REGISTRATION RIGHTS AGREEMENT
Exhibit
10.2
REGISTRATION
RIGHTS AGREEMENT
(this
“Agreement”),
dated
as of May 30, 2008, by and among by and among Ecolab Inc., a Delaware
corporation (the "Investor")
and
Linkwell Corporation, a Florida corporation, ("Linkwell").
PRELIMINARY
STATEMENT
A. In
connection with the Stock Purchase Agreement dated February 15, 2008 (the
“Stock
Purchase Agreement”)
by and
among the parties hereto and Linkwell Tech Group, Inc., a Florida corporation
(“Linkwell
Tech”),
Linkwell Tech has agreed, upon the terms and subject to the conditions of
the
Stock Purchase Agreement, to issue and sell to the Investor shares of Linkwell
Tech’s common stock.
B. On
or
about the date hereof, the Investor, Linkwell and Linkwell Tech have entered
into a Stockholders Agreement (the “Stockholders
Agreement”)
pursuant to which, in certain circumstances, the Investor could require Linkwell
to purchase the Investor’s shares of common stock in Linkwell Tech and Linkwell
could satisfy the purchase price therefor by the issuance of shares of common
stock in the capital of Linkwell.
C. Linkwell
has agreed to provide certain registration rights under the Securities Act
of
1933, as amended, and the rules and regulations thereunder, or any similar
successor statute (collectively, the “Securities
Act”),
and
applicable state securities laws.
NOW,
THEREFORE,
in
consideration of the premises and the mutual covenants contained herein and
other good and valuable consideration, the receipt and sufficiency of which
are
hereby acknowledged, Linkwell and the Investor hereby agree as
follows:
1.
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DEFINITIONS.
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(a) Capitalized
terms used but not defined in this Agreement shall have the meaning given
to
them in the Stockholders Agreement.
(b) As
used
in this Agreement, the following terms shall have the following
meanings:
“Common
Stock”
means
shares of common stock in the capital of Linkwell.
“Delay
Payment Rate”
means
(i) during the first two weeks of a Damages Accrual Period, an amount per
week
(or portion thereof) per share of Common Stock equal to 0.5% of the Fair
Market
Value of such share, (ii) during the next two weeks of a Damages Accrual
Period,
an amount per week (or portion thereof) per share of Common Stock equal to
1% of
the Fair Market Value of such share, and (iii) during the remainder of a
Damages
Accrual Period, an amount per week (or portion thereof) per share of Common
Stock equal to 2% of the Fair Market Value of such share.
“Fair
Market Value”
of
a
share of Common Stock during any particular week means the average of the
closing sale price regular way on each day during such week or, if no such
sale
takes place on a day within such week, the average of the reported closing
bid
and asked prices, regular way, on each day during such week, in each case
on the
NASDAQ National Market (“NASDAQ”)
or, if
the Common Stock is not listed or admitted to trading on the NASDAQ, on the
principal national security exchange or quotation system on which the Common
Stock is quoted or listed or admitted to trading, or, if not quoted or listed
or
admitted to trading on any national securities exchange or quotation system,
the
average of the closing bid and asked prices of the Common Stock on the
over-the-counter market on each day during such week, in each case as reported
by the National Quotation Bureau Incorporated, or a similar generally accepted
reporting service. The Fair Market Value shall be calculated, as appropriate,
by
making proportionate adjustments necessary to reflect any stock split, stock
combination or stock dividend or similar stock distribution made during the
applicable period.
“Person”
means
a
corporation, a limited liability company, an association, a partnership,
an
organization, a business, an individual, a governmental or political subdivision
thereof or a governmental agency.
“Register,”
“registered,”
and
“registration”
refer
to a registration effected by preparing and filing one or more Registration
Statements (as defined below) in compliance with the Securities Act and pursuant
to Rule 415 under the Securities Act or any successor rule providing for
offering securities on a continuous or delayed basis (“Rule
415”),
and
the declaration or ordering of effectiveness of such Registration Statement(s)
by the United States Securities and Exchange Commission (the “SEC”).
“Registrable
Securities”
means
the Stock Consideration Shares.
“Registration
Delay”
means
the occurrence of any of (i) a Registration Statement covering all the
Registrable Securities is not filed with the SEC on or before the Filing
Deadline or is not declared effective by the SEC on or before the Effectiveness
Deadline, (ii) a Registration Statement in connection with a Demand Registration
covering all of the Registrable Securities required to be covered thereby
is not
filed with the SEC on or before the deadline described in the last sentence
of
Section 2(a) or is not declared effective by the SEC on or before the deadline
described in the last sentence of Section 2(a), (iii) on any day during the
Registration Period (other than during an Allowable Grace Period, as defined
in
Section 3(g)), any Registrable Security required to be included in such
Registration Statement cannot be sold pursuant to such Registration Statement
as
a matter of law or because Linkwell has failed to perform its obligations
under
this Agreement within the applicable time period required for such performance
(including, without limitation, because of a failure to keep such Registration
Statement effective, to disclose such information as is necessary for sales
to
be made pursuant to such Registration Statement or to register a sufficient
number of shares of Common Stock), or (iv) a Grace Period (as defined in
Section
3(g)) exceeds the length of an Allowable Grace Period.
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“Registration
Statement”
means
a
registration statement or registration statements of Linkwell filed under
the
Securities Act covering the Registrable Securities.
2.
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REGISTRATION.
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(a) Mandatory
Registration.
If
Linkwell elects to pay Stock Consideration Shares for the Put Shares, Linkwell
shall prepare, and, as soon as practicable, but in no event later than seventy
five (75) days after the date of its receipt of the Put Notice (the
“Filing
Deadline”),
file
with the SEC a Registration Statement or Registration Statements (as necessary)
on Form S-3 covering the resale of all of the Registrable Securities. In
the
event that Form S-3 is unavailable for such a registration, Linkwell shall
use
such other form as is available for such a registration, subject to the
provisions of Section 2(d). Linkwell shall use its best efforts to cause
such Registration Statement to be declared effective by the SEC as soon as
possible, but in no event later than one hundred fifty (150) days after the
date
of its receipt of the Put Notice (the “Effectiveness
Deadline”).
