Exhibit 10.4
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Execution Copy
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REGISTRATION RIGHTS AGREEMENT
December 20, 1996
To each of the Investors listed on Schedule I hereto
Dear Sirs:
This will confirm that in consideration of the agreement by you (the
"Investors") on the date hereof to purchase shares of the Series C Convertible
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Preferred Stock (the "Series C Shares") of NovaMed Holdings Inc. (the
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"Company"), and warrants (the "Warrants") to purchase shares of the Company's
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Series D Convertible Preferred Stock pursuant to the Securities Purchase
Agreement of even date herewith (the "Purchase Agreement") between the Company
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and certain of you and as an inducement to you to consummate the transactions
contemplated by the Purchase Agreement, the Company covenants and agrees with
each of you as follows:
1 Certain Definitions. All capitalized words or terms used herein
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without specific definition shall have the meaning set forth in the Purchase
Agreement. As used in this Agreement, the following terms shall have the
following respective meanings:
"Affiliate" shall mean a person that directly or indirectly through
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one or more intermediaries, controls or is controlled by, or is under common
control with, the person specified. Solely for the purposes of Section 8(a)
hereof, Sierra Ventures V, L.P., CGJR Health Care Services Private Equities,
L.P., CGJR II, L.P., and CGJR/MF III, L.P. shall be Affiliates of each other.
"Commission" shall mean the Securities and Exchange Commission, or any
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other federal agency at the time administering the Securities Act.
"Common Stock" shall mean the Common Stock, $.01 par value, of the
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Company, as constituted as of the date of this Agreement.
"Conversion Shares" shall mean shares of Common Stock issued upon
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conversion of the Preferred Shares.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
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amended, or any similar federal statute, and the rules and regulations of the
Commission thereunder, all as the same shall be in effect at the time.
"Preferred Shares" shall mean the Series C Shares and the Series D
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Shares.
"Registration Expenses" shall mean the expenses so described in
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Section 7.
"Restricted Stock" shall mean the Conversion Shares, excluding
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Conversion Shares which have been (a) registered under the Securities Act
pursuant to an effective registration statement filed thereunder and disposed of
in accordance with the registration statement covering them or (b) publicly sold
pursuant to Rule 144 under the Securities Act.
"Securities Act" shall mean the Securities Act of 1933, as amended,
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or any similar federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.
"Selling Expenses" shall mean the expenses so described in Section 7.
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"Series D Shares" shall mean the shares of Series D Convertible
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Preferred Stock issued or issuable at the Series D Closing under the Purchase
Agreement and upon exercise of the Warrants.
2. Restrictive Legend. Each Warrant and each certificate representing
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Preferred Shares or Restricted Stock shall, except as otherwise provided in this
Section 2 or in Section 3, be stamped or otherwise imprinted with a legend
substantially in the following form:
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933 OR ANY STATE SECURITIES LAWS AND MAY NOT BE TRANSFERRED OR OTHERWISE
DISPOSED OF UNLESS IT HAS BEEN REGISTERED UNDER SUCH ACT AND ALL SUCH APPLICABLE
LAWS OR AN EXEMPTION FROM REGISTRATION IS AVAILABLE."
A certificate shall not bear such legend if in the opinion of counsel
satisfactory to the Company (it being agreed that Xxxxx, Xxxxxxx & Xxxxxxxxx,
LLP shall be satisfactory) the securities represented thereby may be publicly
sold without registration under the Securities Act and any applicable state
securities laws.
