REGISTRATION RIGHTS AGREEMENT
Exhibit 10.3
EXECUTION COPY
This Registration Rights Agreement (this “Agreement”) is made and entered into as of
July 22, 2010, by and between NxStage Medical, Inc., a Delaware corporation (the
“Company”), and DaVita Inc., a Delaware corporation (“DaVita”).
This Agreement is made in connection with the Warrant to Purchase Shares of Common Stock dated
as of the date hereof, by and between the Company and DaVita (the “Warrant Agreement”).
The Company and DaVita hereby agree as follows:
1. Definitions. Capitalized terms used and not otherwise defined herein that are defined
in the Warrant Agreement shall have the meanings given such terms in the Warrant Agreement. As
used in this Agreement, the following terms shall have the following meanings:
“Affiliate” means, with respect to any person, any other person that, directly
or indirectly through one or more intermediaries, controls, is controlled by, or is under
common control with, such specified person as such terms are used in and construed under
Rule 144 under the Securities Act of 1933, as amended.
“Business Day” means any day other than a Saturday or Sunday or any day on
which banks in New York are authorized or required to remain closed.
“Commission” means the Securities and Exchange Commission.
“Common Stock” means the common stock, par value $0.001 per share, of the
Company.
“DaVita Registration Statement” means the DaVita Registration Statement
required to be filed under Section 2, including (in each case) the Prospectus, amendments
and supplements to such registration statement or Prospectus, including pre- and
post-effective amendments, all exhibits thereto, and all material incorporated by reference
or deemed to be incorporated by reference in such registration statement.
“Effectiveness Date” means, with respect to the initial DaVita Registration
Statement required to be filed hereunder, the later of (i) July 30, 2011 and (ii) the date
on which any Shares shall first become vested and exercisable under the Warrant Agreement.
“Effectiveness Period” shall have the meaning set forth in Section 2(a).
“Exchange Act” means the Securities Exchange Act of 1934, as amended, or any
successor statute, and the rules and regulations of the Commission promulgated thereunder,
all as the same shall be in effect from time to time.
“Filing Date” shall have the meaning set forth in Section 2(a).
“Indemnified Party” shall have the meaning set forth in Section 5(c).
“Indemnifying Party” shall have the meaning set forth in Section 5(c).
“Losses” shall have the meaning set forth in Section 5(a).
“Proceeding” means an action, claim, suit, investigation or proceeding
(including, without limitation, an investigation or partial proceeding, such as a
deposition), whether commenced or threatened.
“Prospectus” means the prospectus included in the DaVita Registration Statement
(including, without limitation, a prospectus that includes any information previously
omitted from a prospectus filed as part of an effective registration statement in reliance
upon Rule 430A promulgated under the Securities Act), as amended or supplemented by any
prospectus supplement, with respect to the terms of the offering of any portion of the
Registrable Securities covered by the DaVita Registration Statement, and all other
amendments and supplements to the Prospectus, including post-effective amendments, and all
material incorporated by reference or deemed to be incorporated by reference in such
Prospectus.
“Registrable Securities” means the Shares, together with any securities issued
or issuable upon any stock split, dividend or other distribution, recapitalization or
similar event with respect to the foregoing; provided, however, a Share shall cease to be a
Registrable Security upon (A) sale pursuant to the DaVita Registration Statement or Rule 144
or (B) such Share becoming eligible for sale without restrictions by the holder thereof
pursuant to Rule 144.
“Rule 144” means Rule 144 promulgated by the Commission pursuant to the
Securities Act, as such Rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the Commission having substantially the same effect as such
Rule.
“Rule 415” means Rule 415 promulgated by the Commission pursuant to the
Securities Act, as such Rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the Commission having substantially the same effect as such
Rule.
“Rule 424” means Rule 424 promulgated by the Commission pursuant to the
Securities Act, as such Rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the Commission having substantially the same effect as such
Rule.
“Securities Act” means the Securities Act of 1933, as amended, or any successor
statute, and the rules and regulations of the Commission promulgated thereunder, all as the
same shall be in effect from time to time.
“Shares” solely for the purpose of this Agreement means the Shares (as defined
in the Warrant Agreement).
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“Trading Day” means a day on which the Common Stock is trading on a Trading
Market.
“Trading Market” means the following markets or exchanges on which the Common
Stock is listed or quoted for trading on the date in question: the American Stock Exchange,
the New York Stock Exchange, the NASDAQ Global Market, the NASDAQ Capital Market, the OTC
Bulletin Board, or any other recognized exchange or automated quotation system.
2. DaVita Registration.
(a) On or prior to April 1, 2011 (the “Filing Date”), the Company shall use its best
efforts to prepare and file with the Commission the DaVita Registration Statement covering the
resale by DaVita to the public of the Registrable Securities for an offering to be made on a
continuous basis pursuant to Rule 415. The DaVita Registration Statement required hereunder shall
be on Form S-3 (except if the Company is not then eligible to register for resale the Registrable
Securities on Form S-3, in which case such registration shall be on another appropriate form in
accordance herewith). The DaVita Registration Statement shall contain (except if otherwise
required by applicable law or pursuant to comments received from the Commission upon a review of
the DaVita Registration Statement) the “Plan of Distribution” attached hereto as Annex
A. The Company shall use its best efforts to cause the DaVita Registration Statement to be
declared effective under the Securities Act as promptly as possible after the filing thereof, but
in any event not later than the Effectiveness Date, and shall use commercially reasonable efforts
to keep the DaVita Registration Statement continuously effective under the Securities Act until the
earlier of (i) such time as all the Registrable Securities covered by the DaVita Registration
Statement have been publicly sold or (ii) such time as all the Registrable Securities may be sold
pursuant to Rule 144 without restrictions (the “Effectiveness Period”).
