Exhibit 3
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REGISTRATION RIGHTS AGREEMENT
April 30, 1999
To each of the several Purchasers named in Exhibit 1.01 to the Securities
Purchase Agreement dated April 30, 1999
Ladies and Gentlemen:
This will confirm that in consideration of your agreement on the date
hereof to enter into the Securities Purchase Agreement of even date herewith
(the "Purchase Agreement") between MedPlus, Inc. (the "Company") and you, and as
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an inducement to you to consummate the transactions contemplated by the Purchase
Agreement, the Company covenants and agrees with each of you as follows. All
capitalized terms not defined herein shall have the meanings assigned to them in
the Purchase Agreement.
1. Certain Definitions. As used in this Agreement, the following terms
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shall have the following respective meanings:
"Commission" shall mean the Securities and Exchange Commission, or any
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other federal agency at the time administering the Securities Act.
"Common Stock" shall mean the Common Stock, no par value, of the
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Company, as constituted as of the date of this Agreement.
"Conversion Shares" shall mean shares of Common Stock issued upon
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conversion of the Preferred Shares.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
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amended, or any similar federal statute, and the rules and regulations of the
Commission thereunder, all as the same shall be in effect at the time.
"Managing Shareholder" shall mean Xxxxxxx X. Xxxxxxx.
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"Managing Shareholder Shares" shall mean shares of Common Stock now or
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hereafter owned beneficially and of record by the Managing Shareholder.
"Notes" shall mean the Company's subordinated notes, due 2004, in the
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aggregate principal amount of $2,000,000 issued pursuant to the Purchase
Agreement.
"Note Warrants" shall mean the warrants to purchase shares of Common
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Stock or Preferred Stock issued pursuant to the Notes.
"Preferred Shares" shall mean the shares of Preferred Stock issued
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pursuant to the Purchase Agreement, any shares of Preferred Stock issued upon
exercise of the Warrants and any additional shares of Preferred Stock hereafter
acquired by the Purchasers.
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"Preferred Stock" shall mean the Series A Convertible Preferred
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Stock of the Company, $.01 par value.
"Purchase Warrants" shall mean the warrants to purchase an aggregate
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of 759,562 shares of the Preferred Stock to be issued pursuant to the Purchase
Agreement.
"Registration Expenses" shall mean the expenses so described in
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Section 8.
"Restricted Stock" shall mean the Conversion Shares, the Warrant
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Shares and any additional shares of Common Stock which the Purchasers hereafter
acquire, excluding Conversion Shares, Warrant Shares and shares of Common Stock
held by the Purchasers which have been (a) registered under the Securities Act
pursuant to an effective registration statement filed thereunder and disposed of
in accordance with the registration statement covering them or (b) publicly sold
pursuant to Rule 144 under the Securities Act.
"Securities Act" shall mean the Securities Act of 1933, as amended,
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or any similar federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.
"Selling Expenses" shall mean the expenses so described in Section 8.
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"Warrants" shall mean the Purchase Warrants and the Note Warrants.
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"Warrant Shares" shall mean the shares of Common Stock issued upon
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exercise of the Note Warrants.
2. Restrictive Legend. Each certificate representing Preferred Shares,
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Conversion Shares or Warrant Shares shall, except as otherwise provided in this
Section 2 or in Section 3, be stamped or otherwise imprinted with a legend
substantially in the following form:
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933 OR ANY STATE SECURITIES LAWS AND MAY NOT BE TRANSFERRED OR
OTHERWISE DISPOSED OF UNLESS IT HAS BEEN REGISTERED UNDER SUCH ACT AND
ALL SUCH APPLICABLE LAWS OR AN EXEMPTION FROM REGISTRATION IS
AVAILABLE."
A certificate shall not bear such legend if in the opinion of counsel
satisfactory to the Company (it being agreed that Xxxxx, Xxxxxxx & Xxxxxxxxx,
LLP shall be satisfactory) the securities represented thereby may be publicly
sold without registration under the Securities Act and any applicable state
securities laws.
