REGISTRATION RIGHTS AGREEMENT
EXECUTION
VERSION
This
Registration Rights Agreement (this “Agreement”) is made and
entered into as of September 30, 2010, by and among Health Benefits Direct
Corporation, a Delaware corporation (the “Company”), and the investors
signatory hereto (each a “Investor” and collectively,
the “Investors”).
This
Agreement is made pursuant to the Securities Purchase Agreement, dated as of the
date hereof, among the Company and the Investors (the “Purchase
Agreement”).
In
consideration of the mutual covenants contained in this Agreement, and for other
good and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the Company and the Investors hereby agree as follows, with the
intent to be legally bound hereby:
1. Definitions. Capitalized
terms used and not otherwise defined herein that are defined in the Purchase
Agreement shall have the meanings given such terms in the Purchase
Agreement. As used in this Agreement, the following terms shall have
the respective meanings set forth in this Section 1:
“Common Stock” means the
common stock, par value $0.001 per share, of the Company.
“Conversion Shares” means the
shares of Common Stock issuable upon conversion of the Preferred
Stock.
“Demand Notice” has the
meaning set forth in Section 2(a) of this Agreement.
“Effective Date” means the
date that the Registration Statement filed pursuant to Section 2(a), 2(b) or
2(c) of this Agreement is first declared effective by the
Commission.
“Effectiveness Date” means:
(a) with respect to the initial Registration Statement required to be filed
under Section 2(a) to cover the resale by the Holders of the Registrable
Securities the 60th calendar day after the Filing Date (or the 120th calendar
day after the Filing Date in the event that such Registration Statement is
subject to review by the Commission) and (b) with respect to any additional
Registration Statements that may be required pursuant to Section 2(b) or 2(c)
hereof, the 90th calendar day following the date on which the Company first
knows, or reasonably should have known, that such additional Registration
Statement is required under such Section (or the 150th calendar day after such
date in the event that such Registration Statement is subject to review by the
Commission).
“Effectiveness Period” shall
have the meaning set forth in Section 2(a).
“Exchange Act” means the
Securities Exchange Act of 1934, as amended.
“Excluded Registration” means
(i) a registration relating solely to the sale of securities to employees of the
Company or a subsidiary of the Company pursuant to a stock option, stock
purchase, or similar plan or (ii) a registration relating to a Rule 145
transaction.
“Filing Date” means, with
respect to the initial Registration Statement required to be filed to cover the
resale by the Holders of the Registrable Securities, 30 days following the
receipt of a Demand Notice.
“Holder” or “Holders” means an Investor or
Investors (as the case may be), or any transferee or assignee of any Registrable
Securities, to whom an Investor assigns its rights under this Agreement and who
agrees to become bound by the provisions of this Agreement in accordance with
the Purchase Agreement and any transferee or assignee thereof to whom a
transferee or assignee of any Registrable Securities assigns its rights under
this Agreement and who agrees to become bound by the provisions of this
Agreement in accordance with the Purchase Agreement.
“Indemnified Party” shall have
the meaning set forth in Section 5(c).
“Indemnifying Party” shall
have the meaning set forth in Section 5(c).
“Losses” shall have the
meaning set forth in Section 5(a).
"Preferred Stock" means shares
of Series B Convertible Preferred Stock, $0.001 par value per share, of the
Company.
“Proceeding” means an action,
claim, suit, investigation or proceeding (including, without limitation, an
investigation or partial proceeding, such as a deposition), whether commenced or
threatened.
“Prospectus” means the
prospectus included in a Registration Statement (including, without limitation,
a prospectus that includes any information previously omitted from a prospectus
filed as part of an effective registration statement in reliance upon Rule 430A
promulgated under the Securities Act), as amended or supplemented by any
prospectus supplement, with respect to the terms of the offering of any portion
of the Registrable Securities covered by such Registration Statement, and all
other amendments and supplements to such prospectus, including post-effective
amendments, and all material incorporated by reference or deemed to be
incorporated by reference in such prospectus.
“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 and the declaration of effectiveness of such Registration
Statement(s) by the Commission.
“Registrable Securities” means
(i) the Shares, (ii) the Conversion Shares (iii) the Warrant Shares and (iv) any
securities issued or issuable with respect to the securities referenced in (i),
(ii), or (iii) above, including, without limitation, as a result of any stock
dividend, stock split or other distribution, recapitalization, merger,
consolidation, reorganization, exchange or similar event or otherwise (without
regard to any limitations on exercises of the Warrants).
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“Registration Statement” means
the initial registration statement required to be filed under the Securities Act
in accordance with Section 2(a) and any additional registration statement(s)
required to be filed under Sections 2(b) or 2(c), including (in each case) the
Prospectus, amendments and supplements to such registration statements or
Prospectus, including pre- and post-effective amendments, all exhibits thereto,
and all material incorporated by reference or deemed to be incorporated by
reference in such registration statements.
“Rule 144” means Rule 144
promulgated by the Commission pursuant to the Securities Act, as such Rule may
be amended from time to time, or any similar rule or regulation hereafter
adopted by the Commission having substantially the same effect as such
Rule.
“Rule 415” means Rule 415
promulgated by the Commission pursuant to the Securities Act, as such Rule may
be amended from time to time, or any similar rule or regulation hereafter
adopted by the Commission having substantially the same effect as such
Rule.
“Rule 424” means Rule 424
promulgated by the Commission pursuant to the Securities Act, as such Rule may
be amended from time to time, or any similar rule or regulation hereafter
adopted by the Commission having substantially the same effect as such
Rule.
“Securities Act” means the
Securities Act of 1933, as amended.
“Shares” means the shares of
Preferred Stock issued or issuable to the Investors by the Company pursuant to
the Purchase Agreement.
“Warrants” means the warrants
issued or issuable to the Investors pursuant to the Purchase
Agreement.
“Warrant Shares” means the
shares of Common Stock issued or issuable upon exercise of the
Warrants.
2. Demand
Registration.
(a) If
at any time after the date of this Agreement the Company receives a request from
a Holder of Registrable Securities that the Company file a Registration
Statement on Form S-1 covering the resale of the Registrable Securities held by
such Holder (a "Demand
Notice"), then the Company shall (i) within five (5) days after the date
it receives the Demand Notice, give notice thereof to all other Holders and (ii)
as soon as reasonably practicable, but in no event later than the Filing Date,
file with the Commission a Registration Statement on Form S-1 covering the
resale of all Registrable Securities of the Holder that provided the Demand
Notice and any additional Registrable Securities requested by the other Holders
to be included therein, as specified by each such other Holder within twenty
(20) days after such Holder has received notice from the Company pursuant to
clause (i); provided
that such Registration Statement need not include Registrable Securities
already covered by an existing and effective Registration Statement The
Registration Statement shall be for an offering to be made on a continuous basis
pursuant to Rule 415. The Registration Statement shall contain (except if
otherwise required pursuant to written comments received from the Commission
upon a review of such Registration Statement) the “Plan of Distribution”
attached hereto as Annex
A. The Company shall use its reasonable best efforts to cause
the Registration Statement to be declared effective under the Securities Act as
soon as practicable but, in any event, no later than the Effectiveness Date, and
shall use its reasonable best efforts to keep the Registration Statement
effective under the Securities Act until the date when all Registrable
Securities covered by the Registration Statement have been sold or may be sold
without volume restrictions pursuant to Rule 144(b)(i) promulgated under the
Securities Act (the “Effectiveness
Period”).