(b) DaVita agrees to furnish to the Company a completed Questionnaire in the form attached to
this Agreement as Annex B, or other form reasonably acceptable to the Company (a
“Selling Holder Questionnaire”). The Company shall not be required to include the
Registrable Securities in the DaVita Registration Statement if DaVita fails to furnish to the
Company a fully completed Selling Holder Questionnaire at least two Trading Days prior to the
Filing Date (subject to the requirements set forth in Section 3(a)).
(c) If DaVita intends to distribute the Registrable Securities by means of an underwriting,
DaVita shall promptly so advise the Company. DaVita and Company shall enter into an underwriting
agreement in usual and customary form with the underwriter or underwriters selected for such
underwriting by DaVita (which underwriter or underwriters shall be reasonably acceptable to the
Company).
(d) For not more than twenty (20) consecutive days or for a total of not more than forty-five
(45) days in any twelve (12) month period, the Company may suspend the use of any Prospectus
included in the DaVita Registration Statement contemplated by this Section 2 in the event that the
Company determines in good faith that such suspension is necessary to (i) delay the disclosure of
material non-public information concerning the Company, the disclosure of
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which at the time is not, in the good faith opinion of the Company, in the best interests of
the Company or (ii) amend or supplement the DaVita Registration Statement or the related Prospectus
so that the DaVita Registration Statement or Prospectus shall not include an untrue statement of a
material fact or omit to state a material fact required to be stated therein or necessary to make
the statements therein, in the case of the Prospectus in light of the circumstances under which
they were made, not misleading (an “Allowed Delay”), provided that the Company shall
promptly (a) notify DaVita in writing of the commencement of and the reasons for an Allowed Delay,
but shall not disclose to DaVita any material non-public information giving rise to the Allowed
Delay, (b) advise DaVita in writing to cease all sales under the DaVita Registration Statement
until the end of the Allowed Delay and (c) use commercially reasonable efforts to terminate the
Allowed Delay as promptly as practicable.
3. Registration Procedures.
In connection with the Company’s registration obligations under Section 2, the Company shall:
(a) Not less than three (3) Trading Days prior to the filing of the DaVita Registration
Statement or any related Prospectus or any amendment or supplement thereto, (i) furnish to DaVita
copies of all such documents proposed to be filed (including documents incorporated or deemed
incorporated by reference to the extent requested by DaVita) which documents will be subject to the
review of DaVita, and (ii) cause its officers and directors, counsel and independent certified
public accountants to respond to such inquiries as shall be necessary, in the reasonable opinion of
respective counsel to conduct a reasonable investigation within the meaning of the Securities Act.
The Company shall not file the DaVita Registration Statement or any such Prospectus or any
amendments or supplements thereto, to which DaVita shall reasonably object.
(b) (i) Prepare and file with the Commission such amendments, including post-effective
amendments, to the DaVita Registration Statement and the Prospectus used in connection therewith as
may be necessary to keep the DaVita Registration Statement continuously effective as to the
applicable Registrable Securities for the Effectiveness Period; (ii) cause the related Prospectus
to be amended or supplemented by any required Prospectus supplement, and as so supplemented or
amended to be filed pursuant to Rule 424; (iii) respond as promptly as reasonably possible to any
comments received from the Commission with respect to the DaVita Registration Statement or any
amendment thereto and, as promptly as reasonably possible, upon request, provide DaVita true and
complete copies of all correspondence from and to the Commission relating to such DaVita
Registration Statement that would not result in the disclosure to DaVita of material and non-public
information concerning the Company; and (iv) comply in all material respects with the provisions of
the Securities Act and the Exchange Act with respect to the disposition of all Registrable
Securities covered by the DaVita Registration Statement during the applicable period.
(c) Notify DaVita as promptly as reasonably possible (and, in the case of (i)(A) below, not
less than three (3) Trading Days prior to such filing) and (if requested by DaVita) confirm such
notice in writing promptly following the day (i)(A) when a Prospectus or any Prospectus supplement
or post-effective amendment to the DaVita Registration Statement is proposed to be filed; (B) when
the Commission notifies the Company whether there will be a
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“review” of the DaVita Registration Statement and whenever the Commission comments in writing
on such DaVita Registration Statement (the Company shall upon DaVita’s request provide true and
complete copies thereof and all written responses thereto that would not result in the disclosure
to DaVita of material and non-public information concerning the Company); and (C) with respect to
the DaVita Registration Statement or any post-effective amendment, when the same has become
effective; (ii) of any request by the Commission or any other federal or state governmental
authority during the Effectiveness Period for amendments or supplements to the DaVita Registration
Statement or Prospectus or for additional information; (iii) of the issuance by the Commission or
any other federal or state governmental authority of any stop order suspending the effectiveness of
the DaVita Registration Statement covering any or all of the Registrable Securities or the
initiation of any Proceedings for that purpose; (iv) of the receipt by the Company of any
notification with respect to the suspension of the qualification or exemption from qualification of
any of the Registrable Securities for sale in any jurisdiction, or the initiation or threatening of
any Proceeding for such purpose; and (v) of the occurrence of any event or passage of time that
makes the financial statements included in the DaVita Registration Statement ineligible for
inclusion therein or any statement made in such DaVita Registration Statement or Prospectus or any
document incorporated or deemed to be incorporated therein by reference untrue in any material
respect or that requires any revisions to the DaVita Registration Statement, Prospectus or other
documents so that, in the case of the DaVita Registration Statement or the Prospectus, as the case
may be, it will not contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(d) Use its best efforts to avoid the issuance of, or, if issued, obtain the withdrawal of (i)
any order suspending the effectiveness of the DaVita Registration Statement, or (ii) any suspension
of the qualification (or exemption from qualification) of any of the Registrable Securities for
sale in any jurisdiction, at the earliest practicable moment.