3. Notice of Proposed Transfer. Prior to any proposed transfer of any
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Preferred Shares, Conversion Shares or Warrant Shares (other than under the
circumstances described in Sections 4, 5 or 6), the holder thereof shall give
written notice to the Company of its intention to effect such transfer. Each
such notice shall describe the manner of the proposed transfer and, if requested
by the Company, shall be accompanied by an opinion of counsel satisfactory to
the Company (it being agreed that Xxxxx, Xxxxxxx & Xxxxxxxxx, LLP shall be
satisfactory) to the effect that the proposed transfer may be effected without
registration under the Securities Act and any applicable state securities laws,
whereupon the holder of such stock shall be entitled to transfer such stock in
accordance with the terms of its notice;
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provided, however, that no such opinion of counsel shall be required for a
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to one or more partners of the transferor (in the case of a transferor that is a
partnership) or to an affiliated corporation (in the case of a transferor that
is a corporation). Each certificate for Preferred Shares, Conversion Shares or
Warrant Shares transferred as above provided shall bear the legend set forth in
Section 2, except that such certificate shall not bear such legend if (i) such
transfer is in accordance with the provisions of Rule 144 (or any other rule
permitting public sale without registration under the Securities Act) or (ii)
the opinion of counsel referred to above is to the further effect that the
transferee and any subsequent transferee (other than an affiliate of the
Company) would be entitled to transfer such securities in a public sale without
registration under the Securities Act. The restrictions provided for in this
Section 3 shall not apply to securities which are not required to bear the
legend prescribed by Section 2 in accordance with the provisions of that
Section.
4. Required Registration.
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(a) At any time after the date hereof, the holders of Restricted
Stock constituting at least a majority of the total shares of Restricted Stock
then outstanding may request the Company to register under the Securities Act
all or any portion of the shares of Restricted Stock held by such requesting
holder or holders for sale in the manner specified in such notice, provided that
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the shares of Restricted Stock for which registration has been requested shall
constitute at least 20% of the total shares of Restricted Stock originally
issued if such holder or holders shall request the registration of less than all
shares of Restricted Stock then held by such holder or holders (or any lesser
percentage if the reasonably anticipated aggregate price to the public of such
public offering would exceed $5,000,000). For purposes of this Section 4,
Section 5 and Section 6, the term "Restricted Stock" shall be deemed to include
the number of shares of Restricted Stock which would be issuable to a holder of
Preferred Shares or Warrants upon the exercise of all Warrants and the
conversion of all Preferred Shares held by such holder (assuming such exercise)
at such time, and for purposes of Sections 12(a) and 12(d), the term "Restricted
Stock" shall be deemed to include the number of shares of Restricted Stock which
would be issuable to a holder of Preferred Shares or Warrants upon exercise of
all Warrants and conversion of all Preferred Shares held by such holder
(assuming such exercise) at such time, provided, however, that the only
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securities which the Company shall be required to register pursuant hereto shall
be shares of Common Stock, and provided, further, however, that, in any
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underwritten public offering contemplated by this Section 4, Section 5 or
Section 6, the holders of Preferred Shares shall be entitled to sell such
Preferred Shares to the underwriters for conversion and sale of the shares of
Common Stock issued upon conversion thereof. In the event that any registration
pursuant to this Section 4 shall be, in whole or in part, an underwritten public
offering of Common Stock, the number of shares of Restricted Stock to be
included in such an underwriting may be reduced (pro rata among the requesting
holders based upon the number of shares of Restricted Stock owned by such
holders) if and to the extent that the managing underwriter shall be of the
opinion that the inclusion of all such shares would adversely affect the
marketing of the shares to be sold therein, provided, however, that such number
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of shares of Restricted Stock shall not be reduced if any shares are to be
included in such underwriting for the account of any person other than
requesting holders of Restricted Stock. Notwithstanding anything to the
contrary contained herein, no request may be made under this Section 4 within
120 days after the effective date of a registration statement filed by the
Company covering a firm commitment underwritten public offering in which the
holders of Restricted Stock shall have been entitled to join pursuant to Section
5 and in which there shall have been effectively registered all shares of
Restricted Stock as to which registration shall have been requested.