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(b) If
for any reason the Commission does not permit all of the Registrable Securities
requested by a Holder to be included in the Registration Statement filed
pursuant to Section 2(a), or for any other reason any such Registrable
Securities are not permitted by the Commission to be included on a Registration
Statement filed under this Agreement, then the Company shall prepare and file as
soon as possible after the date on which such filing may be made, an additional
Registration Statement covering the resale of all of the Registrable Securities
requested by Holder not already covered by an existing and effective
Registration Statement for an offering to be made on a continuous basis at the
market pursuant to Rule 415 or otherwise as may be acceptable to a Holder whose
Registrable Securities were not registered for resale. Each such Registration
Statement shall contain (except if otherwise required pursuant to written
comments received from the Commission upon a review of such Registration
Statement) the “Plan of Distribution” attached hereto as Annex A. The Company
shall use its reasonable best efforts to cause each such Registration Statement
to be declared effective under the Securities Act as soon as possible but, in
any event, no later than its Effectiveness Date, and shall use its reasonable
best efforts to keep such Registration Statement effective under the Securities
Act during the entire Effectiveness Period.
(c) If:
(i) a Registration Statement covering all of the Registrable Securities required
to be covered thereby is not filed by the Company with the Commission on or
prior to the Filing Date (or the applicable filing date if the Registration
Statement is not the initial Registration Statement required to be filed under
Section 2(a)), (ii) a Registration Statement covering all of the Registrable
Securities is not declared effective by the Commission on or prior to its
required Effectiveness Date (it being understood that if the Company shall not
have filed a “final” prospectus for the Registration Statement with the SEC
under Rule 424(b) in accordance with Section 2(f) below (whether or not such a
prospectus is technically required by such rule), the Company shall not be
deemed to have satisfied this clause (ii)), (iii) the Company fails to file a
request for the acceleration of the Effectiveness Date of the applicable
Registration Statement as required by Section 3(c), (iv) there is a suspension
or delisting of the Company’s Common Stock (or the Company fails to timely list
all the Registrable Securities) on its principal trading market or exchange, (v)
after its Effective Date, other than during an Allowable Grace Period (as
defined below), such Registration Statement ceases to be effective and available
for use by the Holders as to any Registrable Securities to which it is required
to cover at any time prior to the expiration of its Effectiveness Period for up
to no more than 3 consecutive Trading Days (or 20 Trading Days in any 12 month
period in the aggregate) (any such failure or breach being referred to as an
“Event,” and for purposes of clauses
(i)-(iv), on the date on which such Event occurs, or for purposes of clause (v),
the date on which the Allowable Grace Period or other specified period is
exceeded, being referred to as “Event Date”), then, in
addition to any other rights available to the Holders under this Agreement or
under applicable law: (x) on each such Event Date the Company shall pay to each
Holder an amount in cash, as partial damages and not as a penalty, equal to 1.5%
of the aggregate Investment Amount paid by such Holder pursuant to the Purchase
Agreement; and (y) on each 30-day anniversary of each such Event Date (if the
applicable Event shall not have been cured by such date) until the applicable
Event is cured, the Company shall pay to each Holder an amount in cash, as
partial damages and not as a penalty, equal to 1.5% of the aggregate Investment
Amount paid by such Holder pursuant to the Purchase Agreement. The partial
damages pursuant to the terms hereof shall apply on a pro rata basis for any
portion of a month prior to the cure of an Event. Notwithstanding the foregoing,
in no event shall the partial damages under this Section 2(d) exceed an amount
equal to 20% of the aggregate Investment Amounts.
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(d) Notwithstanding
anything to the contrary contained in this Agreement, in the event the staff of
the Commission (the “Staff”) or the Commission
requires any Holder seeking to sell securities under a Registration
Statement filed pursuant to this Agreement to be specifically identified as
an “underwriter” in order to permit such Registration Statement to
become effective, and such Holder does not consent to being so named as an
underwriter in such Registration Statement, then in each such case, the
Company shall reduce the total number of Registrable Securities to be
registered on behalf of such Holder, until such time as the Staff
or the Commission does not require such identification or until such Holder
accepts such identification and the manner thereof. Any reduction pursuant
to this paragraph will first reduce all Registrable Securities other than
those issued pursuant to the Purchase Agreement and in the event of any
reduction pursuant to this paragraph, no Holder shall have any claim against the
Company as a result of such reduction and any Event or other delay or breach of
this Agreement occurring primarily due to such action by the Staff or the
Commission and any such relating reduction shall not require the Company to pay
any partial damages pursuant to Section 2(d) hereof or otherwise provide the
basis for any claim by any Holder against the Company pursuant to the
Transaction Documents (it being understood that the foregoing does not
constitute a waiver of Section 3.2(f) of the Securities Purchase Agreement by
any Holder or the obligations of the Company under this paragraph and elsewhere
in relation thereto). In the event of any reduction in Registrable
Securities pursuant to this paragraph, an affected Holder shall have the
right to require, upon delivery of a written request to the Company signed by
the Holder, the Company to file a registration statement within 30 days of such
request (subject to any restrictions imposed by Rule 415 or required by
the Staff or the Commission) for re-sale by such Holder in a manner
acceptable to such Holder, and the Company shall following such
request cause to be and keep effective such registration statement in the
same manner as otherwise contemplated in this Agreement
for registration statements hereunder, in each case until such time as: (i)
all Registrable Securities held by such Holder have been registered
pursuant to an effective Registration Statement in a manner acceptable to such
Holder or (ii) the Registrable Securities may be resold by such
Holder without restriction (including volume limitations) pursuant to Rule
144(b)(i) of the Securities Act (taking account of any Staff position with
respect to “affiliate” status) or (iii) the Holder agrees to be named as an
underwriter in any such Registration Statement in a manner acceptable to Holder
as to all Registrable Securities held by such Holder and that have not
theretofore been included in a Registration Statement under this Agreement (it
being understood that the special demand right under this sentence may be
exercised by a Holder multiple times and with respect to limited amounts of
Registrable Securities in order to permit the re-sale thereof by such Holder as
contemplated above).
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(e) In
the event that Form S-1 is not available for the registration of the resale of
Registrable Securities hereunder, the Company shall use reasonable best efforts
to (i) register the resale of the Registrable Securities on another appropriate
form reasonably acceptable to the Holders and (ii) undertake to register the
Registrable Securities on Form S-1 as soon as such form is available, provided
that the Company shall use reasonable best efforts to maintain the effectiveness
of the Registration Statement then in effect until such time as a Registration
Statement on Form S-1 covering the Registrable Securities has been declared
effective by the Commission. In the event the Company becomes eligible to
register the Registrable Securities on Form S-3, the Company shall use
reasonable best efforts to promptly register the Registrable Securities on Form
S-3, provided that the Company shall use reasonable best efforts to maintain the
effectiveness of the Registration Statement(s) then in effect until such time as
a Registration Statement on Form S-3 covering the Registrable Securities has
been declared effective by the Commission.
