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EXIBIT 10.2
REGISTRATION AGREEMENT
THIS AGREEMENT is made as of November 3, 1998, among CRITICARE
SYSTEMS, INC., a Delaware corporation (the "Company"), and TeleMed Technologies
International, Inc. (the "Investor").
RECITAL
The Investor is party to an Assignment Agreement of even date
herewith (the "Assignment Agreement") with the Company. In order to induce
Investor to enter into the Assignment Agreement, the Company has agreed to
provide the registration rights set forth in this Agreement. Unless otherwise
provided in this Agreement, capitalized terms used herein shall have the
meanings set forth in paragraph 8 hereof.
AGREEMENTS
The parties hereto agree as follows:
1. Demand Registrations.
(a) Request for Registration. Subject to the
terms and conditions of this Agreement, the holders of a majority of the
Registrable Securities may request registration under the Securities Act of all
or a majority of the Registrable Securities (a "Demand Registration") by
delivering a written notice to the Company if such registration may be made on
Form S-2 or S-3 or any similar short-form registration statement. A Demand
Registration shall specify the approximate number of Registrable Securities
requested to be registered and the anticipated per share price range for such
offering.
(b) Number of Demand Registrations. The holders
of Registrable Securities shall be entitled to request one Demand Registration
during the first 11 months after the date of this Agreement. A registration
shall not count as the one permitted Demand Registration until it has become
effective.
(c) Priority on Demand Registration. The
Company shall not include in any Demand Registration any securities which are
not Registrable Securities without the prior written consent of Investor. If a
Demand Registration is an underwritten offering and the managing underwriters
advise the Company in writing that in their opinion the number of Registrable
Securities and, if permitted hereunder, other securities requested to be
included in such offering exceeds the
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number of Registrable Securities and other securities, if any, which can be sold
in an orderly manner in such offering within a price range acceptable to
Investor, the Company shall include in such registration prior to the inclusion
of any securities which are not Registrable Securities the number of Registrable
Securities requested to be included which in the opinion of such underwriters
can be sold in an orderly manner within the price range of such offering. Any
Persons other than holders of Registrable Securities who participate in Demand
Registrations which are not at the Company's expense must pay their share of the
Registration Expenses as provided in paragraph 5 hereof.
(d) Restrictions on Demand Registration. The
Company shall not be obligated to effect any Demand Registration within 90 days
after the effective date of any previous "Piggyback Registration" pursuant to
Section 2 below. The Company may postpone for up to 90 days the filing or the
effectiveness of a registration statement for a Demand Registration if the
Company determines that such Demand Registration would reasonably be expected to
have a material adverse effect on any proposal or plan by the Company or any of
its Subsidiaries to engage in any acquisition of assets (other than in the
ordinary course of business) or any merger, consolidation, tender offer,
reorganization or similar transaction; provided that in such event, the holders
of Registrable Securities shall be entitled to withdraw such request and, if
such request is withdrawn, such Demand Registration shall not count as the one
permitted Demand Registration hereunder and the Company shall pay all
Registration Expenses in connection with such registration. The Company may
delay a Demand Registration hereunder only once in any 12-month period.
(e) Selection of Underwriters. The holders of a
majority of the Registrable Securities included in the Demand Registration will
have the right to select the investment banker(s) and manager(s) to administer
the offering, subject to the Company's approval which will not be unreasonably
withheld.
(f) Other Registration Rights. Except as
provided in this Agreement, the Company shall not grant to any Persons the right
to request the Company to register any equity securities of the Company, or any
securities convertible or exchangeable into or exercisable for such securities,
during the 12 months following the date of this Agreement, unless the
Registrable Securities owned by Investor have been registered or unless Company
receives the prior written consent of Investor.
2. Piggyback Registrations.
(a) Right to Piggyback. During the 12 months
following the date of this Agreement, whenever the Company proposes to register
any of its
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securities under the Securities Act (other than pursuant to a Demand
Registration) and the registration form to be used may be used for the
registration of Registrable Securities (a "Piggyback Registration"), the Company
shall give prompt written notice to all holders of Registrable Securities of its
intention to effect such a registration and shall include in such registration
all Registrable Securities with respect to which the Company has received
written requests for inclusion therein within 20 days after the receipt of the
Company's notice (subject to paragraphs 2(c) and (d) below).
