1
Exhibit 10.9
REGISTRATION AGREEMENT
THIS AGREEMENT is made as of December 17, 1996 by and among Brim, Inc., an
Oregon corporation (the "Company"), Principal Hospital Company, a Delaware
corporation ("Principal") for the limited purpose specified in Section 9(k)
hereof, Golder, Thoma, Xxxxxxx, Xxxxxx Fund IV, L.P., a Delaware limited
partnership ("GTCR"), Leeway & Co., a Massachusetts general partnership
("Leeway"), First Union Corporation of Virginia, a Virginia corporation ("First
Union"), AmSouth Bancorporation, a Delaware corporation ("AmSouth"), and the
individuals listed on the Schedule of Holders attached hereto (each, an "Other
Holder"). Unless otherwise provided in this Agreement, capitalized terms used
herein shall have the meanings set forth in paragraph 8 hereof.
Whereas the Company desires to provide the holders of Registrable
Securities with the registration rights set forth herein, the parties hereto
agree as follows:
1. Demand Registrations.
a. Requests for Registration. At any time after the 180th day after the
closing of the Initial Public Offering, the holders of a majority of the
Registrable Securities (other than the Leeway Registrable Securities) may
request (i) two registrations under the Securities Act of all or part of their
Registrable Securities on Form S-1 or any similar long-form registration (a
"Long-Form Registration") in which the Company will pay all Registration
Expenses (as defined in paragraph 5 below) ("Company-paid Long-Form
Registrations") and (ii) an unlimited number of Long-Form Registrations in which
the holders of Registrable Securities included in such registration shall pay
their share of the Registration Expenses (as defined in paragraph 5 below). At
any time after the 180th day after the closing of the Initial Public Offering,
the holders of a majority of the Leeway Registrable Securities may request (i)
one Company-paid Long-Form Registration and (ii) an unlimited number of
Long-Form Registrations in which the holders of Registrable Securities included
in such registration shall pay their share of the Registration Expenses (as
defined in paragraph 5 below). All registrations requested pursuant to this
paragraph 1(a) and paragraph 1(c) are referred to herein as "Demand
Registrations". Each request for a Demand Registration shall specify the
approximate number of Registrable Securities requested to be registered and the
anticipated per share price range for such offering. Within ten days after
receipt of any such request, the Company shall give written notice of such
requested registration to all other holders of Registrable Securities and shall
include in such registration all Registrable Securities with respect to which
the Company has received written requests for inclusion therein within 15 days
after the receipt of the Company's notice.
b. Long-Form Registrations. A registration shall not count as one of the
permitted Long-Form Registrations until it has become effective, and no
Long-Form Registration shall count as one of the permitted Long-Form
Registrations unless the holders of Registrable Securities are able to register
and sell at least 90% of the Registrable Securities requested to be included in
such registration; provided that in any event the Company shall pay all
Registration Expenses in connection with any registration initiated as a
Company-paid Long-Form Registration
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whether or not it has become effective and whether or not such registration has
counted as one of the permitted Company-paid Long-Form Registrations.
c. Short-Form Registrations. In addition to the Long-Form Registrations
provided pursuant to paragraph 1(a), the holders of a majority of the
Registrable Securities shall be entitled to request an unlimited number of
registrations of all or any portion of their Registrable Securities on Form S-2
or S-3 or any similar short-form registration ("Short-Form Registrations") in
which the Company shall pay all Registration Expenses. The holder of a majority
of the Leeway Shares shall be entitled to request one Short-Form Registration
annually in which the Company shall pay all Registration Expenses. Demand
Registrations shall be Short-Form Registrations whenever the Company is
permitted to use any applicable short form. After the Company has become subject
to the reporting requirements of the Securities Exchange Act, the Company shall
use its best efforts to make Short-Form Registrations on Form S-3 available for
the sale of Registrable Securities.
d. Priority on Demand Registrations. The Company shall not include in any
Demand Registration any securities which are not Registrable Securities without
the prior written consent of the holders of a majority of the Registrable
Securities included in such registration. If a Demand Registration is an
underwritten offering and the managing underwriters advise the Company in
writing that in their opinion the number of Registrable Securities and, if
permitted hereunder, other securities requested to be included in such offering
exceeds the number of Registrable Securities and other securities, if any, which
can be sold in an orderly manner in such offering within a price range
acceptable to the holders of a majority of the Registrable Securities to be
included in such registration, therein without adversely affecting the
marketability of the offering, the Company shall include in such registration
prior to the inclusion of any securities which are not Registrable Securities
the number of Registrable Securities requested to be included which in the
opinion of such underwriters can be sold in an orderly manner within the price
range of such offering, pro rata among the respective holders thereof on the
basis of the amount of Registrable Securities owned by each such holder. Without
the consent of the Company and the holders of a majority of the Registrable
Securities included in such registration, any Persons other than holders of
Registrable Securities who participate in Demand Registrations which are not at
the Company's expense must pay their share of the Registration Expenses as
provided in paragraph 5 hereof.