3. Notice of Proposed Transfer. Subject to the restrictions set forth
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in the Stockholders' Agreement of even date herewith between the Company and the
other parties thereto, prior to any proposed transfer of any Warrant or any
Preferred Shares or Restricted Stock (other than under the circumstances
described in Sections 4 or 5), the holder thereof shall give written notice to
the Company of its intention to effect such transfer. Each such notice shall
describe the manner of the proposed transfer and, if requested by the Company,
shall be accompanied by an opinion of counsel satisfactory to the Company (it
being agreed that Xxxxx, Xxxxxxx & Xxxxxxxxx, LLP shall be satisfactory) to the
effect that the proposed transfer may be effected without registration under the
Securities Act and any applicable state securities laws, whereupon the holder of
such stock shall be entitled to transfer such stock in accordance with the terms
of its notice; provided, however, that no such opinion of counsel shall be
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required for a transfer to one or more partners of the transferor (in the case
of a transferor that is a partnership)
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or to an affiliated corporation (in the case of a transferor that is a
corporation). Each Warrant and each certificate for Preferred Shares or
Restricted Stock transferred as above provided shall bear the legend set forth
in Section 2, except that such certificate shall not bear such legend if (i)
such transfer is in accordance with the provisions of Rule 144 (or any other
rule permitting public sale without registration under the Securities Act) or
(ii) the opinion of counsel referred to above is to the further effect that the
transferee and any subsequent transferee (other than an Affiliate of the
Company) would be entitled to transfer such securities in a public sale without
registration under the Securities Act. The restrictions provided for in this
Section 3 shall not apply to securities which are not required to bear the
legend prescribed by Section 2 in accordance with the provisions of that
Section.
4. Required Registration. (a) At any time after the earlier of (i)
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six months after any registration statement covering a public offering of
securities of the Company under the Securities Act shall have become effective
and (ii) January 1, 2002, the holders of Restricted Stock constituting at least
51% of the total shares of Restricted Stock then outstanding may request the
Company to register under the Securities Act all or any portion of the shares of
Restricted Stock held by such requesting holder or holders for sale in the
manner specified in such notice, provided that the shares of Restricted Stock
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for which registration has been requested shall constitute at least 20% of the
total shares of Restricted Stock originally issued if such holder or holders
shall request the registration of less than all shares of Restricted Stock then
held by such holder or holders and the reasonably anticipated aggregate price to
the public of such public offering is in excess of $5,000,000. For purposes of
this Section 4 and Section 5, the term "Restricted Stock" shall be deemed to
include the number of shares of Restricted Stock which would be issuable to a
holder of Preferred Shares upon the exercise of all Warrants and the conversion
of all Preferred Shares held by such holder (assuming such exercise) at such
time, and for purposes of Section 12(d), the term "Restricted Stock" shall be
deemed to include the number of shares of Restricted Stock which would be
issuable to a holder of Preferred Shares or Warrants upon exercise of all
Warrants and conversion of all Preferred Shares held by such holder (assuming
such exercise) at such time, provided, however, that the only securities which
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the Company shall be required to register pursuant hereto shall be shares of
Common Stock, and provided, further, however, that, in any underwritten public
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offering contemplated by this Section 4 or Section 5, the holders of Preferred
Shares shall be entitled to sell such Preferred Shares or Warrant Shares to the
underwriters for conversion and sale of the shares of Common Stock issued upon
conversion thereof. Notwithstanding anything to the contrary contained herein,
no request may be made under this Section 4 within 90 days after the effective
date of a registration statement filed by the Company covering a firm commitment
underwritten public offering in which the holders of Restricted Stock shall have
been entitled to join pursuant to Section 5 and in which there shall have been
effectively registered all shares of Restricted Stock as to which registration
shall have been requested.
(b) Following receipt of any notice under this Section 4, the Company
shall immediately notify all holders of Preferred Shares, Restricted Stock and
Warrants from whom notice has not been received and shall use its best efforts
to register under the Securities Act, for public sale in accordance with the
method of disposition specified in such notice from requesting holders, the
number of shares of Restricted Stock specified in such notice (and in all
notices
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received by the Company from other holders within 30 days after the giving of
such notice by the Company). If such method of disposition shall be an
underwritten public offering, the holders of a majority of the shares of
Restricted Stock to be sold in such offering may designate the managing
underwriter of such offering, subject to the approval of the Company, which
approval shall not be unreasonably withheld or delayed. The Company shall be
obligated to register Restricted Stock pursuant to this Section 4 on two
occasions only, provided, however, that such obligation shall be deemed
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satisfied only when a registration statement covering at least 60% of the shares
of Restricted Stock specified in notices received as aforesaid, for sale in
accordance with the method of disposition specified by the requesting holders,
shall have become effective and, if such method of disposition is a firm
commitment underwritten public offering, all such shares shall have been sold
pursuant thereto, and provided further that after the first occasion, holders of
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Restricted Stock constituting at least 25% of the Restricted Stock then
outstanding may require the Company to register Restricted Stock pursuant to
this Section 4.