(b) Piggyback Expenses. The Registration
Expenses of the holders of Registrable Securities shall be paid by the Company
in all Piggyback Registrations as provided in paragraph 5.
(c) Priority on Primary Registrations. If a
Piggyback Registration is an underwritten primary registration on behalf of the
Company, and the managing underwriters advise the Company in writing that in
their opinion the number of securities requested to be included in such
registration exceeds the number which can be sold in such offering without
adversely affecting the marketability of the offering, the Company shall include
in such registration (i) first, the securities the Company proposes to sell,
(ii) second, the Registrable Securities requested to be included in such
registration, and (iii) third, other securities requested to be included in such
registration.
(d) Priority on Secondary Registrations. If a
Piggyback Registration is an underwritten secondary registration on behalf of
holders of the Company's securities, and the managing underwriters advise the
Company in writing that in their opinion the number of securities requested to
be included in such registration exceeds the number which can be sold in such
offering without adversely affecting the marketability of the offering, the
Company shall include in such registration (i) first, the securities requested
to be included therein by the holders requesting such registration, (ii) second,
the Registrable Securities requested to be included in such registration, and
(iii) third, other securities requested to be included in such registration.
(e) Selection of Underwriters. The Company will
have the right to select the investment banker(s) and manager(s) to administer
any offering pursuant to a Piggyback Registration.
(f) Other Registrations. If the Company has
previously filed a registration statement with respect to Registrable Securities
pursuant to paragraph 1 or pursuant to this paragraph 2, and if such previous
registration has not been withdrawn or abandoned, the Company shall not file or
cause to be effected any other registration of any of its equity securities or
securities
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convertible or exchangeable into or exercisable for its equity securities under
the Securities Act (except on Form S-8 or any successor form), whether on its
own behalf or at the request of any holder or holders of such securities, until
a period of at least 180 days has elapsed from the effective date of such
previous registration.
3. Holdback Agreements.
(a) Each holder of Registrable Securities shall
not effect any public sale or distribution (including sales pursuant to Rule
144) of equity securities of the Company, or any securities convertible into or
exchangeable or exercisable for such securities, during the seven days prior to
and the 180-day period beginning on the effective date of any underwritten
Demand Registration or any underwritten Piggyback Registration in which
Registrable Securities are included (except as part of such underwritten
registration), unless the underwriters managing the registered public offering
otherwise agree.
(b) The Company shall not effect any public sale
or distribution of its equity securities, or any securities convertible into or
exchangeable or exercisable for such securities, during the seven days prior to
and during the 180-day period beginning on the effective date of any
underwritten Demand Registration or any underwritten Piggyback Registration
(except as part of such underwritten registration or pursuant to registrations
on Form S-8 or any successor form), unless the underwriters managing the
registered public offering otherwise agree.
4. Registration Procedures. Whenever the holders of
Registrable Securities have requested that any Registrable Securities be
registered pursuant to this Agreement, the Company shall use its reasonable best
efforts to effect the registration and the sale of such Registrable Securities
in accordance with the intended method of disposition thereof, and pursuant
thereto the Company shall as expeditiously as possible:
(a) prepare and file with the Securities and
Exchange Commission a registration statement with respect to such Registrable
Securities and use its reasonable best efforts to cause such registration
statement to become effective (provided that before filing a registration
statement or prospectus or any amendments or supplements thereto, the Company
shall furnish to the counsel selected by the Investor copies of all such
documents proposed to be filed);
(b) notify each holder of Registrable Securities
of the effectiveness of each registration statement filed hereunder and prepare
and file with the Securities and Exchange Commission such amendments and
supplements to such registration statement and the prospectus used in connection
therewith as
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may be necessary to keep such registration statement effective for a period of
not less than 180 days or until the earlier sale of the Registrable Securities
registered thereunder and comply with the provisions of the Securities Act with
respect to the disposition of all securities covered by such registration
statement during such period in accordance with the intended methods of
disposition by the sellers thereof set forth in such registration statement;
(c) furnish to each seller of Registrable