e. Restrictions on Long-Form Registrations. The Company shall not be
obligated to effect any Long-Form Registration within one year after the
effective date of a previous Long-Form Registration or a previous registration
in which the holders of Registrable Securities were given piggyback rights
pursuant to paragraph 2 and in which there was no reduction in the number of
Registrable Securities requested to be included; provided that the Company shall
be obligated to effect any Long-Form Registration 180 days after the effective
date of a previous registration in which the holders of Registrable Securities
were given piggyback rights pursuant to paragraph 2 if such holders were not
allowed to sell in such offering the entire amount of Registrable Securities
which they desired to sell. The Company may postpone for up to one year the
filing or the effectiveness of a registration statement for a Demand
Registration if the Company and the holders of a majority of the Registrable
Securities agree that such Demand Registration would reasonably be expected to
have a material adverse effect on any proposal or plan by the Company or any of
its Subsidiaries to engage in any acquisition of assets (other than in the
ordinary course of business) or any merger, consolidation, tender offer,
reorganization or similar transaction; provided
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that in such event, the holders of Registrable Securities initially requesting
such Demand Registration shall be entitled to withdraw such request and, if
such request is withdrawn, such Demand Registration shall not count as one of
the permitted Demand Registrations hereunder and the Company shall pay all
Registration Expenses in connection with such registration.
f. Selection of Underwriters. The holders of a majority of the Registrable
Securities included in any Demand Registration/Long-Form Registration shall have
the right to select the investment banker(s) and manager(s) to administer the
offering.
g. Other Registration Rights. Except as provided in this Agreement, the
Company shall not grant to any Persons the right to request the Company to
register any equity securities of the Company, or any securities convertible or
exchangeable into or exercisable for such securities, without the prior written
consent of the holders of a majority of the Registrable Securities.
2. Piggyback Registrations.
a. Right to Piggyback. Whenever the Company proposes to register any of its
securities under the Securities Act (other than pursuant to the Initial Public
Offering or a Demand Registration) and the registration form to be used may be
used for the registration of Registrable Securities (a "Piggyback
Registration"), the Company shall give prompt written notice (in any event
within three business days after its receipt of notice of any exercise of demand
registration rights other than under this Agreement) to all holders of
Registrable Securities of its intention to effect such a registration and shall
include in such registration all Registrable Securities with respect to which
the Company has received written requests for inclusion therein within 20 days
after the receipt of the Company's notice.
b. Piggyback Expenses. The Registration Expenses of the holders of
Registrable Securities shall be paid by the Company in all Piggyback
Registrations.
c. Priority on Primary Registrations. If a Piggyback Registration is an
underwritten primary registration on behalf of the Company, and the managing
underwriters advise the Company in writing that in their opinion the number of
securities requested to be included in such registration exceeds the number
which can be sold in an orderly manner in such offering within a price range
acceptable to the Company, the Company shall include in such registration (i)
first, the securities the Company proposes to sell, (ii) second, the Registrable
Securities requested to be included in such registration, pro rata among the
holders of such Registrable Securities on the basis of the number of shares
owned by each such holder, and (iii) third, other securities requested to be
included in such registration.
d. Priority on Secondary Registrations. If a Piggyback Registration is an
underwritten secondary registration on behalf of holders of the Company's
securities, and the managing underwriters advise the Company in writing that in
their opinion the number of securities requested to be included in such
registration exceeds the number which can be sold in an orderly manner in such
offering within a price range acceptable to the holders of a majority of the
Registrable Securities to be included in such registration, the Company shall
include in such registration (i) first, the securities requested to be included
therein by the holders requesting such
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registration, (ii) second, the Registrable Securities requested to be included
in such registration, pro rata among the holders of such Registrable Securities
on the basis of the number of shares owned by each such holder, and (iii) third,
other securities requested to be included in such registration.
e. Selection of Underwriters. If any Piggyback Registration is an
underwritten offering, the selection of investment banker(s) and manager(s) for
the offering must be approved by the holders of a majority of the Registrable
Securities included in such Piggyback Registration. Such approval shall not be
unreasonably withheld.
f. Other Registrations. If the Company has previously filed a registration
statement with respect to Registrable Securities pursuant to paragraph 1 or
pursuant to this paragraph 2, and if such previous registration has not been
withdrawn or abandoned, the Company shall not file or cause to be effected any
other registration of any of its equity securities or securities convertible or
exchangeable into or exercisable for its equity securities under the Securities
Act (except on Form S-8 or any successor form), whether on its own behalf or at
the request of any holder or holders of such securities, until a period of at
least 180 days has elapsed from the effective date of such previous
registration.