If for
any reason prior to the expiration of the Registration Period (as hereinafter
defined), the Registration Statement required to be filed pursuant to this
Section 2(a) ceases to be effective or fails to cover all of the Registrable
Securities, the Investor may on one (1) occasion subsequently demand
registration pursuant to the terms of and within the time frames set forth
in
this Section 2(a) by providing written demand registration notice to Linkwell
(a
“Demand
Registration”).
The
Filing Deadline and Effectiveness Deadline with respect to any Demand
Registration will be those dates which are sixty (60) days and one hundred
thirty-five (135) days after the date that the Demand Registration notice
is
delivered to Linkwell.
(b) Piggy-Back
Registrations.
If at
any time prior to the expiration of the Registration Period (as hereinafter
defined), the number of shares of Common Stock available for sale under a
Registration Statement is insufficient (as that term is used in Section 2(f))
to
cover all of the Registrable Securities and Linkwell proposes to file with
the
SEC a Registration Statement relating to an offering for its own account
or the
account of others under the Securities Act of any of its securities (other
than
on Form S-4, Form S-8 or Form S-1 (or their equivalents at such time)
relating to securities to be issued solely in connection with any acquisition
of
any entity or business or to equity securities issuable in connection with
stock
option or other employee benefit plans approved by the board of directors
of
Linkwell) Linkwell shall promptly send to the Investor written notice of
Linkwell’s intention to file a Registration Statement and of the Investor’s
rights under this Section 2(b) and, if within twenty (20) days after receipt
of
such notice, the Investor shall so request in writing, Linkwell shall include
in
such Registration Statement all or any part of the Registrable Securities
the
Investor requests to be registered, subject to the priorities set forth in
this
Section 2(b) below. No right to registration of Registrable Securities under
this Section 2(b) shall be construed to limit any registration required under
Section 2(a). If an offering in connection with which the Investor is entitled
to registration under this Section 2(b) is an underwritten offering, then
if the
Investor’s Registrable Securities are included in such Registration Statement
the Investor shall, unless otherwise agreed by Linkwell, offer and sell such
Registrable Securities in an underwritten offering using the same underwriter
or
underwriters and, subject to the provisions of this Agreement, on the same
terms
and conditions as other shares of Common Stock included in such underwritten
offering. If a registration pursuant to this Section 2(b) is to be an
underwritten public offering and the managing underwriter(s) advise Linkwell
in
writing, that in their reasonable good faith opinion, marketing or other
factors
dictate that a limitation on the number of shares of Common Stock which may
be
included in the Registration Statement is necessary to facilitate and not
adversely affect the proposed offering, then Linkwell shall include in such
registration: (1) first, all securities Linkwell proposes to sell for its
own
account and (2) second, up to the full number of securities proposed to be
registered for the account of the Investor entitled to registration under
this
Section 2(b).
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(c) Legal
Counsel.
Subject
to Section 5 of this Agreement, the Investor shall have the right to select
one
legal counsel to review and comment upon any registration pursuant to this
Agreement (“Legal
Counsel”).
Linkwell shall reasonably cooperate with Legal Counsel in performing Linkwell’s
obligations under this Agreement.
(d) Ineligibility
for Form S-3.
In the
event that Form S-3 is not available for any registration of Registrable
Securities hereunder, Linkwell shall (i) register the sale of the Registrable
Securities on another appropriate form reasonably acceptable to the Investor
and
(ii) undertake to register the Registrable Securities on Form S-3 as soon
as
such form is available, provided that Linkwell shall maintain the effectiveness
of the Registration Statement then in effect until such time as a Registration
Statement on Form S-3 covering the Registrable Securities has been declared
effective by the SEC.
(e) Sufficient
Number of Shares Registered.
In the
event the number of shares available under a Registration Statement filed
pursuant to Section 2(a) is insufficient to cover all of the Registrable
Securities which such Registration Statement is required to cover, Linkwell
shall amend the Registration Statement, or file a new Registration Statement
(on
the short form available therefor, if applicable), or both, so as to cover
the
Registrable Securities as soon as practicable, but in any event not later
than
fifteen (15) days after the necessity therefor arises. Linkwell shall use
its
best efforts to cause such amendment and/or new Registration Statement to
become
effective as soon as practicable following the filing thereof.
(f) Failure
to File, Obtain and Maintain Effectiveness of Registration
Statement.
If a
Registration Delay occurs Linkwell shall pay to the Investor (the “Registration
Delay Payments”),
as
liquidated damages and not as a penalty, and calculated for each share of
Common
Stock then outstanding that is a Registrable Security, an accruing amount
per
each such share equal to the Delay Payment Rate for each week (or portion
thereof) during the Damages Accrual Period. The Registration Delay Payments
shall accrue from the first day of the applicable Registration Delay through
the
date it is cured (the “Damages
Accrual Period”),
and
shall be payable in cash to the record holders of the Registrable Securities
entitled thereto on the last business day of each calendar month. The parties
agree that the sole monetary damages payable for a violation of the terms
of
Section 2(a) shall be such liquidated damages (unless such liquidated damages
are disallowed, reduced or not permitted by applicable law). Nothing shall
preclude the Investor from pursuing or obtaining specific performance or
other
equitable relief with respect to this Agreement in accordance with applicable
law. The parties hereto agree that the liquidated damages provided for in
this
Section 2(f) constitute a reasonable estimate of the damages that may be
incurred by the Investor by reason of the failure of the Registration Statement
to be filed or declared effective or available for effecting resales of
Registrable Securities in accordance with the provisions hereof.
3.
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RELATED
OBLIGATIONS.
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At
such
time as Linkwell is obligated to file a Registration Statement with the SEC
pursuant to Section 2(a) or 2(e), Linkwell will use its best efforts to effect
the registration of the Registrable Securities in accordance with the intended
method of disposition thereof and, pursuant thereto, Linkwell shall have
the
following obligations:
4
(a) Linkwell
shall promptly prepare and file with the SEC a Registration Statement with
respect to the Registrable Securities (but in no event later than the Filing
Deadline) and use its best efforts to cause such Registration Statement relating
to the Registrable Securities to become effective as soon as practicable
after
such filing (but in no event later than the applicable Effectiveness Deadline).
