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EXCHANGE
AND SUPPORT AGREEMENT
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ARTICLE
1 DEFINITIONS AND INTERPRETATION
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4 | |
1.1
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DEFINITIONS
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4
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1.2
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RULES
OF INTERPRETATION
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7
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1.3
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ENTIRE
AGREEMENT
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8
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ARTICLE
2 REPRESENTATIONS AND WARRANTIES OF OPKO
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8 | |
2.1
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REPRESENTATIONS
AND WARRANTIES OF OPKO
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8
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ARTICLE
3 EXCHANGE RIGHT
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10 | |
3.1
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GRANT
OF EXCHANGE RIGHT
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10
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3.2
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EXERCISE
OF EXCHANGE RIGHT
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10
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3.3
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DELIVERY
OF EXCHANGE RIGHT CONSIDERATION
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11
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3.4
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EFFECT
OF EXERCISE
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11 |
3.5
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DEEMED
EXERCISE OF EXCHANGE RIGHT SUBSEQUENT TO RETRACTION
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12 |
3.6
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NOTICE
OF INSOLVENCY EVENT
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12
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ARTICLE
4 AUTOMATIC EXCHANGE RIGHT
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12 | |
4.1
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NOTICE
OF OPKO LIQUIDATION EVENT
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12
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4.2
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AUTOMATIC
EXCHANGE
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13
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4.3
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CERTIFICATES
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13
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ARTICLE
5 ECONOMIC EQUIVALENCE
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13
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5.1
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ECONOMIC
EQUIVALENCE - OPKO OBLIGATIONS
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13
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5.2
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ECONOMIC
EQUIVALENCE - THE CORPORATION OBLIGATIONS
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14
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5.3
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COVENANTS
REGARDING EXCHANGEABLE SHARES
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15
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5.4
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ADDITIONAL
OPKO COVENANTS
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16
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5.5
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DELIVERY
OF OPKO COMMON SHARES
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16
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5.6
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PROVISION
OF FUNDS
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17
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5.7
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OWNERSHIP
OF COMMON SHARES
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17
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5.8
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OPKO
AND AFFILIATES NOT TO VOTE EXCHANGEABLE SHARES
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17
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5.9
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GRANT
OF CALL RIGHTS
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18
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5.10
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NOTIFICATION
OF CERTAIN EVENTS
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18
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5.11
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QUALIFICATION
OF OPKO COMMON SHARES
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18
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5.12
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TENDER
OFFERS
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19
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ARTICLE
6 TAX MATTERS
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19 | |
6.1
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RIGHT
TO WITHHOLD
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19
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6.2
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SECTION
116 CLEARANCE CERTIFICATE FOR NON-RESIDENT HOLDERS
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19
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6.3
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TRANSFER
TAXES
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21
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ARTICLE
7 REGISTRATION
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21
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7.1
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PIGGYBACK
REGISTRATION.
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21
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7.2
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REGISTRATION
EXPENSES.
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22
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7.3
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OBLIGATIONS
OF OPKO.
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22
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7.4
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OBLIGATIONS
OF THE HOLDERS.
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25
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7.5
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TERMINATION
OF REGISTRATION RIGHTS.
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25
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7.6
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DISPOSITIONS.
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25
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7.7
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SEC
RULE144 REPORTING.
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25
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7.8
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INDEMNIFICATION
AND CONTRIBUTION.
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26
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ARTICLE
8 GENERAL
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29 | |
8.1
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TRANSFER
AND ISSUANCE RESTRICTIONS
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29
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8.2
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LEGENDS
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29
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8.3
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SELLER
ACKNOWLEDGEMENTS AND AGREEMENTS
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30
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8.4
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COMPLIANCE
WITH OTHER INSTRUMENTS
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30
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8.5
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CHANGES
IN CAPITAL OF OPKO AND THE CORPORATION
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31
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8.6
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TERM
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31
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8.7
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ENUREMENT
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31
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8.8
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NOTICES
TO PARTIES
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31
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8.9
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NOTICE
TO HOLDERS
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32
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8.10
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AMENDMENT
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32
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8.11
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ASSIGNMENT
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32
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8.12
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FURTHER
ASSURANCES
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32
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8.13
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EXECUTION
AND DELIVERY
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33
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A.
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The
parties wish to set out their understanding with respect to certain
rights
and obligations in connection with the exchange of shares of the
Corporation for shares of Opko.
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B.
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Schedule
A shall be automatically amended by the Corporation to include each
additional investor that executes a counterpart instrument of accession
to
this Agreement in the form attached as Schedule
B.
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1.1
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Definitions
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(a) | one Opko Common Share (as adjusted for Equity Splits); and |
(b)
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an
amount equal to the Outstanding Dividend Amount on such Exchangeable
Share
on the date of exchange.
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1.2
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Rules
of Interpretation
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(a)
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Consent
-
Whenever a provision of this Agreement requires an approval or consent
and
such approval or consent is not delivered within the applicable time
limit, then, unless otherwise specified, the Party whose consent
or
approval is required will be conclusively deemed to have withheld
its
approval or consent.
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(b)
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Currency
-
Unless otherwise specified, all references to money amounts are to
the
lawful currency of the United States of
America.
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(c)
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Governing
Law
-
This Agreement is a contract made under and is governed by and construed
in accordance with the law of the Province of Ontario and the federal
laws
of Canada applicable in the Province of
Ontario.
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(d)
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Headings
-
Headings of Articles and Sections are inserted for convenience of
reference only and do not affect the construction or interpretation
of
this Agreement.
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(e)
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Including
-
Where the word “including” or “includes” is used in this Agreement, it
means “including (or includes) without
limitation”.