3. Holdback Agreements.
a. Each holder of Registrable Securities shall not effect any public sale
or distribution (including sales pursuant to Rule 144) of equity securities of
the Company, or any securities convertible into or exchangeable or exercisable
for such securities, during the seven days prior to and the 180-day period
beginning on the effective date of any underwritten Demand Registration or any
underwritten Piggyback Registration in which Registrable Securities are included
(except as part of such underwritten registration), unless the underwriters
managing the registered public offering otherwise agree.
b. The Company (i) shall not effect any public sale or distribution of its
equity securities, or any securities convertible into or exchangeable or
exercisable for such securities, during the seven days prior to and during the
180-day period beginning on the effective date of any underwritten Demand
Registration or any underwritten Piggyback Registration (except as part of such
underwritten registration or pursuant to registrations on Form S-8 or any
successor form), unless the underwriters managing the registered public offering
otherwise agree, and (ii) shall cause each holder of its Stock, or any
securities convertible into or exchangeable or exercisable for Stock, purchased
from the Company at any time after the date of this Agreement (other than in a
registered public offering) to agree not to effect any public sale or
distribution (including sales pursuant to Rule 144) of any such securities
during such period (except as part of such underwritten registration, if
otherwise permitted), unless the underwriters managing the registered public
offering otherwise agree.
4. Registration Procedures. Whenever the holders of Registrable Securities
have requested that any Registrable Securities be registered pursuant to this
Agreement, the Company shall use its best efforts to effect the registration and
the sale of such Registrable Securities in accordance with the intended method
of disposition thereof, and pursuant thereto the Company shall as expeditiously
as possible:
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a. prepare and file with the Securities and Exchange Commission a
registration statement with respect to such Registrable Securities and use its
best efforts to cause such registration statement to become effective (provided
that before filing a registration statement or prospectus or any amendments or
supplements thereto, the Company shall furnish to the counsel selected by the
holders of a majority of the Registrable Securities covered by such registration
statement copies of all such documents proposed to be filed, which documents
shall be subject to the review and comment of such counsel);
b. notify each holder of Registrable Securities of the effectiveness of
each registration statement filed hereunder and prepare and file with the
Securities and Exchange Commission such amendments and supplements to such
registration statement and the prospectus used in connection therewith as may be
necessary to keep such registration statement effective for a period of not less
than 180 days and comply with the provisions of the Securities Act with respect
to the disposition of all securities covered by such registration statement
during such period in accordance with the intended methods of disposition by the
sellers thereof set forth in such registration statement;
c. furnish to each seller of Registrable Securities such number of copies
of such registration statement, each amendment and supplement thereto, the
prospectus included in such registration statement (including each preliminary
prospectus) and such other documents as such seller may reasonably request in
order to facilitate the disposition of the Registrable Securities owned by such
seller;
d. use its best efforts to register or qualify such Registrable Securities
under such other securities or blue sky laws of such jurisdictions as any seller
reasonably requests and do any and all other acts and things which may be
reasonably necessary or advisable to enable such seller to consummate the
disposition in such jurisdictions of the Registrable Securities owned by such
seller (provided that the Company shall not be required to (i) qualify generally
to do business in any jurisdiction where it would not otherwise be required to
qualify but for this subparagraph, (ii) subject itself to taxation in any such
jurisdiction or (iii) consent to general service of process in any such
jurisdiction);
e. notify each seller of such Registrable Securities, at any time when a
prospectus relating thereto is required to be delivered under the Securities
Act, of the happening of any event as a result of which the prospectus included
in such registration statement contains an untrue statement of a material fact
or omits any fact necessary to make the statements therein not misleading, and,
at the request of any such seller, the Company 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;
f. cause all such Registrable Securities to be listed on each securities
exchange on which similar securities issued by the Company are then listed and,
if not so listed, to be listed on the NASD automated quotation system and, if
listed on the NASD automated quotation system, use its best efforts to secure
designation of all such Registrable Securities covered by such registration
statement as a NASDAQ "national market system security" within the meaning of
Rule 11Aa2-1
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of the Securities and Exchange Commission or, failing that, to secure NASDAQ
authorization for such Registrable Securities and, without limiting the
generality of the foregoing, to arrange for at least two market makers to
register as such with respect to such Registrable Securities with the NASD;
g. provide a transfer agent and registrar for all such Registrable
Securities not later than the effective date of such registration statement;
h. enter into such customary agreements (including underwriting agreements
in customary form) and take all such other actions as the holders of a majority
of the Registrable Securities being sold or the underwriters, if any, reasonably
request in order to expedite or facilitate the disposition of such Registrable
