities to be offered pursuant to the
Registration Statement and enable such certificates for the Registrable
Securities to be in such denominations or amounts as the case may be, as the
Investor may reasonably request, and, within three (3) business days after a
Registration Statement which includes Registrable Securities is ordered
effective by the SEC, the Company shall deliver, and shall cause legal
counsel selected by the Company to deliver, to the transfer agent for the
Registrable Securities (with copies to the Investor whose Registrable
Securities are included in such Registration Statement) an appropriate
instruction and opinion of such counsel; and
(i) Take all other reasonable actions necessary to expedite and
facilitate disposition by the Investor of the Registrable Securities pursuant
to the Registration Statement.
4. OBLIGATIONS OF THE INVESTOR. In connection with the
registration of the Registrable Securities, the Investor shall have the
following obligations:
(a) It shall be a condition precedent to the obligations of the
Company to complete the registration pursuant to this Agreement with respect
to the Registrable Securities of the Investor that the Investor shall furnish
to the Company such information regarding itself, the Registrable Securities
held by it, and the intended method of disposition of the Registrable
Securities held by it, as shall be reasonably required to effect the
registration of such Registrable Securities and shall execute such documents
in connection with such registration as the Company may reasonably request.
At least five (5) days prior to the first anticipated filing date of the
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Registration Statement, the Company shall notify the Investor of the
information the Company requires from the Investor (the "Requested
Information").
(b) The Investor agrees to cooperate with the Company as
reasonably requested by the Company in connection with the preparation and
filing of the Registration Statement hereunder; and
(c) The Investor agrees that, upon receipt of any notice from the
Company of the happening of any event of the kind described in Section 3(e)
or 3(f), above, the Investor will immediately discontinue disposition of
Registrable Securities pursuant to the Registration Statement covering such
Registrable Securities until the Investor's receipt of the copies of the
supplemented or amended prospectus contemplated by Section 3(e) or 3(f) and,
if so directed by the Company, the Investor shall deliver to the Company (at
the expense of the Company) or destroy (and deliver to the Company a
certificate of destruction) all copies in the Investor's possession, of the
prospectus covering such Registrable Securities current at the time of
receipt of such notice.
5. EXPENSES OF REGISTRATION. All reasonable expenses, other than
underwriting discounts and commissions incurred in connection with
registrations, filings or qualifications pursuant to Section 3, but
including, without limitation, all registration, listing, and qualifications
fees, printers and accounting fees, the fees and disbursements of counsel for
the Company, shall be borne by the Company.
6. INDEMNIFICATION. The rights of the Investor and the Company
to indemnification and/or contribution in the event any Registrable
Securities are included in a Registration Statement under this Agreement are
set forth on Schedule A hereto.
7. REPORTS UNDER EXCHANGE ACT. With a view to making available
to the Investor the benefits of Rule 144 promulgated under the Securities Act
or any other similar rule or regulation of the SEC that may at any time
permit the Investor to sell securities of the Company to the public without
registration ("Rule 144"), the Company agrees to:
(a) make and keep public information available, as those terms are
understood and defined in Rule 144;
(b) file with the SEC in a timely manner all reports and other
documents required of the Company under the Securities Act and the Exchange
Act; and
(c) furnish to the Investor so long as the Investor owns
Registrable Securities, promptly upon request, (i) a written statement by the
Company that it has complied with the reporting requirements of Rule 144, the
Securities Act and the Exchange Act, (ii) a copy of the most recent annual or
quarterly report of the Company and such other reports and documents so filed
by the Company and (iii) such other information as may be reasonably
requested to permit the Investor to sell such securities pursuant to Rule 144
without registration.
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8. ASSIGNMENT OF THE REGISTRATION RIGHTS. The rights to have the
Company register Registrable Securities pursuant to this Agreement shall be
automatically assigned by the Investor to any transferee of the Registrable
Securities only if: (a) the Investor agrees in writing with the transferee
or assignee to assign such rights, and a copy of such agreement is furnished
to the Company within a reasonable time after such assignment, (b) the
Company is, within a reasonable time after such transfer or assignment,
furnished with written notice of (i) the name and address of such transferee
or assignee and (ii) the securities with respect to which such registration
rights are being transferred or assigned, (c) immediately following such
transfer or assignment the further disposition of such securities by the
transferee or assignee is restricted under the Securities Act and applicable
state securities laws, (d) at or before the time the Company received the
written notice contemplated by clause (b) of this sentence the transferee or
assignee agrees in writing with the Company to be bound by all of the
provisions contained herein, and (e) such transferee shall be an "accredited
investor" as defined in Rule 501 of Regulation D. In the event of any delay
in filing or effectiveness of the Registration Statement as a result of such
assignment, the Company shall not be liable for any damages arising from such
delay, or the payments set forth in Section 2(c) hereof.
9. AMENDMENT OF REGISTRATION RIGHTS. Any provision of this
Agreement may be amended and the observance thereof may be waived (either
generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the Company and the
Investor. Any amendment or waiver effected in accordance with this Section 9
shall be binding upon the Investor and the Company.