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(f)
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Number
and Gender
-
Unless the context otherwise requires, words importing the singular
include the plural and vice versa and words importing gender include
all
genders.
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(g)
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Severability
-
If, in any jurisdiction, any provision of this Agreement or its
application to any party or circumstance is restricted, prohibited
or
unenforceable, such provision will, as to such jurisdiction, be
ineffective only to the extent of such restriction, prohibition or
unenforceability without invalidating the remaining provisions of
this
Agreement and without affecting the validity or enforceability of
such
provision in any other jurisdiction or without affecting its application
to other Parties or circumstances.
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(h)
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Statutory
references
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A reference to a statute includes all regulations made pursuant to
such
statute and, unless otherwise specified, the provisions of any statute
or
regulation that amends, supplements or supersedes any such statute
or any
such regulation.
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(i)
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Time
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Time is of the essence in the performance of the Parties’ respective
obligations.
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(j)
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Time
Periods
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Unless otherwise specified, time periods within or following which
any
payment is to be made or act is to be done are calculated by excluding
the
day on which the period commences and including the day on which
the
period ends and by extending the period to the next Business Day
if the
last day of the period is not a Business
Day.
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1.3
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Entire
Agreement
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2.1
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Representations
and warranties of Opko
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(a)
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Authorized
and Outstanding Capital
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At October 25, 2007, the authorized capital stock of OPKO consisted
of
500,000,000 shares of common stock, $.01 par value per share, of
which as
of November 9, 2007 163,214,203 shares were issued or outstanding,
fully
paid and non-assessable, and 10,000,000 shares of preferred stock,
$.01
par value per share, of which 869,366 shares were issued or outstanding,
fully paid and non-assessable. OPKO’s common stock has been duly and
validly registered pursuant to Section 12(b) of the Exchange Act
which
registration is in full force and
effect.
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(b)
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Incorporation
and Organization
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OPKO is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware and has all necessary
corporate power to own all of its property and assets, to incur all
of its
liabilities and to carry on its business as presently conducted.
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(c)
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Interest
in each Subsidiary
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All shares of, or interests in, each of OPKO’s wholly-owned subsidiaries,
held directly or indirectly by Opko are owned free and clear of all
mortgages, liens, charges, pledges, security interests, encumbrances,
claims and demands whatsoever and no person has any right, agreement
or
option, present or future, contingent or absolute, or any right capable
of
becoming a right, agreement or option, for the issue or allotment
of any
unissued shares of each of OPKO’s wholly-owned subsidiaries or any other
security convertible into or exchangeable for any shares of each
of OPKO’s
wholly-owned subsidiaries or to require each of OPKO’s wholly-owned
subsidiaries to purchase, redeem or otherwise acquire any of its
issued
and outstanding shares.
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(d)
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SEC
Filings
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Except for the Current Report on form 8-K and certain financial statements
of Ophthalmic Technologies Inc. in connection with the initial investment
in Ophthalmic Technologies Inc., since March 27, 2007, OPKO has filed
all reports, documents and other information required of it to be
filed
with the SEC (the “OPKO
SEC Reports”).
The OPKO SEC Reports were prepared in accordance with the requirements
of
the Securities Act or the Exchange Act, as the case may be, and the
rules
and regulations of the SEC thereunder applicable to such OPKO SEC
Reports.
No disclosure included in any of the Parent SEC Reports included
any
statement that, when made or, if such Parent SEC Reports were subsequently
amended, when amended, contained an untrue statement of a material
fact or
omitted to state a material fact necessary in order to make the statements
therein, in light of the circumstances in which such statements were
made,
not materially misleading.
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(e)
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Stock
Exchange Listing
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The outstanding Common Shares of OPKO are listed for trading on the
American Stock Exchange, and Opko is, and at all times, has been
in
material compliance with the by-laws, rules and regulations of the
American Stock Exchange.
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(f)
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No
Material Changes
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Since the date of the latest financial statements included within
a report
filed by OPKO with the Securities and Exchange Commission, and except
as
disclosed in OPKO’s reports filed with the SEC and other than this
transaction, there has not been any material change in the assets,
liabilities or obligations of Opko or any of OPKO’s wholly-owned
subsidiaries, and to OPKO’s knowledge, there has not been any material
adverse change in the business, operations or condition (financial
or
otherwise) or results of the operations of Opko or any of OPKO’s
wholly-owned subsidiaries.
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3.1
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Grant
of Exchange Right
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(a)
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an
Insolvency Event;
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(b)
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the
failure of Opko or any Permitted Subsidiary to purchase all or any
part of
the Exchangeable Shares held by such Holder following exercise of
the
Liquidation Call Right as provided in the Exchangeable Share
Provisions;
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(c)
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subject
to Section 3.1(b),
the failure of the Corporation to redeem all the outstanding Exchangeable
Shares following a Liquidation Event as provided in the Exchangeable
Share
Provisions;
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(d)
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the
failure of Opko or any Permitted Subsidiary to purchase all or any
part of
the Exchangeable Shares held by such Holder following exercise of
the
Redemption Call Right as provided in the Exchangeable Share
Provisions;
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(e)
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subject
to Section 3.2(d),
the failure of the Corporation to redeem all the outstanding Exchangeable
Shares held by such Holder on the Redemption Date as provided in
the
Exchangeable Share Provisions;
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(f)
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the
failure of Opko or any Permitted Subsidiary to purchase all or any
part of
the Exchangeable Shares held by such Holder following exercise of
the
Retraction Call Right as provided in the Exchangeable Share Provisions;
or
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(g)
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subject
to Section 3.1(f),
the failure of the Corporation to redeem the Retracted Shares under
a
Retraction Request as provided in the Exchangeable Share Provisions.