Securities (including effecting a stock split or a combination of shares);
i. make available for inspection by any seller of Registrable Securities,
any underwriter participating in any disposition pursuant to such registration
statement and any attorney, accountant or other agent retained by any such
seller or underwriter, all financial and other records, pertinent corporate
documents and properties of the Company, and cause the Company's officers,
directors, employees and independent accountants to supply all information
reasonably requested by any such seller, underwriter, attorney, accountant or
agent in connection with such registration statement;
j. otherwise use its best efforts to comply with all applicable rules and
regulations of the Securities and Exchange Commission, and make available to its
security holders, as soon as reasonably practicable, an earnings statement
covering the period of at least twelve months beginning with the first day of
the Company's first full calendar quarter after the effective date of the
registration statement, which earnings statement shall satisfy the provisions of
Section 11(a) of the Securities Act and Rule 158 thereunder;
k. permit any holder of Registrable Securities which holder, in its sole
and exclusive judgment, might be deemed to be an underwriter or a controlling
person of the Company, to participate in the preparation of such registration or
comparable statement and to require the insertion therein of material, furnished
to the Company in writing, which in the reasonable judgment of such holder and
its counsel should be included;
l. in the event of the issuance of any stop order suspending the
effectiveness of a registration statement, or of any order suspending or
preventing the use of any related prospectus or suspending the qualification of
any stock included in such registration statement for sale in any jurisdiction,
the Company shall use its best efforts promptly to obtain the withdrawal of such
order;
m. use its best efforts to cause such Registrable Securities covered by
such registration statement to be registered with or approved by such other
governmental agencies or authorities as may be necessary to enable the sellers
thereof to consummate the disposition of such Registrable Securities; and
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n. obtain a cold comfort letter from the Company's independent public
accountants in customary form and covering such matters of the type customarily
covered by cold comfort letters as the holders of a majority of the Registrable
Securities being sold reasonably request (provided that such Registrable
Securities constitute at least 10% of the securities covered by such
registration statement).
5. Registration Expenses.
a. All expenses incident to the Company's performance of or compliance with
this Agreement, including without limitation all registration and filing fees,
fees and expenses of compliance with securities or blue sky laws, printing
expenses, messenger and delivery expenses, fees and disbursements of custodians,
and fees and disbursements of counsel for the Company and all independent
certified public accountants, underwriters (excluding discounts and commissions)
and other Persons retained by the Company (all such expenses being herein called
"Registration Expenses"), shall be borne as provided in this Agreement, except
that the Company shall, in any event, pay its internal expenses (including,
without limitation, all salaries and expenses of its officers and employees
performing legal or accounting duties), the expense of any annual audit or
quarterly review, the expense of any liability insurance and the expenses and
fees for listing the securities to be registered on each securities exchange on
which similar securities issued by the Company are then listed or on the NASD
automated quotation system.
b. In connection with each Demand Registration and each Piggyback
Registration, the Company shall reimburse the holders of Registrable Securities
included in such registration for the reasonable fees and disbursements of one
counsel chosen by the holders of a majority of the Registrable Securities
included in such registration and for the reasonable fees and disbursements of
each additional counsel retained by any holder of Registrable Securities for the
purpose of rendering a legal opinion on behalf of such holder in connection with
any underwritten Demand Registration or Piggyback Registration.
c. To the extent Registration Expenses are not required to be paid by the
Company, each holder of securities included in any registration hereunder shall
pay those Registration Expenses allocable to the registration of such holder's
securities so included, and any Registration Expenses not so allocable shall be
borne by all sellers of securities included in such registration in proportion
to the aggregate selling price of the securities to be so registered.
6. Indemnification.
a. The Company agrees to indemnify, to the extent permitted by law, each
holder of Registrable Securities, its officers and directors and each Person who
controls such holder (within the meaning of the Securities Act) against all
losses, claims, damages, liabilities and expenses caused by any untrue or
alleged untrue statement of material fact contained in any registration
statement, prospectus or preliminary prospectus or any amendment thereof or
supplement thereto or any omission or alleged omission of a material fact
required to be stated therein or necessary to make the statements therein not
misleading, except insofar as the same are caused by or contained in any
information furnished in writing to the Company by such holder expressly for use
therein or by such holder's failure to deliver a copy of the registration
statement or prospectus or any
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amendments or supplements thereto after the Company has furnished such holder
with a sufficient number of copies of the same. In connection with an
underwritten offering, the Company shall indemnify such underwriters, their
officers and directors and each Person who controls such underwriters (within
the meaning of the Securities Act) to the same extent as provided above with
respect to the indemnification of the holders of Registrable Securities.