Securities such number of copies of such registration statement, each amendment
and supplement thereto, the prospectus included in such registration statement
(including each preliminary prospectus) and such other documents as such seller
may reasonably request in order to facilitate the disposition of the Registrable
Securities owned by such seller;
(d) use its reasonable best efforts to register
or qualify such Registrable Securities under such other securities or blue sky
laws of such jurisdictions as any seller reasonably requests and do any and all
other acts and things which may be reasonably necessary or advisable to enable
such seller to consummate the disposition in such jurisdiction of the
Registrable Securities owned by such seller (provided that the Company shall not
be required to (i) qualify generally to do business in any jurisdiction where it
would not otherwise be required to qualify but for this subparagraph, (ii)
subject itself to taxation in any such jurisdiction or (iii) consent to general
service of process in any such jurisdiction);
(e) notify each seller of such Registrable
Securities, at any time when a prospectus relating thereto is required to be
delivered under the Securities Act, of the happening of any event as a result of
which the prospectus included in such registration statement contains an untrue
statement of a material fact or omits any fact necessary to make the statements
therein not misleading, and, at the request of any such seller, the Company
shall prepare a supplement or amendment to such prospectus so that, as
thereafter delivered to the purchasers of such Registrable Securities, such
prospectus shall not contain an untrue statement of a material fact or omit to
state any fact necessary to make the statements therein not misleading;
(f) enter into such customary agreements
(including underwriting agreements in customary form) and take all such other
actions as the Investor or the underwriters, if any, reasonably request in order
to expedite or facilitate the disposition of such Registrable Securities;
(g) make available for inspection by any seller,
any underwriter participating in any disposition pursuant to such registration
statement
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and any attorney, accountant or other agent retained by any such
seller or underwriter, all financial and other records, pertinent corporate
documents and properties of the Company, and cause the Company's officers,
directors, employees and independent accountants to supply all information
reasonably requested by any such seller, underwriter, attorney, accountant or
agent in connection with such registration statement;
(h) otherwise use its reasonable best efforts to
comply with all applicable rules and regulations of the Securities and Exchange
Commission, and make available to its security holders, as soon as reasonably
practicable, an earnings statement covering the period of at least 12 months
beginning with the first day of the Company's first full calendar quarter after
the effective date of the registration statement, which earnings statement shall
satisfy the provision of section 11(a) of the Securities Act and Rule 158
thereunder;
(i) in the event of the issuance of any stop
order suspending the effectiveness of a registration statement, or of any order
suspending or preventing the use of any related prospectus or suspending the
qualification of any common stock including in such registration statement for
sale in any jurisdiction, the Company shall use its reasonable efforts promptly
to obtain the withdrawal of such order;
(j) use its reasonable best efforts to cause
such Registrable Securities covered by such registration statement to be
registered with or approved by such other governmental agencies or authorities
as may be necessary to enable the sellers thereof to consummate the disposition
of such Registrable Securities.
5. Registration Expenses.
(a) All expenses incident to the Company's
performance of or compliance with this Agreement, including without limitation
all registration and filing fees, fees and expenses of compliance with
securities or blue sky laws, printing expenses, messenger and delivery expenses,
fees and disbursements of custodians, and fees and disbursements of counsel for
the Company and all independent certified public accountants, underwriters
(excluding discounts and commissions) and other Persons retained by the Company
(all such expenses being herein called "Registration Expenses"), shall be borne
as provided in this Agreement, except that the Company shall, in any event, pay
its internal expenses (including, without limitation, all salaries and expenses
of its officers and employees performing legal or accounting duties), the
expense of any annual audit or quarterly review, the expense of any liability
insurance and the expenses and fees for listing the securities to be registered
on each securities exchange on which
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similar securities issued by the Company are then listed or on the NASD
automated quotation system.
(b) In connection with each Demand Registration
and each Piggyback Registration, each holder of Registrable Securities shall be
solely responsible for (i) its pro rata share of the fees and disbursements of
any legal counsel retained by the holders of Registrable Securities, and (ii)
underwriting discounts and commissions.