(b) Following receipt of any notice under this Section 4, the Company
shall immediately notify the Managing Shareholder and all holders of Restricted
Stock and Warrants from
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whom notice has not been received and shall use its best efforts to register
under the Securities Act, for public sale in accordance with the method of
disposition specified in such notice from requesting holders, (i) the number of
shares of Restricted Stock specified in such notice (and in all notices received
by the Company from other holders within 30 days after the giving of such notice
by the Company), and (ii) subject to Section 4(d), the number of Managing
Shareholder Shares specified in any notice received by the Company from the
Managing Shareholder within 30 days after the giving of such notice by the
Company. If such method of disposition shall be an underwritten public offering,
the holders of a majority of the shares of Restricted Stock to be sold in such
offering may designate the managing underwriter of such offering, subject to the
approval of the Company, which approval shall not be unreasonably withheld or
delayed. The Company shall be obligated to register Restricted Stock pursuant to
this Section 4 on two occasions only, provided, however, that such obligation
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shall be deemed satisfied only when a registration statement covering all shares
of Restricted Stock specified in notices received as aforesaid, for sale in
accordance with the method of disposition specified by the requesting holders,
shall have become effective and, if such method of disposition is a firm
commitment underwritten public offering, all such shares shall have been sold
pursuant thereto.
(c) The Company shall be entitled to include in any registration
statement referred to in this Section 4, for sale in accordance with the method
of disposition specified by the requesting holders, shares of Common Stock to be
sold by the Company for its own account, except as and to the extent that, in
the opinion of the managing underwriter (if such method of disposition shall be
an underwritten public offering), such inclusion would adversely affect the
marketing of the Restricted Stock to be sold. Except for registration statements
on Form X-0, X-0 or any successor thereto, the Company will not file with the
Commission any other registration statement with respect to its Common Stock,
whether for its own account or that of other stockholders, from the date of
receipt of a notice from requesting holders pursuant to this Section 4 until the
completion of the period of distribution of the registration contemplated
thereby.
(d) Notwithstanding anything herein to the contrary, with respect to
any single registration, (i) the Company shall not register more than that
number of Managing Shareholder Shares as is equal to twenty percent (20%) of the
aggregate shares of Restricted Stock registered in such registration, and (ii)
in no event shall the Company shall not register any Managing Shareholder Shares
if such registration is, in whole or in part, an underwritten public offering of
Common Stock and the managing underwriter is of the opinion that the inclusion
of such Managing Shareholder Shares would adversely affect the marketing of the
shares to be sold therein.
5. Incidental Registration. If the Company at any time (other than
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pursuant to Section 4 or Section 6) proposes to register any of its securities
under the Securities Act for sale to the public, whether for its own account or
for the account of other security holders or both (except with respect to
registration statements on Forms X-0, X-0 or another form not available for
registering the Restricted Stock for sale to the public), each such time it will
give written notice to all holders of outstanding Restricted Stock and Warrants
of its intention so to do. Upon the written request of any such holder,
received by the Company within 30 days after the giving of any such notice by
the Company, to register any of its Restricted Stock, the Company will use its
best efforts to cause the Restricted Stock as to which registration shall have
been so requested to be included in the securities to be covered by the
registration statement proposed to be filed by the Company, all to the extent
requisite to permit the sale or other disposition by the holder of such
Restricted Stock so registered. In the event that any registration pursuant to
this Section 5 shall be, in whole or in part, an underwritten public offering of
Common Stock, (i) then the holders of a majority of the shares of Restricted
Stock to be sold in such offering may designate a co-managing underwriter of
such offering, and (ii) the number of shares of
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Restricted Stock to be included in such an underwriting may be reduced (pro rata
among the requesting holders based upon the number of shares of Restricted Stock
owned by such holders) if and to the extent that the managing underwriter shall
be of the opinion that such inclusion would adversely affect the marketing of
the securities to be sold by the Company therein, provided, however, that such
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number of shares of Restricted Stock shall not be reduced if any shares are to
be included in such underwriting for the account of any person other than the
Company or requesting holders of Restricted Stock. Notwithstanding the foregoing
provisions, the Company may withdraw any registration statement referred to in
this Section 5 without thereby incurring any liability to the holders of
Restricted Stock. The Company hereby agrees that it will not register any of its
securities under the Securities Act for sale to the public for the account of
any security holder other than a Purchaser without the prior written consent of
the Purchasers.