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3.2
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Exercise
of Exchange Right
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(a)
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that
the Holder is exercising the Exchange
Right;
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(b)
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the
number of Exchangeable Shares in respect of which the Exchange Right
is
being exercised;
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(c)
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that
the Holder has good title to and owns all the Exchangeable Shares
free and
clear of all encumbrances, other than those stipulated under the
Share
Purchase Agreement or the Articles;
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(d)
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whether
the Holder is a non-resident of Canada for the purposes of the
Income
Tax Act
(Canada) (the “Tax Act”);
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(e)
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the
names in which the new certificates representing the Opko Common
Shares
are to be issued; and
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(f)
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the
name and address of the Person to whom such new certificates are
to be
delivered.
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3.3
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Delivery
of Exchange Right
Consideration
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3.4
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Effect
of Exercise
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3.5
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Deemed
Exercise of Exchange Right Subsequent to
Retraction
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3.6
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Notice
of Insolvency Event
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4.1
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Notice
of Opko Liquidation Event
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(a)
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Opko
will give the Holders notice of each of the following events at the
time
set forth below:
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(i)
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in
the event of any determination by Opko to institute voluntary liquidation,
dissolution or winding-up proceedings with respect to Opko or to
effect
any other distribution of assets of Opko among its shareholders for
the
purpose of winding up its affairs, at least 60 days prior to the
proposed
effective date of such liquidation, dissolution, winding-up or other
distribution; and
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(ii)
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immediately,
upon the earlier of (A) receipt by Opko of notice of and (B) Opko
otherwise becoming aware of any threatened or instituted claim, suit,
petition or other proceedings with respect to the involuntary liquidation,
dissolution or winding up of Opko or to effect any other distribution
of
assets of Opko among its shareholders for the purpose of winding
up its
affairs.
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(b)
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Notice
of any event (an "Opko
Liquidation Event")
contemplated by Section 4.1(a)(i)
or
4.1(a)(ii)
above shall include a brief description of the automatic exchange
of
Exchangeable Shares for Opko Common Shares provided for in Section
4.2
below.
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4.2
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Automatic
Exchange
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(a)
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Opko
or such Permitted Subsidiary, as applicable, will deliver or cause
to be
delivered to each Holder the Exchange Right Consideration for each
Exchangeable Share held by the
Holder;
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(b)
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each
Holder will be deemed to have transferred to Opko or such Permitted
Subsidiary, as applicable, all of the Holder’s interest in the
Exchangeable Shares (which shall be free and clear of all liens and
encumbrances, other than those stipulated under the Share Purchase
Agreement, or the Articles) and will cease to be a Holder of those
Exchangeable Shares;
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(c)
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the
Holder will be deemed to be the holder of the Opko Common Shares
delivered
to it; and
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(d)
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the
certificates held by the Holder previously representing the Exchangeable
Shares will be deemed to represent the Opko Common Shares and other
Exchange Right Consideration delivered to the Holder.
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4.3
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Certificates
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5.1
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Economic
Equivalence - Opko
Obligations
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(a)
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declare
or pay or make any distribution (other than a distribution consisting
of
an issuance referred to in Section 5.1(b))
on the Opko Common Shares unless the Corporation forthwith declares,
pays
or makes, as the case may be, the same per share dividend or distribution
on the Exchangeable Shares as provided in Section 4.1
of
the Exchangeable Share Provisions;
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(b)
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issue
or distribute to all of the Holders of the then outstanding Opko
Common
Shares in respect of the Opko Common Shares held by such
holders:
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(i)
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Opko
Common Shares (or securities exchangeable for or convertible into
or
carrying rights to acquire Opko Common Shares) by way of a share
distribution or other distribution;
or
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(ii)
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rights,
options or warrants entitling them to subscribe for or to purchase
Opko
Common Shares (or securities exchangeable for or convertible into
or
carrying rights to acquire Opko Common
Shares),
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(c)
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effect:
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(i)
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a
subdivision or change of the then outstanding Opko into a greater
number
of Opko Common Shares;
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(ii)
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a
reduction, combination, consolidation or change of the then outstanding
Opko Common Shares into a lesser number of Opko Common
Shares;
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(iii)
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a
reclassification or other change of the Opko Common Shares;
or
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(iv)
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an
amalgamation, merger, reorganization or other transaction affecting
the
Opko Common Shares, other than in the event of an Opko Sale pursuant
to
which a Redemption right is exercised,
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5.2
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Economic
Equivalence - the Corporation
Obligations
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(a)
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declare
or pay any dividend or make any other distribution (other than a
dividend
or distribution consisting of an issuance referred to in Section
5.2(b))
on the Exchangeable Shares unless Opko forthwith declares, pays or
makes,
as the case may be, the same per unit distribution on the Opko Common
Shares;
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(b)
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issue
to all of the Holders in respect of the Exchangeable Shares held
by such
Holders:
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(i)
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Exchangeable
Shares (or securities exchangeable for or convertible into or carrying
rights to acquire Exchangeable Shares) by way of stock dividend or
other
distribution; or
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(ii)
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rights,
options or warrants entitling them to subscribe for or to purchase
Exchangeable Shares (or securities exchangeable for or convertible
into or
carrying rights to acquire Exchangeable
Shares),
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(c)
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effect:
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(iii)
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a
subdivision or change of the then outstanding Exchangeable Shares
into a
greater number of Exchangeable
Shares;
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(iv)
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a
reduction, combination, consolidation or change of the then outstanding
Exchangeable Shares into a lesser number of Exchangeable
Shares;
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(v)
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a
reclassification or other change of the Exchangeable Shares;
or
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(vi)
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an
amalgamation, merger, reorganization or other transaction affecting
the
Exchangeable Shares, other than in the event of an Opko Sale pursuant
to
which a Redemption right is
exercised,
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5.3
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Covenants
Regarding Exchangeable
Shares
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(a)
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ensure
that the declaration date, record date and payment date for a dividend
on
the Exchangeable Shares will be the same as the declaration date,
record
date and payment date for the corresponding dividend on Opko Common
Shares;
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(b)
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advise
each Holder sufficiently in advance of any Company Sale or Liquidation
Event to allow each Holder to exercise its rights of retraction pursuant
to the Exchangeable Share Provisions to receive Opko Common Shares
immediately prior to any such event or date;
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(c)
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duly
and timely perform all of their respective obligations, and take
all
actions and do all things as are necessary or desirable to enable
and
permit each other to perform their respective obligations, under
the
Exchangeable Share Provisions; and
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(d)
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ensure
that any redemption of Exchangeable Shares of a Holder in connection
with
a Company Sale, if requested by such Holder, shall be effective only
upon,
and will be conditional upon, the closing of the Company Sale.