(e) Furnish to DaVita, without charge, at least one conformed copy of each the DaVita
Registration Statement and each amendment thereto, and all exhibits to the extent requested by
DaVita (including those previously furnished) promptly after the filing of such documents with the
Commission.
(f) Promptly deliver to DaVita, without charge, as many copies of the Prospectus or
Prospectuses (including each form of prospectus) and each amendment or supplement thereto as DaVita
may reasonably request. The Company hereby consents to the use of such Prospectus and each
amendment or supplement thereto by DaVita in connection with the offering and sale of the
Registrable Securities covered by such Prospectus and any amendment or supplement thereto.
(g) Prior to any public offering of Registrable Securities, use commercially reasonable
efforts to register or qualify or cooperate with DaVita in connection with the registration or
qualification (or exemption from such registration or qualification) of such Registrable Securities
for offer and sale under the securities or Blue Sky laws of such jurisdictions within the United
States as DaVita reasonably requests in writing, to keep each such registration or qualification
(or exemption therefrom) effective during the Effectiveness Period
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and to do any and all other acts or things reasonably necessary or advisable to enable the
disposition in such jurisdictions of the Registrable Securities covered by the DaVita Registration
Statement; provided, that the Company shall not be required to qualify generally to do business in
any jurisdiction where it is not then so qualified and where such a qualification would subject the
Company to any material tax in any such jurisdiction where it is not then so subject or file a
general consent to service of process in any such jurisdiction.
(h) Cooperate with DaVita to facilitate the timely preparation and delivery of certificates
representing Registrable Securities to be delivered to a transferee pursuant to the DaVita
Registration Statement, which certificates shall be free, to the extent permitted by the Warrant
Agreement, of all restrictive legends, and to enable such Registrable Securities to be in such
denominations and registered in such names as DaVita may request.
(i) Upon the occurrence of any event contemplated by Section 3(c)(v), as promptly as
reasonably possible, prepare a supplement or amendment, including a post-effective amendment if
necessary, to the DaVita Registration Statement or a supplement to the related Prospectus or any
document incorporated or deemed to be incorporated therein by reference, and file any other
required document so that, as thereafter delivered, neither the DaVita Registration Statement nor
the Prospectus will contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(j) In the event of any underwritten public offering of the Registrable Securities, cooperate
with and enter into and perform its obligations under an underwriting agreement, in usual and
customary form, with the managing underwriter(s) of such offering.
4. Registration Expenses.
All reasonable expenses, other than underwriting discounts, commissions or concessions and
brokers’ or agents’ commissions or concessions or selling commissions or concessions, incurred in
connection with registrations, filings or qualifications pursuant to this Agreement, including,
without limitation, all registration, listing and qualifications fees, printers and accounting
fees, and fees and disbursements of counsel for Company shall be paid by Company. DaVita shall pay
any and all fees and disbursements of legal counsel for DaVita in connection with registration,
filing or qualification of the Registrable Securities pursuant to this Agreement.
5. Indemnification.
(a) Indemnification by the Company. The Company shall, notwithstanding any
termination of this Agreement, indemnify and hold harmless DaVita, its officers, directors, agents
and employees, each person or entity who controls DaVita (within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act) and the officers, directors, agents and employees
of each such controlling person or entity, to the fullest extent permitted by applicable law, from
and against any and all losses, claims, damages, liabilities, costs (including, without limitation,
reasonable attorneys’ fees) and expenses (collectively, “Losses”), as incurred, arising out
of or relating to (i) any violation by the Company of federal or state securities law, or any other
law or regulation relating to the offer or sale of the Registrable Securities pursuant to
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the DaVita Registration Statement; (ii) any untrue or alleged untrue statement of a material
fact contained in the DaVita Registration Statement, any Prospectus or any form of prospectus or in
any amendment or supplement thereto or in any preliminary prospectus, or (iii) any omission or
alleged omission of a material fact required to be stated in the DaVita Registration Statement, any
Prospectus or any form of prospectus or in any amendment or supplement thereto or in any
preliminary prospectus or necessary to make the statements therein (in the case of any Prospectus
or form of prospectus or supplement thereto, in light of the circumstances under which they were
made) not misleading, except to the extent, but only to the extent, that (1) such untrue statements
or omissions are based solely upon information regarding DaVita furnished in writing to the Company
by DaVita expressly for use therein, or to the extent that such information relates to DaVita or
DaVita’s proposed method of distribution of Registrable Securities and was reviewed and expressly
approved in writing by DaVita expressly for use in the DaVita Registration Statement, such
Prospectus or such form of Prospectus or in any amendment or supplement thereto (it being
understood that DaVita has approved Annex A hereto for this purpose) or (2) in the case of an
occurrence of an event of the type specified in Section 3(c)(ii)-(v), DaVita uses an outdated or
defective Prospectus after the Company has notified DaVita in writing that the Prospectus is
outdated or defective and prior to the receipt by DaVita of the Advice contemplated in Section
8(d). The Company shall notify DaVita promptly of the institution, threat or assertion of any
Proceeding of which the Company is aware in connection with the transactions contemplated by this
Agreement.