6. Registration on Form S-3. If at any time (i) a holder or holders of
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Preferred Shares or Restricted Stock request that the Company file a
registration statement on Form S-3 or any successor thereto for a public
offering of all or any portion of the shares of Restricted Stock held by such
requesting holder or holders, the reasonably anticipated aggregate price to the
public of which would exceed $1,000,000, and (ii) the Company is a registrant
entitled to use Form S-3 or any successor thereto to register such shares, then
the Company shall use its best efforts to register under the Securities Act on
Form S-3 or any successor thereto, for public sale in accordance with the method
of disposition specified in such notice, the number of shares of Restricted
Stock specified in such notice. Whenever the Company is required by this
Section 6 to use its best efforts to effect the registration of Restricted
Stock, each of the procedures and requirements of Section 4 (including but not
limited to the requirement that the Company notify all holders of Restricted
Stock and Warrants from whom notice has not been received and provide them with
the opportunity to participate in the offering) shall apply to such
registration, provided, however, that there shall be no limitation on the number
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of registrations on Form S-3 which may be requested and obtained under this
Section 6, and provided, further, however, that the requirements contained in
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the first sentence of Section 4(a) shall not apply to any registration on Form
S-3 which may be requested and obtained under this Section 6.
7. Registration Procedures. If and whenever the Company is required by
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the provisions of Sections 4, 5 or 6 to use its best efforts to effect the
registration of any shares of Restricted Stock under the Securities Act, the
Company will, as expeditiously as possible:
(a) prepare and file with the Commission a registration statement
(which, in the case of an underwritten public offering pursuant to Section 4,
shall be on Form S-1 or other form of general applicability satisfactory to the
managing underwriter selected as therein provided) with respect to such
securities and use its best efforts to cause such registration statement to
become and remain effective for the period of the distribution contemplated
thereby (determined as hereinafter provided);
(b) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in connection
therewith as may be necessary to keep such registration statement effective for
the period specified in paragraph (a) above and comply with the provisions of
the Securities Act with respect to the disposition of all Restricted Stock
covered by such registration statement in accordance with the sellers' intended
method of disposition set forth in such registration statement for such period;
(c) furnish to each seller of Restricted Stock and to each
underwriter, and to the Managing Shareholder if any Managing Shareholder Shares
are included in such registration, such number of copies of the registration
statement and the prospectus included therein (including each
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preliminary prospectus) as such persons reasonably may request in order to
facilitate the public sale or other disposition of the Restricted Stock and
Managing Shareholder Shares, if any, covered by such registration statement;
(d) use its best efforts to register or qualify the Restricted Stock
and the Managing Shareholder Shares, if any, covered by such registration
statement under the securities or "blue sky" laws of such jurisdictions as the
sellers of Restricted Stock or, in the case of an underwritten public offering,
the managing underwriter reasonably shall request, provided, however, that the
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Company shall not for any such purpose be required to qualify generally to
transact business as a foreign corporation in any jurisdiction where it is not
so qualified or to consent to general service of process in any such
jurisdiction;
(e) use its best efforts to list the Restricted Stock and the
Managing Shareholder Shares, if any, covered by such registration statement with
any securities exchange on which the Common Stock of the Company is then listed;
(f) immediately notify each seller of Restricted Stock and each
underwriter, and the Managing Shareholder, if any Managing Shareholder Shares
are included in such registration, under such registration statement, at any
time when a prospectus relating thereto is required to be delivered under the
Securities Act, of the happening of any event of which the Company has knowledge
as a result of which the prospectus contained in such registration statement, as
then in effect, includes an untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances then existing;
(g) if the offering is underwritten and at the request of any seller
of Restricted Stock, use its best efforts to furnish on the date that Restricted
Stock is delivered to the underwriters for sale pursuant to such registration:
(i) an opinion dated such date of counsel representing the Company for the
purposes of such registration, addressed to the underwriters and to such seller,
stating that such registration statement has become effective under the
Securities Act and that (A) to the best knowledge of such counsel, no stop order
suspending the effectiveness thereof has been issued and no proceedings for that
purpose have been instituted or are pending or contemplated under the Securities
Act, (B) the registration statement, the related prospectus and each amendment
or supplement thereof comply as to form in all material respects with the
requirements of the Securities Act (except that such counsel need not express
any opinion as to financial statements contained therein) and (C) to such other
effects as reasonably may be requested by counsel for the underwriters or by
such seller or its counsel and (ii) a letter dated such date from the
independent public accountants retained by the Company, addressed to the
underwriters and to such seller, stating that they are independent public
accountants within the meaning of the Securities Act and that, in the opinion of
such accountants, the financial statements of the Company included in the
registration statement or the prospectus, or any amendment or supplement
thereof, comply as to form in all material respects with the applicable
accounting requirements of the Securities Act, and such letter shall
additionally cover such other financial matters (including information as to the
period ending no more than five business days prior to the date of such letter)
with respect to such registration as such underwriters reasonably may request;
and
(h) make available for inspection by each seller of Restricted Stock,
any underwriter participating in any distribution pursuant to such registration
statement, and any attorney, accountant or other agent retained by such seller
or underwriter, all financial and other records, pertinent corporate documents
and properties of the Company, and cause the Company's officers, directors and
employees
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to supply all information reasonably requested by any such seller, underwriter,
attorney, accountant or agent in connection with such registration statement.
For purposes of Section 7(a) and 7(b) and of Section 4(c), the period of
distribution of Restricted Stock in a firm commitment underwritten public
offering shall be deemed to extend until each underwriter has completed the
distribution of all securities purchased by it, and the period of distribution
of Restricted Stock in any other registration shall be deemed to extend until
the earlier of the sale of all Restricted Stock covered thereby and 120 days
after the effective date thereof.
In connection with each registration hereunder, the sellers of Restricted
Stock will furnish to the Company in writing such information with respect to
themselves and the proposed distribution by them as reasonably shall be
necessary in order to assure compliance with federal and applicable state
securities laws. In connection with any registration of Managing Shareholder
Shares pursuant to the terms hereof, the Managing Shareholder will furnish to
the Company in writing such information with respect to himself and the proposed
distribution by him as reasonably shall be necessary in order to assure
compliance with federal and applicable state securities laws.
In connection with each registration pursuant to Sections 4, 5 or 6
covering an underwritten public offering, the Company and each seller agree to
enter into a written agreement with the managing underwriter selected in the
manner herein provided in such form and containing such provisions as are
customary in the securities business for such an arrangement between such
underwriter and companies of the Company's size and investment stature.
8. Expenses. All expenses incurred by the Company in complying with
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Sections 4, 5 or 6, including, without limitation, all registration and filing
fees, printing expenses, fees and disbursements of counsel and independent
public accountants for the Company, fees and expenses (including counsel fees)
incurred in connection with complying with state securities or "blue sky" laws,
fees of the National Association of Securities Dealers, Inc., transfer taxes,
fees of transfer agents and registrars, costs of insurance and reasonable fees
and disbursements of one counsel for the sellers of Restricted Stock, but
excluding any Selling Expenses, are called "Registration Expenses". All
underwriting discounts and selling commissions applicable to the sale of
Restricted Stock and Managing Shareholder Shares are called "Selling Expenses".
The Company will pay all Registration Expenses in connection with each
registration statement under Sections 4, 5 or 6. All Selling Expenses in
connection with each registration statement under Sections 4, 5 or 6 shall be
borne by the participating sellers in proportion to the number of shares sold by
each, or by such participating sellers other than the Company (except to the
extent the Company shall be a seller) as they may agree.