Linkwell shall keep each Registration Statement effective pursuant to Rule
415
at all times until the earlier of (i) the date as of which the Investor may
sell
all of the Registrable Securities covered by such Registration Statement
without
restriction pursuant to Rule 144(k) promulgated under the Securities Act
(or
successor thereto) or (ii) the date on which the Investor shall have sold
all
the Registrable Securities covered by such Registration Statement (the
“Registration
Period”),
which
Registration Statement (including any amendments or supplements thereto and
prospectuses contained therein) shall not contain any untrue statement of
a
material fact or omit to state a material fact required to be stated therein,
or
necessary to make the statements therein, in light of the circumstances in
which
they were made, not misleading. The term “best efforts” as used in the first
sentence of this Section 3(a) shall mean, among other things, that Linkwell
shall submit to the SEC, within two (2) business days after Linkwell learns
that
no review of a particular Registration Statement will be made by the staff
of
the SEC or that the staff has no further comments on the Registration Statement,
as the case may be, a request for acceleration of effectiveness of such
Registration Statement to a time and date not later than two (2) business
days
after the submission of such request.
(b) Linkwell
shall prepare and file with the SEC such amendments (including post-effective
amendments) and supplements to a Registration Statement and the prospectus
used
in connection with such Registration Statement, which prospectus is to be
filed
pursuant to Rule 424 promulgated under the Securities Act, as may be necessary
to keep such Registration Statement effective at all times during the
Registration Period, and, during such period, comply with the provisions
of the
Securities Act with respect to the disposition of all Registrable Securities
of
Linkwell covered by such Registration Statement until such time as all of
such
Registrable Securities shall have been disposed of in accordance with the
intended methods of disposition by the seller or sellers thereof as set forth
in
such Registration Statement. In the case of amendments and supplements to
a
Registration Statement which are required to be filed pursuant to this Agreement
(including pursuant to this Section 3(b)) by reason of Linkwell filing a
report
on Form 10-K, Form 10-Q or Form 8-K or any analogous report under the Securities
Exchange Act of 1934, as amended (the “Exchange
Act”),
Linkwell shall have incorporated such report by reference into the Registration
Statement, if applicable, or shall file such amendments or supplements with
the
SEC on the same day on which the Exchange Act report is filed which created
the
requirement for Linkwell to amend or supplement the Registration
Statement.
(c) Linkwell
shall (a) permit Legal Counsel to review and comment upon those sections
of (i)
the Registration Statement which are applicable to the Investor at least
five
(5) business days prior to its filing with the SEC and (ii) all other
Registration Statements and all amendments and supplements to all Registration
Statements which are applicable to the Investor (except for Proxy Statements,
Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports
on Form 8-K and any similar or successor reports) within a reasonable number
of
days prior to the their filing with the SEC and (b) not file any document
in a
form to which Legal Counsel reasonably objects. Linkwell shall not submit
a
request for acceleration of the effectiveness of a Registration Statement
or any
amendment or supplement thereto without the prior approval of Legal Counsel,
which consent shall not be unreasonably withheld. Linkwell shall furnish
to
Legal Counsel, without charge, (i) any correspondence from the SEC or the
staff
of the SEC to Linkwell or its representatives relating to any Registration
Statement, provided the Investor and Legal Counsel keep such correspondence
confidential, (ii) promptly after the same is prepared and filed with the
SEC,
one copy of any Registration Statement and any amendment(s) thereto, including
financial statements and schedules and all exhibits and (iii) upon the
effectiveness of any Registration Statement, one copy of the prospectus included
in such Registration Statement and all amendments and supplements thereto.
Linkwell shall reasonably cooperate with Legal Counsel in performing Linkwell’s
obligations pursuant to this Section 3.
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(d) Linkwell
shall furnish to the Investor, without charge, (i) promptly after the same
is
prepared and filed with the SEC, at least one copy of the Registration Statement
and any amendment(s) thereto, including financial statements and schedules,
and
all exhibits and each preliminary prospectus, (ii) upon the effectiveness
of any
Registration Statement, ten (10) copies of the prospectus included in such
Registration Statement and all amendments and supplements thereto and (iii)
such
other documents, including copies of any preliminary or final prospectus,
as the
Investor may reasonably request from time to time in order to facilitate
the
disposition of the Registrable Securities.
(e) Linkwell
shall use its best efforts to (i) register and qualify the Registrable
Securities covered by a Registration Statement under all other securities
or
“blue sky” laws of such jurisdictions in the United States, (ii) prepare and
file in those jurisdictions, such amendments (including post-effective
amendments) and supplements to such registrations and qualifications as may
be
necessary to maintain the effectiveness thereof during the Registration Period,
(iii) take such other actions as may be necessary to maintain such registrations
and qualifications in effect at all times during the Registration Period,
and
(iv) take all other actions reasonably necessary or advisable to qualify
the
Registrable Securities for sale in such jurisdictions; provided, however,
that
Linkwell shall not be required in connection therewith or as a condition
thereto
to (w) make any change in Linkwell’s Certificate of Incorporation or by-laws
that Linkwell’s board of directors determines in good faith to be contrary to
the best interests of Linkwell and its shareholders, (x) qualify to do business
in any jurisdiction where it would not otherwise be required to qualify but
for
this Section 3(e), (y) subject itself to general taxation in any such
jurisdiction, or (z) file a general consent to service of process in any
such
jurisdiction. Linkwell shall promptly notify Legal Counsel and the Investor
of
the receipt by Linkwell of any notification with respect to the suspension
of
the registration or qualification of any of the Registrable Securities for
sale
under the securities or “blue sky” laws of any jurisdiction in the United States
or its receipt of actual notice of the initiation or threat of any proceeding
for such purpose.