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5.4
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Additional
Opko Covenants
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(a)
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not
exercise its vote as a shareholder of the Corporation, nor allow
any
direct or indirect Subsidiary to exercise its own vote as a shareholder
of
the Corporation, to initiate the voluntary liquidation, dissolution
or
winding-up of the Corporation nor take any action or omit to take
any
action that is designed to result in the liquidation, dissolution
or
winding-up of the Corporation, other than in circumstances where
such vote
is necessary in order to enable the Corporation to fulfill its obligations
under this Agreement or pursuant to the Exchangeable Share Provisions;
and
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(b)
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take
all such commercially reasonable actions and do all such commercially
reasonable things as are necessary or desirable to enable and permit
Opko,
the Corporation, or a Permitted Subsidiary, as applicable, in accordance
with applicable law, to perform its obligations arising upon the
exercise
by it of the Liquidation Call Right, the Retraction Call Right or
the
Redemption Call Right, including without limitation all such actions
and
all such things as are necessary or desirable to enable and permit
Opko,
the Corporation, or a Permitted Subsidiary, as applicable, to cause
to be
delivered Opko Common Shares to the holders of Exchangeable Shares
in
accordance with the provisions of the Liquidation Call Right, the
Retraction Call Right or the Redemption Call Right, as the case may
be.
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5.5
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Delivery
of Opko Common Shares
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5.6
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Provision
of Funds
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5.7
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Ownership
of Common Shares
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5.8
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Opko
and Affiliates Not to Vote Exchangeable
Shares
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(a)
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Subject
to Section 5.4,
Section 5.8(b)
and Section 5.8(c),
Opko will appoint and cause to be appointed proxyholders with respect
to
all Exchangeable Shares from time to time held by it and its Affiliates
for the sole purpose of attending each meeting of Holders in order
to be
counted as part of the quorum for each
meeting.
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(b)
|
Opko
will not, and will cause its Affiliates not to, exercise any voting
rights
that may be exercisable by holders of the Exchangeable Shares from
time to
time in respect of any matter considered at any meeting of Holders
of
Exchangeable Shares.
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(c)
|
Where
Holders (excluding Opko and its Affiliates) of more than two-thirds
of the
Exchangeable Shares approve the adding to or changing of restrictions
or
conditions, or the removing or changing of rights or privileges,
attaching
to the Exchangeable Shares, and such Holders of the Exchangeable
Shares do
not hold a sufficient number of Exchangeable Shares to cause such
action
to be approved by written consent of such Holders (as prescribed
by
applicable Law), Opko will, if it is a holder of Exchangeable Shares,
and
will cause its Affiliates who are holders of Exchangeable Shares,
to
execute any resolutions in writing which are executed by such other
Holders or to exercise its votes in the same manner as exercised
by the
Holders of more than two-thirds of the Exchangeable Shares (excluding
Opko
and its affiliates).
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5.9
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Grant
of Call Rights
|
5.10
|
Notification
of Certain Events
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(a)
|
in
the event of any determination by the board of directors of the
Corporation to institute voluntary liquidation, dissolution or winding
up
proceedings with respect to the Corporation or to effect any other
distribution of the assets of the Corporation among its shareholders
for
the purpose of winding up its affairs, at least 60 days prior to
the
proposed effective date of such liquidation, dissolution, winding
up or
other distribution;
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(b)
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immediately,
upon the earlier of (i) receipt by the Corporation of notice of,
and (ii)
the Corporation otherwise becoming aware of, any threatened or instituted
claim, suit, petition or other proceedings with respect to the involuntary
liquidation, dissolution or winding up of the Corporation or to effect
any
other distribution of the assets of the Corporation among its shareholders
for the purpose of winding up its
affairs;
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(c)
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immediately,
upon receipt by the Corporation of a Retraction Request;
and
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(d)
|
as
soon as practicable upon the issuance by the Corporation of any
Exchangeable Shares or rights to acquire Exchangeable
Shares.
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5.11
|
Qualification
of Opko Common Shares
|
5.12
|
Tender
Offers
|
6.1
|
Right
to Withhold
|
6.2
|
Section
116 Clearance Certificate for Non-Resident
Holders
|
(a)
|
Each
Holder that is a non-resident of Canada for purposes of the Tax Act
(a
“Non-resident
Holder”)
and to whom the Exchangeable Shares are “taxable Canadian property” and
not “excluded property” for purposes of the Tax Act must, prior to a
disposition of such shares to the Corporation, Opko or any Permitted
Subsidiary as may be designated by Opko, deliver to the Payer an
amount in
Canadian dollars equal to 25% of the fair market value of the Exchangeable
Shares to be disposed of, as determined on the date of disposition
(the
“Up-front
Amount”).
