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EXHIBIT 7.2
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (this "Agreement"), dated as of
September 28, 1998, is made and entered into by and between INFOCURE CORP., a
Delaware corporation (the "Company"), and CRESCENT INTERNATIONAL LIMITED, a
Bermuda corporation (the "Investor").
WHEREAS, the Company and the Investor have entered into that certain
Stock Purchase Agreement, dated as of the date hereof (the "Stock Purchase
Agreement"), pursuant to which the Company will issue, from time to time, to the
Investor up to $10,000,000 worth of shares of Common Stock, at par value $0.001
per share, of the Company (the "Common Stock");
WHEREAS, pursuant to the terms of, and in partial consideration for,
the Investor entering into the Stock Purchase Agreement, the Company has issued
to the Investor an incentive warrant dated as of the date hereof, exercisable
from time to time within five (5) years following the date of issuance (the
"Incentive Warrant") for the purchase of an aggregate of up to 100,000 shares of
Common Stock at a price specified in such Incentive Warrant;
WHEREAS, pursuant to the terms of, and in partial consideration for,
the Investor entering into the Stock Purchase Agreement, the Company will issue
to the Investor the Additional Warrant, which may become exercisable from time
to time as described in the Stock Purchase Agreement (the "Additional Warrant"
and together with the Incentive Warrant, the "Warrants") for the purchase of a
number of shares of Common Stock and at a price to be determined as described in
each such Additional Warrant;
WHEREAS, pursuant to the terms of, and in partial consideration for,
the Investor's agreement to enter into the Stock Purchase Agreement, the Company
has agreed to provide the Investor with certain registration rights with respect
to the shares issued to the Investor and any additional shares of Common Stock
issued or distributed to the Investor by way of a dividend, stock split, or
other distribution with respect of the Shares, or acquired by way of any rights
offering or similar offering made in respect of the shares (collectively, the
"Registrable Securities");
NOW, THEREFORE, in consideration of the premises, the representations,
warranties, covenants and agreements contained herein, in the Warrants, and in
the Stock Purchase Agreement, and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, intending to be legally
bound hereby, the parties hereto agree as follows (capitalized terms used herein
and not defined herein shall have the respective meanings ascribed to them in
the Stock Purchase Agreement):
ARTICLE I
REGISTRATION RIGHTS
Section 1.1. REGISTRATION STATEMENTS.
(a) Filing of Registration Statements. Subject to the terms
and conditions of this Agreement the Company shall file with the SEC on or
before:
(i) the end of a twenty (20) calendar day period
immediately following the Subscription Date, a registration statement or
statements on such form promulgated by the SEC for which the Company qualifies,
that counsel for the Company shall deem appropriate and which form shall be
available for the sale of the shares of Common Stock purchased by the Investor
through the first Put (the "Initial Shares"), the Incentive Warrant
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Shares, and a number of Additional Warrant Shares equal to 125% of the Initial
Shares to be registered thereunder in accordance with the provisions of this
Agreement (the "Initial Registration Statement"); and
(ii) the end of a twenty (20) calendar day period
immediately following each Closing Date, a registration statement on such form
promulgated by the SEC for which the Company qualifies, that counsel for the
Company shall deem appropriate and which form shall be available for the sale of
the shares of Common Stock purchased by the Investor through the applicable Put
(the "Applicable Shares") and a number of Additional Warrant Shares equal to
125% of the Applicable Shares to be registered thereunder in accordance with the
provisions of this Agreement (each a "Subsequent Registration Statement" and
together with the Initial Registration Statement, the "Registration
Statements").
(b) Piggyback Registrations. If the Company at any time
proposes to commence a public offering of Company securities of the same class
as any Registrable Securities, after the date hereof, it shall each such time
provide prompt written notice to the Investor of its intention to do so,
including a description of the intended method of the Company's disposition of
such securities, and of the Investor's rights. The Investor shall be able to
request that the underwriter register under the secondary public offering any
unsold Registrable Securities not covered by any effective Registration
Statement shares held by the Investor on the effective date of the registration
statement relating to such secondary public offering (effecting a "Piggyback
Registration"). The Company will pay all Registration Expenses (as defined in
Section 2.2 hereof) incurred in connection with each Piggyback Registration. If
(i) a Piggyback Registration pursuant to this Section 1.1(b) involves an
underwritten offering of the securities being registered, whether or not for
sale for the account of the Company, to be distributed by or through one or more
underwriters under underwriting terms appropriate for such a transaction, and
(ii) the managing underwriter of such underwritten offering shall inform the
Company of its belief that the distribution of all or a specified number of such
unsold shares held by the Investor concurrently with the securities being
distributed by such underwriters would interfere with the successful marketing
of the securities being distributed by such underwriters (such writing to state
the basis of such belief and the approximate number of such shares which may be
distributed without such effect), then the Company may, upon written notice to
the Investor, reduce (the "Underwriter's Cut-back") if and to the extent stated
by such managing underwriter to be necessary to eliminate such effect the number
of such unsold shares the registration of which shall have been requested by the
Investor so that the resultant aggregate number of such securities so included
in such registration by the Investor and any and all other stockholders shall be
equal to the number of shares that such managing underwriter shall indicate may
be included for sale by selling stockholders. The Underwriter's Cut-back shall
also be applied by the Company pro rata among the shares of other stockholders
whose shares are to be included in such registration statement unless the
Company's agreements with such other stockholders do not permit the Company to
apply the Underwriter's Cut-back to reduce the number of shares of such other
stockholders;
and any securities of the Company so excluded shall be withdrawn from and
shall not be included in such Piggyback Registration, but excluded
securities shall be covered by the applicable Registration Statement.