(f) By
5:30 p.m. on the Trading Day immediately following the Effective Date of each
Registration Statement, the Company shall file with the Commission in accordance
with Rule 424 under the Securities Act the final prospectus to be used in
connection with sales pursuant to such Registration Statement.
3. Company
Registration.
(a)
If the Company proposes to register
(including for this purpose, a registration effected by the Company for
stockholders other than the Holders), any of its securities under the Securities
Act in connection with the offering of such securities for cash (other than an
Excluded Registration), the Company shall, at such time, promptly give each
Holder notice of the proposed registration. Upon the request of each Holder
given within twenty (20) days after such notice is given by the Company, the
Company shall, subject to the provisions of Section 3(b), cause to be registered
all of the Registrable Securities that each such holder has requested be
included in such registration. The Company shall have the right to terminate or
withdraw any registration initiated by it under this Section 3 before the
effective date of such registration, whether or not any Holder has elected to
include Registrable Securities in such registration. The expenses of
such withdrawn registration shall be borne by the Company.
(b)
If a registration under Section 3(a) involves an underwritten offering by the
Company, the Company shall not be required to include any Holder's Registrable
Securities in such underwriting unless the Holders accept the terms of the
underwriting as agreed upon between the Company and its underwriters, and then
only in such quantity as the underwriters determine will not jeopardize the
success of the offering by the Company. If the total number of securities,
including Registrable Securities, requested by stockholders to be included in
such offering exceeds the number of securities to be sold (other than by the
Company) that the underwriters determine is compatible with the success of the
offering, then the Company shall be required to include in the offering only
that number of such securities, including Registrable Securities, which the
underwriters and the Company determine will not jeopardize the success of the
offering. If the underwriters determine that less than all of the Registrable
Securities requested to be registered can be included in such offering, then the
Registrable Securities that are included in such offering shall be allocated
among the selling Holders in proportion (as nearly as practicable) to the number
of Registrable Securities owned by each selling Holder or in such other
proportions as shall mutually be agreed to by all such selling
Holders.
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4. Registration
Procedures
In
connection with the Company’s registration obligations hereunder, the Company
shall:
(a) Not
less than ten (10) Trading Days prior to the filing of a Registration Statement
and not less than five (5) Trading Days prior to the filing of any related
Prospectus or any amendment or supplement thereto (except for any amendment or
supplement thereto related to the filing of an Annual Report on Form 10-K,
Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and any similar or
successor reports), the Company shall furnish to the Holders copies of such
document, as proposed to be filed in substantially final form. The Company shall
(A) permit each Holder to review and comment upon (i) each Registration
Statement at least five (5) Trading Days prior to its filing with the
Commission, provided that such comments are received by the Company no later
than three (3) Trading Days after providing such Registration Statement for
review, and (ii) all amendments and supplements to all Registration Statements
(except for any amendment or supplement thereto related to the filing of an
Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on
Form 8-K, and any similar or successor reports) within a reasonable number of
days prior to their filing with the Commission, provided that such comments are
received by the Company no later than three (3) Trading Days after providing
such amendment or supplement for review, and (B) shall consider all such
reasonable comments in good faith.
(b)
(i) Prepare and file with the Commission such amendments, including
post-effective amendments, to each Registration Statement and the Prospectus
used in connection therewith as may be necessary to keep such Registration
Statement continuously effective as to the applicable Registrable Securities for
its Effectiveness Period and prepare and file with the Commission such
additional Registration Statements in order to register for resale under the
Securities Act all of the Registrable Securities; (ii) cause the related
Prospectus to be amended or supplemented by any required Prospectus supplement,
and as so supplemented or amended to be filed pursuant to Rule 424; (iii)
respond as promptly as reasonably possible to any comments received from the
Commission with respect to each Registration Statement or any amendment thereto
and, as promptly as reasonably possible provide the Holders true and complete
copies of all correspondence from and to the Commission relating to such
Registration Statement that pertain to the Holders as a Selling Stockholder or
to the Plan of Distribution, but would not result in the disclosure to the
Holders of material, non-public information concerning the Company or any of its
subsidiaries; and (iv) comply in all material respects with the provisions of
the Securities Act and the Exchange Act with respect to the Registration
Statements and the disposition of all Registrable Securities covered by each
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 4(b)) by reason of the Company filing a
report on Form 10-Q or Form 10-K or any analogous report under the Exchange Act,
the Company shall have incorporated such report by reference into such
Registration Statement, if applicable, or shall file such amendments or
supplements with the Commission on the same day on which the Exchange Act report
is filed, if practicable. The Company shall ensure that each
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 the case of prospectuses, in the
light of the circumstances in which they were made) not
misleading.
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(c) Notify
the Holders' Counsel (which may occur electronically and any other notifications
or documents required to be provided to a Holder or any other party hereunder
may be provided electronically pursuant to the notice provisions contained
herein) as promptly as reasonably possible and (if requested by any such Person)
confirm such notice in writing no later than one three (3) Trading Days
following the day (i)(A) when a Prospectus or any Prospectus supplement or
post-effective amendment to a Registration Statement is proposed to be filed or
is filed; (B) when the Commission notifies the Company whether there will be a
“review” of a Registration Statement or post-effective amendment and whenever
the Commission comments in writing on such Registration Statement or
post-effective amendment (the Company shall provide true and complete copies
thereof and all written responses thereto to each of the Holders, but not
information which the Company believes in good faith would constitute material,
non-public information); and (C) with respect to each Registration Statement or
any post-effective amendment, when the same has become effective; (ii) of any
request by the Commission or any other Federal or state governmental authority
for amendments or supplements to a Registration Statement or Prospectus or for
additional information that pertains to the Holders as a Selling Stockholder or
to the Plan of Distribution; (iii) of the issuance by the Commission of any stop
order or other suspension of the effectiveness of a Registration Statement
covering any or all of the Registrable Securities or the initiation of any
Proceedings for that purpose; (iv) of the receipt by the Company of any
notification with respect to the suspension of the qualification or exemption
from qualification of any of the Registrable Securities for sale in any
jurisdiction, or the initiation or threatening of any Proceeding for such
purpose; and (v) of the occurrence of any event or passage of time that makes
the financial statements included in a Registration Statement ineligible for
inclusion therein or any statement made in such Registration Statement or
Prospectus or any document incorporated or deemed to be incorporated therein by
reference untrue in any material respect or that requires any revisions to such
Registration Statement, Prospectus or other documents so that, in the case of
such Registration Statement or the Prospectus, as the case may be, it will not
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading. The
Company shall submit to the Commission, within two (2) Trading Days after the
date that the Company learns that no review of a particular Registration
Statement will be made by the Staff or the Commission or that such Staff has no
further comments on a particular Registration Statement (as the case may be);
provided that the financial information included in such Registration Statement
meets all applicable SEC requirements.