The Up-front Amount shall be released by the Payer or remitted to
the
Canada Revenue Agency (the “CRA”)
as set forth below.
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(b)
|
If
the Up-front Amount has not been delivered to the Payer on, or prior
to,
the date of disposition of the Exchangeable Shares (the “Effective
Date”),
the Non-resident Holder must, prior to a disposition of such shares
to the
Corporation, Opko or any Permitted Subsidiary as may be designated
by
Opko, deliver a section 116 clearance certificate (a “Clearance
Certificate”)
to the Payer.
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(c)
|
If
a Clearance Certificate having a certificate limit as
defined in subsection 2 of Section 116 of the Tax Act (the “Certificate
Limit”)
at least equal to the fair market value for the Exchangeable Shares
being
disposed of has not been delivered to the Payer on or prior to the
Effective Date, the Payer shall withhold 50%
of
the proceeds of disposition otherwise deliverable to the Non-resident
Holder. If a Clearance Certificate has been delivered to the Payer
on or
before the Effective Date and the Certificate Limit is less than
the 50%
of the fair market value of the Exchangeable Shares being disposed
of, the
Payer shall withhold 50% of the amount by which the proceeds of
disposition otherwise payable to the Non-resident Holder exceeds
the
Certificate Limit. Any
amount so withheld (the “Withheld
Amount”)
shall be released by the Payer or remitted to the Canada Revenue
Agency
(the “CRA”)
as set forth below.
|
(d)
|
If
on or before the 27th day of the month following the calendar month
which
includes the Effective Date (the “Remittance
Date”),
the Payer receives from the Non-resident Holder a Clearance Certificate
with a Certificate Limit at
least equal to the fair market value of the Exchangeable Shares disposed
of, the Payer shall, promptly after receipt of such Clearance Certificate,
deliver to the Non-resident Holder the Withheld Amount or the Up-front
Amount, as may be applicable, plus any interest earned thereon (less
any
applicable withholding taxes).
|
(e)
|
If
on or before the Remittance Date, the Payer does not receive from
the
Non-resident Holder a Clearance Certificate, or receives a Clearance
Certificate with a Certificate Limit that is less than the fair market
value of the Exchangeable Shares being disposed of, then, unless
the CRA
has issued a letter confirming that the CRA will not enforce the
remittance of funds as is normally required under subsection 116(5)
of the
Tax Act and that the Payer will not be charged interest or penalties
if it
delays the remittance of amounts in respect of the disposition of
the
Exchangeable Shares until further instructed by the CRA (a “Comfort
Letter”),
the Payer shall remit to the Receiver General for Canada (the
“Receiver
General”)
from the Withheld Amount or the Up-front Amount, as may be applicable,
an
amount equal to 25% of the fair market value of the Exchangeable
Shares
disposed of (or, if a Clearance Certificate is received but with
a
Certificate Limit less than the fair market value of the Exchangeable
Shares disposed of, an amount equal to 25% of the difference between
the
fair market value of the Exchangeable Shares disposed of and the
Certificate Limit) and shall remit to the Non-resident Holder such
portion
of the Withheld Amount or the Up-front Amount, as may be applicable,
not
required to be remitted to CRA (if any), together with any interest
earned
thereon (less applicable withholding taxes).
|
(f)
|
If
the CRA has issued a Comfort Letter, the Payer shall not make any
remittance to the Receiver General on the date that would otherwise
be the
Remittance Date and if a Clearance Certificate is subsequently received
while the Comfort Letter remains in effect, with a Certificate Limit
at
least equal to the fair market value of the Exchangeable Shares being
disposed of, the Payer shall, promptly after receipt of such certificate,
remit to the Non-resident Holder the Withheld Amount or the Up-front
Amount, as may be applicable, together with any interest earned thereon,
less any applicable withholding taxes. If notification from the CRA
is
received that the Comfort Letter is no longer in effect, the date
of
receipt of such notification shall be deemed to be the Remittance
Date for
the purposes of this section.
|
(g)
|
Any
amount that the Payer withholds from the proceeds of disposition
otherwise
payable to the Non-resident Holder pursuant to the provisions hereof
shall
be treated as having been paid to the Non-resident Holder on account
of
the proceeds of disposition on the date of
disposition.
|
6.3
|
Transfer
Taxes
|
7.1
|
Piggyback
Registration.
|
(a)
|
Beginning
on the date of this Agreement, OPKO will notify all Holders of Registrable
Securities in writing at least 10 days prior to the filing of any
registration statement under the Securities Act for purposes of a
public
offering of OPKO Common Shares by OPKO (including, but not limited
to,
registration statements relating to secondary offerings of OPKO Common
Shares, but excluding registration statements relating to employee
benefit
plans or with respect to corporate reorganizations or other transactions
under SEC Rule 145) and will afford each such Holder an opportunity
to
include in such registration statement up to 100% of such Registrable
Securities held by such Holder, subject to Section 7.1(b).
Each Holder desiring to include in any such registration statement
part of
the Registrable Securities held by it will, within 5 days after the
above-described notice from OPKO (the “Holder Notice Period”), so notify
OPKO in writing. Such notice will state the intended method of disposition
of the Registrable Securities by such Holder as well as the number
of
Registrable Securities proposed by such Holder to be included in
such
registration statement.
|
(b)
|
If
the registration statement under which OPKO gives notice under this
Section 7.1(b)
is
for an underwritten offering, OPKO will so advise the Holders of
Registrable Securities as a part of such notice. In such event, the
right
of any Holder to be included in a registration pursuant to this
Section 7.1(b)
will 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 herein. All Holders proposing
to
distribute their Registrable Securities through such underwriting
will
enter into an underwriting agreement in customary form with the
underwriter or underwriters selected for such underwriting by OPKO.