(c) The Company shall be entitled to include in any registration
statement referred to in this Section 4, for sale in accordance with the method
of disposition specified by the requesting holders, shares of Common Stock to be
sold by the Company for its own account, except as and to the extent that, in
the opinion of the managing underwriter (if such method of disposition shall be
an underwritten public offering), such inclusion would adversely affect the
marketing of the Restricted Stock to be sold. Except for registration statements
on Form X-0, X-0 or any successor thereto, the Company will not file with the
Commission any other registration statement with respect to its Common Stock,
whether for its own account or that of other stockholders, from the date of
receipt of a notice from requesting holders pursuant to this Section 4 until the
completion of the period of distribution of the registration contemplated
thereby.
5. Incidental Registration. If the Company at any time (other than
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pursuant to Section 4) proposes to register any of its securities under the
Securities Act for sale to the public, whether for its own account or for the
account of other security holders or both (except with respect to registration
statements on Forms X-0, X-0 or another form not available for registering the
Restricted Stock for sale to the public), each such time it will give written
notice to all holders of outstanding Restricted Stock, Preferred Shares and
Warrants of its intention so to do. Upon the written request of any such holder,
received by the Company within 30 days after the giving of any such notice by
the Company, to register any of its Restricted Stock, the Company will use its
best efforts to cause the Restricted Stock as to which registration shall have
been so requested to be included in the securities to be covered by the
registration statement proposed to be filed by the Company, all to the extent
requisite to permit the sale or other disposition by the holder of such
Restricted Stock so registered. In the event that any registration pursuant to
this Section 5 shall be, in whole or in part, an underwritten public offering of
Common Stock, the number of shares of Restricted Stock to be included in such an
underwriting may be reduced (pro rata among the requesting holders based upon
the number of shares of Restricted Stock owned by such holders) if and to the
extent that the managing underwriter shall be of the opinion that such inclusion
would adversely affect the marketing of the securities to be sold by the Company
therein, provided, however, that (i) in the case of the Company's initial public
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offering such number of shares of Restricted Stock shall not be reduced if any
shares are to be included in such
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underwriting for the account of any person other than the Company or requesting
holders of Restricted Stock, and (ii) in the case of subsequent offerings in no
event may less than one-half of the total number of shares of Common Stock to be
included in such underwriting for the account of persons other than the Company
be made available for shares of Restricted Stock. Notwithstanding the foregoing
provisions, the Company may withdraw any registration statement referred to in
this Section 5 without thereby incurring any liability to the holders of
Restricted Stock. The rights provided under this Section 5 terminate with
respect to a holder of Restricted Stock as soon as such holder is able to sell
its Restricted Stock pursuant to Rule 144(k).