(d) Use
its reasonable best efforts to avoid the issuance of, or, if issued, obtain the
withdrawal of (i) any stop order or other suspension of the effectiveness of a
Registration Statement, or (ii) any suspension of the qualification (or
exemption from qualification) of any of the Registrable Securities for sale in
any jurisdiction, at the earliest practicable moment and, if such an order or
suspension is issued, to obtain the withdrawal of such order or suspension at
the earliest practicable moment and each Holder who holds Registrable Securities
being sold 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.
(e) Furnish
to each Holder, without charge, at least one conformed copy of each Registration
Statement and each amendment thereto and all exhibits to the extent requested by
such Person (including those previously furnished) promptly after the filing of
such documents with the Commission.
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(f) Promptly
deliver to each Holder, without charge, as many copies of each Prospectus or
Prospectuses (including each form of prospectus) and each amendment or
supplement thereto as such Persons may reasonably request from time to time and
such other documents as such Holder may reasonably request from time to time in
order to facilitate the disposition of the Registrable Securities owned by such
Holder. The Company hereby consents to the use of such Prospectus and
each amendment or supplement thereto by each of the selling Holders in
connection with the offering and sale of the Registrable Securities covered by
such Prospectus and any amendment or supplement thereto.
(g) Prior
to any resale of Registrable Securities, use its reasonable best efforts to (i)
register or qualify or cooperate with the selling Holders in connection with the
registration or qualification (or exemption from such registration or
qualification) of such Registrable Securities for offer and sale under the
securities or Blue Sky laws of those specific jurisdictions within the United
States which the Holders may reasonably request from time to time in writing to
the Company, (ii) keep each such registration or qualification (or exemption
therefrom) effective during the Effectiveness Period and (iii) do any and all
other acts or things necessary or advisable to enable the disposition in such
jurisdictions of the Registrable Securities covered by the Registration
Statements; provided, that the Company shall not be required to qualify
generally to do business in any jurisdiction where it is not then so qualified
or subject the Company to any material tax in any such jurisdiction where it is
not then so subject. The Company shall promptly notify each Holder of the
receipt by the Company 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 threatening of any
proceeding for such purpose.
(h) Cooperate
with the Holders to facilitate the timely preparation and delivery of
certificates representing Registrable Securities to be delivered to a transferee
pursuant to the Registration Statements, which certificates shall be free, to
the extent permitted by the Purchase Agreement, of all restrictive legends, and
to enable such Registrable Securities to be in such denominations and registered
in such names as any such Holders may request.
(i) Upon
the occurrence of any event contemplated by Section 4(c)(v), as promptly as
reasonably possible, prepare a supplement or amendment, including a
post-effective amendment, to the affected Registration Statements or a
supplement to the related Prospectus or any document incorporated or deemed to
be incorporated therein by reference, and file any other required document so
that, as thereafter delivered, no Registration Statement nor any Prospectus will
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not
misleading.
(j) Each
Holder agrees to furnish to the Company a completed Selling Questionnaire in the
form attached to this Agreement as Annex B (a “Selling Holder
Questionnaire”). The Company shall not be required to include the
Registrable Securities of a Holder in a Registration Statement and shall not be
required to pay any partial or other damages under Section 2(d) hereof to such
Holder who fails to furnish to the Company a fully completed Selling Holder
Questionnaire at least five (5) Trading Days prior to the Filing
Date).
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(k) If
requested by a Holder, the Company shall as soon as practicable after receipt of
notice from such Holder and subject to Section 3(p) hereof, use reasonable best
efforts to (i) incorporate in a prospectus supplement or post-effective
amendment such information as a Holder reasonably requests to be included
therein relating to 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; (ii) 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; and
(iii) supplement or make amendments to any Registration Statement if reasonably
requested by a Holder holding any Registrable Securities.
(l) The
Company shall use its reasonable best efforts to cause the Registrable
Securities covered by a 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.
(m) The
Company shall otherwise use its reasonable best efforts to comply with all
applicable rules and regulations of the Commission in connection with any
registration hereunder. Within one (1) Trading Day after a
Registration Statement which covers Registrable Securities is declared effective
by the Commission, the Company shall deliver, and shall cause legal counsel for
the Company to deliver, to the transfer agent for such Registrable Securities
(with copies to the Holders whose Registrable Securities are included in such
Registration Statement) confirmation that such Registration Statement has been
declared effective by the Commission in a customary form.
(p)
Notwithstanding anything to the contrary
herein (but subject to the last sentence of this Section 4(p), at any time after
the Effective Date of the initial Registration Statement required to be filed
hereunder pursuant to Section 2(a), the Company may delay the disclosure of
material, non-public information concerning the Company the disclosure of which
at the time is not, in the good faith determination of the Board of Directors of
the Company, in the best interest of the Company and is not, in the opinion of
Board of Directors of the Company, after consultation with the Company’s
counsel, otherwise required (a “Grace Period”); provided, that
the Company shall promptly (i) notify the Holders in writing of the existence of
material, non-public information giving rise to a Grace Period (provided that in
each notice the Company will not disclose the content of such material,
non-public information to the Holders) and the date on which the Grace Period
will begin, and (ii) notify the Holders in writing of the date on which the
Grace Period ends; and, provided that no Grace Period shall exceed thirty (30)
consecutive days and during any three hundred sixty five (365) day period such
Grace Periods shall not exceed an aggregate of sixty (60) days and the first day
of any Grace Period must be at least two (2) Trading Days after the last day of
any prior Grace Period (each, an “Allowable Grace Period”);
provided further, that no Allowable Grace Period may exist during the first
thirty (30) Trading Days after the Effective Date of the initial Registration
Statement required to be filed hereunder pursuant to Section 2(a). 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.
Notwithstanding anything to the contrary contained in this Section 4(p), the
Company shall cause its transfer agent to deliver shares of Common Stock to a
transferee of a Holder in accordance with the terms of the Purchase Agreement in
connection with any sale of Registrable Securities with respect to which such
Holder has entered into a contract for sale, and delivered a copy of the
prospectus included as part of the applicable Registration Statement (to the
extent required under applicable securities laws), prior to such Holder’s
receipt of the notice of a Grace Period and for which such Holder has not yet
settled.
-10-
(q) At
the reasonable request of any Holder, the Company shall use its reasonable best
efforts to furnish to such Holder, on the date of the effectiveness of the
Registration Statement or any additional registration statement required by the
terms of this Agreement and thereafter from time to time on such dates as a
Holder may reasonably request (i) a letter, dated such date, from the Company'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, addressed to the Holders, and (ii) an opinion,
dated as of such date, of counsel representing the Company for purposes of such
Registration Statement or such additional registration statement, in form, scope
and substance as is customarily given in an underwritten public offering,
addressed to the Holders.