b. In connection with any registration statement in which a holder of
Registrable Securities is participating, each such holder shall furnish to the
Company in writing such information and affidavits as the Company reasonably
requests for use in connection with any such registration statement or
prospectus and, to the extent permitted by law, shall indemnify the Company, its
directors and officers and each Person who controls the Company (within the
meaning of the Securities Act) against any losses, claims, damages, liabilities
and expenses resulting from any untrue or alleged untrue statement of material
fact contained in the registration statement, prospectus or preliminary
prospectus or any amendment thereof or supplement thereto or any omission or
alleged omission of a material fact required to be stated therein or necessary
to make the statements therein not misleading, but only to the extent that such
untrue statement or omission is contained in any information or affidavit so
furnished in writing by such holder; provided that the obligation to indemnify
shall be individual, not joint and several, for each holder and shall be limited
to the net amount of proceeds received by such holder from the sale of
Registrable Securities pursuant to such registration statement.
c. Any Person entitled to indemnification hereunder shall (i) give prompt
written notice to the indemnifying party of any claim with respect to which it
seeks indemnification (provided that the failure to give prompt notice shall not
impair any Person's right to indemnification hereunder to the extent such
failure has not prejudiced the indemnifying party) and (ii) unless in such
indemnified party's reasonable judgment a conflict of interest between such
indemnified and indemnifying parties may exist with respect to such claim,
permit such indemnifying party to assume the defense of such claim with counsel
reasonably satisfactory to the indemnified party. If such defense is assumed,
the indemnifying party shall not be subject to any liability for any settlement
made by the indemnified party without its consent (but such consent shall not be
unreasonably withheld). An indemnifying party who is not entitled to, or elects
not to, assume the defense of a claim shall not be obligated to pay the fees and
expenses of more than one counsel for all parties indemnified by such
indemnifying party with respect to such claim, unless in the reasonable judgment
of any indemnified party a conflict of interest may exist between such
indemnified party, and any other of such indemnified parties with respect to
such claim.
d. The indemnification provided for under this Agreement shall remain in
full force and effect regardless of any investigation made by or on behalf of
the indemnified party or any officer, director or controlling Person of such
indemnified party and shall survive the transfer of securities. The Company also
agrees to make such provisions, as are reasonably requested by any indemnified
party, for contribution to such party in the event the Company's indemnification
is unavailable for any reason.
7. Participation in Underwritten Registrations. No Person may participate
in any registration hereunder which is underwritten unless such Person (i)
agrees to sell such Person's securities on the basis provided in any
underwriting arrangements approved by the Person or Persons
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entitled hereunder to approve such arrangements and (ii) completes and executes
all questionnaires, powers of attorney, indemnities, underwriting agreements and
other documents required under the terms of such underwriting arrangements;
provided that no holder of Registrable Securities included in any underwritten
registration shall be required to make any representations or warranties to the
Company or the underwriters (other than representations and warranties regarding
such holder and such holder's intended method of distribution) or to undertake
any indemnification obligations to the Company or the underwriters with respect
thereto, except as otherwise provided in paragraph 6 hereof.
8. Definitions.
(a) "Executives" means Xxxxxx X. Xxxx and Xxxxxxx X. Xxxx.
(b) "Common Stock" means the Company's Common Stock, no par value.
(c) "GTCR Registrable Securities" means (i) any Common Stock issued or
issuable to GTCR pursuant to the Investment Agreement or the Merger Agreement,
(ii) any Stock issued to GTCR pursuant to Section 6 of the Stockholders
Agreement, of even date herewith among the Company, GTCR and the other
stockholders named therein (whether issued before or after the date hereof),
(iii) any stock purchased by GTCR pursuant to the Senior Management Agreements,
(iv) any other Common Stock issued or issuable with respect to the securities
referred to in clauses (i), (ii) and (iii) by way of a stock dividend or stock
split or in connection with an exchange or combination of shares,
recapitalization, merger, consolidation or other reorganization, and (v) any
other shares of Common Stock held by Persons holding securities described in
clauses (i) to (iv), inclusive, above.
(d) "Initial Public Offering" means the sale in an initial underwritten
public offering registered under the Securities Act (other than on Form S-8 or a
similar form) of shares of Common Stock.
(e) "Investment Agreement" means the Investment Agreement dated as of
November 21, 1996, between the Company and the Investor, as amended,
supplemented or otherwise modified from time to time.
(f) "Leeway Registrable Securities" means (i) any Common Stock issued or
issuable to Leeway pursuant to the Securities Purchase Agreement, Section 6 of
the Shareholders Agreement or the Warrant, (ii) any stock purchased by Leeway
pursuant to the Senior Management Agreements, (iii) any other Common Stock
issued or issuable with respect to the securities referred to in clauses (i) and
(ii) by way of a stock dividend or stock split or in connection with an exchange
or combination of shares, recapitalization, merger, consolidation or other
reorganization, and (iv) any other shares of Common Stock held by Persons
holding securities described in clauses (i), (ii) or (iii) above.