(f) As
promptly as practicable after becoming aware of such event or development,
Linkwell shall notify Legal Counsel and the Investor in writing of the happening
of any event as a result of which the prospectus included in a Registration
Statement, as then in effect, includes an untrue statement of a material
fact or
omission 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, and promptly prepare a supplement or amendment to such
Registration Statement to correct such untrue statement or omission, and
deliver
ten (10) copies of such supplement or amendment to Legal Counsel and the
Investor. Linkwell shall also promptly notify Legal Counsel and the Investor
in
writing (i) when a prospectus or any prospectus supplement or post-effective
amendment has been filed, and when a Registration Statement or any
post-effective amendment has become effective (notification of such
effectiveness shall be delivered to Legal Counsel and the Investor by facsimile
on the same day of such effectiveness), (ii) of any request by the SEC for
amendments or supplements to a Registration Statement or related prospectus
or
related information, and (iii) of Linkwell’s reasonable determination that a
post-effective amendment to a Registration Statement would be
appropriate.
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(g) Linkwell
shall use its best efforts to prevent the issuance of any stop order or other
suspension of effectiveness of a Registration Statement, or the suspension
of
the qualification of any of the Registrable Securities for sale in any
jurisdiction and, if such an order or suspension is issued, to obtain the
withdrawal of such order or suspension at the earliest possible moment and
to
notify Legal Counsel and the Investor of the issuance of such order and the
resolution thereof or its receipt of actual notice of the initiation or threat
of any proceeding for such purpose.
(h) At
the
reasonable request of the Investor and at the Investor’s expense, Linkwell shall
use its best efforts to furnish to the Investor, on the date of the
effectiveness of the Registration Statement and thereafter from time to time
on
such dates as the Investor may reasonably request (i) a letter, dated such
date,
from Linkwell’s independent certified public accountants in form and substance
as is customarily given by independent certified public accountants to
underwriters in an underwritten public offering, and (ii) an opinion, dated
as
of such date, of counsel representing Linkwell for purposes of such Registration
Statement, in form, scope and substance as is customarily given in an
underwritten public offering, addressed to the Investor.
(i) Linkwell
shall make available for inspection by (i) the Investor, (ii) Legal Counsel
and
(iii) one firm of accountants or other agents retained by the Investor
(collectively, the “Inspectors”)
all
pertinent financial and other records, and pertinent corporate documents
and
properties of Linkwell (collectively, the “Records”),
which
are requested for any purpose reasonably related to the Investor’s rights and/or
Linkwell’s obligations under this Agreement, and cause Linkwell’s officers,
directors and employees to supply all information which any Inspector may
reasonably request; provided, however, that each Inspector which is not a
party
hereto shall agree in writing prior to obtaining access to any Records, and
the
Investor hereby agrees, to hold in strict confidence and shall not make any
disclosure or use of any Record or other information which Linkwell determines
in good faith to be confidential, and of which determination the Inspectors
are
so notified, unless (a) the disclosure of such Records is necessary to avoid
or
correct a misstatement or omission in any Registration Statement or is otherwise
required under the Securities Act, (b) the release of such Records is ordered
pursuant to a final, non-appealable subpoena or order from a court or government
body of competent jurisdiction, or (c) the information in such Records has
been
made generally available to the public other than by disclosure in violation
of
this or any other agreement of which the Inspector has knowledge. Linkwell
shall
not be required to disclose any confidential information in such Records
to any
Inspector until and unless such Inspector shall have entered into
confidentiality agreements with Linkwell with respect thereto, substantially
in
the form of this Section 3(i). The Investor agrees that it shall, if permitted
by applicable law, upon learning that disclosure of such Records is sought
in or
by a court or governmental body of competent jurisdiction or through other
means, give prompt notice to Linkwell prior to making any such disclosure
and
allow Linkwell, at its expense, to undertake appropriate action to prevent
disclosure of, or to obtain a protective order for, the Records deemed
confidential.
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(j) Linkwell
shall hold in confidence and not make any disclosure of information concerning
the Investor provided to Linkwell unless (i) disclosure of such information
is
necessary to comply with federal or state securities laws, (ii) the disclosure
of such information is necessary to avoid or correct a misstatement or omission
in any Registration Statement, (iii) the release of such information is ordered
pursuant to a subpoena or other final, non-appealable order from a court
or
governmental body of competent jurisdiction, (iv) such information has been
made
generally available to the public other than by disclosure in violation of
this
Agreement or any other agreement, or (v) the Investor consents to the form
and
content of any such disclosure. Linkwell agrees that it shall, if permitted
by
applicable law, upon learning that disclosure of such information concerning
the
Investor is sought in or by a court or governmental body of competent
jurisdiction or through other means, give prompt written notice to the Investor
prior to making any such disclosure and allow the Investor, at the Investor’s
expense, to undertake appropriate action to prevent disclosure of, or to
obtain
a protective order for, such information.
(k) Linkwell
shall use its best efforts either to (i) cause all the Registrable Securities
covered by a Registration Statement to be listed on each securities exchange
on
which securities of the same class or series issued by Linkwell are then
listed,
if any, if the listing of such Registrable Securities is then permitted under
the rules of such exchange, or (ii) secure designation and quotation of all
the
Registrable Securities covered by the Registration Statement on The NASDAQ
Stock
Market. Linkwell shall pay all fees and expenses in connection with satisfying
its obligation under this Section 3(k).
(l) Linkwell
shall facilitate the timely preparation and delivery of certificates (not
bearing any restrictive legend) representing the Registrable Securities to
be
offered pursuant to a Registration Statement and enable such certificates
to be
in such denominations or amounts, as the case may be, as the Investor may
reasonably request and registered in such names as the Investor may
request.
(m) Linkwell
shall provide a transfer agent and registrar of all such Registrable Securities
not later than the effective date of such Registration Statement.
(n) If
requested by the Investor, Linkwell shall (i) as soon as practicable incorporate
in a prospectus supplement or post-effective amendment, as necessary, such
information as the Investor requests to be included therein relating to the
Investor and the sale and distribution of Registrable Securities, including,
without limitation, information with respect to the number of Registrable
Securities being offered or sold, the purchase price being paid therefor
and any
other terms of the offering of the Registrable Securities to be sold in such
offering; and (ii) as soon as practicable make all required filings of such
prospectus supplement or post-effective amendment after being notified of
the
matters to be incorporated in such prospectus supplement or post-effective
amendment.
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(o) Linkwell
shall use its best efforts to cause the Registrable Securities covered by
the
applicable Registration Statement to be registered with or approved by such
other governmental agencies or authorities as may be necessary to consummate
the
disposition of such Registrable Securities within the United
States.