(r)
The Company shall make available for inspection by (i) any
Holder, (ii) legal counsel to any Holder and (iii) one firm of accountants or
other agents retained by the Holders (collectively, the "Inspectors"), all pertinent
financial and other records, and pertinent corporate documents and properties of
the Company (collectively, the "Records"), as shall be
reasonably deemed necessary by each Inspector, and cause the Company's officers,
directors and employees, and shall use its reasonable best efforts to cause its
counsel and the Company's independent certified public accountants to, supply
all information which may be necessary and any Inspector may reasonably request;
provided, however, that prior to inspection, each Inspector shall agree to hold
in strict confidence and shall not make any disclosure (except to an Investor)
or use of any Record or other information which the Company determines in good
faith to be confidential, pursuant to the terms of a Confidentiality Agreement
in form and substance reasonably satisfactory to the Company. Nothing herein
shall be deemed to limit the Holders' ability to sell Registrable Securities in
a manner which is otherwise consistent with applicable laws and
regulations.
(s)
If requested by a Holder, the Company shall,
within five days of receipt of notice from such Holder, (i) incorporate in a
prospectus supplement or post-effective amendment such information as an
Investor reasonably requests to be included therein relating to 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; (ii) 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; and (iii) supplement or make amendments
to any Registration Statement if reasonably requested by an Investor holding any
Registrable Securities.
-11-
(t)
The Company shall make generally available to its
security holders as soon as practical, but not later than 90 days after the
close of the period covered thereby, an earnings statement (in form complying
with, and in the manner provided by, the provisions of Rule 158 under the 0000
Xxx) covering a twelve-month period beginning not later than the first day of
the Company's fiscal quarter next following the Effective Date of the
Registration Statement or any additional registration statement required by the
terms of this Agreement.
5.
Registration
Expenses. All fees and expenses incident to the performance of
or compliance with this Agreement by the Company shall be borne by the Company
whether or not any Registrable Securities are sold pursuant to a Registration
Statement. The fees and expenses referred to in the foregoing
sentence shall include, without limitation, (i) all registration and filing fees
(including, without limitation, fees and expenses (A) with respect to filings
required to be made with any Trading Market on which the Common Stock is then
listed for trading, and (B) in compliance with applicable state securities or
Blue Sky laws), (ii) printing expenses (including, without limitation, expenses
of printing certificates for Registrable Securities and of printing prospectuses
if the printing of prospectuses is reasonably requested by the holders of a
majority of the Registrable Securities included in the Registration Statement),
(iii) messenger, telephone and delivery expenses, (iv) fees and disbursements of
counsel for the Company, (v) Securities Act liability insurance, if the Company
so desires such insurance, and (vi) fees and expenses of all other Persons
retained by the Company in connection with the consummation of the transactions
contemplated by this Agreement. In addition, the Company shall be
responsible for all of its internal expenses incurred in connection with the
consummation of the transactions contemplated by this Agreement (including,
without limitation, all salaries and expenses of its officers and employees
performing legal or accounting duties), the expense of any audit and the fees
and expenses incurred in connection with the listing of the Registrable
Securities on any securities exchange as required hereunder.
-12-
6.
Indemnification.
(a) Indemnification by the
Company. The Company shall, notwithstanding any termination of
this Agreement, indemnify and hold harmless each Holder, the officers,
directors, agents, investment advisors, partners, members, employees, agents and
representatives of each of them, each Person who controls any such Holder
(within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act) and officers, directors, agents, investment advisors, partners,
members, employees, agents and representatives of each such controlling Person
(each an “Indemnified
Person”), to the fullest extent permitted by applicable law, from and
against any and all losses, claims, damages, liabilities, judgments, fines,
penalties, charges, amounts paid in settlement, costs and expenses, joint or
several, (including, without limitation, reasonable out-of-pocket costs of
preparation and reasonable attorneys’ fees and expenses) (collectively, “Losses”), as incurred, arising
out of or relating to (i) any untrue or alleged untrue statement of a material
fact contained in any Registration Statement, any Prospectus or any form of
prospectus or in any amendment or supplement thereto, in any preliminary
prospectus 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, or arising out of or relating to any
omission or alleged omission of a material fact required to be stated therein or
necessary to make the statements therein (in the case of any Prospectus or form
of prospectus or supplement thereto, in light of the circumstances under which
they were made) not misleading, except to the extent, but only to the extent,
that (1) such untrue statements or omissions are based solely upon information
regarding such Holder furnished in writing to the Company by such Holder
expressly for use therein, or to the extent that such information relates to
such Holder or such Holder’s proposed method of distribution of Registrable
Securities and was reviewed and expressly approved in writing by such Holder
expressly for use in the Registration Statement, such Prospectus or such form of
Prospectus or in any amendment or supplement thereto (it being understood that
the Holder has approved Annex A hereto for
this purpose) or (2) in the case of an occurrence of an event of the type
specified in Section 4(c)(ii)-(v), the use by such Holder of an outdated or
defective Prospectus after the Company has notified such Holder in writing that
the Prospectus is outdated or defective and prior to the receipt by such Holder
of an Advice or an amended or supplemented Prospectus, but only if and to the
extent that following the receipt of the Advice or the amended or supplemented
Prospectus the misstatement or omission giving rise to such Loss would have been
corrected and no grounds for such Loss would have existed; or (ii) any violation
or alleged violation by the Company 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 Company shall notify the
Holders promptly of the institution, threat or assertion of any Proceeding of
which the Company is aware in connection with the transactions contemplated by
this Agreement. Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of the Indemnified Person
and shall survive the transfer of any of the Registrable Securities by any of
the Holders.
(b) Indemnification by
Holders. Each Holder shall, severally and not jointly, indemnify and hold
harmless the Company, its directors, officers, agents and employees, each Person
who controls the Company (within the meaning of Section 15 of the Securities Act
and Section 20 of the Exchange Act), and the directors, officers, agents or
employees of such controlling Persons, to the fullest extent permitted by
applicable law, from and against all Losses, as incurred, arising solely out of
or based solely upon: (x) such Holder’s failure to comply with the prospectus
delivery requirements of the Securities Act to the extent applicable or (y) any
untrue statement of a material fact contained in any Registration Statement, any
Prospectus, or any form of prospectus, or in any amendment or supplement
thereto, or arising solely out of or based solely upon any omission of a
material fact required to be stated therein or necessary to make the statements
therein not misleading to the extent, but only to the extent that, (1) such
untrue statements or omissions are based solely upon information regarding such
Holder furnished in writing to the Company by such Holder expressly for use
therein, or to the extent that such information relates to such Holder or such
Holder’s proposed method of distribution of Registrable Securities and was
reviewed and expressly approved in writing by such Holder expressly for use in
the Registration Statement (it being understood that the Holder has approved
Annex A hereto for this purpose), such Prospectus or such form of Prospectus or
in any amendment or supplement thereto or (2) in the case of an occurrence of an
event of the type specified in Section 4(c)(ii)-(v), the use by such Holder of
an outdated or defective Prospectus after the Company has notified such Holder
in writing that the Prospectus is outdated or defective and prior to
the receipt by such Holder of an Advice or an amended or supplemented
Prospectus, but only if and to the extent that following the receipt of the
Advice or the amended or supplemented Prospectus the misstatement or omission
giving rise to such Loss would have been corrected and no grounds for such Loss
would have existed. In no event shall the liability of any selling
Holder hereunder be greater in amount than the dollar amount of the net proceeds
received by such Holder upon the sale of the Registrable Securities giving rise
to such indemnification obligation. The indemnity agreement contained in this
Section 6(b) and the agreement with respect to contribution contained in Section
6(d) shall not apply to amounts paid in settlement of any Losses if such
settlement is effected without the prior written consent of the applicable
Holder, which consent shall not be unreasonably withheld or
delayed.