(g) "Leeway Shares" means (i) any capital stock of the Company purchased or
otherwise acquired by Leeway, (ii) any warrants, options or other rights to
subscribe for or to acquire, directly or indirectly, any capital stock of the
Company, purchased or otherwise acquired
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by Leeway, whether or not then exercisable or convertible, and (iii) any stock
or other securities which are convertible into or exchangeable for, directly or
indirectly, any capital stock of the Company, purchased or otherwise acquired by
Leeway, whether or not then convertible or exchangeable, (iv) any securities or
rights issued or issuable directly or indirectly with respect to the securities
and rights referred to in clauses (i), (ii) and (iii) above by way of stock
dividend or stock split or in connection with a combination of shares,
recapitalization, merger, consolidation or other reorganization. As to any
particular Leeway Shares, such shares shall cease to be Leeway Shares when they
have been (a) effectively registered under the Securities Act and disposed of in
accordance with the registration statement covering them or (b) distributed to
the public through a broker, dealer or market maker pursuant to Rule 144 under
the Securities Act (or any similar rule then in force), it being understood that
this clause (b) shall not apply to transfers of shares pursuant to Rule 144A
under the Securities Act (or any similar rule then in force) and private
placements pursuant to Section 4(1) or Section 4(2) of the Securities Act.
References to a majority of the Leeway Shares or a certain percentage of the
Leeway Shares shall be calculated with all holders of Leeway Shares voting as a
single class, with each share of Junior Preferred and Common Stock which is a
Leeway Share being entitled to a number of votes equal to its pro rata portion
of the aggregate number of votes allocable to its class.
(h) "Merger Agreement" means the Agreement and Plan of Merger dated as of
December 17, 1996 among the Company, Principal Merger Company, Principal and
certain other parties, as amended, supplemented or otherwise modified from time
to time.
(i) "Other Registrable Securities" means (i) any Common Stock issued to
First Union, AmSouth or any Other Holder (whether issued before or after the
date hereof), (ii) any other Common Stock issued or issuable with respect to the
securities referred to in clause (i) by way of a stock dividend or stock split
or in connection with an exchange or combination of shares, recapitalization,
merger, consolidation or other reorganization, and (iii) any other shares of
Common Stock held by Persons holding securities described in clauses (i) or (ii)
above.
(j) "Principal Registration Agreement" means the Amended and Restated
Registration Agreement, dated as of November 12, 1996 between Principal, GTCR,
First Union, AmSouth and the Executives.
(k) "Registrable Securities" means, collectively, the GTCR Registrable
Securities, the Leeway Registrable Securities and the Other Registrable
Securities. As to particular Registrable Securities, such securities shall cease
to be Registrable Securities when they have been distributed to the public
pursuant to an offering registered under the Securities Act or sold to the
public through a broker, dealer or market maker in compliance with Rule 144
under the Securities Act (or any similar rule then in force). For purposes of
this Agreement, a Person shall be deemed to be a holder of Registrable
Securities whenever such Person has the right to acquire such Registrable
Securities (upon conversion or exercise in connection with a transfer of
securities or otherwise, but disregarding any restrictions or limitations upon
the exercise of such right), whether or not such acquisition has actually been
effected.
(l) "Securities Purchase Agreement" means the Securities Purchase Agreement
of even date herewith between the Company and Leeway.
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(m) "Senior Management Agreements" means the Senior Management Agreements
of even date herewith between the Company, Principal, Leeway and each of Xxxxxx
X. Xxxx and Xxxxxxx X. Xxxx.
(n) "Stockholders Agreement" means the Stockholders Agreement of even date
herewith between the Company, GTCR, Leeway, First Union, AmSouth, the
Executives, Principal and the individuals listed on Schedule I thereto.
(o) "Stock" means, collectively, the Company's Series A Senior Preferred
Stock, no par value, the Company's Series B Junior Preferred Stock, no par value
and the Company's Common Stock, no par value.
(p) "Warrant" means the Warrant of even date herewith between the Company
and Leeway and any warrant issued pursuant to Section 6 of the Stockholders
Agreement.
(q) Unless otherwise stated, other capitalized terms contained herein have
the meanings set forth in the Stockholders Agreement dated as of the date hereof
among the Company and the parties hereto.