6. Indemnification.
(a) The Company agrees to indemnify, to the
extent permitted by law, each holder of Registrable Securities, its officers and
directors and each Person who controls such holder (within the meaning of the
Securities Act) against all losses, claims, damages, liabilities and expenses
caused by any untrue or alleged untrue statement of material fact contained in
any registration statement, prospectus or preliminary prospectus or any
amendment thereof or supplement thereto or any omission or alleged omission of a
material fact required to be stated therein or necessary to make the statements
therein not misleading, except insofar as the same are caused by or contained in
any information furnished in writing to the Company by such holder expressly for
use therein or by such holder's failure to deliver a copy of the registration
statement or prospectus or any amendments or supplements thereto after the
Company has furnished such holder with a sufficient number of copies of the
same. In connection with an underwritten offering, the Company shall indemnify
such underwriters, their officers and directors and each Person who controls
such underwriters (within the meaning of the Securities Act) to the same extent
as provided above with respect to indemnification of the holders of Registrable
Securities.
(b) In connection with any registration
statement in which a holder of Registrable Securities is participating, each
such holder shall furnish to the Company in writing such information and
affidavits as the Company reasonably requests for use in connection with any
such registration statement or prospectus and, to the extent permitted by law,
shall indemnify the Company, its directors and officers and each person who
controls the Company (within the meaning of the Securities Act) against any
losses, claims, damages, liabilities and expenses resulting from any untrue or
alleged untrue statement of material fact contained in the registration
statement, prospectus or preliminary prospectus or any amendment thereof or
supplement thereto or any omission or alleged omission of a material fact
required to be stated therein or necessary to make the statements therein not
misleading, but only to the extent that such untrue statement or omission is
contained in any information or affidavit so furnished in writing by such
holder; provided that the obligation to indemnify shall be individual, not joint
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and several, for each holder and shall be limited to the net amount of proceeds
received by such holder from the sale of Registrable Securities pursuant to such
registration statement.
(c) Any Person entitled to indemnification
hereunder shall (i) give prompt written notice to the indemnifying party of any
claim with respect to which it seeks indemnification (provided that the failure
to give prompt notice shall not impair any Person's right to indemnification
hereunder to the extent such failure has not prejudiced the indemnifying party)
and (ii) unless in such indemnified party's reasonable judgment a conflict of
interest between such indemnified and indemnifying parties exists with respect
to such claim, permit such indemnifying party to assume the defense of such
claim with counsel reasonably satisfactory to the indemnified party. If such
defense is assumed, the indemnifying party shall not be subject to any liability
for any settlement made by the indemnified party without its consent. An
indemnifying party who is not entitled to, or elects not to, assume the defense
of a claim shall not be obligated to pay the fees and expenses of more than one
counsel for all parties indemnified by such indemnifying party with respect to
such claim, unless in the reasonable judgment of any indemnified party a
conflict of interest exists between such indemnified party and other of such
indemnified parties with respect to such claim.
(d) The indemnification provided for under this
Agreement shall remain in full force and effect regardless of any investigation
made by or on behalf of the indemnified party or any officer, director or
controlling Person of such indemnified party and shall survive the transfer of
securities. The Company also agrees to make such provisions, as are reasonably
requested by any indemnified party, for contribution to such party in the event
the Company's indemnification is unavailable for any reason.
7. Participation in Underwritten Registrations. No
Person may participate in any registration hereunder which is underwritten
unless such Person (i) agrees to sell such Person's securities on the basis
provided in any underwriting arrangements approved by the Person or Persons
entitled hereunder to approve such arrangements and (ii) completes and executes
all questionnaires, powers of attorney, indemnities, underwriting agreements and
other documents required under the terms of such underwriting arrangements.
8. Definitions.
"Holder of Registrable Securities" means any of the
Investor and any permitted transferee of any of the Registrable Securities.
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"Investor" means TeleMed Technologies International,
Inc.
"Person" means any corporation, association, joint
venture, partnership, limited liability company, trust, business, individual,
government or political subdivision thereof, or any governmental agency.