9. Indemnification and Contribution.
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(a) In the event of a registration of any of the Restricted Stock
under the Securities Act pursuant to Sections 4, 5 or 6, the Company will
indemnify and hold harmless each seller of such Restricted Stock thereunder,
each underwriter of such Restricted Stock thereunder and each other person, if
any, who controls such seller or underwriter within the meaning of the
Securities Act, against any losses, claims, damages or liabilities, joint or
several, to which such seller, underwriter or controlling person may become
subject under the Securities Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon any untrue statement or alleged untrue statement of any material fact
contained in any registration statement under which such
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Restricted Stock was registered under the Securities Act pursuant to Sections 4,
5 or 6, any preliminary prospectus or final prospectus contained therein, or any
amendment or supplement thereof, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, and will
reimburse each such seller, each such underwriter and each such controlling
person for any legal or other expenses reasonably incurred by them in connection
with investigating or defending any such loss, claim, damage, liability or
action, provided, however, that the Company will not be liable in any such case
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if and to the extent that any such loss, claim, damage or liability arises out
of or is based upon an untrue statement or alleged untrue statement or omission
or alleged omission so made in conformity with information furnished by any such
seller, any such underwriter or any such controlling person in writing
specifically for use in such registration statement or prospectus.
(b) In the event of a registration of any of the Restricted Stock
under the Securities Act pursuant to Sections 4, 5 or 6, each seller of such
Restricted Stock thereunder, and the Managing Shareholder, to the extent a
seller of Managing Shareholder Shares thereunder, severally and not jointly,
will indemnify and hold harmless the Company, each person, if any, who controls
the Company within the meaning of the Securities Act, each officer of the
Company who signs the registration statement, each director of the Company, each
underwriter and each person who controls any underwriter within the meaning of
the Securities Act, against all losses, claims, damages or liabilities, joint or
several, to which the Company or such officer, director, underwriter or
controlling person may become subject under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in the registration statement under
which such Restricted Stock was, and Managing Shareholder Shares were,
registered under the Securities Act pursuant to Sections 4, 5 or 6, any
preliminary prospectus or final prospectus contained therein, or any amendment
or supplement thereof, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, and will reimburse the
Company and each such officer, director, underwriter and controlling person for
any legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action,
provided, however, that such seller will be liable hereunder in any such case if
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and only to the extent that any such loss, claim, damage or liability arises out
of or is based upon an untrue statement or alleged untrue statement or omission
or alleged omission made in reliance upon and in conformity with information
pertaining to such seller, as such, furnished in writing to the Company by such
seller specifically for use in such registration statement or prospectus, and
provided, further, however, that the liability of each seller hereunder shall be
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limited to the proportion of any such loss, claim, damage, liability or expense
which is equal to the proportion that the public offering price of the shares
sold by such seller under such registration statement bears to the total public
offering price of all securities sold thereunder, but not in any event to exceed
the net proceeds received by such seller from the sale of shares covered by such
registration statement.
(c) Promptly after receipt by an indemnified party hereunder of
notice of the commencement of any action, such indemnified party shall, if a
claim in respect thereof is to be made against the indemnifying party hereunder,
notify the indemnifying party in writing thereof, but the omission so to notify
the indemnifying party shall not relieve it from any liability which it may have
to such indemnified party other than under this Section 9 and shall only relieve
it from any liability which it may have to such indemnified party under this
Section 9 if and to the extent the indemnifying party is prejudiced by such
omission. In case any such action shall be brought against any indemnified party
and it shall notify the indemnifying party of the commencement thereof, the
indemnifying party shall be entitled to participate in and, to the extent it
shall wish, to assume and undertake the defense thereof with
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counsel satisfactory to such indemnified party, and, after notice from the
indemnifying party to such indemnified party of its election so to assume and
undertake the defense thereof, the indemnifying party shall not be liable to
such indemnified party under this Section 9 for any legal expenses subsequently
incurred by such indemnified party in connection with the defense thereof other
than reasonable costs of investigation and of liaison with counsel so selected,
provided, however, that, if the defendants in any such action include both the
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indemnified party and the indemnifying party and the indemnified party shall
have reasonably concluded that there may be reasonable defenses available to it
which are different from or additional to those available to the indemnifying
party or if the interests of the indemnified party reasonably may be deemed to
conflict with the interests of the indemnifying party, the indemnified party
shall have the right to select a separate counsel and to assume such legal
defenses and otherwise to participate in the defense of such action, with the
expenses and fees of such separate counsel and other expenses related to such
participation to be reimbursed by the indemnifying party as incurred.