(p) Linkwell
shall otherwise use its best efforts to comply with all applicable rules
and
regulations of the SEC in connection with any registration
hereunder.
(q) Within
two (2) business days after a Registration Statement which covers applicable
Registrable Securities is ordered effective by the SEC, Linkwell shall deliver,
and shall cause legal counsel for Linkwell to deliver, to the transfer agent
for
such Registrable Securities (with copies to the Investor) confirmation that
such
Registration Statement has been declared effective by the SEC.
(r) Notwithstanding
anything to the contrary in this Section 3, at any time after the applicable
Registration Statement has been declared effective by the SEC, Linkwell may
delay the disclosure of material non-public information concerning Linkwell
the
disclosure of which at the time is not, in the good faith opinion of the
Board
of Directors of Linkwell and its counsel, in the best interest of Linkwell
and,
in the opinion of counsel to Linkwell, otherwise required (a “Grace
Period”);
provided, that Linkwell shall promptly (i) notify the Investor in writing
of the
existence of material non-public information giving rise to a Grace Period
(provided that in each notice Linkwell will not disclose the content of such
material non-public information to the Investor) and the date on which the
Grace
Period will begin, and (ii) notify the Investor in writing of the date on
which
the Grace Period ends; and, provided further, that no Grace Periods shall
exceed
thirty (30) consecutive days and during any consecutive three hundred sixty-five
(365) day period, such Grace Periods shall not exceed an aggregate of sixty
(60)
days (an “Allowable
Grace Period”).
For
purposes of determining the length of a Grace Period above, the Grace Period
shall begin on and include the date the holders receive the notice referred
to
in clause (i) and shall end on and include the later of the date the holders
receive the notice referred to in clause (ii) and the date referred to in
such
notice. The provisions of Section 3(g) hereof shall not be applicable during
the
period of any Allowable Grace Period. Upon expiration of the Grace Period,
Linkwell shall again be bound by the first sentence of Section 3(f) with
respect
to the information giving rise thereto unless such material non-public
information is no longer applicable.
4.
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OBLIGATIONS
OF THE INVESTOR.
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(a) At
least
seven (7) days prior to the first anticipated filing date of a Registration
Statement, Linkwell shall notify the Investor in writing of the information
Linkwell requires from the Investor. It shall be a condition precedent to
the
obligations of Linkwell to complete the registration pursuant to this Agreement
that the Investor shall furnish to Linkwell such information regarding itself
and the intended method of disposition of the Registrable Securities as shall
be
reasonably required to effect the registration of such Registrable Securities
and shall execute such documents in connection with such registration as
Linkwell may reasonably request. If the Investor does not provide Linkwell
with
the information it has requested pursuant to this Section 4(a) within seven
(7) days of being notified by Linkwell of its necessity, then the Filing
Deadline and Effectiveness Deadline shall each be extended by (i) if the
information is provided prior to the anticipated filing date, the period
equal
to the number of days (after such seventh (7th)
day)
until the Investor provided the requested information, and (ii) if the
information is provided after the anticipated filing date, the period that
is
equal to the longer of (A) the period equal to the number of days (after
such
seventh (7th)
day)
until the Investor provided the requested information , and (B) 15
days.
9
(b) The
Investor agrees to cooperate with Linkwell as reasonably requested by Linkwell
in connection with the preparation and filing of any Registration Statement
hereunder.
(c) The
Investor agrees that, upon receipt of any notice from Linkwell of the happening
of any event of the kind described in Section 3(g) or the first sentence
of
3(f), the Investor will immediately discontinue disposition of Registrable
Securities pursuant to any Registration Statement(s) covering such Registrable
Securities until the Investor’s receipt of the copies of the supplemented or
amended prospectus contemplated by Section 3(g) or the first sentence of
3(f) or
receipt of notice that no supplement or amendment is required. Notwithstanding
anything to the contrary, Linkwell shall cause its transfer agent to deliver
unlegended shares of Common Stock to a transferee of the Investor in accordance
with the terms of the Stock Purchase Agreement in connection with any sale
of
Registrable Securities with respect to which the Investor has entered into
a
contract for sale prior to the Investor’s receipt of a notice from Linkwell of
the happening of any event of the kind described in Section 3(g) or the first
sentence of Section 3(f) and for which the Investor has not yet
settled.
(d) As
promptly as practicable after becoming aware of such event, the Investor
shall
notify Linkwell in writing of the happening of any event as a result of which
the information provided in writing by the Investor to Linkwell expressly
for
use in the Prospectus included in a Registration Statement, as then in effect,
includes an untrue statement of a material fact or omission 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.
5.
|
EXPENSES
OF REGISTRATION.
|
All
expenses incurred in connection with registrations, filings or qualifications
pursuant to Sections 2 and 3 of this Agreement, including, without limitation,
all registration, listing and qualifications fees, printers and accounting
fees,
transfer agent fees and fees and disbursements of counsel for Linkwell, but
excluding underwriting discounts and commissions, shall be paid by Linkwell.
Linkwell shall also reimburse the Investor for the reasonable and documented
fees and disbursements of Legal Counsel in connection with registration,
filing
or qualification pursuant to Sections 2 and 3 of this Agreement. Linkwell
shall
pay all of the Investor’s reasonable costs (including fees and disbursements of
Legal Counsel) incurred in connection with the successful enforcement of
the
Investor’s rights under this Agreement. Notwithstanding the foregoing, each
seller of Registrable Securities shall pay all fees and disbursements of
all
counsel (other than the Legal Counsel) retained by such seller and all selling
expenses, including, without limitation, all underwriting discounts, selling
commissions, transfer taxes and other similar expenses, to the extent required
by applicable law.