6. Registration Procedures. If and whenever the Company is required
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by the provisions of Sections 4 or 5 to use its best efforts to effect the
registration of any shares of Restricted Stock under the Securities Act, the
Company will, as expeditiously as possible:
(a) prepare and file with the Commission a registration statement
(which, in the case of an underwritten public offering pursuant to Section 4,
shall be on Form S-I or other form of general applicability satisfactory to the
managing underwriter selected as therein provided) with respect to such
securities and use its best efforts to cause such registration statement to
become and remain effective for the period of the distribution contemplated
thereby (determined as hereinafter provided);
(b) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in connection
therewith as may be necessary to keep such registration statement effective for
the period specified in paragraph (a) above and comply with the provisions of
the Securities Act with respect to the disposition of all Restricted Stock
covered by such registration statement in accordance with the sellers' intended
method of disposition set forth in such registration statement for such period;
(c) furnish to each seller of Restricted Stock and to each underwriter
such number of copies of the registration statement and the prospectus included
therein (including each preliminary prospectus) as such persons reasonably may
request in order to facilitate the public sale or other disposition of the
Restricted Stock covered by such registration statement;
(d) use its best efforts to register or qualify the Restricted Stock
covered by such registration statement under the securities or "blue sky" laws
of such jurisdictions as the sellers of Restricted Stock or, in the case of an
underwritten public offering, the managing underwriter reasonably shall request,
provided, however, that the Company shall not for any such purpose be required
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to qualify generally to transact business as a foreign corporation in any
jurisdiction where it is not so qualified or to consent to general service of
process in any such jurisdiction;
(e) use its best efforts to list the Restricted Stock covered by such
registration statement with any securities exchange on which the Common Stock of
the Company is then listed;
(f) immediately notify each seller of Restricted Stock and each
underwriter under such registration statement, at any time when a prospectus
relating thereto is required to be
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delivered under the Securities Act, of the happening of any event of which the
Company has knowledge as a result of which the prospectus contained in such
registration statement, as then in effect, includes an untrue statement of a
material fact or omits to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in light of the
circumstances then existing;
(g) if the offering is underwritten and at the request of any seller
of Restricted Stock, use its best efforts to furnish on the date that Restricted
Stock is delivered to the underwriters for sale pursuant to such registration:
(i) an opinion dated such date of counsel representing the Company for the
purposes of such registration, addressed to the underwriters and to such seller,
stating that such registration statement has become effective under the
Securities Act and that (A) to the best knowledge of such counsel, no stop order
suspending the effectiveness thereof has been issued and no proceedings for
that purpose have been instituted or are pending or contemplated under the
Securities Act, (B) the registration statement, the related prospectus and each
amendment or supplement thereof comply as to form in all material respects with
the requirements of the securities act (except that such counsel need not
express any opinion as to financial statements contained therein) and (C) to
such other effects as reasonably may be requested by counsel for the
underwriters or by such seller or its counsel and (ii) a letter dated such date
from the independent public accountants retained by the Company, addressed to
the underwriters and to such seller, stating that they are independent public
accountants within the meaning of the Securities Act and that, in the opinion of
such accountants, the financial statements of the Company included in the
registration statement or the prospectus, or any amendment or supplement
thereof, comply as to form in all material respects with the applicable
accounting requirements of the Securities Act, and such letter shall
additionally cover such other financial matters (including information as to the
period ending no more than five business days prior to the date of such letter)
with respect to such registration as such underwriters reasonably may request;
and
(h) make available for inspection by each seller of Restricted Stock,
any underwriter participating in any distribution pursuant to such registration
statement, and any attorney, accountant or other agent retained by such seller
or underwriter, all financial and other records, pertinent corporate documents
and properties of the Company, and cause the Company's officers, directors and
employees to supply all information reasonably requested by any such seller,
underwriter, attorney, accountant or agent in connection with such registration
statement.
For purposes of section 6(a) and 6(b) and of section 4(c), the period
of distribution of Restricted Stock in a firm commitment underwritten public
offering shall be deemed to extend until each underwriter has completed the
distribution of all securities purchased by it, and the period of distribution
of Restricted Stock in any other registration shall be deemed to extend until
the earlier of the sale of all Restricted Stock covered thereby and 120 days
after the effective date thereof.
In connection with each registration hereunder, the sellers of
Restricted Stock will furnish to the Company in writing such information with
respect to themselves and the proposed
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distribution by them as reasonably shall be necessary in order to assure
compliance with federal and applicable state securities laws.
In connection with each registration pursuant to Sections 4 or 5
covering an underwritten public offering, the Company and each seller agree to
enter into a written agreement with the managing underwriter selected in the
manner herein provided in such form and containing such provisions as are
customary in the securities business for such an arrangement between such
underwriter and companies of the Company's size and investment stature.