9. Miscellaneous.
a. No Inconsistent Agreements. The Company shall not hereafter enter into
any agreement with respect to its securities which is inconsistent with or
violates the rights granted to the holders of Registrable Securities in this
Agreement.
b. Adjustments Affecting Registrable Securities. The Company shall not take
any action, or permit any change to occur, with respect to its securities which
would adversely affect the ability of the holders of Registrable Securities to
include such Registrable Securities in a registration undertaken pursuant to
this Agreement or which would adversely affect the marketability of such
Registrable Securities in any such registration (including, without limitation,
effecting a stock split or a combination of shares).
c. Remedies. Any Person having rights under any provision of this Agreement
shall be entitled to enforce such rights specifically to recover damages caused
by reason of any breach of any provision of this Agreement and to exercise all
other rights granted by law. The parties hereto agree and acknowledge that money
damages may not be an adequate remedy for any breach of the provisions of this
Agreement and that any party may in its sole discretion apply to any court of
law or equity of competent jurisdiction (without posting any bond or other
security) for specific performance and for other injunctive relief in order to
enforce or prevent violation of the provisions of this Agreement.
d. Amendments and Waivers. Except as otherwise provided herein, the
provisions of this Agreement may be amended or waived only upon the prior
written consent of the Company and holders of at least 90% of the Registrable
Securities.
12
e. Successors and Assigns. All covenants and agreements in this Agreement
by or on behalf of any of the parties hereto shall bind and inure to the benefit
of the respective successors and assigns of the parties hereto whether so
expressed or not, and the rights and obligations of GTCR under this Agreement
and the agreements contemplated hereby may be assigned by GTCR at any time, in
whole or in part, to any investment fund managed by Golder, Thoma, Cressey,
Rauner, Inc., or any successor thereto. In addition, whether or not any express
assignment has been made, the provisions of this Agreement which are for the
benefit of purchasers or holders of Registrable Securities are also for the
benefit of, and enforceable by, any subsequent holder of Registrable Securities.
f. Severability. Whenever possible, each provision of this Agreement shall
be interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Agreement is held to be prohibited by or invalid
under applicable law, such provision shall be ineffective only to the extent of
such prohibition or invalidity, without invalidating the remainder of this
Agreement.
g. Counterparts. This Agreement may be executed simultaneously in two or
more counterparts, any one of which need not contain the signatures of more than
one party, but all such counterparts taken together shall constitute one and the
same Agreement.
h. Descriptive Headings. The descriptive headings of this Agreement are
inserted for convenience only and do not constitute a part of this Agreement.
i. Governing Law. All issues and questions concerning the construction,
validity, interpretation and enforcement of this Agreement and the exhibits and
schedules hereto shall be governed by, and construed in accordance with, the
laws of the State of New York, without giving effect to any choice of law or
conflict of law rules or provisions (whether of the State of New York or any
other jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of New York.
j. Notices. All notices, demands or other communications to be given or
delivered under or by reason of the provisions of this Agreement shall be in
writing and shall be deemed to have been given when delivered personally to the
recipient, sent to the recipient by reputable overnight courier service (charges
prepaid) or mailed to the recipient by certified or registered mail, return
receipt requested and postage prepaid. Such notices, demands and other
communications shall be sent to Leeway, First Union, AmSouth and the Other
Holders at the addresses indicated on Schedule of Holders attached hereto and to
the Company at the address of its corporate headquarters or to such other
address or to the attention of such other person as the recipient party has
specified by prior written notice to the sending party.
k. Termination of Principal Registration Agreement. Principal, GTCR, First
Union, AmSouth and the Executives agree that the Principal Registration
Agreement will be terminated automatically upon the effectiveness of this
Agreement and from and after such time, shall have no further force or effect.
13
l. Additional Holders of Registrable Securities. In connection with the
issuance of any additional equity securities of the Company, the Company may
permit such person to become a party to this Agreement and succeed to all of the
rights and obligations of a holder of Registrable Securities under this
Agreement by obtaining an executed counterpart signature page to this Agreement,
and, upon such execution, such person shall for all purposes be a holder of
Registrable Securities party to this Agreement. The Company will not, without
the prior written consent of the holders of 90% of the Registrable Securities,
grant registration rights to any party other than pursuant to a counterpart to
this Agreement.
* * * * *
14
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.
BRIM, INC.
By /s/ Xxxxxx X. Xxxx
--------------------------------------
Its: Chief Executive Officer
GOLDER, THOMA, XXXXXXX, XXXXXX
FUND IV, L.P.
By: GTCR IV, L.P., its General Partner
By: Golder, Thoma, Cressey, Rauner, Inc.,
Its: General Partner
By: /s/ Xxxxx X. Xxxxxx
-------------------------------------
Its: Principal
PRINCIPAL HOSPITAL COMPANY
By /s/ Xxxxxx X. Xxxx
--------------------------------------
Its: Chief Executive Officer
LEEWAY & CO.
By State Street Bank & Trust Company
Its Partner
By /s/ Xxxxxx X. Xxxxx Xx.