In the event that Investor elects to include Registrable
Securities in a Piggyback Registration, then at the request of the
underwriter, Investor shall timely execute and deliver to the underwriter a
"lock-up" agreement (in customary form as requested by the Underwriter)
pursuant to which Investor shall agree not to sell any other shares of
Common Stock purchased pursuant to the Stock Purchase Agreement or the
Warrants, other than the
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Registrable Securities included in the Piggyback Registration, for a period
which is the same as the lock-up period agreed to by executive officers and
directors of the Company, not to exceed 180 days.
The Investor's election to include Registrable Securities in a
Piggyback Registration shall not relieve the Company of its other obligations
under this Agreement.
(c) Effectiveness of the Registration Statements. The Company
shall use its best efforts: (i) to have the Initial Registration Statement
declared effective by the SEC in no event later than one hundred and fifty (150)
calendar days after the Subscription Date, (ii) to have each Subsequent
Registration Statement declared effective by the SEC in no event later than
ninety (90) calendar days after each applicable Closing Date and (iii) to insure
that each Registration Statement remains in effect for a period ending 180 days
following the earlier of termination of the Commitment Period and termination of
the Investor's obligations pursuant to Section 2.7 of the Stock Purchase
Agreement; provided that such period shall be extended one day for each day
after the applicable Effective Date, that the Registration Statement covering
(i) shares purchased by the Investor through the applicable Put and (ii) the
Additional Warrant Shares related to such Put, is not effective during the
period such Registration Statement is required to be effective pursuant to this
Agreement.
(d) Failure to Obtain or Maintain Effectiveness of
Registration Statements. In the event the Company fails for any reason to obtain
the effectiveness of any of the Registration Statements within the time periods
set forth in Section 1.1(c), or unless the Registrable Securities covered by any
such Registration Statement have become freely tradeable pursuant to Rule 144(k)
of the Securities Act or have been otherwise sold, if the Company fails for any
reason to maintain the effectiveness of any of the Registration Statements (or
the underlying prospectus) for a period ending 180 days following the earlier of
termination of the Commitment Period and termination of the Investor's
obligations pursuant to Section 2.7 of the Stock Purchase Agreement (provided
that such period shall be extended one day for each day after the applicable
Effective Date, that the Registration Statement covering (i) shares purchased by
the Investor through the applicable Put and (ii) the Additional Warrant Shares
related to such Put, is not effective during the period such Registration
Statement is required to be effective pursuant to this Agreement), at any time
during any period of such ineffectiveness (an "Ineffective Period"), then, in
either event the Company shall pay to the Investor in immediately available
funds into an account designated by the Investor an amount equal to one and a
half percent (1.5%) of the aggregate Purchase Price of all of the Registrable
Securities then held by the Investor for each calendar month and for each
portion of a calendar month, pro rata, during an Ineffective Period. Such
payments shall be made on the first Trading Day after the earliest to occur of
(i) the expiration of the applicable Ineffective Period and (ii) the last day of
each calendar month during an Ineffective Period.
(e) Failure to Register Sufficient Shares. If an Additional
Warrant becomes exercisable for a number of shares in excess of the number of
Additional Warrant Shares included in the applicable Registration Statement
("Excess Shares"), then the Company shall immediately amend such Registration
Statement (or file a new Registration Statement) to cover the Excess Shares
(such amended or new Registration Statement is referred to herein as an "Excess
Registration Statement") and, subject to Section 1.1(g), the Company shall pay
to the Investor in immediately available funds into an account designated by the
Investor an amount equal to one and a half percent (1.5%) of the product of (x)
the number of Excess Shares multiplied by (y) the Sale Price of the Common Stock
on the applicable Effective Date, for each calendar month and for each portion
of a calendar month, pro rata, during the period from the Effective Date of the
applicable Registration Statement and the Effective Date of the applicable
Excess Registration Statement.
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(f) Liquidated Damages. The Company and the Investor hereto
acknowledge and agree that the sums payable under subsection 1(d) and 1(e)
hereof shall constitute liquidated damages and not penalties. The parties
further acknowledge that (i) the amount of loss or damages likely to be incurred
is incapable or is difficult to estimate precisely, (ii) the amounts specified
in such subsections bear a reasonable proportion and are not plainly or grossly
disproportionate to the probable loss likely to be incurred in connection with
any failure by the Company to obtain or maintain the effectiveness of a
Registration Statement, (iii) one of the reasons for the Company and the
Investor reaching an agreement as to such amounts was the uncertainty and cost
of litigation regarding the question of actual damages, and (iv) the Company and
the Investor are sophisticated business parties and have been represented by
sophisticated and able legal and financial counsel and negotiated this Agreement
at arm's length.