7. Expenses. All expenses incurred by the Company in complying with
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Sections 4 or 5, including, without limitation, all registration and filing
fees, printing expenses, fees and disbursements of counsel and independent
public accountants for the Company, fees and expenses (including counsel fees)
incurred in connection with complying with state securities or "blue sky" laws,
fees of the National Association of Securities Dealers, Inc., transfer taxes,
fees of transfer agents and registrars, costs of insurance, but excluding any
Selling Expenses, are called "Registration Expenses". All underwriting
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discounts, selling commissions and fees and disbursements of counsel for any
seller of Restricted Stock applicable to the sale of Restricted Stock are called
"Selling Expenses".
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The Company will pay all Registration Expenses in connection with each
registration statement under Sections 4 or 5. All Selling Expenses in connection
with each registration statement under Sections 4 or 5 shall be borne by the
participating sellers in proportion to the number of shares sold by each, or by
such participating sellers other than the Company (except to the extent the
Company shall be a seller) as they may agree.
8. Indemnification and Contribution. (a) In the event of a
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registration of any of the Restricted Stock under the Securities Act pursuant to
Sections 4 or 5, the Company will indemnify and hold harmless each seller of
such Restricted Stock thereunder, each underwriter of such Restricted Stock
thereunder and each other person, if any, who controls such seller or
underwriter within the meaning of the Securities Act, against any losses,
claims, damages or liabilities, joint or several, to which such seller,
underwriter or controlling person may become subject under the Securities Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in any registration statement
under which such Restricted Stock was registered under the Securities Act
pursuant to Sections 4 or 5, any preliminary prospectus or final prospectus
contained therein, or any amendment or supplement thereof, or arise out of or
are based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, and will reimburse each such seller, each such underwriter and each
such controlling person for any legal or other expenses reasonably incurred by
them in connection with investigating or defending any such loss, claim, damage,
liability or action, provided, however, that the Company will not be liable in
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any such case if and to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission so made in conformity with information
furnished by any such seller, or an Affiliate of such seller which is
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also a seller, any such underwriter or any such controlling person in writing
specifically for use in such registration statement or prospectus.
(b) In the event of a registration of any of the Restricted Stock
under the Securities Act pursuant to Sections 4 or 5, each seller of such
Restricted Stock thereunder, severally and not jointly, except that liability
shall be joint hereunder with respect to each Affiliate of a seller which is
also a seller, will indemnify and hold harmless the Company, each person, if
any, who controls the Company within the meaning of the Securities Act, each
officer of the Company who signs the registration statement, each director of
the Company, each underwriter and each person who controls any underwriter
within the meaning of the Securities Act, against all losses, claims, damages or
liabilities, joint or several, to which the Company or such officer, director,
underwriter or controlling person may become subject under the Securities Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the registration statement
under which such Restricted Stock was registered under the Securities Act
pursuant to Sections 4 or 5, any preliminary prospectus or final prospectus
contained therein, or any amendment or supplement thereof, or arise out of or
are based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, and will reimburse the Company and each such officer, director,
underwriter and controlling person for any legal or other expenses reasonably
incurred by them in connection with investigating or defending any such loss,
claim, damage, liability or action, provided, however, that such seller will be
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liable hereunder in any such case if and only to the extent that any such loss,
claim, damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in reliance upon
and in conformity with information pertaining to such seller, as such, furnished
in writing to the Company by such seller or an Affiliate of such seller which is
also a seller specifically for use in such registration statement or prospectus,
and provided, further, however, that the liability of each seller hereunder
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shall be limited to the net proceeds received by such seller and Affiliates of
such seller from the sale of Restricted Stock covered by such registration
statement.