(b) Indemnification by DaVita. DaVita shall, notwithstanding any termination of this
Agreement, indemnify and hold harmless the Company, its directors, officers, agents and employees,
each person or entity who controls the Company (within the meaning of Section 15 of the Securities
Act and Section 20 of the Exchange Act), and the directors, officers, agents and employees of each
such controlling person or entity, to the fullest extent permitted by applicable law, from and
against all Losses, as incurred, arising out of or based solely upon: (x) DaVita’s failure to
comply with the prospectus delivery requirements of the Securities Act or (y) any untrue or alleged
untrue statement of a material fact contained in any DaVita Registration Statement, any Prospectus,
or any form of prospectus, or in any amendment or supplement thereto or in any preliminary
prospectus, or arising out of or relating to any omission or alleged omission of a material fact
required to be stated in the DaVita Registration Statement, any Prospectus or any form of
prospectus or in any amendment or supplement thereto or in any preliminary prospectus or necessary
to make the statements therein (in the case of any Prospectus or form of prospectus or supplement
thereto, in light of the circumstances under which they were made) not misleading (i) to the
extent, but only to the extent, that such untrue statement or omission is contained in any
information so furnished in writing by DaVita to the Company expressly for inclusion in such DaVita
Registration Statement or such Prospectus or (ii) to the extent that (1) such untrue statements or
omissions are based upon information regarding DaVita furnished in writing to the Company by DaVita
expressly for use therein, or to the extent that such information relates to DaVita or DaVita’s
proposed method of distribution of Registrable Securities and was reviewed and expressly approved
in writing by DaVita expressly for use in the DaVita Registration Statement (it being understood
that DaVita has approved Annex A hereto for this purpose), such Prospectus or such form of
Prospectus or in any amendment or supplement thereto or (2) in the case of an occurrence of an
event of the type specified in Section 3(c)(ii)-(v), DaVita uses an outdated or defective
Prospectus after the Company has notified
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DaVita in writing that the Prospectus is outdated or defective and prior to the receipt by
DaVita of the Advice contemplated in Section 8(d).
(c) Conduct of Indemnification Proceedings. If any Proceeding shall be brought or
asserted against any person or entity entitled to indemnity hereunder (an “Indemnified
Party”), such Indemnified Party shall promptly notify the person or entity from whom indemnity
is sought (the “Indemnifying Party”) in writing, and the Indemnifying Party shall have the
right to assume the defense thereof, including the employment of counsel reasonably satisfactory to
the Indemnified Party and the payment of all fees and expenses incurred in connection with defense
thereof; provided, that the failure of any Indemnified Party to give such notice shall not relieve
the Indemnifying Party of its obligations or liabilities pursuant to this Agreement, except (and
only) to the extent that it shall be finally determined by a court of competent jurisdiction (which
determination is not subject to appeal or further review) that such failure shall have prejudiced
the Indemnifying Party.
An Indemnified Party shall have the right to employ separate counsel in any such Proceeding
and to participate in the defense thereof, but the fees and expenses of such counsel shall be at
the expense of such Indemnified Party or Parties unless: (1) the Indemnifying Party has agreed in
writing to pay such fees and expenses; (2) the Indemnifying Party shall have failed promptly to
assume the defense of such Proceeding and to employ counsel reasonably satisfactory to such
Indemnified Party in any such Proceeding; or (3) the named parties to any such Proceeding
(including any impleaded parties) include both such Indemnified Party and the Indemnifying Party,
and such Indemnified Party shall have been advised by counsel that a conflict of interest is likely
to exist if the same counsel were to represent such Indemnified Party and the Indemnifying Party
(in which case, if such Indemnified Party notifies the Indemnifying Party in writing that it elects
to employ separate counsel at the expense of the Indemnifying Party, the Indemnifying Party shall
not have the right to assume the defense thereof and the reasonable fees and expenses of one
separate counsel shall be at the expense of the Indemnifying Party). In no event shall the
Indemnifying Party be liable for fees and expenses of more than one counsel (in addition to any
local counsel) for all Indemnified Parties. The Indemnifying Party shall not be liable for any
settlement of any such Proceeding effected without its written consent, which consent shall not be
unreasonably withheld. No Indemnifying Party shall, without the prior written consent of the
Indemnified Party, effect any settlement of any pending Proceeding in respect of which any
Indemnified Party is a party, unless such settlement includes an unconditional release of such
Indemnified Party from all liability on claims that are the subject matter of such Proceeding.
All reasonable fees and expenses of the Indemnified Party (including reasonable fees and
expenses to the extent incurred in connection with investigating or preparing to defend such
Proceeding in a manner not inconsistent with this Section) shall be paid to the Indemnified Party,
as incurred, within thirty days of written notice thereof to the Indemnifying Party;
provided, that the Indemnified Party shall promptly reimburse the Indemnifying Party for
that portion of such fees and expenses applicable to such actions for which such Indemnified Party
is not entitled to indemnification hereunder, determined based upon the relative faults of the
parties.
(d) Contribution. If a claim for indemnification under Section 5(a) or 5(b) is
unavailable to an Indemnified Party (by reason of public policy or otherwise), then each
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Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall contribute to the
amount paid or payable by such Indemnified Party as a result of such Losses, in such proportion as
is appropriate to reflect the relative fault of the Indemnifying Party and Indemnified Party in
connection with the actions, statements or omissions that resulted in such Losses as well as any
other relevant equitable considerations. The relative fault of such Indemnifying Party and
Indemnified Party shall be determined by reference to, among other things, whether any action in
question, including any untrue or alleged untrue statement of a material fact or omission or
alleged omission of a material fact, has been taken or made by, or relates to information supplied
by, such Indemnifying Party or Indemnified Party, and the parties’ relative intent, knowledge,
access to information and opportunity to correct or prevent such action, statement or omission.