(g) Redemption Option. In lieu of paying the liquidated
damages described in Section 1(d), the Company may redeem any or all of the
Excess Shares by delivering written notice to the Investor of its intention to
redeem such Excess Shares no later than one day following the Effective Date of
the applicable Registration Statement (the "Redemption Option"). If the Company
chooses the Redemption Option, then it shall deliver the Redemption Price (as
defined below) by wire transfer of immediately available funds to an account
designated by the Investor within three (3) Trading Days after delivering notice
of its intention to redeem such Excess Shares. Upon receipt of full payment for
the redeemed Excess Shares, the Investor shall deliver to the Company
certificates representing such redeemed Excess Shares.
Redemption Price shall mean the product of (x) the Sale Price
of one share of Common Stock on the Effective Date of the applicable
Registration Statement multiplied by (y) the number of Excess Shares redeemed by
the Company pursuant to this Section 1(g).
ARTICLE II
REGISTRATION PROCEDURES
Section 2.1. FILINGS; INFORMATION. The Company will effect the
registration of the Registrable Securities in accordance with the
intended methods of disposition thereof as furnished to the Company by
any proposed seller of such Registrable Securities. Without limiting
the foregoing, the Company in each such case will do the following as
expeditiously as possible, but in no event later than the deadline, if
any, prescribed therefor in this Agreement:
(a) The Company shall (i) prepare and file with the SEC a
separate Registration Statement covering shares through each Put, as is defined
in subsection 1.1(a) above; (ii) use its best efforts to cause such filed
Registration Statement to become and remain effective (pursuant to Rule 415
under the Securities Act or otherwise) for the period prescribed by Section
1.1(c); (iii) prepare and file with the SEC such amendments and supplements to
each Registration Statement and the prospectus used in connection therewith as
may be necessary to keep each Registration Statement effective for the time
period prescribed by Section 1.1(c); and (iv) comply with the provisions of the
Securities Act with respect to the disposition of all securities covered by each
Registration Statement during such period in accordance with the intended
methods of disposition by the Investor set forth in each Registration Statement.
(b) The Company shall file all necessary amendments to each
Registration Statement in order to effectuate the purpose of this Agreement, the
Stock Purchase Agreement, and the Warrants.
(c) Five (5) Trading Days prior to filing each Registration
Statement or prospectus, or any amendment or supplement thereto (excluding
amendments deemed to result from the filing of documents incorporated by
reference therein), the Company shall deliver to the
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Investor and one firm of counsel representing the Investor, in accordance with
the notice provisions of Section 4.8, copies of such Registration Statement as
proposed to be filed, together with exhibits thereto, which documents will be
subject to review by the Investor and such counsel, and thereafter deliver to
the Investor and such counsel, in accordance with the notice provisions of
Section 4.8, such number of copies of such Registration Statement, each
amendment and supplement thereto (in each case including all exhibits thereto),
the prospectus included in such Registration Statement (including each
preliminary prospectus) and such other documents or information as the Investor
or counsel may reasonably request in order to facilitate the disposition of the
Registrable Securities.
(d) The Company shall deliver, in accordance with the notice
provisions of Section 4.8, to each seller of Registrable Securities covered by
each Registration Statement such number of conformed copies of such Registration
Statement and of each amendment and supplement thereto (in each case including
all exhibits and documents incorporated by reference), such number of copies of
the prospectus contained in such Registration Statement (including each
preliminary prospectus and any summary prospectus) and any other prospectus
filed under Rule 424 promulgated under the Securities Act relating to such
seller's Registrable Securities, and such other documents, as such seller may
reasonably request to facilitate the disposition of its Registrable Securities.
(e) After the filing of each Registration Statement, the
Company shall promptly notify the Investor of any stop order issued or
threatened by the SEC in connection therewith and take all commercially
reasonable actions required to prevent the entry of such stop order or to remove
it if entered.
(f) The Company shall use its best efforts to (i) register or
qualify the Registrable Securities under such other securities or blue sky laws
of such jurisdictions in the United States as the Investor may reasonably (in
light of its intended plan of distribution) request, and (ii) cause the
Registrable Securities to be registered with or approved by such other
governmental agencies or authorities in the United States as may be necessary by
virtue of the business and operations of the Company and do any and all other
acts and things that may be reasonably necessary or advisable to enable the
Investor to consummate the disposition of the Registrable Securities; provided,
however, that the Company will not be required to qualify generally to do
business in any jurisdiction where it would not otherwise be required to qualify
but for this paragraph (f), subject itself to taxation in any such jurisdiction,
or consent or subject itself to general service of process in any such
jurisdiction.