(c) Promptly after receipt by an indemnified party hereunder of notice
of the commencement of any action, such indemnified party shall, if a claim in
respect thereof is to be made against the indemnifying party hereunder, notify
the indemnifying party in writing thereof, but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
such indemnified party other than under this Section 8 and shall only relieve it
from any liability which it may have to such indemnified party under this
Section 8 if and to the extent the indemnifying party is prejudiced by such
omission. In case any such action shall be brought against any indemnified party
and it shall notify the indemnifying party of the commencement thereof, the
indemnifying party shall be entitled to participate in and, to the extent it
shall wish, to assume and undertake the defense thereof with counsel
satisfactory to such indemnified party, and, after notice from the indemnifying
party to such indemnified party of its election so to assume and undertake the
defense thereof, the indemnifying party shall not be liable to such indemnified
party under this Section 8 for any legal expenses subsequently incurred by such
indemnified party in connection with the defense thereof, provided, however,
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that, if the defendants in any such action include both the indemnified party
and the indemnifying party and
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the indemnified party shall have reasonably concluded that there may be
reasonable defenses available to it which are different from or additional to
those available to the indemnifying party or if the interests of the indemnified
party reasonably may be deemed to conflict with the interests of the
indemnifying party, the indemnified party shall have the right to select a
separate counsel and to assume such legal defenses and otherwise to participate
in the defense of such action, with the reasonable expenses and fees of such
separate counsel and other reasonable expenses related to such participation to
be reimbursed by the indemnifying party as incurred.
(d) In order to provide for just and equitable contribution to joint
liability under the Securities Act in any case in which either (i) any holder of
Restricted Stock exercising rights under this Agreement, or any controlling
person of any such holder, makes a claim for indemnification pursuant to this
Section 8 but it is judicially determined (by the entry of a final judgment or
decree by a court of competent jurisdiction and the expiration of time to appeal
or the denial of the last right of appeal) that such indemnification may not be
enforced in such case notwithstanding the fact that this Section 8 provides for
indemnification in such case, or (ii) contribution under the Securities Act may
be required on the part of any such selling holder or any such controlling
person in circumstances for which indemnification is provided under this Section
8; then, and in each such case, the Company and such holder will contribute to
the aggregate losses, claims, damages or liabilities to which they may be
subject (after contribution from others) in such proportion so that such holder
is responsible for the portion represented by the percentage that the public
offering price of its and its Affiliates' Restricted Stock offered by the
registration statement bears to the public offering price of all securities
offered by such registration statement, and the Company is responsible for the
remaining portion; provided, however, that, in any such case, (A) no such holder
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will be required to contribute any amount in excess of the public offering price
of all such Restricted Stock offered by it pursuant to such registration
statement; and (B) no person or entity guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) will be entitled to
contribution from any person or entity who was not guilty of such fraudulent
misrepresentation.
9. Changes in Common Stock or Preferred Stock. If, and as often as,
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there is any change in the Common Stock or the Preferred Stock by way of a stock
split, stock dividend, combination or reclassification, or through a merger,
consolidation, reorganization or recapitalization, or by any other means,
appropriate adjustment shall be made in the provisions hereof so that the rights
and privileges granted hereby shall continue with respect to the Common Stock or
the Preferred Stock as so changed.
10. Rule 144 Reporting. With a view to making available the benefits
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of certain rules and regulations of the Commission which may at any time permit
the sale of the Restricted Stock to the public without registration, at all
times after 90 days after any registration statement covering a public offering
of securities of the Company under the Securities Act shall have become
effective, the company agrees to:
(a) make and keep public information available, as those terms are
understood and defined in Rule 144 under the Securities Act;
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(b) use its best efforts to file with the Commission in a timely
manner all reports and other documents required of the Company under the
Securities Act and the Exchange Act; and
(c) furnish to each holder of Restricted Stock forthwith upon request
a written statement by the Company as to its compliance with the reporting
requirements of such Rule 144 and of the Securities Act and the Exchange Act, a
copy of the most recent annual or quarterly report of the Company, and such
other reports and documents so filed by the Company as such holder may
reasonably request in availing itself of any rule or regulation of the
Commission allowing such holder to sell any Restricted Stock without
registration.
11. Representations and Warranties of the Company. The Company
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represents and warrants to you as follows:
(a) The execution, delivery and performance of this Agreement by the
Company have been duly authorized by all requisite corporate action and will not
violate any provision of law, any order of any court or other agency of
government, the Charter or By-laws of the Company or any provision of any
indenture, agreement or other instrument to which it or any or its properties or
assets is bound, conflict with, result in a breach of or constitute (with due
notice or lapse of time or both) a default under any such indenture, agreement
or other instrument or result in the creation or imposition of any lien, charge
or encumbrance of any nature whatsoever upon any of the properties or assets of
the Company.