-13-
(c)
Conduct of Indemnification
Proceedings. If any Proceeding shall be brought or asserted against any
Person entitled to indemnity hereunder (an “Indemnified Party”), such
Indemnified Party shall promptly notify the Person from whom indemnity is sought
(the “Indemnifying
Party”) in writing, and the Indemnifying Party shall assume the defense
thereof, including the employment of counsel reasonably satisfactory to the
Indemnified Party and the payment of all fees and expenses incurred in
connection with defense thereof; provided, that the failure of any Indemnified
Party to give such notice shall not relieve the Indemnifying Party of its
obligations or liabilities pursuant to this Agreement, except (and only) to the
extent that it shall be finally determined by a court of competent jurisdiction
(which determination is not subject to appeal or further review) that such
failure shall have proximately and materially adversely prejudiced the
Indemnifying Party.
An
Indemnified Party shall have the right to employ separate counsel in any such
Proceeding and to participate in the defense thereof, but the fees and expenses
of such counsel shall be at the expense of such Indemnified Party or Parties
unless: (1) the Indemnifying Party has agreed in writing to pay such fees and
expenses; (2) the Indemnifying Party shall have failed promptly to assume the
defense of such Proceeding and to employ counsel reasonably satisfactory to such
Indemnified Party in any such Proceeding; or (3) the named parties to any such
Proceeding (including any impleaded parties) include both such Indemnified Party
and the Indemnifying Party, and such Indemnified Party shall have been advised
by counsel that a conflict of interest is likely to exist if the same counsel
were to represent such Indemnified Party and the Indemnifying Party (in which
case, if such Indemnified Party notifies the Indemnifying Party in writing that
it elects to employ separate counsel at the expense of the Indemnifying Party,
the Indemnifying Party shall not have the right to assume the defense thereof
and such counsel shall be at the expense of the Indemnifying Party); provided
that the Indemnifying Party shall not be liable for the fees and expenses of
more than one separate firm of attorneys at any time for all Indemnified
Parties. The Indemnified Party shall reasonably cooperate with the Indemnifying
Party in connection with any negotiation or defense of any such action or Losses
by the Indemnifying Party and shall furnish to the Indemnifying Party all
information reasonably available to the Indemnified Party which relates to such
action or Losses. The Indemnifying Party shall keep the Indemnified Party
reasonably apprised at all times as to the status of the defense or any
settlement negotiations with respect thereto. The Indemnifying Party shall not
be liable for any settlement of any such Proceeding effected without its written
consent, which consent shall not be unreasonably withheld. No
Indemnifying Party shall, without the prior written consent of the Indemnified
Party, which consent shall not be unreasonably withheld, effect any settlement
of any pending Proceeding in respect of which any Indemnified Party is a party,
unless such settlement includes an unconditional release of such Indemnified
Party from all liability on claims that are the subject matter of such
Proceeding.
-14-
All
reasonable out-of-pocket fees and expenses of the Indemnified Party (including
reasonable out-of-pocket fees and expenses to the extent incurred in connection
with investigating or preparing to defend such Proceeding in a manner not
inconsistent with this Section) shall be paid to the Indemnified Party, as
incurred, within ten (10) Trading Days of written notice thereof to the
Indemnifying Party (regardless of whether it is ultimately determined that an
Indemnified Party is not entitled to indemnification hereunder; provided, that
the Indemnifying Party may require such Indemnified Party to undertake to
reimburse all such fees and expenses to the extent it is finally judicially
determined that such Indemnified Party is not entitled to indemnification
hereunder).
No Person
involved in the sale of Registrable Securities who is guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act) in
connection with such sale shall be entitled to indemnification from any Person
involved in such sale of Registrable Securities who is not guilty of fraudulent
misrepresentation.
The
indemnity agreements contained herein shall be in addition to (i) any cause of
action or similar right of the Indemnified Party against the Indemnifying Party
or others, and (ii) any liabilities the Indemnifying Party may be subject to
pursuant to the law.
(d)
Contribution. If
a claim for indemnification under Section 6(a) or 6(b) is unavailable to an
Indemnified Party (by reason of public policy or otherwise), then each
Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall
contribute to the amount paid or payable by such Indemnified Party as a result
of such Losses, in such proportion as is appropriate to reflect the relative
fault of the Indemnifying Party and Indemnified Party in connection with the
actions, statements or omissions that resulted in such Losses as well as any
other relevant equitable considerations. The relative fault of such Indemnifying
Party and Indemnified Party shall be determined by reference to, among other
things, whether any action in question, including any untrue or alleged untrue
statement of a material fact or omission or alleged omission of a material fact,
has been taken or made by, or relates to information supplied by, such
Indemnifying Party or Indemnified Party, and the parties’ relative intent,
knowledge, access to information and opportunity to correct or prevent such
action, statement or omission. The amount paid or payable by a party
as a result of any Losses shall be deemed to include, subject to the limitations
set forth in Section 6(c), any reasonable out-of-pocket attorneys’ fees or
expenses or other reasonable out-of-pocket fees or expenses incurred by such
party in connection with any Proceeding to the extent such party would have been
indemnified for such fees or expenses if the indemnification provided for in
this Section was available to such party in accordance with its
terms.
The
parties hereto agree that it would not be just and equitable if contribution
pursuant to this Section 6(d) were determined by pro rata allocation or by any
other method of allocation that does not take into account the equitable
considerations referred to in the immediately preceding
paragraph. Notwithstanding the provisions of this Section 6(d), (i)
no Holder shall be required to contribute, in the aggregate, any amount in
excess of the amount by which the net proceeds actually received by such Holder
from the sale of the Registrable Securities subject to the Proceeding exceeds
the amount of any damages that such Holder has otherwise been required to pay,
or would otherwise be required to pay under Section 6(b), by reason of such
untrue or alleged untrue statement or omission or alleged omission; (ii) no
contribution shall be made under circumstances where the maker would not have
been liable for indemnification under the fault standards set forth in Section 6
hereof and (iii) no Person involved in the sale of Registrable Securities which
Person is guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) in connection with such sale shall be entitled to
contribution from any Person involved in such sale of Registrable Securities who
was not guilty of fraudulent misrepresentation.
-15-
The
indemnity and contribution agreements contained in this Section are in addition
to any liability that the Indemnifying Parties may have to the Indemnified
Parties.