The amount paid or payable by a party as a result of any Losses shall be deemed to include, subject
to the limitations set forth in Section 5(c), any reasonable attorneys’ or other reasonable fees or
expenses incurred by such party in connection with any Proceeding to the extent such party would
have been indemnified for such fees or expenses if the indemnification provided for in this Section
was available to such party in accordance with its terms.
The parties hereto agree that it would not be just and equitable if contribution pursuant to
this Section 5(d) were determined by pro rata allocation or by any other method of allocation that
does not take into account the equitable considerations referred to in the immediately preceding
paragraph. Notwithstanding the provisions of this Section 5(d), DaVita shall not be required to
contribute, in the aggregate, any amount in excess of the amount by which the proceeds actually
received by DaVita from the sale of the Registrable Securities subject to the Proceeding exceeds
the amount of any damages that DaVita has otherwise been required to pay by reason of such untrue
or alleged untrue statement or omission or alleged omission, except in the case of fraud or willful
or intentional misconduct by DaVita. No person or entity guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) will be entitled to contribution from
any person or entity who was not guilty of such fraudulent misrepresentation.
Absent fraud or willful or intentional misconduct, the indemnification and contribution
provided by the Company and DaVita pursuant to this Section 5 shall be the sole and exclusive
remedy for any Losses referred to herein. The amount of any payment by the Company under this
Section 5 in respect of any Losses resulting from or arising out of any indemnification or
contribution claim shall in no event exceed the gross proceeds actually received by the Company as
a result of the exercise of the Warrant Agreement by DaVita pursuant to the terms and conditions
contained therein. The amount of any payment by DaVita under this Section 5 in respect of any
Losses resulting from or arising out of any indemnification or contribution claim shall in no event
exceed the gross proceeds to such DaVita as a result of the sale of the Shares pursuant to the
DaVita Registration Statement.
Further, the Company and DaVita agree that in no event shall either party’s aggregate
liability under this Agreement exceed $2,000,000.
6. Withdrawal of the DaVita Registration Statement. After the termination of the
Effectiveness Period, the Company shall be entitled to withdraw the DaVita Registration Statement,
and DaVita shall have no further right to offer or sell any of the Shares pursuant to the DaVita
Registration Statement.
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7. Standstill
(a) Standstill Agreement. DaVita will not, directly or indirectly, without the prior
consent of a majority of the Board of Directors of the Company (the “Board”), (i) acquire,
or offer or agree to acquire, any shares of Common Stock; (ii) engage or become a participant in
any “solicitation” of “proxies” (as each such term is defined in Regulation 14A under the Exchange
Act) or consent to vote any shares of Common Stock; or (iii) transfer to any third party (other
than to DaVita’s “affiliates,” “associates” (as each such term is defined in Rule 12b-2 under the
Exchange Act), officers, directors or employees and other than pursuant to a proxy solicitation
conducted by or on behalf of the Board), the right to vote any shares of Common Stock, provided
that nothing contained in this Section 7(a) will prevent or prohibit DaVita from purchasing any
Shares vested and issuable pursuant to the Warrant Agreement or selling any Shares issued upon
exercise of the Warrant Agreement, provided further that any purchase of Shares shall be subject to
Section 12 of the Warrant Agreement. DaVita also agrees that it will not advise, assist or
encourage any third party to do any of the foregoing. This Section 7 shall terminate (if not
earlier terminated pursuant to Section 7(b)) upon the earlier of (i) such time as all Shares issued
under the Warrant Agreement have been exercised and sold to any Person not affiliated with DaVita
and no further Shares are then issuable under the Warrant Agreement, and (ii) December 31, 2013.
(b) Termination of Standstill. Notwithstanding the foregoing, the obligations of
DaVita under this Section 7 shall terminate in the event (i) of any bona fide third party tender or
exchange offer for at least 50% of the outstanding shares of Common Stock, (ii) it is publicly
disclosed that more than 30% of the shares of Common Stock then outstanding have been acquired or
are proposed to be acquired by any person or corporate or governmental entity (a “Person”)
or group unaffiliated with DaVita, (iii) the Company enters into any agreement to merge with any
Person not affiliated with DaVita, or (iv) DaVita enters into any agreement to sell all or
substantially all of its assets to any Person not affiliated with DaVita. All of the provisions of
Section 7 shall be reinstated and shall apply in full force according to their terms in the event
that: (x) if the provisions of Section 7 shall have terminated as the result of a tender or
exchange offer, such tender or exchange offer (as originally made or as amended or modified) shall
have terminated (without closing) prior to the commencement of a tender or exchange offer by DaVita
that would have been permitted to be made pursuant to the first sentence of this Section 7(b) as a
result of such third-party tender or exchange offer; (y) any tender or exchange offer by DaVita (as
originally made or as extended or modified) that was permitted to be made pursuant to this Section
7(b) shall have terminated (without closing); or (z) if the provisions of this Section 7 shall have
terminated as a result of any action by the Company referred to in this Section 7(b), the Company
shall have determined not to take any of such actions (and no such transaction shall have closed)
prior to the commencement of a tender or exchange offer by DaVita that would have been permitted to
be made pursuant to this Section 7(b) as a result of the initial determination of the Company
referred to in this Section 7(b). Upon reinstatement of the provisions of Section 7, the
provisions of this Section 7(b) shall continue to govern in the event that any of the events
described in this Section 7(b) shall occur.
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8. Miscellaneous.