10
6.
|
INDEMNIFICATION.
|
In
the
event any Registrable Securities are included in a Registration Statement
under
this Agreement:
(a) To
the
fullest extent permitted by law, Linkwell will, and hereby does, indemnify,
hold
harmless and defend the Investor, the directors, officers, partners, employees,
agents, representatives of, and each Person, if any, who controls the Investor
within the meaning of the Securities Act or the Exchange Act (each, an
“Investor
Indemnified Person”),
against any losses, claims, damages, liabilities, judgments, fines, penalties,
charges, costs, reasonable attorneys’ fees, amounts paid in settlement or
expenses, joint or several, (collectively, “Claims”)
incurred in investigating, preparing or defending any action, claim, suit,
inquiry, proceeding, investigation or appeal taken from the foregoing by
or
before any court or governmental, administrative or other regulatory agency,
body or the SEC, whether pending or threatened, whether or not an indemnified
party is or may be a party thereto (“Indemnified
Damages”),
to
which any of them may become subject insofar as such Claims (or actions or
proceedings, whether commenced or threatened, in respect thereof) arise out
of
or are based upon: (i) any untrue statement or alleged untrue statement of
a
material fact in a Registration Statement or any post-effective amendment
thereto or in any filing made in connection with the qualification of the
offering under the securities or other “blue sky” laws of any jurisdiction in
which Registrable Securities are offered (“Blue
Sky Filing”),
or
the omission or alleged omission to state a material fact required to be
stated
therein or necessary to make the statements therein not misleading, (ii)
any
untrue statement or alleged untrue statement of a material fact contained
in any
preliminary prospectus if used prior to the effective date of such Registration
Statement, or contained in the final prospectus (as amended or supplemented,
if
Linkwell files any amendment thereof or supplement thereto with the SEC)
or the
omission or alleged omission to state therein any material fact necessary
to
make the statements made therein, in light of the circumstances under which
the
statements therein were made, not misleading or (iii) any violation or alleged
violation by Linkwell of the Securities Act, the Exchange Act, any other
law,
including, without limitation, any state securities law, or any rule or
regulation thereunder relating to the offer or sale of the Registrable
Securities pursuant to a Registration Statement (the matters in the foregoing
clauses (i) through (iii) being, collectively, “Violations”).
Subject to Section 6(c), Linkwell shall reimburse the Investor and each such
controlling person, promptly as such expenses are incurred and are due and
payable, for any legal fees or disbursements or other reasonable expenses
incurred by them in connection with investigating or defending any such Claim.
Notwithstanding anything to the contrary contained herein, the indemnification
agreement contained in this Section 6(a): (i) shall not apply to a Claim
by an
Investor Indemnified Person arising out of or based upon a Violation which
occurs in reliance upon and in conformity with information furnished in writing
to Linkwell by such Investor Indemnified Person expressly for use in connection
with the preparation of the Registration Statement or any such amendment
thereof
or supplement thereto, if such prospectus was timely made available by Linkwell
pursuant to Section 3(d); (ii) shall not be available to the extent such
Claim
is based on a failure of the Investor to deliver or to cause to be delivered
the
prospectus made available by Linkwell, if such prospectus was timely made
available by Linkwell pursuant to Section 3(d); and (iii) shall not apply
to
amounts paid in settlement of any Claim, if such settlement is effected without
the prior written consent of Linkwell, which consent shall not be unreasonably
withheld. Such indemnity shall remain in full force and effect regardless
of any
investigation made by or on behalf of the Investor Indemnified Person and
shall
survive the transfer of the Registrable Securities by the Investor pursuant
to
Section 9.
11
(b) In
connection with any Registration Statement, the Investor agrees to indemnify,
hold harmless and defend, to the same extent and in the same manner as is
set
forth in Section 6(a), Linkwell, each of its directors, each of its officers
who
signs the Registration Statement, each of Linkwell’s agents or representatives,
and each Person, if any, who controls Linkwell within the meaning of the
Securities Act or the Exchange Act (each an “Company
Indemnified Party”),
against any Claim or Indemnified Damages to which any of them may become
subject, under the Securities Act, the Exchange Act or otherwise, insofar
as
such Claim or Indemnified Damages arise out of or are based upon any Violation,
in each case to the extent, and only to the extent, that such Violation occurs
in reliance upon and in conformity with written information furnished to
Linkwell by the Investor specifically for use in connection with such
Registration Statement; and, subject to Section 6(d), the Investor will
reimburse any legal or other expenses reasonably incurred by them in connection
with investigating or defending any such Claim; provided, however, that the
indemnity agreement contained in this Section 6(b) and the agreement with
respect to contribution contained in Section 7 shall not apply to amounts
paid
in settlement of any Claim if such settlement is effected without the prior
written consent of the Investor, which consent shall not be unreasonably
withheld; provided, further, however, that the Investor shall be liable under
this Section 6(b) for only that amount of a Claim or Indemnified Damages
as does
not exceed the net proceeds to the Investor as a result of the sale of
Registrable Securities pursuant to such Registration Statement. Such indemnity
shall remain in full force and effect regardless of any investigation made
by or
on behalf of such Company Indemnified Party and shall survive the transfer
of
the Registrable Securities by the Investor pursuant to Section 9.
Notwithstanding anything to the contrary contained herein, the indemnification
agreement contained in this Section 6(b) with respect to any prospectus shall
not inure to the benefit of any Company Indemnified Party if the untrue
statement or omission of material fact contained in the prospectus was corrected
on a timely basis in the prospectus, as then amended or
supplemented.
(c) Promptly
after receipt by an Investor Indemnified Person or Company Indemnified Party
under this Section 6 of notice of the commencement of any action or proceeding
(including any governmental action or proceeding) involving a Claim, such
Investor Indemnified Person or Company Indemnified Party shall, if a Claim
in
respect thereof is to be made against any indemnifying party under this Section
6, deliver to the indemnifying party a written notice of the commencement
thereof, and the indemnifying party shall have the right to participate in,
and,
to the extent the indemnifying party so desires, jointly with any other
indemnifying party similarly noticed, to assume control of the defense thereof
with counsel mutually satisfactory to the indemnifying party and the Investor
Indemnified Person or Linkwell Indemnified Party, as the case may be; provided,
however, that an Investor Indemnified Person or Company Indemnified Party
shall
have the right to retain its own counsel with the fees and expenses of not
more
than one counsel for such Investor Indemnified Person or Company Indemnified
Party to be paid by the indemnifying party, if, in the reasonable opinion
of
counsel retained by the indemnifying party, the representation by such counsel
of the Investor Indemnified Person or Company Indemnified Party and the
indemnifying party would be inappropriate due to actual or potential conflicting
interests between such Investor Indemnified Person or Company Indemnified
Party
and any other party represented by such counsel in such proceeding. In the
case
of an Investor Indemnified Person, legal counsel referred to in the immediately
preceding sentence shall be selected by the Investor. Linkwell Indemnified
Party
or Investor Indemnified Person shall cooperate with the indemnifying party
in
connection with any negotiation or defense of any such action or claim by
the
indemnifying party and shall furnish to the indemnifying party all information
reasonably available to Linkwell Indemnified Party or Investor Indemnified
Person which relates to such action or claim. The indemnifying party shall
keep
Linkwell Indemnified Party or Investor Indemnified Person apprised as to
the
status of the defense or any settlement negotiations with respect thereto.