7. Reports Under the Exchange
Act. With a view to making available to the Holders the benefits of Rule
144 promulgated under the Securities Act or any other similar rule or regulation
of the Commission that may at any time permit the Holders to sell securities of
the Company to the public without registration, the Company agrees to use
reasonable best efforts to:
(a) make
and keep public information available, as those terms are understood and defined
in Rule 144;
(b) 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 so long as the
Company remains subject to such requirements (it being understood that nothing
herein shall limit the Company’s obligations under the Purchase Agreement) and
the filing of such reports and other documents is required for the applicable
provisions of Rule 144; and
(c) furnish
to each Holder so long as such Holder owns Registrable Securities, promptly upon
request, (i) a written statement by the Company, if true, that it has complied
with the reporting requirements of Rule 144, the Securities Act and the Exchange
Act, (ii) a copy of the most recent annual or quarterly report of the Company
and such other reports and documents so filed by the Company if such reports are
not publicly available via XXXXX, and (iii) such other information as may be
reasonably requested to permit the Holders to sell such securities pursuant to
Rule 144 without registration.
8. Miscellaneous.
(a) Remedies. In the
event of a breach by the Company or by a Holder, of any of their obligations
under this Agreement, each Holder or the Company, as the case may be, in
addition to being entitled to exercise all rights granted by law and under this
Agreement, including recovery of damages, will be entitled to specific
performance of its rights under this Agreement (without the obligation to post a
bond or any other type of security). The Company and each Holder
agree that monetary damages would not provide adequate compensation for any
losses incurred by reason of a breach by it of any of the provisions of this
Agreement and hereby further agrees that, in the event of any action for
specific performance in respect of such breach, it shall waive the defense that
a remedy at law would be adequate.
(b) No Piggyback on
Registrations. Except as set forth on Schedule 8(b) attached hereto,
neither the Company nor any of its security holders (other than the Holders in
such capacity pursuant hereto) may include securities of the Company in a
Registration Statement required to be filed hereunder other than the Registrable
Securities, provided that no securities set forth on Schedule 8(b) may be
included in a Registration Statement if including any such securities would
adversely affect any of the Holders. The Company shall not after the date hereof
until the initial Effective Date enter into any agreement providing any such
right to any of its security holders.
-16-
(c) Compliance. Each
Holder covenants and agrees that it will comply with any prospectus delivery
requirements of the Securities Act as applicable to it and otherwise comply with
all applicable securities laws in connection with sales of Registrable
Securities pursuant to the Registration Statement.
(d) Discontinued
Disposition. Each Holder agrees by its acquisition of such
Registrable Securities that, upon receipt of a notice from the Company of the
occurrence of any event of the kind described in clauses (ii) through (v) of
Section 4(c), such Holder will forthwith discontinue disposition of such
Registrable Securities under the Registration Statement until such Holder’s
receipt of the copies of the supplemented Prospectus and/or amended Registration
Statement or until it is advised in writing (the “Advice”) by the Company that
the use of the applicable Prospectus may be resumed, and, in either case, has
received copies of any additional or supplemental filings that are incorporated
or deemed to be incorporated by reference in such Prospectus or Registration
Statement. The Company may provide appropriate stop orders to enforce the
provisions of this paragraph. Notwithstanding anything to the contrary in this
Section 7(d), the Company shall cause its transfer agent to deliver shares of
Common Stock to a transferee of a Holder in accordance with the terms of the
Purchase Agreement in connection with any sale of Registrable Securities with
respect to which such Holder has entered into a contract for sale, and delivered
a copy of the prospectus included as part of the applicable Registration
Statement (to the extent required under applicable securities laws) prior to
such Holder’s receipt of a notice from the Company of the happening of any event
of the kind described in Section 4(c)(ii)-(v).
(e) Amendments and
Waivers. No provision of this Agreement may be waived or
amended except in a written instrument signed by the Company and the Holders of
no less than a majority of the outstanding Registrable Securities; provided that
any party shall have the right to provide a waiver with regard to
itself. No waiver of any default with respect to any provision,
condition or requirement of this Agreement shall be deemed to be a continuing
waiver in the future or a waiver of any subsequent default or a waiver of any
other provision, condition or requirement hereof, nor shall any delay or
omission of either party to exercise any right hereunder in any manner impair
the exercise of any such right.
(f) Notices. Any
and all notices or other communications or deliveries required or permitted to
be provided hereunder shall be in writing or via e-mail and shall be deemed
given and effective on the earliest of (i) the date of transmission, if such
notice or communication is delivered via facsimile or e-mail at the facsimile
telephone number or e-mail address, as applicable, specified in this Section
prior to 6:30 p.m. (New York City time) on a Trading Day, (ii) the Trading Day
after the date of transmission, if such notice or communication is delivered via
facsimile or e-mail at the facsimile telephone number or e-mail address, as
applicable, specified in this Agreement later than 6:30 p.m. (New York City
time) on any date and earlier than 11:59 p.m. (New York City time) on such date,
(iii) the Trading Day following the date of mailing, if sent by nationally
recognized overnight courier service (with next day delivery specified), or (iv)
upon actual receipt by the party to whom such notice is required to be
given. The address for such notices and communications shall be as
follows:
-17-
|
If
to the Company:
|
Health
Benefits Direct Corporation
|
|
000
X. Xxxxxx-Xxxxxxx Xxxx, Xxxxxx, XX 00000
|
|
|
Facsimile:
(000) 000-0000
|
|
|
Attn:
Vice President and Controller
|
|
|
With
a copy to:
|
Xxxxxx,
Xxxxx & Bockius LLP
|
|
0000
Xxxxxx Xxxxxx, Xxxxxxxxxxxx, XX 00000
|
|
|
Facsimile:
(000) 000-0000
|
|
|
Attn:
Xxxxx X. XxXxxxxx, Xx., Esq.
|
|
|
If
to an Investor:
|
To
the address, e-mail address or facsimile number set forth
under
such Investor’s name
|
|
on
the signature pages hereof;
|
If to any
other Person who is then the registered Holder:
|
To
the address, e-mail address or facsimile number of such Holder as it
appears in the stock transfer books of the
Company
|
or such
other address, e-mail address or facsimile number as may be designated
hereafter, in the same manner, by such Person.
(g) Successors and
Assigns. This Agreement shall inure to the benefit of and be
binding upon the successors and permitted assigns of each of the parties and
shall inure to the benefit of each Holder. The Company may not assign its rights
or obligations hereunder without the prior written consent of each Holder. Each
Holder may assign their respective rights hereunder in the manner and to the
Persons as permitted under the Purchase Agreement.
(h) Execution and
Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed shall be deemed to be an original
and, all of which taken together shall constitute one and the same
Agreement. In the event that any signature is delivered by facsimile
transmission, such signature shall create a valid binding obligation of the
party executing (or on whose behalf such signature is executed) the same with
the same force and effect as if such facsimile signature were the original
thereof. Each pronoun herein shall be deemed to include the
masculine, feminine, neuter, singular and plural forms thereof. The
terms “including,” “includes,” “include” and words of
like import shall be construed broadly as if followed by the words “without
limitation.” The terms “herein,” “hereunder,” “hereof” and words of
like import refer to this entire Agreement instead of just the provision in
which they are found.