(a) Remedies. In the event of a breach by the Company or by DaVita, of any of their
obligations under this Agreement, DaVita or the Company, as the case may be, in addition to being
entitled to exercise all rights granted by law and under this Agreement, including recovery of
damages, will be entitled to specific performance of its rights under this Agreement. The Company
and DaVita agree that monetary damages would not provide adequate compensation for any losses
incurred by reason of a breach by it of any of the provisions of this Agreement and hereby further
agrees that, in the event of any action for specific performance in respect of such breach, it
shall waive the defense that a remedy at law would be adequate.
(b) Registration of Other Securities. Notwithstanding anything contained herein to
the contrary and for the avoidance of doubt, the parties hereto acknowledge that (a) the Company
has granted registration rights to other holders with respect its Common Stock, and (b) any DaVita
Registration Statement prepared, filed and made effective under Section 3 may also cover the resale
of such other securities as well as any securities held by other security holders which the Company
has an obligation to register.
(c) Compliance. DaVita covenants and agrees that it will comply with the prospectus
delivery requirements of the Securities Act as applicable to it in connection with sales of
Registrable Securities pursuant to the DaVita Registration Statement.
(d) Discontinued Disposition. DaVita agrees that, upon receipt of a notice from the
Company of (i) the commencement of an Allowed Delay pursuant to Section 2(d) or (ii) the occurrence
of any event of the kind described in Section 3(c), DaVita will forthwith discontinue disposition
of any Registrable Securities under the DaVita Registration Statement until it is advised in
writing (the “Advice”) by the Company that such disposition may again be made. The Company
may provide appropriate stop orders to enforce the provisions of this paragraph.
(e) Amendments and Waivers. The provisions of this Agreement, including the
provisions of this sentence, may not be amended, modified or supplemented, and waivers or consents
to departures from the provisions hereof may not be given, unless the same shall be in writing and
signed by the Company and DaVita.
(f) Notices. Any and all notices or other communications or deliveries required or
permitted to be provided hereunder shall be in writing and shall be deemed given and effective on
the earliest of (i) the date of transmission, if such notice or communication is delivered via
facsimile at the facsimile number provided for below, (ii) the Trading Day following the date of
mailing, if sent by nationally recognized overnight courier service, or (iii) upon actual receipt
by the party to whom such notice is required to be given. The address for such notices and
communications shall be delivered and addressed as set forth in the Warrant Agreement.
(g) Successors and Assigns. Neither this Agreement nor any of the rights hereunder
shall be assignable or transferable in whole or in part except that DaVita may transfer this
Agreement to one of its Affiliates, provided that, as a condition to such transfer, such
Affiliate shall (a) furnish to the Company written notice of such transfer and (b) agree in
a written instrument delivered to the Company to be bound by and subject to the terms and
conditions of
11
this Agreement. Any assignment or transfer of this Agreement or any of the rights hereunder
in violation of the provisions of this Agreement shall be null and void. Subject to applicable
securities laws and the provisions of this Agreement, this Agreement and the rights and obligations
evidenced hereby shall inure to the benefit of and be binding upon the successors of the Company
and the successors and permitted assigns of DaVita.
(h) Execution and Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed shall be deemed to be an original and, all of which
taken together shall constitute one and the same Agreement. In the event that any signature is
delivered by facsimile transmission, such signature shall create a valid binding obligation of the
party executing (or on whose behalf such signature is executed) the same with the same force and
effect as if such facsimile signature were the original thereof.
(i) Governing Law. All questions concerning the construction, validity, enforcement
and interpretation of this Agreement shall be governed by and construed and enforced in accordance
with the internal laws of the State of Delaware, without regard to the principles of conflicts of
law thereof. Each party agrees that all legal proceedings concerning the interpretations,
enforcement and defense of the transactions contemplated by this Agreement (whether brought against
a party hereto or its respective affiliates, directors, officers, shareholders, employees or
agents) shall be commenced exclusively in the state and federal courts sitting in the State of
Delaware. Each party hereto hereby irrevocably submits to the exclusive jurisdiction of the state
and federal courts sitting in the State of Delaware for the adjudication of any dispute hereunder
or in connection herewith or with any transaction contemplated hereby or discussed herein
(including with respect to the enforcement of the any provision of this Agreement), and hereby
irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it
is not personally subject to the jurisdiction of any such court, that such suit, action or
proceeding is improper. Each party hereto hereby irrevocably waives, to the fullest extent
permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out
of or relating to this Agreement or the transactions contemplated hereby. If either party shall
commence an action or proceeding to enforce any provisions of this Agreement, then the prevailing
party in such action or proceeding shall be reimbursed by the other party for its attorney’s fees
and other costs and expenses incurred with the investigation, preparation and prosecution of such
action or proceeding.
(j) Cumulative Remedies. The remedies provided herein are cumulative and not
exclusive of any remedies provided by law or equitable remedies.
(k) Severability. If any term, provision, covenant or restriction of this Agreement
is held by a court of competent jurisdiction to be invalid, illegal, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in
full force and effect and shall in no way be affected, impaired or invalidated, and the parties
hereto shall use their best efforts to find and employ an alternative means to achieve the same or
substantially the same result as that contemplated by such term, provision, covenant or
restriction. It is hereby stipulated and declared to be the intention of the parties that they
would have executed the remaining terms, provisions, covenants and restrictions without including
any of such that may be hereafter declared invalid, illegal, void or unenforceable.
12
(l) Headings. The headings in this Agreement are for convenience of reference only
and shall not limit or otherwise affect the meaning hereof.