(g) The Company shall immediately notify the Investor upon the
occurrence of any of the following events in respect of any Registration
Statement or related prospectus in respect of an offering of Registrable
Securities: (i) receipt of any request by the SEC or any other federal or state
governmental authority for additional information, amendments or supplements to
such Registration Statement or related prospectus; (ii) the issuance by the SEC
or any other federal or state governmental authority of any stop order
suspending the effectiveness of such Registration Statement or the initiation of
any proceedings for that purpose; (iii) receipt 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; (iv) the happening of any event
that makes any statement made in such Registration Statement or related
prospectus or any document incorporated or deemed to be incorporated therein by
reference untrue in any material respect or that requires the making of any
changes in such Registration Statement, related prospectus or documents so that,
in the case of such Registration Statement, 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 not misleading, and
that in the case of the related
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prospectus, 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 the light of the circumstances under which they were
made, not misleading; and (v) the Company's reasonable determination that a
post-effective amendment to such Registration Statement would be appropriate and
the Company will promptly make available to the Investor any such supplement or
amendment to the related prospectus.
(h) The Company shall enter into customary agreements and take
such other actions as are reasonably required in order to expedite or facilitate
the disposition of such Registrable Securities.
(i) The Company shall make available to the Investor (and will
deliver to Investor's counsel), subject to restrictions imposed by the United
States federal government or any agency or instrumentality thereof, copies of
all correspondence between the SEC and the Company, concerning any Registration
Statement, and will also make available for inspection by the Investor and any
attorney, accountant or other professional retained by the Investor
(collectively, the "Inspectors"), all financial and other records, pertinent
corporate documents and properties of the Company (collectively, the "Records")
as shall be reasonably necessary to enable them to exercise their due diligence
responsibility, and cause the Company's officers and employees to supply all
information reasonably requested by any Inspectors in connection with any
Registration Statement. Records that the Company determines, in good faith, to
be confidential and that it notifies the Inspectors are confidential shall not
be disclosed by the Inspectors unless (i) the disclosure of such Records is
necessary to avoid or correct a misstatement or omission in any Registration
Statement or (ii) the disclosure or release of such Records is requested or
required pursuant to oral questions, interrogatories, requests for information
or documents or a subpoena or other order from a court of competent jurisdiction
or other process; provided, however, that prior to any disclosure or release
pursuant to clause (ii), the Inspectors shall provide the Company with prompt
notice of any such request or requirement so that the Company may seek an
appropriate protective order or waive such Inspectors' obligation not to
disclose such Records; and, provided, further, that if failing the entry of a
protective order or the waiver by the Company permitting the disclosure or
release of such Records, the Inspectors, upon advice of counsel, are compelled
to disclose such Records, the Inspectors may disclose that portion of the
Records that counsel has advised the Inspectors that the Inspectors are
compelled to disclose. The Investor agrees that information obtained by it
solely as a result of such inspections (not including any information obtained
from a third party who, insofar as is known to the Investor after reasonable
inquiry, is not prohibited from providing such information by a contractual,
legal or fiduciary obligation to the Company) shall be deemed confidential and
shall not be used by it as the basis for any market transactions in the
securities of the Company or its affiliates unless and until such information is
made generally available to the public. The Investor further agrees that it
will, upon learning that disclosure of such Records is sought in a court of
competent jurisdiction, give notice to the Company and allow the Company, at its
expense, to undertake appropriate action to prevent disclosure of the Records
deemed confidential.
(j) To the extent required by law or reasonably necessary to
effect a sale of Registrable Securities in accordance with prevailing business
practices at the time of any sale of Registrable Securities pursuant to a
Registration Statement, the Company shall deliver to the Investor a signed
counterpart, addressed to the Transfer Agent, of an opinion or opinions of
counsel to the Company.
(k) The Company shall otherwise comply with all applicable
rules and regulations of the SEC, including, without limitation, compliance with
applicable reporting requirements under the Exchange Act.
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(l) The Company shall appoint a transfer agent and registrar
for all of the class that includes the Registrable Securities covered by a
Registration Statement not later than the effective date of a Registration
Statement.
(m) The Company may require the Investor to furnish promptly
in writing to the Company such information as may be legally required in
connection with any registration including, without limitation, all such
information as may be requested by the SEC or the National Association of
Securities Dealers. The Investor agrees to provide such information requested in
connection with any registration within five (5) Trading Days after receiving
such written request and the Company shall not be responsible for any delays in
obtaining or maintaining the effectiveness of a Registration Statement caused by
the Investor's failure to timely provide such information. Each seller of
Registrable Securities shall notify the Company as promptly as practicable of
any inaccuracy or change in information previously furnished by such seller to
the Company or of the occurrence of any event, in either case as a result of
which any prospectus relating to the Registrable Securities contains or would
contain an untrue statement of a material fact regarding such seller or its
intended method of disposition of such Registrable Securities or omits to state
any material fact regarding such seller or such seller's intended method of
disposition of such Registrable Securities required to be stated therein or
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, and promptly furnish to the Company
any additional information required to correct and update any previously
furnished information or required so that such prospectus shall not contain,
with respect to such seller or the disposition of such Registrable Securities,
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 light
of the circumstances under which they were made, not misleading.