(d) In order to provide for just and equitable contribution to joint
liability under the Securities Act in any case in which either (i) any holder of
Restricted Stock exercising rights under this Agreement, or any controlling
person of any such holder, makes a claim for indemnification pursuant to this
Section 9 but it is judicially determined (by the entry of a final judgment or
decree by a court of competent jurisdiction and the expiration of time to appeal
or the denial of the last right of appeal) that such indemnification may not be
enforced in such case notwithstanding the fact that this Section 9 provides for
indemnification in such case, or (ii) contribution under the Securities Act may
be required on the part of any such selling holder or any such controlling
person in circumstances for which indemnification is provided under this Section
9; then, and in each such case, the Company and such holder will contribute to
the aggregate losses, claims, damages or liabilities to which they may be
subject (after contribution from others) in such proportion so that such holder
is responsible for the portion represented by the percentage that the public
offering price of its shares of Common Stock offered by the registration
statement bears to the public offering price of all securities offered by such
registration statement, and the Company is responsible for the remaining
portion; provided, however, that, in any such case, (A) no such holder will be
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required to contribute any amount in excess of the public offering price of all
such shares of Common Stock offered by it pursuant to such registration
statement; and (B) no person or entity guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) will be entitled to
contribution from any person or entity who was not guilty of such fraudulent
misrepresentation.
10. Changes in Common Stock or Preferred Stock. If, and as often as,
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there is any change in the Common Stock or the Preferred Stock by way of a stock
split, stock dividend, combination or reclassification, or through a merger,
consolidation, reorganization or recapitalization, or by any other means,
appropriate adjustment shall be made in the provisions hereof so that the rights
and privileges granted hereby shall continue with respect to the Common Stock or
the Preferred Stock as so changed.
11. Rule 144 Reporting. With a view to making available the benefits of
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certain rules and regulations of the Commission which may at any time permit the
sale of the Restricted Stock to the public without registration, at all times
after 90 days after any registration statement covering a public offering of
securities of the Company under the Securities Act shall have become effective,
the Company agrees to:
(a) make and keep public information available, as those terms are
understood and defined in Rule 144 under the Securities Act;
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(b) use its best efforts to file with the Commission in a timely
manner all reports and other documents required of the Company under the
Securities Act and the Exchange Act; and
(c) furnish to each holder of Restricted Stock forthwith upon request
a written statement by the Company as to its compliance with the reporting
requirements of such Rule 144 and of the Securities Act and the Exchange Act, a
copy of the most recent annual or quarterly report of the Company, and such
other reports and documents so filed by the Company as such holder may
reasonably request in availing itself of any rule or regulation of the
Commission allowing such holder to sell any Restricted Stock without
registration.
12. Representations and Warranties of the Company. The Company represents
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and warrants to you as follows:
(a) The execution, delivery and performance of this Agreement by the
Company have been duly authorized by all requisite corporate action and will not
violate any provision of law, any order of any court or other agency of
government, the Charter or Code of Regulations of the Company or any provision
of any indenture, agreement or other instrument to which it or any or its
properties or assets is bound, conflict with, result in a breach of or
constitute (with due notice or lapse of time or both) a default under any such
indenture, agreement or other instrument or result in the creation or imposition
of any lien, charge or encumbrance of any nature whatsoever upon any of the
properties or assets of the Company.
(b) This Agreement has been duly executed and delivered by the
Company and constitutes the legal, valid and binding obligation of the Company,
enforceable in accordance with its terms.