10. MISCELLANEOUS.
(a) A person or entity is deemed to be a holder of Registrable
Securities whenever such person or entity owns of record such Registrable
Securities. If the Company receives conflicting instructions, notices or
elections from two or more persons or entities with respect to the same
Registrable Securities, the Company shall act upon the basis of instructions,
notice or election received from the registered owner of such Registrable
Securities.
(b) Notices required or permitted to be given hereunder shall be
in writing and shall be deemed to be sufficiently given when personally
delivered (by hand, by courier, by telephone line facsimile transmission,
receipt confirmed, or other means) or sent by certified mail, return receipt
requested, properly addressed and with proper postage pre-paid (i) if to the
Company, 2 Annabel Lane, Suite 220, San Ramon, California 94583, Attention:
Joseph Rubin Feld, with a copy to Wilson Sonsini Goodrich & Rosati, 650 Page
Mill Road, Palo Alto, California 94304-1050, Attention: Kathleen Block,
Esq.; and (ii) if to the Investor, at 105 Adelaide Street West, Suite 1200,
Toronto Ontario MSH 1P9, Attention: Mr. Isser Elishis, or at such other
address as each such party furnishes by notice given in accordance with this
Section 10(b), and shall be effective, when personally delivered, upon
receipt and, when so sent by certified mail, four (4) calendar days after
deposit with the United States Postal Service.
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(c) Failure of any party to exercise any right or remedy under
this Agreement or otherwise, or delay by a party in exercising such right or
remedy, shall not operate as a waiver thereof.
(d) This Agreement shall be governed by and interpreted in
accordance with the internal laws of the State of Delaware, without giving
effect to the choice of law provisions. Each of the Company and the Investor
(i) hereby irrevocably submits to the jurisdiction of the United States
District Court and other courts of the United States sitting in the State of
Delaware for the purposes of any suit, action or proceeding arising out of or
relating to this Agreement and (ii) hereby waives, and agrees not to assert
in any such suit, action or proceeding, any claim that it is not personally
subject to the jurisdiction of such court, that the suit, action or
proceeding is brought in an inconvenient forum or that the venue of the suit,
action or proceeding is improper. Each of the Company and the Investor
consents to process being served in any such suit, action or proceeding by
mailing a copy thereof to such party at the address in effect for notices to
it under this Agreement and agrees that such service shall constitute good
and sufficient service of process and notice thereof. Nothing in this
Section shall affect or limit any right to serve process in any other manner
permitted by law.
(e) A facsimile transmission of this signed Agreement shall be
legal and binding on all parties hereto. If any provision of this Agreement
shall be invalid or unenforceable in any jurisdiction, such invalidity or
unenforceability shall not affect the validity or enforceability of the
remainder of this Agreement or the validity or enforceability of this
Agreement in any other jurisdiction. This Agreement may be amended only by
an instrument in writing signed by the party to be charged with enforcement.
This Agreement supersedes all prior agreements and understandings among the
parties hereto with respect to the subject matter hereof.
(f) This Agreement and the Purchase Agreement constitute the
entire agreement among the parties hereto with respect to the subject matter
hereof. There are no restrictions, promises, warranties or undertakings,
other than those set forth or referred to herein. This Agreement supersedes
all prior agreements and understandings among the parties hereto with respect
to the subject matter hereof.
(g) Subject to the requirements of Section 8 hereof, this
Agreement shall inure to the benefit of and be binding upon the successors
and assigns of each of the parties hereto.
(h) All pronouns and any variations thereof refer to the
masculine, feminine or neuter, singular or plural, as the context may require.
(i) The headings in this Agreement are for convenience of reference
only and shall not limit or otherwise affect the meaning thereof.
(i) This Agreement may be executed in two or more counterparts,
each of which shall be deemed an original but all of which shall constitute
one and the same agreement. This Agreement, once executed by a party, may be
delivered to the other party hereto by
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telephone line facsimile transmission of a copy of this Agreement bearing the
signature of the party so delivering this Agreement.
(j) Neither party shall be liable for consequential damages.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
duly executed by their respective officers thereunto duly authorized as of
the day and year first above written.
SUPERGEN, INC.
By: /s/ Dr. Joseph Rubinfeld
---------------------------------------------
Name: Dr. Joseph Rubinfeld
Title: President and Chief Executive Officer
HSBC JAMES CAPEL CANADA, INC.