Section 2.2. REGISTRATION EXPENSES. In connection with each
Registration Statement, the Company shall pay all registration expenses
incurred in connection with the registration thereunder (the
"Registration Expenses"), including, without limitation: (i) all
registration, filing, securities exchange listing and fees required by
the National Association of Securities Dealers, (ii) all registration,
filing, qualification and other fees and expenses of compliance with
securities or blue sky laws (including reasonable fees and
disbursements of counsel in connection with blue sky qualifications of
the Registrable Securities required hereby), (iii) all of the Company's
word processing, duplicating, printing, messenger and delivery
expenses, (iv) the Company's internal expenses (including, without
limitation, all salaries and expenses of its officers and employees
performing legal or accounting duties), (v) the fees and expenses
incurred by the Company in connection with the listing of the
Registrable Securities, (vi) reasonable fees and disbursements of
counsel for the Company and customary fees and expenses for independent
certified public accountants retained by the Company hereof), (vii) the
fees and expenses of any special experts retained by the Company in
connection with such registration, (viii) premiums and other costs of
policies of insurance purchased at the discretion of the Company
against liabilities arising out of any public offering of the
Registrable Securities being registered, and (ix) any fees and
disbursements of underwriters customarily paid by issuers or sellers of
securities, but excluding underwriting fees, discounts, transfer taxes
or commissions, if any, attributable to the sale of Registrable
Securities, which shall be payable by each holder of Registrable
Securities pro rata on the basis of the number of Registrable
Securities of each such holder that are included in a registration
under this Agreement.
Section 2.3. BLACKOUT PERIOD. Investor agrees by acquisition of
Registrable Securities that, upon receipt of written notice from the
Company of the occurrence of any
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event of the kind described in Section 2.1(g)(iv), for a period not to
exceed 120 days the Investor shall forthwith discontinue the Investor's
offer of the Registrable Securities pursuant to the Registration
Statement relating to such Registrable Securities until the Investor
shall have received copies of the supplemented or amended prospectus
contemplated by Section 2.1(g)(iv) and, if so directed by the Company,
will deliver to the Company (at the Company's expense) all copies,
other than permanent file copies, then in the Investor's possession, of
the prospectus relating to such Registrable Securities at the time of
receipt of such notice. In the event that any Investor uses a
prospectus in connection with the offering and sale of any of the
Registrable Securities covered by such prospectus, such Investor will
use only the latest version of such prospectus provided by the Company
to the Investor.
ARTICLE III
INDEMNIFICATION AND CONTRIBUTION
Section 3.1. INDEMNIFICATION BY THE COMPANY. The Company agrees to
indemnify and hold harmless the Investor, its partners, affiliates,
officers, directors, employees and duly authorized agents, and each
Person or entity, if any, who controls the Investor within the meaning
of Section 15 of the Securities Act or Section 20 of the Exchange Act,
together with the partners, Affiliates, officers, directors, employees
and duly authorized agents of such controlling Person or entity
(collectively, the "Controlling Persons"), from and against any and all
losses, claims, damages, liabilities, costs and expenses (including,
without limitation, any and all reasonable attorneys' fees and
disbursements and costs and expenses of investigating and defending any
such claim and any and all amounts paid in settlement of, any action,
suit or proceeding between any of the indemnified parties and any
indemnifying parties or between any indemnified party and any third
party, or otherwise, or any claim asserted) (collectively, "Damages"),
joint or several, and any action or proceeding in respect thereof to
which the Investor, its partners, affiliates, officers, directors,
employees and duly authorized agents, and any Controlling Person, may
become subject under the Securities Act, the Exchange Act or other
federal or state statutory law or regulation, at common law or
otherwise, as and when incurred, insofar as such Damages (or actions or
proceedings in respect thereof) (i) arise out of, or are based upon,
any untrue statement or alleged untrue statement of a material fact
contained in any Registration Statement, or in any preliminary
prospectus, final prospectus, summary prospectus, documents filed under
the Exchange Act and deemed to be incorporated by reference into any
Registration Statement, application or other document executed by or on
behalf other Company or based on written information furnished by or on
behalf of the Company filed in any jurisdiction in order to qualify the
Registrable Securities under the securities or blue sky laws thereof or
filed with the SEC, amendment or supplement relating to the Registrable
Securities or (ii) arise out of, or are based upon, any omission or
alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, and
shall reimburse the Investor, its partners, affiliates, officers,
directors, employees and duly authorized agents, and each such
Controlling Person, for any legal and other expenses reasonably
incurred by the Investor, its partners, affiliates, officers,
directors, employees and duly authorized agents, or any such
Controlling Person, as incurred, in investigating or defending or
preparing to defend against any such Damages or actions or proceedings;
provided, however, that the Company shall not be liable to the extent
that any such Damages arise out of the Investor's failure to send or
give a copy of the final prospectus or supplement to the persons
asserting an untrue statement or alleged untrue statement or omission
or alleged omission at or prior to the written confirmation of the sale
of Registrable Securities to such person if such statement or omission
was corrected in such final prospectus or supplement; provided,
further, that the Company shall not be liable to the extent that any
such Damages arise out of or are based upon an untrue statement or
alleged untrue statement
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or omission or alleged omission made in such Registration Statement, or
any such preliminary prospectus, final prospectus, summary prospectus,
amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by the Investor or any other
person who participates as a seller or as an underwriter in the
offering or sale of such securities, in either case, in any
questionnaire or other request by the Company, or otherwise
specifically stating that it is for use in the preparation thereof.