Notwithstanding any other provision of this
Section 7.1(b),
if
the underwriter determines that marketing factors require a limitation
of
the number of shares to be underwritten, the number of shares that
may be
included in the underwriting will be allocated first to OPKO.
|
(c)
|
OPKO
will have the right to terminate or withdraw any registration initiated
by
it under this Section 7.1
prior to the effectiveness of such registration whether or not any
Holder
has elected to include securities in such registration.
|
7.2
|
Registration
Expenses.
|
7.3
|
Obligations
of OPKO.
|
(a)
|
prepare
and file with the SEC a registration statement with respect to such
Registrable Securities and use its reasonable efforts to cause such
registration statement to become effective and keep such registration
statement effective for at least 180 days or, if earlier, until
(i) the participating Holder or Holders have completed the
distribution related thereto or (ii) the Registrable Securities are
no longer required to be
registered;
|
(b)
|
prepare
and file with the SEC such amendments and supplements to such registration
statement and the prospectus used in connection with such registration
statement as may be necessary to comply with the provisions of the
Securities Act with respect to the disposition of all securities
covered
by such registration statement;
|
(c)
|
in
the event of any underwritten public offering, enter into and perform
its
obligations under an underwriting agreement, in usual and customary
form,
with the managing underwriter or underwriters of such offering. Each
Holder participating in such underwriting will also enter into and
perform
its obligations under such an agreement;
|
(d)
|
promptly
notify each Holder of Registrable Securities covered by such registration
statement at any time when a prospectus relating thereto is required
to be
delivered under the Securities Act upon learning of the happening
of any
event as a result of which the prospectus included in such registration
statement, as then in effect, includes an untrue statement of a material
fact or omits to state a material fact required to be stated therein
or
necessary to make the statements therein not misleading and, at the
request of the Holders, OPKO shall prepare a supplement or amendment
to
such prospectus so that, as thereafter delivered to the purchasers
of such
Registrable Securities, such prospectus shall not contain an untrue
statement of a material fact or omit to state any fact necessary
to make
the statements therein not misleading in the light of the circumstances
then existing;
|
(e)
|
furnish
to each Holder and to each underwriter such number of copies of the
registration statement and the prospectus included therein (including
each
preliminary prospectus) as such Persons reasonably may request in
order to
facilitate the intended disposition of the Registrable Securities
covered
by such registration statement;
|
(f)
|
use
its best efforts (i) to
register or qualify the Registrable Securities covered by such
registration statement under the securities or “blue sky” laws of such
jurisdictions as the sellers of Registrable Securities or, in the
case of
an underwritten public offering, the managing underwriter reasonably
shall
request, (ii) to
prepare and file in those jurisdictions such amendments (including
post
effective amendments) and supplements, and take such other actions,
as may
be necessary to maintain such registration and qualification in effect
at
all times for the period of distribution contemplated thereby and
(iii) to
take such further action as may be necessary or advisable to enable
the
disposition of the Registrable Securities in such jurisdictions,
provided,
that OPKO shall not for any such purpose be required to qualify generally
to transact business as a foreign corporation in any jurisdiction
where it
is not so qualified or to consent to general service of process in
any
such jurisdiction;
|
(g)
|
permit
a single firm of counsel designated as selling stockholders' counsel
by
the Holders to review the registration statement and all amendments
and
supplements thereto for a reasonable period of time prior to their
filing.
|
(h)
|
if
such registration involves an underwritten offering, furnish a legal
opinion of the Corporation’s counsel, dated the date of the closing under
the underwriting agreement, with respect to the registration statement,
each amendment and supplement thereto, the prospectus included therein
(including the preliminary prospectus) and other documents relating
thereto, in customary form and covering such matters as are customarily
covered by legal opinions of issuers’ counsel in such public
offerings.
|
(i)
|
if
such registration involves an underwritten offering, furnish a legal
opinion of the Corporation’s counsel, dated the date of the closing under
the underwriting agreement, with respect to the registration statement,
each amendment and supplement thereto, the prospectus included therein
(including the preliminary prospectus) and other documents relating
thereto, in customary form and covering such matters as are customarily
covered by legal opinions of issuers’ counsel in such public
offerings
|
(j)
|
make
available for inspection by each seller of Registrable Securities,
any
underwriter participating in any distribution pursuant to such
registration statement, and any attorney, accountant or other agent
retained by such seller or underwriter, all relevant financial and
other
records, pertinent corporate documents and properties of OPKO, and
cause
OPKO's officers, directors and employees to supply all information
reasonably requested by any such seller, underwriter, attorney, accountant
or agent in connection with such registration statement;
|
(k)
|
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;
|
(l)
|
take
all actions reasonably necessary to facilitate the timely preparation
and
delivery of certificates (not bearing any legend restricting the
sale or
transfer of such securities) representing the Registrable Securities
to be
sold pursuant to the Registration Statement and to enable such
certificates to be in such denominations and registered in such names
as
the Sellers or any underwriters may reasonably
request;
|
(m)
|
take
all other reasonable actions necessary to expedite and facilitate
the
registration of the Registrable Securities pursuant to the Registration
Statement; and
|
(n)
|
advise
each Holder of Registrable Securities covered by such registration
statement and, if requested by any such Holder, confirm such advice
in
writing:
|
(i)
|
when
such registration statement, and any amendment thereto, has been
filed
with the SEC and when the registration statement or any post-effective
amendment thereto has become effective;
|
(ii)
|
of
any request by the SEC for amendments or supplements to such registration
statement or the prospectus included therein or for additional
information;
|
(iii)
|
of
the issuance by the SEC of any stop order suspending effectiveness
of the
registration statement or the initiation of any proceedings for that
purpose; and
|
(iv)
|
of
the receipt by OPKO of any notification with respect to the suspension
of
the qualification of the securities included in the registration
statement
for sale in any jurisdiction or the initiation of any proceeding
for such
purpose.