-18-
(i)
Governing
Law. All questions concerning the construction, validity,
enforcement and interpretation of this Agreement shall be governed by and
construed and enforced in accordance with the internal laws of the State of
Delaware, without regard to the principles of conflicts of law thereof. Each
party agrees that all Proceedings concerning the interpretations, enforcement
and defense of the transactions contemplated by this Agreement (whether brought
against a party hereto or its respective Affiliates, employees or agents) shall
be commenced exclusively in the state and federal courts sitting in the City of
Wilmington, State of Delaware, (the “Delaware Courts”). Each party
hereto hereby irrevocably submits to the exclusive jurisdiction of the Delaware
Courts for the adjudication of any dispute hereunder or in connection herewith
or with any transaction contemplated hereby or discussed herein, and hereby
irrevocably waives, and agrees not to assert in any Proceeding, any claim that
it is not personally subject to the jurisdiction of any Delaware Court, or that
such Proceeding has been commenced in an improper or inconvenient
forum. Each party hereto hereby irrevocably waives personal service
of process and consents to process being served in any such Proceeding by
mailing a copy thereof via registered or certified mail or overnight delivery
(with evidence of delivery) to such party at the address in effect for notices
to it under this Agreement and agrees that such service shall constitute good
and sufficient service of process and notice thereof. Nothing
contained herein shall be deemed to limit in any way any right to serve process
in any manner permitted by law. Each party hereto hereby irrevocably
waives, to the fullest extent permitted by applicable law, any and all right to
trial by jury in any Proceeding arising out of or relating to this Agreement or
the transactions contemplated hereby. If either party shall commence
a Proceeding to enforce any provisions of this Agreement, then the prevailing
party in such Proceeding shall be reimbursed by the other party for its
attorneys’ fees and other costs and expenses incurred with the investigation,
preparation and prosecution of such Proceeding.
(j)
Cumulative Remedies.
The remedies provided herein are cumulative and not exclusive of any remedies
provided by law.
(k) Severability. If any
term, provision, covenant or restriction of this Agreement is held by a court of
competent jurisdiction to be invalid, illegal, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions set forth herein
shall remain in full force and effect and shall in no way be affected, impaired
or invalidated, and the parties hereto shall use their reasonable efforts to
find and employ an alternative means to achieve the same or substantially the
same result as that contemplated by such term, provision, covenant or
restriction. It is hereby stipulated and declared to be the intention
of the parties that they would have executed the remaining terms, provisions,
covenants and restrictions without including any of such that may be hereafter
declared invalid, illegal, void or unenforceable.
(l)
Headings. The
headings in this Agreement are for convenience of reference only and shall not
limit or otherwise affect the meaning hereof.
(m) Entire
Agreement. This Agreement, the other Transaction Documents (as
defined in the Purchase Agreement), the schedules and exhibits attached hereto
and thereto and the instruments referenced herein and therein constitute the
entire agreement among the parties hereto with respect to the subject matter
hereof and thereof. There are no restrictions, promises, warranties
or undertakings, other than those set forth or referred to herein and
therein. This Agreement, the other Transaction Documents, the
schedules and exhibits attached hereto and thereto and the instruments
referenced herein and therein supersede all prior agreements and understandings
among the parties hereto with respect to the subject matter hereof and
thereof.
-19-
(n) Independent Nature of
Holders’ Obligations and Rights. The obligations of each
Holder under this Agreement and the other Transaction Documents are several and
not joint with the obligations of any other Holder, and no Holder shall be
responsible in any way for the performance of the obligations of any other
Holder under this Agreement or any other Transaction Document. Nothing contained
herein or in any other Transaction Document, and no action taken by any Holder
pursuant hereto or thereto, shall be deemed to constitute the Holders as a
partnership, an association, a joint venture or any other kind of group or
entity, or create a presumption that the Holders are in any way acting in
concert or as a group or entity with respect to such obligations or the
transactions contemplated by the Transaction Documents or any matters, and the
Company acknowledges that the Holders are not acting in concert or as a group
with respect to such obligations or the transactions contemplated by this
Agreement or any of the other the Transaction Documents. Each Holder shall be
entitled to independently protect and enforce its rights, including, without
limitation, the rights arising out of this Agreement or out of any other
Transaction Documents, and it shall not be necessary for any other Holder to be
joined as an additional party in any proceeding for such purpose. The use of a
single agreement with respect to the obligations of the Company contained herein
was solely in the control of the Company, not the action or decision of any
Holder, and was done solely for the convenience of the Company and not because
it was required or requested to do so by any Holder.
(o)
No Strict
Construction. The language used in this Agreement will be deemed to be
the language chosen by the parties to express their mutual intent and no rules
of strict construction will be applied against any party.
(p)
No Third Party
Beneficiaries. This Agreement is intended for the benefit of the parties
hereto and their respective permitted successors and assigns, and is not for the
benefit of, nor may any provision hereof be enforced by, any other Person, other
than the Persons referred to in Section 5 hereof.
(q)
Further
Assurances. Each party shall do and perform, or cause to be
done and performed, all such further acts and things, and shall execute and
deliver all such other agreements, certificates, instruments and documents as
any other party may reasonably request in order to carry out the intent and
accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.
[signature page
follows]
-20-
IN
WITNESS WHEREOF, the parties have executed this Registration Rights Agreement as
of the date first written above.
|
HEALTH
BENEFITS DIRECT CORPORATION
|
|
|
By:
|
/s/ Xxxxxxx X. Xxxxx
|
|
Name:
|
Xxxxxxx
X. Xxxxx
|
|
Title:
|
Acting
Chief Executive Officer, Chief Operating
|
|
Officer
and Chief Financial Officer
|
|
[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE
PAGES OF INVESTORS TO FOLLOW]
IN
WITNESS WHEREOF, the parties have executed this Registration Rights Agreement as
of the date first written above.
|
INDEPENDENCE
BLUE CROSS
|
||
|
By:
|
/s/ Xxxxxx X. Xxxxx
|
|
|
Name:
|
Xxxxxx
X. Xxxxx
|
|
|
Title:
|
President
& Chief Executive Officer
|
|
|
Address
for Notice:
|
||
|
Independence
Blue Cross
|
||
|
0000
Xxxxxx Xxxxxx
|
||
|
Xxxxxxxxxxxx,
XX 00000
|
||
|
Attention:
Xxxx Xxxxxxxxx
|
||
|
Chief
Financial Officer
|
||
|
Facsimile
No.: 000-000-0000
|
||
|
*E-mail: Xxxx.Xxxxxxxxx@xxx.xxx
|
||
|
With
a copy to:
|
||
|
Independence
Blue Cross
|
||
|
0000
Xxxxxx Xxxxxx
|
||
|
Xxxxxxxxxxxx,
XX 00000
|
||
|
Attn.:
|
Xxxxxx
X’Xxxxxxx
|
|
|
Senior
Counsel
|
||
|
Facsimile
No.: 000-000-0000
|
||
|
*E-mail: Xxxxxx.Xxxxxxxx@xxx.xxx
|
||
By
providing an e-mail address, the party listed above hereby consents to
electronic delivery of the documents and notices required to be delivered
pursuant to this Agreement.