Section 3.2. INDEMNIFICATION BY THE INVESTOR. Investor will, if
Registrable Securities held by it are included in the securities as to
which such registration, qualification or compliance is being effected,
indemnify the Company, each of its directors and officers and each
underwriter, if any, of the Company's securities covered by such
registration statement and each person who controls the Company within
the meaning of Section 15 of the Securities Act, against all claims,
losses, damages and liabilities (or actions in respect thereof) arising
out of or based on any untrue statement (or alleged untrue statement)
of a material fact contained in any such registration statement,
prospectus, offering circular or other document, or any omission (or
alleged omission) to state therein a material fact required to be
stated therein or necessary to make the statements therein not
misleading, and will reimburse the Company, such directors, officers or
control persons or underwriters for any legal or any other expenses
reasonably incurred in connection with investigating or defending any
such claim, loss, damage, liability or action, in each case to the
extent, but only to the extent, that such untrue statement (or alleged
untrue statement) or omission (or alleged omission) is made in such
registration statement, prospectus, offering circular or other document
in reliance upon and in conformity with written information furnished
to the Company by the Investor.
Section 3.3. CONDUCT OF INDEMNIFICATION PROCEEDINGS. Promptly after
receipt by any person or entity in respect of which indemnity may be
sought pursuant to Section 3.1 or 3.2 (an "Indemnified Party") of
notice of any claim or the commencement of any action, the Indemnified
Party shall, if a claim in respect thereof is to be made against the
person or entity against whom such indemnity may be sought (the
"Indemnifying Party"), notify the Indemnifying Party in writing of the
claim or the commencement of such action. In the event an Indemnified
Party shall fail to give such notice as provided in this Section 3.2
and the Indemnifying Party to whom notice was not given was unaware of
the proceeding to which such notice would have related and was
materially prejudiced by the failure to give such notice, the
indemnification provided for in Section 3.1 shall be reduced to the
extent of any actual prejudice resulting from such failure to so notify
the Indemnifying Party; provided, however, that the failure to notify
the Indemnifying Party shall not relieve the Indemnifying Party from
any liability that it may have to an Indemnified Party otherwise than
under Section 3.1. If any such claim or action shall be brought against
an Indemnified Party, and it shall notify the Indemnifying Party
thereof, the Indemnifying Party shall be entitled to participate
therein, and, to the extent that it wishes, jointly with any other
similarly notified Indemnifying Party, to assume the defense thereof
with counsel reasonably satisfactory to the Indemnified Party. After
notice from the Indemnifying Party to the Indemnified Party of its
election to assume the defense of such claim or action, the
Indemnifying Party shall not be liable to the Indemnified Party for any
legal or other expenses subsequently incurred by the Indemnified Party
in connection with the defense thereof other than reasonable costs of
investigation; provided, however, that the Indemnified Party shall have
the right to employ separate counsel to represent the Indemnified Party
and its Controlling Persons who may be subject to liability arising out
of any claim in respect of which indemnity may be sought by the
Indemnified Party against the Indemnifying Party, but the fees and
expenses of such counsel shall be for the account of such Indemnified
Party, unless (i) the Indemnifying Party and the Indemnified Party
shall have mutually agreed to the
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retention of such counsel or (ii) in the reasonable judgment of the
Company and such Indemnified Party, representation of both parties by
the same counsel would be inappropriate due to actual or potential
conflicts of interest between them, it being understood, however, that
the Indemnifying Party shall not, in connection with any one such claim
or action or separate but substantially similar or related claims or
actions in the same jurisdiction arising out of the same general
allegations or circumstances, be liable for the fees and expenses of
more than one separate firm of attorneys (together with appropriate
local counsel) at any time for all Indemnified Parties, or for fees and
expenses that are not reasonable. No Indemnifying Party shall, without
the prior written consent of the Indemnified Party, effect any
settlement of any claim or pending or threatened proceeding in respect
of which the Indemnified Party is or could have been a party and
indemnity could have been sought hereunder by such Indemnified Party,
unless such settlement includes an unconditional release of such
Indemnified Party from all liability arising out of such claim or
proceeding. Whether or not the defense of any claim or action is
assumed by the Indemnifying Party, such Indemnifying Party will not be
subject to any liability for any settlement made without its consent,
which consent will not be unreasonably withheld.
Section 3.4. OTHER INDEMNIFICATION. Indemnification similar to that
specified in the preceding paragraphs of this Article 3 (with
appropriate modifications) shall be given by the Company with respect
to any required registration or other qualification of securities under
any federal or state law or regulation of any governmental authority
other than the Securities Act. The provisions of this Article III shall
be in addition to any other rights to indemnification, contribution or
other remedies which an Indemnified Party may have pursuant to law,
equity, contract or otherwise.