(b) This Agreement has been duly executed and delivered by the Company
and constitutes the legal, valid and binding obligation of the Company,
enforceable in accordance with its terms.
12. Miscellaneous.
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(a) All covenants and agreements contained in this Agreement by or on
behalf of any of the parties hereto shall bind and inure to the benefit of the
respective successors and assigns of the parties hereto (including without
limitation transferees of any Preferred Shares, Warrants, or Restricted Stock),
whether so expressed or not, provided, however, that registration rights
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conferred herein on the holders of Preferred Shares, Warrants or Restricted
Stock shall only inure to the benefit of a transferee of Preferred Shares,
Warrants or Restricted Stock if (i) there is transferred to such transferee
securities representing or convertible into or exercisable for at least 500,000
Conversion Shares, or (ii) such transferee is a partner, shareholder or
affiliate of a party hereto.
(b) All notices, requests, consents and other communications hereunder
shall be in writing and shall be delivered in person, mailed by certified or
registered mail, return receipt requested, or sent by telecopier or telex,
addressed as follows:
if to the Company or any other party hereto, at the address of such
party set forth on Schedule I hereto;
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if to any subsequent holder of Preferred Shares, Warrants or
Restricted Stock, to it at such address as may have been furnished to the
Company in writing by such holder;
or, in any case, at such other address or addresses as shall have been furnished
in writing to the Company (in the case of a holder of Preferred Shares, Warrants
or Restricted Stock) or to the holders of Preferred Shares, Warrants or
Restricted Stock (in the case of the Company) in accordance with the provisions
of this paragraph.
(c) This Agreement shall be governed by and construed in accordance
with the laws of the State of Illinois.
(d) This Agreement may not be amended or modified, and no provision
hereof may be waived, without the written consent of the Company and the holders
of at least two-thirds of the outstanding shares of Restricted Stock.
(e) This Agreement may be executed in two or more counterparts, each
of which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
(f) The obligations of the Company to register shares of Restricted
Stock under Sections 4 or 5 shall terminate on the fifth anniversary of the date
of the Company's initial public offering of shares of Common Stock at a per
share price of at least $7.50, and for aggregate offering proceeds (net of
underwriting commissions and offering expenses) of not less than $20,000,000 (a
"Qualified IPO").
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(g) If requested in writing by the underwriters for the initial
underwritten public offering of securities of the Company, each holder of
Restricted Stock who is a party to this Agreement shall agree not to sell
publicly any shares of Restricted Stock or any other shares of Common Stock
(other than shares of Restricted Stock or other shares of Common Stock being
registered in such offering), without the consent of such underwriters, for such
period as may be determined by the Company and such underwriters; provided,
--------
however, that all persons entitled to registration rights with respect to shares
-------
of Common Stock who are not parties to this Agreement, all other persons selling
shares of Common Stock in such offering, all persons holding in excess of 5% of
the capital stock of the Company on a fully diluted basis and all executive
officers and directors of the Company shall also have agreed not to sell
publicly their Common Stock under the circumstances and pursuant to the terms
set forth in this Section 12(g).
(h) The Company shall not grant to any third party any registration
rights more favorable than or inconsistent with any of those contained herein,
so long as any of the registration rights under this Agreement remains in
effect. It is agreed that the Investors are "Senior Parties" for the purposes of
(i) that certain Registration Rights Agreement by and between NovaMed Eyecare
Management, LLC, The Eye Center, Inc. and Cataract Surgery Center of St. Louis,
Inc. dated as of November 1, 1996 and (ii) that certain Registration Rights
Agreement by and between NovaMed Eyecare Management, LLC, Illinois Eye
Specialists, Ltd.
-11-
and Eyes of Illinois Surgery Center, S.C. ((i) and (ii) collectively referred to
as the "Junior Agreements"), and that the rights provided under the Junior
Agreements are expressly subordinate to the rights provided under this
Agreement.