[Signature pages follow]
13
IN WITNESS WHEREOF, the parties have executed this Registration Rights Agreement as of the
date first written above.
| NXSTAGE MEDICAL, INC. | ||||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
| DAVITA INC. | ||||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
ANNEX A
PLAN OF DISTRIBUTION
The shares covered by this prospectus may be offered and sold from time to time by the
selling stockholder. The term “selling stockholder” includes donees, pledgees, transferees or other
successors-in-interest selling shares received after the date of this prospectus from the selling
stockholder as a gift, pledge, distribution or other non-sale related transfer. The selling
stockholder will act independently of us in making decisions with respect to the timing, manner and
size of each sale. Such sales may be made on one or more exchanges or in the over-the-counter
market or otherwise, at prices and under terms then prevailing or at prices related to then current
market price or in negotiated transactions. The selling stockholder may sell its shares by one or
more of, or a combination of, the following methods:
| • | purchases by a broker-dealer as principal and resale by such broker-dealer for its own account pursuant to this prospectus; | ||
| • | ordinary brokerage transactions and transactions in which the broker solicits purchasers; | ||
| • | an over-the-counter distribution in accordance with the rules of The Nasdaq Stock Market; | ||
| • | in privately negotiated transactions; | ||
| • | in options transactions; | ||
| • | to or through underwriters; | ||
| • | through dealers or agents; | ||
| • | a block trade in which the broker or dealer so engaged will attempt to sell the securities as an agent but may position and resell a portion of the block as a principal to facilitate the transaction; | ||
| • | through a combination of these methods; and | ||
| • | by any other legally available means. |
In addition, any shares that qualify for sale pursuant to Rule 144 may be sold under Rule 144
rather than pursuant to this prospectus.
To the extent required, this prospectus may be amended or supplemented from time to time
to describe a specific plan of distribution. In connection with the distributions of shares or
otherwise, the selling stockholder may enter into hedging transactions with broker-dealers or other
financial institutions. In connection with such transactions, broker-dealers or other financial
institutions may engage in short sales of the common stock in the course of hedging the positions
they assume with the selling stockholder. The selling stockholder may enter into option or other
transactions with broker-dealers or other financial institutions which require the delivery to such
broker-dealer or other financial institution of shares offered by this prospectus, which shares
such broker-dealer or other financial institution may resell pursuant to this
prospectus (as supplemented or amended to reflect such transaction). The selling stockholder
may also pledge shares to a broker-dealer or other financial institution, and, upon a default, such
broker-dealer or other financial institution, may effect sales of the pledged shares pursuant to
this prospectus (as supplemented or amended to reflect such transaction).
In effecting sales, underwriters, broker-dealers or agents engaged by the selling stockholder
may arrange for other underwriters or broker-dealers to participate. Underwriters, broker-dealers
or agents may receive commissions, discounts or concessions from the selling stockholder in amounts
to be negotiated immediately prior to the sale. Such discounts, concessions or commissions as to
particular underwriters, broker-dealers or agents may be in excess of those customary on the types
of transactions involved.
In offering the shares covered by this prospectus, the selling stockholder and any
broker-dealers who execute sales for the selling stockholder may be deemed to be “underwriters”
within the meaning of the Securities Act in connection with such sales. Any profits realized by the
selling stockholder and the compensation of any broker-dealer may be deemed to be underwriting
discounts and commissions. Some of the underwriters or deemed underwriters or agents and their
associates may be customers of, engage in transactions with, and perform services for us in the
ordinary course of business.
In order to comply with the securities laws of certain states, if applicable, the shares must
be sold in such jurisdictions only through registered or licensed brokers or dealers. In addition,
in certain states the shares may not be sold unless they have been registered or qualified for sale
in the applicable state or an exemption from the registration or qualification requirement is
available and is complied with.
We have advised the selling stockholder that the anti-manipulation rules of Regulation M under
the Exchange Act may apply to sales of shares in the market and to the activities of the selling
stockholder and their affiliates. In addition, we will make copies of this prospectus available to
the selling stockholder for the purpose of satisfying the prospectus delivery requirements of the
Securities Act. The selling stockholder may indemnify any broker-dealer that participates in
transactions involving the sale of the shares against certain liabilities, including liabilities
arising under the Securities Act.
At the time a particular offer of shares is made, if required, a prospectus supplement will be
distributed that will set forth the number of shares being offered and the terms of the offering,
including the name of any underwriter, dealer or agent, the purchase price paid by any underwriter,
any discount, commission and other item constituting compensation, any discount, commission or
concession allowed or reallowed or paid to any dealer, and the proposed selling price to the
public.
Notwithstanding anything to the contrary, the selling stockholder may not sell or
distribute the shares covered by this prospectus in short sales.
We will pay all expenses of the registration of the shares of common stock pursuant to
the registration rights agreement, including, without limitation, U.S. Securities and Exchange
Commission filing fees and expenses of compliance with state securities or “blue sky” laws;
provided, however, that the selling stockholder will pay all underwriting discounts, commissions
and concessions and brokers’ or agents’ commissions and concessions or selling commissions and
concessions, if any. We have agreed to indemnify the selling stockholder against certain
liabilities, including certain liabilities under the Securities Act, relating to the registration
of shares offered by this prospectus. Underwriters, dealers and agents may be entitled to
indemnification by us and the selling stockholder against specific civil liabilities, including
liabilities under the Securities Act or to contribution with respect to payments which the
underwriters or agents may be required to make in respect thereof, under underwriting or other
agreements. The terms of any indemnification provisions will be set forth in a prospectus
supplement.
We have agreed with the selling stockholder to keep the registration statement of which this
prospectus constitutes a part effective until the earlier of (1) such time as all of the shares
covered by this prospectus have been publicly sold or (2) such time as all of the shares covered by
this prospectus may be sold pursuant to Rule 144 without restrictions. Notwithstanding the
foregoing obligations, we may, under specified circumstances, suspend the use of the registration
statement, or any amendment or supplement thereto.