"Registrable Securities" means (i) any Common Stock
issued to the Investor pursuant to the Assignment Agreement and (ii) any equity
securities issued or issuable with respect to the securities referred to in
clause (i) by way of a stock dividend or stock split or in connection with a
combination of shares, recapitalization, merger, consolidation or other
reorganization. As to any particular Registrable Securities, such securities
shall cease to be Registrable Securities upon the first to occur of the
following: (x) they have been sold to the public pursuant to a registration or
pursuant to Rule 144 under the Securities Act (or any similar rule then in
effect), (y) they have been exchanged, substituted or replaced by securities
which have been registered under the Securities Act or (z) they have become
eligible for sale pursuant to Rule 144(k) under the Securities Act (or any
similar rule then in effect).
"Securities Act" means the Securities Act of 1933, as
amended.
9. Miscellaneous.
(a) No Inconsistent Agreements. The Company
shall not hereafter enter into any agreement with respect to its securities
which is inconsistent with or violates the rights granted to the holders of
Registrable Securities in this Agreement.
(b) Remedies. Any Person having rights under any
provision of this Agreement shall be entitled to enforce such rights
specifically to recover damages caused by reason of any breach of any provision
of this Agreement and to exercise all other rights granted by law. The parties
hereto agree and acknowledge that money damages may not be an adequate remedy
for any breach of the provisions of this Agreement and that any party may in its
sole discretion apply to any court of law or equity of competent jurisdiction
(without posting any bond or other security) for specific performance and for
other injunctive relief in order to enforce or prevent violation of the
provisions of this Agreement.
(c) Amendments and Waivers. Except as otherwise
provided herein, the provisions of this Agreement may be amended or waived only
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upon the prior written consent of the Company, the holders of a majority of the
Registrable Securities.
(d) Successors and Assigns. All covenants and
agreements 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 whether so expressed or not. In addition, whether or not any
express assignment has been made, the provisions of this Agreement which are for
the benefit of purchasers or holders of Registrable Securities are also for the
benefit of, and enforceable by, any subsequent holder of Registrable Securities.
(e) Severability. Whenever possible, each
provision of this Agreement shall be interpreted in such manner as to be
effective and valid under applicable law, but if any provision of this Agreement
is held to be prohibited by or invalid under applicable law, such provision
shall be ineffective only to the extent of such prohibition or invalidity,
without invalidating the remainder of this Agreement.
(f) Counterparts. This Agreement may be
executed simultaneously in two or more counterparts, any one of which need not
contain the signatures of more than one party, but all such counterparts taken
together shall constitute one and the same Agreement.
(g) Descriptive Headings. The descriptive
headings of this Agreement are inserted for convenience only and do not
constitute a part of this Agreement.
(h) Governing Law. Issues and questions
concerning the construction, validity, interpretation and enforcement of this
Agreement and the exhibits and schedules hereto shall be governed by, and
construed in accordance with, the laws of the State of Wisconsin, without giving
effect to any choice of law or conflict of law rules or provisions (whether of
the State of Wisconsin or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the State of Wisconsin.
(i) Notices. All notices, demands or other
communications to be given or delivered under or by reason of the provisions of
this Agreement shall be in writing and shall be deemed to have been given when
delivered personally to the recipient, sent to the recipient by reputable
overnight courier service (charges prepaid) or mailed to the recipient by
certified or registered mail, return receipt requested and postage prepaid. Such
notices, demands and other communications shall be sent to the addresses
indicated below:
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To the Investor:
Telemed Technologies International, Inc.
000 Xxxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
with copies to:
Doepken, Keevican & Xxxxx
58th Floor, USX Tower
000 Xxxxx Xxxxxx
Xxxxxxxxxx, XX 00000-0000
to the Company:
Criticare Systems, Inc.
00000 Xxxxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000
Attn: President
with copies to:
Xxxxxx X. Xxxxxx, Esq.
Reinhart, Boerner, Van Deuren
Xxxxxx & Rieselbach, s.c.
0000 Xxxxx Xxxxx Xxxxxx
Xxxxx 0000
Xxxxxxxxx, XX 00000
or to such other address or to the attention of such other person as the
recipient party has specified by prior written notice to the sending party.
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IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
CRITICARE SYSTEMS, INC.
BY /s/ Xxxxxxx von der Ruhr
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Xxxxxxx von der Ruhr, President
TELEMED TECHNOLOGIES INTERNATIONAL, INC.
BY /s/ Xxx X. Xxxxxxxxxx
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Its
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