|
(a)
|
Make
and keep public information available, as those terms are understood
and
defined in SEC Rule 144 or any similar or analogous rule promulgated
under the Securities Act.
|
(b)
|
File
with the SEC, in a timely manner, all reports and other documents
required
of OPKO under the Exchange Act;
|
(c)
|
As
long as a Holder owns any Registrable Securities, furnish to such
Holder
promptly upon request: a written statement by OPKO as to its compliance
with the reporting requirements of SEC Rule 144, the Securities Act,
and the Exchange Act, a copy of the most recent annual or quarterly
report
of OPKO and such other reports and documents so filed by OPKO; and
such
other reports and documents as a Holder may reasonably request in
availing
itself of any rule or regulation of the SEC allowing it to sell any
such
securities without registration.
|
(a)
|
In
the event of a registration of any of the Registrable Securities
under the
Securities Act pursuant to Section 7.1,
OPKO will indemnify and hold harmless each seller of such Registrable
Securities thereunder, any underwriter (as defined in the Securities
Act)
for such seller, and each other Person, if any, who controls such
seller
or underwriter within the meaning of the Securities Act or the Exchange
Act, from and against, and pay or reimburse them for, any losses,
claims,
reasonable expenses, damages or liabilities to which such seller,
underwriter or controlling Person may become subject under the Securities
Act, the Exchange Act or otherwise, insofar as such losses, claims,
expenses, damages or liabilities (or actions in respect thereof)
arise out
of or are based upon any untrue statement or alleged untrue statement
of
any material fact contained in any registration statement under which
such
Registrable Securities were registered under the Securities Act pursuant
to Section 7.1,
any preliminary prospectus or final prospectus contained therein,
or any
amendment or supplement thereof, or arise out of or are based upon
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, or any violation or alleged violation of the Securities
Act,
the Exchange Act, any state securities or blue sky laws and specifically
will reimburse each such seller, underwriter and controlling Person
for
any legal or other expenses reasonably incurred by it in connection
with
investigating or defending any such loss, claim, damage, liability
or
action; provided,
that OPKO will not be liable in any such case if and to the extent
that
any such loss, claim, expense, damage or liability arises out of
or is
based upon OPKO's reliance on an untrue statement or alleged untrue
statement or omission or alleged omission so made in conformity with
information furnished by any such seller, underwriter or controlling
Person in writing specifically for use in such registration statement
or
prospectus; and provided further,
that OPKO shall not be liable to the extent that any such loss, claim,
expense, damage or liability (or action in respect thereof) arises
out of
or is based upon an untrue statement or alleged untrue statement
or
omission in such registration statement corrected in an amendment
or
supplement to the registration statement, such amendment or supplement
was
delivered to the indemnified party in sufficient quantities and a
reasonable period of time prior to the closing of any offering and
the
indemnified party failed to deliver or failed to cause to be delivered
such registration statement as so amended or supplemented to the
Person
asserting such loss, claim, expense, damage or
liability.
|
(b)
|
In
the event of a registration of any of the Registrable Securities
under the
Securities Act pursuant to Section 7.1,
each seller of such Registrable Securities thereunder, severally
and not
jointly, will indemnify and hold harmless OPKO, each Person, if any,
who
controls OPKO within the meaning of the Securities Act, each officer
of
OPKO who signs the registration statement, each director of OPKO
and any
underwriter and any controlling Person of such underwriter from and
against all losses, claims, reasonable expenses, damages or liabilities,
joint or several, to which OPKO or such officer, director, underwriter or
controlling Person may become subject under the Securities Act, Exchange
Act or otherwise, insofar as such losses, claims, expenses, damages
or
liabilities (or actions in respect thereof) arise out of or are based
upon
reliance on any untrue statement or alleged untrue statement of any
material fact contained in the registration statement under which
such
Registrable Securities were registered under the Securities Act,
any
preliminary prospectus or final prospectus contained therein, or
any
amendment or supplement thereof, or arise out of or are based upon
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, and will reimburse OPKO and each such officer, director,
underwriter and controlling Person for any legal or other expenses
reasonably incurred by them in connection with investigating or defending
any such loss, claim, expense, damage, liability or action; provided,
that such seller will be liable hereunder in any such case if and
only to
the extent that any such loss, claim, expense, damage or liability
arises
out of or is based upon an untrue statement or alleged untrue statement
or
omission or alleged omission made in reliance upon and in conformity
with
information pertaining to such seller, as such, furnished in writing
to
OPKO by such seller specifically for use in such registration statement
or
prospectus; and provided,
further,
that the liability of each seller hereunder shall be limited to the
proportion of any such loss, claim, expense, damage or liability
which is
equal to the proportion that the public offering price of the Registrable
Securities sold by such seller under such registration statement
bears to
the total public offering price of all securities sold
thereunder
|
(c)
|
Notwithstanding
the foregoing, the indemnity provided in this ARTICLE 7
shall not apply to amounts paid in settlement of any such loss, claim,
expense, damage or liability if such settlement is effected without
the
consent of such seller;
|
(d)
|
Promptly
after receipt by an indemnified party hereunder of notice of the
commencement of any action (including any governmental action), such
indemnified party shall, if a claim in respect thereof is to be made
against the indemnifying party hereunder, notify the indemnifying
party in
writing thereof, but the delay so to notify the indemnifying party
shall
not relieve it from any liability which it may have to such indemnified
party other than under this Section 7.8
and shall only relieve it from any liability which it may have to
such
indemnified party under this Section 7.8
if
and to the extent the indemnifying party is materially prejudiced
by such
delay. In case any such action shall be brought against any indemnified
party and it shall notify the indemnifying party of the commencement
thereof, the indemnifying party shall be entitled to participate
in and,
to the extent it shall wish, to jointly with any other indemnifying
party
similarly notified, assume and undertake the defence thereof with
counsel
satisfactory to such indemnified party, and, after notice from the
indemnifying party to such indemnified party of its election so to
assume
and undertake the defence thereof, the indemnifying party shall not
be
liable to such indemnified party under this Section 7.8
for any legal expenses subsequently incurred by such indemnified
party in
connection with the defence thereof provided,
that if the defendants in any such action include both the indemnified
party and the indemnifying party and the indemnified party shall
have
reasonable defences available to it which are different from or additional
to those available to the indemnifying party or if the interests
of the
indemnified party reasonably may be deemed to conflict with the interests
of the indemnifying party, the indemnified party shall have the right
to
select a separate counsel and to assume such legal defences and otherwise
to participate in the defence of such action, with the reasonable
expenses
and fees of such separate counsel and other expenses related to such
participation to be reimbursed by the indemnifying party as incurred.