SELLING STOCKHOLDER QUESTIONNAIRE
| To: | NxStage Medical, Inc. Xxxxxxxx X. Xxxx, Esq. Senior Vice President and General Counsel NxStage Medical, Inc. 000 Xxxxx Xxxxx Xxxxxx, 0xx Xxxxx Xxxxxxxx, XX 00000 |
Reference
is made to the Registration Rights Agreement dated as of
July ___, 2010 (the
“Agreement”), by and between NxStage Medical, Inc. (the “Company”) and DaVita Inc.
Pursuant to Section 2(c) of the Agreement, the undersigned hereby furnishes to the Company the
following information for use by the Company in connection with the preparation of the DaVita
Registration Statement contemplated by Section 2(a) of the Agreement.
| (1) | Name and Contact Information: |
| Full legal name of record holder: | ||||
| Address of record holder: | ||||
| Social Security Number or Taxpayer identification number of record holder: |
||||
| Identity of beneficial owner (if different than record holder): | ||||
| Name of contact person: | ||||
| Telephone number of contact person: | ||||
| Fax number of contact person: | ||||
| E-mail address of contact person: | ||||
| (2) | Beneficial Ownership of Registrable Securities: |
(a) Number of Registrable Securities owned by Selling
Stockholder:
(b) Number of Registrable Securities requested to be registered:
| (3) | Beneficial Ownership of Other Securities of the Company Owned by the Selling Stockholder: |
Except as set forth below in this Item (3), the undersigned is not the
beneficial or registered owner of any securities of the Company other than
the Registrable Securities listed above in Item (2)(a).
Type and amount of other securities beneficially owned by the Selling
Stockholder:
| (4) | Relationships with the Company: |
Except as set forth below, neither the undersigned nor any of its
affiliates, officers, directors or principal equity holders (5% or more) has
held any position or office or has had any other material relationship with
the Company (or its predecessors or affiliates) during the past three years.
State any exceptions here:
| (5) | Plan of Distribution: |
Except as set forth below, the undersigned intends to distribute
pursuant to the DaVita Registration Statement the Registrable Securities
listed above in Item (2) in accordance with the “Plan of Distribution”
section set forth therein:
State any exceptions here:
Note: In no event will such method(s) of distribution take the form of an underwritten
offering of the Registrable Securities without the prior agreement of the Company.
| (6) | Selling Stockholder Affiliations: |
(a) Is the Selling Stockholder a registered broker-dealer?
(b) Is the Selling Stockholder an affiliate of a registered
broker-dealer(s)? (For purposes of this response, an “affiliate” of, or
person “affiliated” with, a specified person, is a person that directly, or
indirectly through one or more intermediaries, controls or is controlled by,
or is under common control with, the person specified.)
(c) If the answer to Item (6)(b) is yes, identify the registered
broker-dealer(s) and describe the nature of the affiliation(s):
(d) If the answer to Item (6)(b) is yes, did the Selling Stockholder acquire
the Registrable Securities in the ordinary course of business (if not,
please explain)?
(e) If the answer to Item (6)(b) is yes, did the Selling Stockholder, at the
time of purchase of the Registrable Securities, have any agreements, plans
or understandings, directly or indirectly, with any person to distribute the
Registrable Securities (if yes, please explain)?
Note: If the Selling Stockholder is an affiliate of a broker-dealer and did not purchase its
Registrable Securities in the ordinary course of business or at the time of the purchase had any
agreements, plans or understandings, directly or indirectly, with any person to distribute the
Registrable Securities, the Company may be required to identify the Selling Stockholder as an
underwriter in the Registration Statement, any amendments thereto and the related prospectus.
Pursuant to Section 3(c) of the Agreement, the undersigned acknowledges that the Company may,
by written notice to the undersigned, suspend or withdraw the DaVita Registration Statement and
require that the undersigned immediately cease sales of Registrable Securities pursuant to the
DaVita Registration Statement under certain circumstances described in the Agreement. At any time
that such notice has been given in accordance with the Agreement, the undersigned may not sell
Registrable Securities pursuant to the DaVita Registration Statement.
The undersigned hereby acknowledges receipt of a draft of the DaVita Registration Statement
dated ___, and confirms that the undersigned has reviewed the sections
captioned “Selling Stockholders” and “Plan of Distribution,” and confirms that, to the best of the
undersigned’s knowledge, the same is true, complete and accurate in every respect as it relates to
the undersigned, except as indicated in this Questionnaire. The undersigned
hereby further acknowledges its indemnification obligations set forth in Section 5 of the
Agreement and acknowledges that the Company is relying upon the information furnished in this
Questionnaire by the undersigned.
By signing below, the undersigned consents to the disclosure of the information contained
herein in its answers to Items (1) through (7) above and the inclusion of such information in the
Registration Statement, any amendments thereto and the related prospectus, until such time as the
undersigned has notified the Company of any changes to Items (1) through (7) above. The
undersigned understands that such information will be relied upon by the Company in connection with
the preparation or amendment of the DaVita Registration Statement and the related prospectus.
The undersigned has reviewed the answers to the above questions and affirms that the same are
true, complete and accurate. THE UNDERSIGNED AGREES TO NOTIFY THE COMPANY IMMEDIATELY OF ANY
CHANGES IN THE FOREGOING INFORMATION.
Dated: |
___, | |||
| Signature of Record Holder (Please sign your name in exactly the same manner as the certificate(s) for the shares being registered) |