No
indemnifying party shall be liable for any settlement of any action, claim
or
proceeding effected without its prior written consent, which consent shall
not
be unreasonably withheld. No indemnifying party shall, without the prior
written
consent of Linkwell Indemnified Party or Investor Indemnified Person, consent
to
entry of any judgment or enter into any settlement or other compromise which
does not include as an unconditional term thereof the giving by the claimant
or
plaintiff to such Company Indemnified Party or Investor Indemnified Person
of a
release from all liability in respect of such claim or litigation. The failure
to deliver written notice to the indemnifying party within a reasonable time
of
the commencement of any such action shall not relieve such indemnifying party
of
any liability to the Investor Indemnified Person or Company Indemnified Party
under this Section 6, except to the extent that the indemnifying party is
prejudiced in its ability to defend such action.
12
(d) The
indemnification required by this Section 6 shall be made by periodic payments
of
the amount thereof during the course of the investigation or defense, as
and
when bills are received or Indemnified Damages are incurred.
(e) The
indemnity agreements contained herein shall be in addition to (i) any cause
of
action or similar right of Linkwell Indemnified Party or Investor Indemnified
Person against the indemnifying party or others, and (ii) any liabilities
the
indemnifying party may be subject to pursuant to the law.
7.
|
CONTRIBUTION.
|
To
the
extent any indemnification by an indemnifying party is prohibited or limited
by
law, the indemnifying party agrees to make the maximum contribution with
respect
to any amounts for which it would otherwise be liable under Section 6 to
the
fullest extent permitted by law; provided, however, that: (i) no Person guilty
of fraudulent 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 fraudulent misrepresentation; and (ii) contribution by any seller
of
Registrable Securities shall be limited in amount to the net amount of proceeds
received by such seller from the sale of such Registrable Securities pursuant
to
such Registration Statement.
8.
|
REPORTS
UNDER THE EXCHANGE ACT.
|
With
a
view to making available to the Investor the benefits of Rule 144 promulgated
under the Securities Act or any other similar rule or regulation of the SEC
that
may at any time permit the Investor to sell securities of Linkwell to the
public
without registration (“Rule
144”),
Linkwell agrees to:
13
(a) make
and
keep public information available, as those terms are understood and defined
in
Rule 144;
(b) file
with
the SEC in a timely manner all reports and other documents required of Linkwell
under the Securities Act and the Exchange Act so long as Linkwell remains
subject to such requirements (it being understood that nothing herein shall
limit Linkwell’s obligations under the Stock Purchase Agreement) and the filing
of such reports and other documents is required for the applicable provisions
of
Rule 144; and
(c) furnish
to the Investor, promptly upon request, (i) a written statement by Linkwell
that
it has complied with the reporting requirements of Rule 144, the Securities
Act
and the Exchange Act and (ii) such other information as may be reasonably
requested to permit the Investor to sell such securities pursuant to Rule
144
without registration.
9.
|
ASSIGNMENT
OF REGISTRATION RIGHTS.
|
The
rights under this Agreement shall be automatically assignable by the Investor
to
any transferee of all or any portion of Registrable Securities if: (i) the
Investor agrees in writing with the transferee or assignee to assign such
rights, and a copy of such agreement is furnished to Linkwell within a
reasonable time after such assignment; (ii) Linkwell is, within a reasonable
time after such transfer or assignment, furnished with written notice of
(a) the
name and address of such transferee or assignee, and (b) the securities with
respect to which such registration rights are being transferred or assigned;
and
(iii) the transferee or assignee agrees in writing with Linkwell to be bound
by
all of the provisions contained herein. No transferee of registration rights
under this Agreement shall be entitled to include any Registrable Securities
on
a Registration Statement unless it previously has provided Linkwell the written
notice referred to in clause (ii) of the preceding sentence.
10.
|
AMENDMENT
OF REGISTRATION RIGHTS.
|
Provisions
of this Agreement may be amended and the observance thereof may be waived
(either generally or in a particular instance and either retroactively or
prospectively), only with the written consent of Linkwell and the Investor.
11.
|
MISCELLANEOUS.
|
(a) All
notices and other communications under this Agreement must be in writing
and are
deemed duly delivered when (a) delivered if delivered personally or by
nationally recognized overnight courier service (costs prepaid), (b) sent
by
facsimile with confirmation of transmission by the transmitting equipment
(or,
the first business day following such transmission if the date of transmission
is not a business day) or (c) received or rejected by the addressee, if sent
by
certified mail, return receipt requested; in each case to the following
addresses or facsimile numbers and marked to the attention of the individual
(by
name or title) designated below (or to such other address, facsimile number
or
individual as a party may designate by notice to the other
parties):
14
If
to
Linkwell:
Linkwell
Corporation
000
Xxxxx
Xxxxxx Xxxx
Xxxxxxx
Xxxxxxxx
Xxxxxxx,
Xxxxx 000000
Fax:
(0000) 00000000
Attn:
Secretary
with
a
copy (which will not constitute notice) to:
Xxxxx
& Xxxxxxxx LLP
000
Xxxxxx Xx.
Xxxxxx,
XX 00000
Fax:
(000) 000-0000
Attn:
Xxxxxxx X. Xxxxx
If
to
Ecolab:
Ecolab
Inc.,
Ecolab
Center,
000
Xxxxxxx Xxxxxx Xxxxx,
Xx.
Xxxx,
XX 00000-0000
Fax:
(000) 000-0000
Attention:
General Counsel
with
a
copy (which will not constitute notice) to:
Xxxxx
& XxXxxxxx LLP
Xxx
Xxxxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx,
Xxxxxxxx, 00000
Fax:
000
000 0000
Attention:
Xxxxxx X. Xxxx
(b) Amendment.