(i) If any provision of this Agreement shall be held to be illegal,
invalid or unenforceable, such illegality, invalidity or unenforceability shall
attach only to such provision and shall not in any manner affect or render
illegal, invalid or unenforceable any other provision of this Agreement, and
this Agreement shall be carried out as if any such illegal, invalid or
unenforceable provision were not contained herein.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK)
-12-
- Registration Rights Agreement -
Please indicate your acceptance of the foregoing by signing and
returning the enclosed counterpart of this letter, whereupon this Agreement
shall be a binding agreement between the Company and you.
Very truly yours,
NOVAMED HOLDINGS, INC.
By: /s/ Xxxxxxx X. Xxxxxx
----------------------------
Title:
_________________________
AGREED TO AND ACCEPTED as of
the date first above written.
Investors named in Schedule I
hereto:
SIERRA VENTURES V, L.P.,
a California Limited Partnership
By: SV Associates V, L.P.
a California Limited Partnership,
its General Partner
By: /s/ Xxxxx X. Xxxxxxxxx
------------------------------
Xxxxx X. Xxxxxxxxx
General Partner
CGJR HEALTH CARE SERVICES PRIVATE EQUITIES, L.P.
By: CGJR Capital Management, Inc.,
as General Partner
By:______________________________
PRESIDENT
- Registration Rights Agreement -
Please indicate your acceptance of the foregoing by signing and
returning the enclosed counterpart of this letter, whereupon this Agreement
shall be a binding agreement between the Company and you.
Very truly yours,
NOVAMED HOLDINGS, INC.
By:_____________________
Title:__________________
AGREED TO AND ACCEPTED as of
the date first above written.
Investors named in Schedule I
hereto:
SIERRA VENTURES V, L.P.,
a California Limited Partnership
By: SV Associates V, L.P.
a California Limited Partnership,
its General Partner
By:_____________________________
Xxxxx X. Xxxxxxxxx
General Partner
CGJR HEALTH CARE SERVICES PRIVATE EQUITIES, L.P.
By: CGJR Capital Management, Inc.,
as General Partner
By: /s/ Xxxxx Xxxxx
----------------------------
President
- Registration Rights Agreement -
CGJR II, L.P.
By: CGJR Capital Management, Inc.,
as General Partner
By: /s/ Xxxxx Xxxxx
-------------------------------
President
CGJR/MF, L.P.
By: CGJR Capital Management, Inc.,
as General Partner
By: /s/ Xxxxx Xxxxx
-------------------------------
President
Schedule I
----------
Investors
---------
Sierra Ventures
0000 Xxxx Xxxx Xxxx
Xxxxxxxx Xxxx - Xxxxx 000
Menlo Park, California 94025
CGJR Health Care Services Private Equities, L.P.
000 Xxxxxxxx Xxxx, Xxxxx 000
Xxxxxxxxx, XX 00000
CGJR II, L.P.
000 Xxxxxxxx Xxxx, Xxxxx 000
Xxxxxxxxx, XX 00000
CGJR/MF III, L.P.
000 Xxxxxxxx Xxxx, Xxxxx 000
Xxxxxxxxx, XX 00000
Schedule II
-----------
INSTRUMENT OF ACCESSION
-----------------------
The undersigned, ___________________, as a condition precedent to becoming
the owner or holder of record of ________ (_______) shares of the __________
Stock, par value $.01 per share, of NovaMed Holdings Inc., an Illinois
corporation (the "Company"), hereby agrees to become a party to and bound by
that certain Registration Rights Agreement, dated as of December ___, 1996, by
and among the Company and certain shareholders of the Company. This Instrument
of Accession shall take effect and shall become an integral part of the said
Registration Rights Agreement immediately upon execution and delivery to the
Company of this Instrument.
IN WITNESS WHEREOF, this INSTRUMENT OF ACCESSION has been duly executed by
or on behalf of the undersigned, as a sealed instrument under the laws of the
State of Illinois, as of the date below written.
Signature:
--------------------------------
Address:
-----------------------------------
-----------------------------------
-----------------------------------
Date:
-------------------------------------
Accepted:
By:
------------------------
Date:
-----------------------