Section 3.5. CONTRIBUTION. If the indemnification and reimbursement
obligations provided for in any section of this Article III is
unavailable or insufficient to hold harmless the Indemnified Parties in
respect of any Damages referred to herein, then the 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
Damages as between the Company on the one hand and the Investor or
seller on the other, in such proportion as is appropriate to reflect
the relative fault of the Company and of the Investor or seller in
connection with such statements or omissions, as well as other
equitable considerations. The relative fault of the Company on the one
hand and of the Investor or seller on the other shall be determined by
reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to
state a material fact relates to information supplied by such party,
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
The Company and the Investor agree that it would not be just and
equitable if contribution pursuant to this Section 3.5 were determined
by pro rata allocation or by any other method of allocation that does
not take account of the equitable considerations referred to in the
immediately preceding paragraph. The amount paid or payable by an
Indemnified Party as a result of the Damages referred to in the
immediately preceding paragraph shall be deemed to include, subject to
the limitations set forth above, any legal or other expenses reasonably
incurred by such Indemnified Party in connection with investigating or
defending any such action or claim. Notwithstanding the provisions of
this Section 3.5, the Investor or seller shall in no event be required
to contribute any amount in excess of the amount by which the total
price at which the Registrable Securities of the Investor or seller
were sold to the public (less underwriting discounts and commissions)
exceeds the amount of any damages which the Investor or seller has
otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission. No Person guilty of
fraudulent
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misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any Person who
was not guilty of such fraudulent misrepresentation.
ARTICLE IV
MISCELLANEOUS
Section 4.1. OUTSTANDING REGISTRATION RIGHTS. Nothing herein shall
prevent or prohibit the Company from granting registration rights which
are pari passu with the rights granted pursuant to this Agreement.
Notwithstanding the immediately preceding sentence, the Company hereby
covenants and agrees to refrain from granting to any other Person
registration rights more favorable than those granted pursuant to this
Agreement. Schedule 4.1 sets forth all agreements with stockholders
which do not permit the Company to apply the Underwriter's Cut-back.
Section 4.2. TERM. The registration rights provided to the holders of
Registrable Securities hereunder shall terminate at such time as all
Registrable Securities have been issued and have ceased to be
Registrable Securities. Notwithstanding the foregoing, paragraphs (c)
and (d) of Section 1.1, Article III, Section 4.8, and Section 4.9 shall
survive the termination of this Agreement.
Section 4.3. RULE 144. If the Company is required to file reports under
the Exchange Act, the Company will file in a timely manner,
information, documents and reports in compliance with the Securities
Act and the Exchange Act and will, at its expense, promptly take such
further action as holders of Registrable Securities may reasonably
request to enable such holders of Registrable Securities to sell
Registrable Securities without registration under the Securities Act
within the limitation of the exemptions provided by (a) Rule 144 under
the Securities Act ("Rule 144"), as such Rule may be amended from time
to time, or (b) any similar rule or regulation hereafter adopted by the
SEC. If at any time the Company is not required to file such reports,
it will, at its expense, forthwith upon the written request of any
holder of Registrable Securities who intends to make a sale under Rule
144, make available adequate current public information with respect to
the Company within the meaning of paragraph (c)(2) of Rule 144 or such
other information as necessary to permit sales pursuant to Rule 144.
Upon the request of the Investor, the Company will deliver to the
Investor a written statement, signed by the Company's principal
financial officer, as to whether it has complied with such
requirements. This Section 4.3 shall terminate at the same time as the
registration rights as provided in Section 4.2.
Section 4.4. CERTIFICATE. The Company will, at its expense, forthwith
upon the request of any holder of Registrable Securities, deliver to
such holder a certificate, signed by the Company's principal financial
officer, stating (a) the Company's name, address and telephone number
(including area code), (b) the Company's Internal Revenue Service
identification number, (c) the Company's Commission file number, (d)
the number of shares of each class of Stock outstanding as shown by the
most recent report or statement published by the Company, and (e)
whether the Company has filed the reports required to be filed under
the Exchange Act for a period of at least ninety (90) days prior to the
date of such certificate and in addition has filed the most recent
annual report required to be filed thereunder.
Section 4.5. AMENDMENT AND MODIFICATION. Any provision of this
Agreement may be waived, provided that such waiver is set forth in a
writing executed by both parties to this Agreement. 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
Company has obtained the written consent of the holders of a majority
of the then outstanding Registrable Securities.
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Notwithstanding the foregoing, the waiver of any provision hereof with
respect to a matter that relates exclusively to the rights of holders
of Registrable Securities whose securities are being sold pursuant to a
Registration Statement and does not directly or indirectly affect the
rights of other holders of Registrable Securities may be given by
holders of at least a majority of the Registrable Securities being sold
by such holders; provided that the provisions of this sentence may not
be amended, modified or supplemented except in accordance with the
provisions of the immediately preceding sentence. No course of dealing
between or among any Person having any interest in this Agreement will
be deemed effective to modify, amend or discharge any part of this
Agreement or any rights or obligations of any person under or by reason
of this Agreement.