This
Agreement may not be amended, supplemented or otherwise modified except in
a
written document signed by each party to be bound by the amendment and that
identifies itself as an amendment to this Agreement.
(c) Waivers
and Remedies.
The
parties may (a) extend the time for performance of any of the obligations
or
other acts of any other party to this Agreement, (b) waive any inaccuracies
in
the representations and warranties of any other party to this Agreement
contained in this Agreement or in any certificate, instrument or document
delivered pursuant to this Agreement or (c) waive compliance with any of
the
covenants, agreements or conditions for the benefit of such party contained
in
this Agreement. Any such extension or waiver by any party to this Agreement
will
be valid only if set forth in a written document signed on behalf of the
party
or parties against whom the waiver or extension is to be effective. No extension
or waiver will apply to any time for performance, inaccuracy in any
representation or warranty, or noncompliance with any covenant, agreement
or
condition, as the case may be, other than that which is specified in the
written
extension or waiver. No failure or delay by any party in exercising any right
or
remedy under this Agreement or any of the documents delivered pursuant to
this
Agreement, and no course of dealing between the parties, operates as a waiver
of
such right or remedy, and no single or partial exercise of any such right
or
remedy precludes any other or further exercise of such right or remedy or
the
exercise of any other right or remedy. Any enumeration of a party’s rights and
remedies in this Agreement is not intended to be exclusive, and a party’s rights
and remedies are intended to be cumulative to the extent permitted by law
and
include any rights and remedies authorized in law or in equity.
15
(d) Entire
Agreement.
This
Agreement (together with the Stock Purchase Agreement, the Stockholders
Agreement and any documents and instruments referred to therein) constitutes
the
entire agreement among the parties and supersedes any prior understandings,
agreements or representations by or among the parties, or any of them, written
or oral, with respect to the subject matter of this Agreement.
(e) Assignment
and Successors.
This
Agreement binds and benefits the parties and their respective successors
and
permitted assigns. Nothing expressed or referred to in this Agreement will
be
construed to give any Person, other than the parties to this Agreement, any
legal or equitable right, remedy or claim under or with respect to this
Agreement or any provision of this Agreement except such rights as may inure
to
a successor or permitted assignee under this Section.
The
rights and obligations of a party hereunder are not assignable without the
prior
written consent of the other party. Any purported assignment in contravention
of
the foregoing shall be void and of no effect.
(f) Severability.
If any
provision of this Agreement is held invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions of this
Agreement are not affected or impaired in any way and the parties agree to
negotiate in good faith to replace such invalid, illegal and unenforceable
provision with a valid, legal and enforceable provision that achieves, to
the
greatest lawful extent under this Agreement, the economic, business and other
purposes of such invalid, illegal or unenforceable provision.
(g) Interpretation.
The
language used in this Agreement is the language chosen by the parties to
express
their mutual intent, and no provision of this Agreement will be interpreted
for
or against any party because that party or its attorney drafted the
provision.
(h) Governing
Law.
The
internal laws of the State of Delaware (without giving effect to any choice
or
conflict of law provision or rule that would cause the application of laws
of
any other jurisdiction) govern all matters arising out of or relating to
this
Agreement and all of the transactions it contemplates, including its validity,
interpretation, construction, performance and enforcement and any disputes
or
controversies arising therefrom.
16
(i) Specific
Performance.
The
parties agree that irreparable damage would occur in the event that any of
the
provisions of this Agreement were not performed in accordance with their
specific terms or were otherwise breached. The parties accordingly agree
that,
in addition to any other remedy to which they are entitled at law or in equity,
the parties are entitled to injunctive relief to prevent breaches of this
Agreement and otherwise to enforce specifically the provisions of this
Agreement. Each party expressly waives any requirement that any other party
obtain any bond or provide any indemnity in connection with any action seeking
injunctive relief or specific enforcement of the provisions of this
Agreement.
(j) Jurisdiction
and Service of Process.
Any
action or proceeding arising out of or relating to this Agreement or the
transactions contemplated by this Agreement must be brought in the courts
of the
State of Minnesota, County of Xxxxxx, or, if it has or can acquire jurisdiction,
in the United States District Court for the District of Minnesota. Each of
the
parties knowingly, voluntarily and irrevocably submits to the exclusive
jurisdiction of each such court in any such action or proceeding and waives
any
objection it may now or hereafter have to venue or to convenience of forum.
Any
party to this Agreement may make service on another party by sending or
delivering a copy of the process to the party to be served at the address
and in
the manner provided for the giving of notices in Section 11(a). Nothing in
this
Section 11(j), however, affects the right of any party to serve legal process
in
any other manner permitted by law.
(k) Waiver
of Jury Trial.
Each
of the parties knowingly, voluntarily and irrevocably waives, to the fullest
extent permitted by law, all right to trial by jury in any action, proceeding
or
counterclaim (whether based on contract, tort or otherwise) arising out of
or
relating to this Agreement or the transactions contemplated by this Agreement
or
the actions of any party to this Agreement in negotiation, administration,
performance or enforcement of this Agreement.
(l) Counterparts.
The
parties may execute this Agreement in multiple counterparts, each of which
constitutes an original as against the party that signed it, and all of which
together constitute one agreement. This Agreement is effective upon delivery
of
one executed counterpart from each party to the other parties. The signatures
of
all parties need not appear on the same counterpart. The delivery of signed
counterparts by facsimile or email transmission that includes a copy of the
sending party’s signature is as effective as signing and delivering the
counterpart in person.
[The
remainder of this page has been intentionally left blank.]
17
The
parties have executed and delivered this Agreement as of the date indicated
in
the first sentence of this Agreement.
Ecolab
Inc.
By:
Xxxxxxx
X.
Xxxxx
Name:
Xxxxxxx X. Xxxxx
Title:
President, International Sector
|
|
Linkwell
Corporation
By:
/s/ Xxxxxxx Xxxx
Name:
Xxxxxxx Xxxx
Title:
Chairman and CEO
|
Signature
Page to Registration Rights Agreement
18