|
(e)
|
If
the indemnification provided for in this Section 7.8
is
held by a court of competent jurisdiction to be unavailable to an
indemnified party with respect to any loss, claim, expense, damage
or
liability referred to therein, then the indemnifying party, in lieu
of
indemnifying such indemnified party hereunder, shall contribute to
the
amount paid or payable by such indemnified party as a result of such loss,
claim, expense, damage or liability in such proportion as is appropriate
to reflect the relative fault of the indemnifying party on the one
hand
and of the indemnified party on the other in connection with the
untrue
statement or alleged untrue statement or omission or alleged omission
or
violation or alleged violation that resulted in such loss, claim,
expense,
damage or liability as well as any other relevant equitable
considerations. The relative fault of the indemnifying party and
of the
indemnified party shall be determined by reference to, among other
things,
whether the untrue statement or alleged untrue statement or omission
or
alleged omission or violation or alleged violation relates to information
supplied or acts or omissions by the indemnifying party or by the
indemnified party and the parties’ relative intent, knowledge, access to
information, and opportunity to correct or prevent such statement,
omission or violation; provided further,
that, in no event shall any contribution of a holder or Registrable
Securities under this Section 7.8
exceed the net proceeds from the offering received by such holder.
|
(f)
|
(e)
The obligations of the Parties under this Section 7.8
shall survive the completion of any offering of Registrable Securities
in
a registration statement under Section 7.1;
provided
that any such indemnification obligations shall not extend beyond
the
period proscribed by the applicable statute of limitations (and all
extensions thereof) with respect to such action or claim; and provided further,
that if notice is given under this Section 7.8
with respect to any matter entitling a party to indemnification hereunder
prior to the applicable expiration date, such indemnification obligation
shall continue indefinitely in respect of the applicable claim until
it is
finally resolved.
|
8.1
|
Transfer
and Issuance Restrictions
|
(a)
|
no
Exchangeable Shares may be Transferred unless, in addition to such
Transfer complying with all provisions related to Transfers set forth
in
this Agreement and in the constating documents of the Corporation,
concurrently with such transfer the transferee enters into this Agreement
by executing a counterpart instrument of accession in the form attached
as
Schedule B; and
|
(b)
|
no
additional Exchangeable Shares may be issued by the Corporation to
any
Person who is not a Holder without Joint Approval, and if Joint Approval
is obtained unless, concurrently with such issuance, the Person to
whom
such shares are issued enters into this Agreement by executing a
counterpart instrument of accession in the form attached as Schedule
B.
|
8.2
|
Legends
|
8.3
|
Seller
Acknowledgements and
Agreements
|
8.4
|
Compliance
with other Instruments
|
8.5
|
Changes
in Capital of Opko and the
Corporation
|
8.6
|
Term
|
8.7
|
Enurement
|
8.8
|
Notices
to Parties
|
(a)
|
if
to the Corporation, to Opko, any Permitted Subsidiary, or their
Affiliates, to:
|
(b)
|
and
if to the Holders in accordance with Section 8.9.
|
(c)
|
Any
such communication so given or made shall be deemed to have been
given or
made and to have been received on the day of delivery if delivered,
or on
the day of faxing or sending by other means of recorded electronic
communication, provided that such day in either event is a Business
Day
and the communication is so delivered, faxed or sent before 4:30
p.m. on
such day. Otherwise, such communication shall be deemed to have been
given
and made and to have been received on the next following Business
Day. Any
such communication sent by mail shall be deemed to have been given
and
made and to have been received on the fifth Business Day following
the
mailing thereof; provided however that no such communication shall
be
mailed during any actual or apprehended disruption of postal services.
Any
such communication given or made in any other manner shall be deemed
to
have been given or made and to have been received only upon actual
receipt.
|
(d)
|
Any
Party may from time to time change its address under this Section
by
notice to the other Party given in the manner provided by this
Section.
|
8.9
|
Notice
to Holders
|
8.10
|
Amendment
|
8.11
|
Assignment
|
8.12
|
Further
Assurances
|
8.13
|
Execution
and Delivery
|
SIGNED
IN THE PRESENCE OF:
|
)
|
|
)
|
||
)
|
||
)
|
||
Witness
|
)
|
RISHARD
WEITZ
|
)
|
||
)
|
||
)
|
||
Witness
|
)
|
CAROLYN
WEISS
|
)
|
||
)
|
||
)
|
||
)
|
||
)
|
||
Witness
|
)
|
GERALD
WEISS, IN TRUST
|
)
|
||
)
|
||
)
|
||
)
|
||
Witness
|
)
|
SHANE
DUNNE
|