By: /s/ Isser Elishis
---------------------------------------------
Name: Isser Elishis
Title: Senior Vice President (SRA)
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SCHEDULE A
(a) To the extent permitted by law, the Company will indemnify and
hold harmless the Investor who holds such Registrable Securities, the
directors, if any, of the Investor, the officers, if any, of the Investor,
each person, if any, who controls the Investor within the meaning of the
Securities Act or the Exchange Act (each, an "Indemnified Person" or
"Indemnified Party"), against any losses, claims, damages, liabilities or
reasonable expenses (joint or several) incurred (collectively, "Claims") to
which any of them may become subject under the Securities Act, the Exchange
Act or otherwise, insofar as such Claims (or actions or proceedings, whether
commenced or threatened, in respect thereof) arise out of or are based upon
any of the following statements, omissions or violations in the Registration
Statement, or any post-effective amendment thereof, or any prospectus
included therein: (i) any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or any post-effective
amendment thereof or the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading, (ii) any untrue statement or alleged
untrue statement of a material fact contained in the final prospectus (as
amended or supplemented, if the Company files any amendment thereof or
supplement thereto with the SEC) or the omission or alleged omission to state
therein any material fact necessary to make the statements made therein, in
light of the circumstances under which the statements therein were made, not
misleading or (iii) any violation or alleged violation by the Company of the
Securities Act, the Exchange Act, any state securities law or any rule or
regulation under the Securities Act, the Exchange Act or any state securities
law (the matters in the foregoing clauses (i) through (iii) being,
collectively, "Violations"). Subject to clause (b) of this Schedule A, the
Company shall reimburse the Investor, promptly as such expenses are incurred
and are due and payable, for any reasonable legal fees or other reasonable
expenses incurred by them in connection with investigating or defending any
such Claim. Notwithstanding anything to the contrary contained herein, the
indemnification agreement contained in this clause (a) shall not (I) apply to
a Claim arising out of or based upon a Violation which occurs in reliance
upon and in conformity with information furnished in writing to the Company
by or on behalf of any Indemnified Person expressly for use in connection
with the preparation of the Registration Statement or any such amendment
thereof or supplement thereto, (II) be available to the extent such Claim is
based on a failure of the Investor to deliver or cause to be delivered the
prospectus made available by the Company; or (III) apply to amounts paid in
settlement of any Claim if such settlement is effected without the prior
written consent of the Company, which consent shall not be unreasonably
withheld. The Investor will indemnify the Company and its officers,
directors and agents and each person, if any, who controls the Company within
the meaning of the Securities Act or the Exchange Act against any Claims
arising out of or based upon a Violation which occurs in reliance upon and in
conformity with information furnished in writing to the Company, by or on
behalf of the Investor, expressly for use in connection with the preparation
of the Registration Statement, subject to such limitations and conditions as
are applicable to the Indemnification provided by the Company hereunder.
Such indemnity shall remain in full force and effect regardless of any
investigation made by or on behalf of the Indemnified Person and shall
survive the transfer of the Registrable Securities by the Investor pursuant
to Section 8 of this Agreement.
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(b) Promptly after receipt by an Indemnified Person or Indemnified
Party under this Schedule A of notice of the commencement of any action
(including any governmental action), such Indemnified Person or Indemnified
Party shall, if a Claim in respect thereof is to be made against any
indemnifying party under this Schedule A, deliver to the indemnifying party a
written notice of the commencement thereof and the indemnifying party shall
have the right to participate in, and, to the extent the indemnifying party
so desires, jointly with any other indemnifying party similarly noticed, to
assume control of the defense thereof with counsel mutually satisfactory to
the indemnifying party and the Indemnified Person or the Indemnified Party,
as the case may be. In case any such action is brought against any
Indemnified Person or Indemnified Party, and it notifies the indemnifying
party of the commencement thereof, the indemnifying party will be entitled to
participate in, and, to the extent that it may wish, jointly with any other
indemnifying party similarly notified, assume the defense thereof, subject to
the provisions herein stated and after notice from the indemnifying party to
such Indemnified Person or Indemnified Party of its election so to assume the
defense thereof, the indemnifying party will not be liable to such
Indemnified Person or Indemnified Party under this Schedule A for any legal
or other reasonable out-of-pocket expenses subsequently incurred by such
Indemnified Person or Indemnified Party in connection with the defense
thereof other than reasonable costs of investigation, unless the indemnifying
party shall not pursue the action of its final conclusion. The Indemnified
Person or Indemnified Party shall have the right to employ separate counsel
in any such action and to participate in the defense thereof, but the
reasonable fees and reasonable out-of-pocket expenses of such counsel shall
not be at the expense of the indemnifying party if the indemnifying party has
assumed the defense of the action with counsel reasonably satisfactory to the
Indemnified Person or Indemnified Party. The failure to deliver written
notice to the indemnifying party within a reasonable time of the commencement
of any such action shall not relieve such indemnifying party of any liability
to the Indemnified Person or Indemnified Party under this Schedule A, except
to the extent that the indemnifying party is prejudiced in its ability to
defend such action. The indemnification required by this Schedule A shall be
made by periodic payments of the amount thereof during the course of the
investigation or defense, as such expense, loss, damage or liability is
incurred and is due and payable.
(c) To the extent any indemnification by an indemnifying party is
prohibited or limited by law, the indemnifying party agrees to make the
maximum contribution with respect to any amounts for which it would otherwise
be liable under this Schedule A to the fullest extent permitted by law;
provided, however, that (a) no contribution shall be made under circumstances
where the maker would not have been liable for indemnification under the
fault standards set forth in this Schedule A; (b) no seller of Registrable
Securities guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribution from
any seller of Registrable Securities who was not guilty of such fraudulent
misrepresentation; and (c) contribution by any seller of Registrable
Securities shall be limited in amount to the net amount of proceeds received
by such seller from the sale of such Registrable Securities.
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