--------------------------------------
Its Vice President
FIRST UNION CORPORATION OF VIRGINIA
By /s/ Xxxxxx X. Xxxxxx
--------------------------------------
Its Senior Vice President
AMSOUTH BANCORPORATION
By /s/ Xxxxx X. Xxxxxx
--------------------------------------
Its Executive Vice President
BRIM CAPITAL CORPORATION
By /s/ X. X. Xxxx
-------------------------------------
Its President
15
SSS CAPITAL CORPORATION
By /s/ K. Xxxxx XxXxxxxxxx
--------------------------------------
Its President
CTK CAPITAL CORPORATION
By /s/ Xxxxx X. Xxxxxxxx
--------------------------------------
Its President
/s/ Xxxxxx X. Xxxx
-----------------------------------------
Xxxxxx X. Xxxx
/s/ Xxxxxxx X. Xxxx
-----------------------------------------
Xxxxxxx X. Xxxx
/s/ Xxxxxxx Xxxxx
-----------------------------------------
Xxxxxxx Xxxxx
/s/ Xxxxxxxxx Xxxxx
-----------------------------------------
Xxxxxxxxx Xxxxx
/s/ Xxxx Xxxxxxx
-----------------------------------------
Xxxx Xxxxxxx
/s/ Xxxxx XxXxxxxx
-----------------------------------------
Xxxxx XxXxxxxx
/s/ Xxxx Xxxxxx
-----------------------------------------
Xxxx Xxxxxx
/s/ Xxxxxxxx Xxxx
-----------------------------------------
Xxxxxxxx Xxxx
/s/ Xxxxx Xxxxxx
-----------------------------------------
Xxxxx Xxxxxx
/s/ Xxxxx Xxxxxxxx
-----------------------------------------
Xxxxx Xxxxxxxx
SCHEDULE OF HOLDERS
Golder, Thoma, Xxxxxxx, Xxxxxx Fund IV, L.P.
0000 Xxxxx Xxxxx
00
Xxxxxxx, XX 00000-0000
Attention: Xxxxx X. Xxxxxx
Xxxxxx X. Xxxx
Principal Hospital Company
0000 Xxxxxxx Xxxxxxx Xxxxx, Xxxxx X00
Xxxxxxxxx, XX 00000
Xxxxxxx X. Xxxx
Principal Hospital Company
0000 Xxxxxxx Xxxxxxx Xxxxx, Xxxxx X00
Xxxxxxxxx, XX 00000
Leeway & Co.
c/o State Street Bank and Trust Company
Master Trust Division - Q4W
X.X. Xxx 0000
Xxxxxx, Xxxxxxxxxxxxx 00000
AmSouth Bancorporation
0000 Xxxxx Xxxxxx Xxxxx
XxXxxxx-Xxxxx Tower, 7th Floor
Birmingham, AL 35203
Attention: Health Care Banking Department
First Union Corporation of Virginia
x/x Xxxxx Xxxxx Xxxxxxxx Xxxx xx Xxxxx Xxxxxxxx
000 Xxxxxx Xxxxxx Xxxxx, Xxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxx
Xxxx Capital Corporation
c/o Brim, Inc.
000 XX 000xx Xxxxxx
Xxxxxxxx, Xxxxxx 00000
SSS Capital Corporation
c/o Brim, Inc.
000 XX 000xx Xxxxxx
Xxxxxxxx, Xxxxxx 00000
CTK Capital Corporation
c/o Brim, Inc.
000 XX 000xx Xxxxxx
Xxxxxxxx, Xxxxxx 00000
17
Xxxxxxx Xxxxx
c/x Xxxx, Inc.
000 XX 000xx Xxxxxx
Xxxxxxxx, Xxxxxx 00000
Xxxxxxxxx Xxxxx
c/o Brim, Inc.
000 XX 000xx Xxxxxx
Xxxxxxxx, Xxxxxx 00000
Xxxx Xxxxxxx
c/x Xxxx, Inc.
000 XX 000xx Xxxxxx
Xxxxxxxx, Xxxxxx 00000
Xxxxx XxXxxxxx
c/o Brim, Inc.
000 XX 000xx Xxxxxx
Xxxxxxxx, Xxxxxx 00000
Xxxx Xxxxxx
c/x Xxxx, Inc.
000 XX 000xx Xxxxxx
Xxxxxxxx, Xxxxxx 00000
Xxxxxxxx Xxxx
c/o Brim, Inc.
000 XX 000xx Xxxxxx
Xxxxxxxx, Xxxxxx 00000
Xxxxx Xxxxxx
c/x Xxxx, Inc.
000 XX 000xx Xxxxxx
Xxxxxxxx, Xxxxxx 00000
Xxxxx Xxxxxxxx
c/o Brim, Inc.
000 XX 000xx Xxxxxx
Xxxxxxxx, Xxxxxx 00000