13. Miscellaneous.
-------------
(a) All covenants and agreements contained in this Agreement by or on
behalf of any of the parties hereto shall bind and inure to the benefit of the
respective successors and assigns of the parties hereto (including without
limitation transferees of any Preferred Shares, Warrants or Restricted Stock),
whether so expressed or not, provided, however, that registration rights
-------- -------
conferred herein on the holders of Preferred Shares, Warrants or Restricted
Stock shall only inure to the benefit of a transferee of Preferred Shares,
Warrants, or Restricted Stock if (i) there is transferred to such transferee at
least 20% of the total shares of Restricted Stock originally issued pursuant to
the Purchase Agreement to the direct or indirect transferor of such transferee
or (ii) such transferee is a partner, shareholder or affiliate of a party
hereto, and provided further that registration rights conferred herein on the
----------------
Managing Shareholder shall not inure to the benefit of any transferee of
Managing Shareholder Shares.
(b) All notices, requests, consents and other communications
hereunder shall be in writing and shall be delivered in person, mailed by
certified or registered mail, return receipt requested, or sent by telecopier or
telex, addressed as follows:
if to the Company or any other party hereto, at the address of
such party set forth in the Purchase Agreement;
if to any subsequent holder of Preferred Shares, Warrants or
Restricted Stock, to it at such address as may have been furnished to the
Company in writing by such holder;
-11-
or, in any case, at such other address or addresses as shall have been furnished
in writing to the Company (in the case of a holder of Preferred Shares, Warrants
or Restricted Stock) or to the holders of Preferred Shares, Warrants or
Restricted Stock (in the case of the Company) in accordance with the provisions
of this paragraph.
(c) This Agreement shall be governed by and construed in accordance
with the laws of the State of Ohio.
(d) This Agreement may not be amended or modified, and no provision
hereof may be waived, without the written consent of the Company and the holders
of at least two-thirds of the outstanding shares of Restricted Stock.
(e) This Agreement may be executed in two or more counterparts, each
of which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
(f) The obligations of the Company to register shares of Restricted
Stock under Sections 4, 5 or 6 shall terminate on the fifteenth anniversary of
the date of this Agreement.
(g) Notwithstanding the provisions of Section 7(a), the Company's
obligation to file a registration statement, or cause such registration
statement to become and remain effective, shall be suspended for a period not to
exceed 90 days in any 24-month period if there exists at the time material non-
public information relating to the Company which, in the reasonable opinion of
the Company, should not be disclosed.
(h) The Company shall not grant to any third party any registration
rights substantially equal to or more favorable than or inconsistent with any of
those contained herein, so long as any of the registration rights under this
Agreement remains in effect.
(i) If any provision of this Agreement shall be held to be illegal,
invalid or unenforceable, such illegality, invalidity or unenforceability shall
attach only to such provision and shall not in any manner affect or render
illegal, invalid or unenforceable any other provision of this Agreement, and
this Agreement shall be carried out as if any such illegal, invalid or
unenforceable provision were not contained herein.
[Remainder of Page Intentionally Blank]
- Registration Rights Agreement -
Please indicate your acceptance of the foregoing by signing and returning
the enclosed counterpart of this letter, whereupon this Agreement shall be a
binding agreement between the Company and you.
Very truly yours,
MEDPLUS, INC.
By:____________________________
Title:_________________________
AGREED TO AND ACCEPTED as of the date first
above written.
Purchasers named in Exhibit 1.01 to the Purchase
Agreement:
XXXXXX, XXXXXXX STRATEGIC PARTNERS FUND, L.P.,
By: XXXXXX, XXXXXXX STRATEGIC PARTNERS, L.P.,
its General Partner
By:__________________________________
Title:_______________________________
STRATEGIC ASSOCIATES, L.P.,
By: XXXXXX, XXXXXXX & COMPANY, LLC,
its General Partner
By:__________________________________
Title:_______________________________
DOUBLE BLACK DIAMOND II LLC
By:__________________________________
Title:_______________________________
Managing Shareholder:
_____________________________________
Xxxxxxx X. Xxxxxxx