Section 4.6. SUCCESSORS AND ASSIGNS; ENTIRE AGREEMENT. This Agreement
and all of the provisions hereof shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and
assigns. The Investor may assign its rights under this Agreement to any
subsequent holder the Registrable Securities, provided that the Company
shall have the right to require any holder of Registrable Securities to
execute a counterpart of this Agreement and agree to be bound by the
provisions of this Agreement as a condition to such holder's claim to
any rights hereunder. This Agreement, together with the Stock Purchase
Agreement, the Warrants and the Letter Agreement and the exhibits and
schedules to such agreements together set forth the entire agreement
and understanding between the parties as to the subject matter hereof
and merges and supersedes all prior discussions, agreements and
understandings of any and every nature among them.
Section 4.7. SEPARABILITY. In the event that any provision of this
Agreement or the application of any provision hereof is declared to be
illegal, invalid or otherwise unenforceable by a court of competent
jurisdiction, the remainder of this Agreement shall not be affected
except to the extent necessary to delete such illegal, invalid or
unenforceable provision unless that provision held invalid shall
substantially impair the benefits of the remaining portions of this
Agreement.
Section 4.8. NOTICES. All notices, demands, requests, consents,
approvals, and other communications required or permitted hereunder
shall be in writing and shall be (i) deposited in the mail, registered
or certified, return receipt requested, postage prepaid, (ii) delivered
by reputable air courier service with charges prepaid, or (iii)
transmitted by hand delivery, telegram or facsimile, addressed as set
forth below or to such other address as such party shall have specified
most recently by written notice. Any notice or other communication
required or permitted to be given hereunder shall be deemed effective
(a) upon hand delivery or delivery by facsimile, with accurate
confirmation generated by the transmitting facsimile machine, at the
address or number designated below (if delivered on a business day
during normal business hours where such notice is to be received), or
the first business day following such delivery (if delivered other than
on a business day during normal business hours where such notice is to
be received) or (b) on the second business day following the date of
mailing by express courier service, fully prepaid, addressed to such
address, or upon actual receipt of such mailing, whichever shall first
occur. The addresses for such communications shall be:
If to the Company:
Infocure Corp.
0000 Xxx Xxxxxxxx
Xxxxx 000
Xxxxxxx, XX 00000
Attention: Xx. Xxxxxxx Xxxxxxx,
Chairman
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Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy (which shall not constitute notice) to:
Xxxxxx, Xxxxxxx & Xxxxxx LLP
1600 Atlanta Financial Center
0000 Xxxxxxxxx Xxxx, X.X.
Xxxxxxx, XX 00000
Attention: Xxx Xxxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
if to the Investor:
Crescent International Limited
x/x Xxxxxxxxxx (Xxxxxxxxxxx), X.X.
00, xx Xxxxx-Xxxxx, X.X. Xxx 000
0000 Xxxxxx, Xxxxxxxx
Xxxxxxxxxxx
Attention: Xxxxxx Xxxx/Maxi Brezzi
Telephone: x00 00 000 00 00
Facsimile: x00 00 000 00 00
with a copy (which shall not constitute notice) to:
Xxxxxx & Xxxxx LLP
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx Xxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Either party hereto may from time to time change its address or
facsimile number for notices under this Section 4.8 by giving at least
ten (10) days' prior written notice of such changed address or
facsimile number to the other party hereto.
Section 4.9. GOVERNING LAW. This Agreement shall be construed under the
laws of the State of Delaware, without giving effect to conflict of law
provisions.
Section 4.10. HEADINGS. The headings in this Agreement are for
convenience of reference only and shall not constitute a part of this
Agreement, nor shall they affect their meaning, construction or effect.
Section 4.11. COUNTERPARTS. This Agreement may be executed in multiple
counterparts, each of which shall be deemed to be an original
instrument and all of which together shall constitute one and the same
instrument.
Section 4.12. FURTHER ASSURANCES. Each party shall cooperate and take
such action as may be reasonably requested by another party in order to
carry out the provisions and purposes of this Agreement and the
transactions contemplated hereby.
Section 4.13. ABSENCE OF PRESUMPTION. This Agreement shall be construed
without regard to any presumption or rule requiring construction or
interpretation against the party drafting or causing any instrument to
be drafted.
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Section 4.14. REMEDIES. In the event of a breach or a threatened breach
by any party to this Agreement of its obligations under this Agreement,
any party injured or to be injured by such breach will be entitled to
specific performance of its rights under this Agreement or to
injunctive relief, in addition to being entitled to exercise all rights
provided in this Agreement and granted by law. The parties agree that
the provisions of this Agreement shall be specifically enforceable, it
being agreed by the parties that the remedy at law, including monetary
damages, for breach of any such provision will be inadequate
compensation for any loss and that any defense or objection in any
action for specific performance or injunctive relief that a remedy at
law would be adequate is waived.
IN WITNESS WHEREOF, the parties hereto have caused this
Registration Rights Agreement to be executed by the undersigned, thereunto duly
authorized, as of the date first set forth above.
INFOCURE CORP.
By: /s/ Xxxxxxx Xxxxxxx
----------------------------------------
Name Xxxxxxx Xxxxxxx
CRESCENT INTERNATIONAL LIMITED
By: /s/ Xxxxxx Xxxx
----------------------------------------
Name Xxxxxx Xxxx
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