REGISTRATION RIGHTS AGREEMENT
Registration Rights Agreement (This "Agreement"), dated April 9, 1998, by
and between Accuhealth, Inc., a New York corporation, (the "Company"), and
Xxxxxxx X. Xxxxx, M.D. (the "Shareholder").
RECITALS:
A. The Shareholder is the owner of 461,834 shares of common stock, par
value $.0l per share, of the Company, none of which are registered with the
Securities Exchange Commission (the "SEC") pursuant to the Securities Act of
1933, as amended (the "Securities Act").
B. The Company desires to grant to the Shareholder certain rights to such
shares registered under the Securities Act.
NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged by both parties, the parties agree
as follows:
ARTICLE I
DEFINITIONS
1. DEFINITIONS. Unless otherwise expressly set forth herein, capitalized
terms used in this Agreement which are not otherwise defined shall have the same
meanings ascribed to them in that certain Agreement and Plan of Merger, dated
December 1, 1997 among the Company, HHI Acquiring Corp., Healix HealthCare,
Inc., Xxxxx Xxxxxx, Xxxxx Charylan, M.D., Xxxx Xxxxxxxxx, Xxxxxxx X. Xxxxx,
M.D., Xxxxxx XxxXxxxxx, Xxxxxx XxxXxxxxx, Xxxxxx Xxxxx, Xxxxxxxx X. O'Xxxxx
XxXxxxxx, and Xxxxxx Xxxxxxxx, Xx. (the "Merger Agreement"). In addition, the
following terms, as used herein, have the following meanings:
1.1 "Holder" means the Shareholder.
1.2 "Person" shall mean any individual, corporation, proprietorship,
firm, partnership, limited partnership, limited liability company, trust,
association or other entity.
1.3 "Registrable Securities" means the Parent Common Stock delivered to
the Shareholder pursuant to the Merger Agreement until (i) a registration
statement covering such Parent Common Stock (or any securities into which such
Parent Common Stock may be hereafter converted by operation of law or otherwise)
has been declared effective by the SEC, (ii) it is sold or may be sold pursuant
to Rule 144 under the Securities Act or (iii) it has been otherwise transferred,
and it may be resold without registration under the Securities Act.
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1.4 "Selling Holder" means a Holder who is selling Registrable
Securities pursuant to a registration statement under the Securities Act.
1.5 "Underwriter" means a securities dealer who purchases any
Registrable Securities as a principal and not as part of such dealer's
market-making activities or who undertakes to sell such securities on a "best
efforts basis".
ARTICLE II
REGISTRATION RIGHTS
2.1 COMPANY REGISTRATION. On or prior to the date which is thirteen (13)
months after the Effective Time, the Company shall file a registration statement
(the "Registration Statement") with the SEC with respect to the Registrable
Securities; provided, however, that, subject to the provisions of Section 2.2,
below, the Company shall not be obligated to effect such registration within six
(6) months of the effective date of a registration of shares initiated by the
Company, other than the Company's Registration Statement on Form S-8 relating to
the Company's Amended and Restated 1988 Stock Option Plan or to another similar
plan adopted by the Company.
2.2 PIGGYBACK REGISTRATION RIGHTS.
(a) PIGGYBACK REGISTRATION. Subject to the provisions of Section
2.2(b), below, if, and whenever prior to the filing of the Registration
Statement, the Company proposes to register any of its securities under any
applicable law for sale to the public, whether for its own account or for the
account of other security holders or both, it will, at any such time, give
written notice (the "Registration Notice") to the Holder or his permitted
transferees or assignees of its intention to do so. Subject to the limitations
contained herein, upon written request of the Holder given to the Company within
thirty (30) days of receipt by the Holder of the Registration Notice, the
Company will cause the Holder's Registrable Securities to be included in the
securities to be covered by such registration and, subject to Section 3(b), use
its best efforts to cause the Holder's Registrable Securities to be included in
any underwriting thereof; provided that, at any time prior to the effective date
of the registration statement with respect to such registration, the Company may
elect in its discretion to terminate or delay such registration, and upon giving
notice thereof to the Holders (i) in the event of any such termination, the
Company shall have no further obligation to register the Holder's Registrable
Securities in connection with such registration, and (ii) in the event of any
such delay, the Company shall be permitted to delay the registration of the
Holder's Registrable Securities for the same period as the delay in registering
the other securities subject to such registration. The Holder shall have the
right to withdraw from participation in any public offering if either of them
disapproves of the terms of such offering.
(b) MARKETING LIMITATIONS. If the underwriter's representative
advises the Company that marketing factors require a limitation of the number of
the shares to be sold by shareholders of the Company, the underwriter's
representative may exclude some or all of the Holder's Registrable Securities
from such public offering; provided, however, that if the
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underwriter's representative limits the number of shares to be included in an
offering and a Holder and other holders of unregistered shares of Parent Common
Stock desire to participate in such offering, the number of shares belonging to
the Holder and such other holders to be included in such offering shall be
allocated between them in proportion to the respective amounts of shares of
Parent Common Stock which such parties hold.
(c) Notwithstanding anything contained herein to the contrary, the
Holder shall not directly or indirectly, sell, pledge, give, transfer, assign or
in any other way whatsoever encumber or dispose of (hereinafter collectively
called "transfer") any of the Registrable Securities, or any interest therein,
except as follows: the Holder may transfer up to 12.5% of the Registrable
Securities per quarter, on a cumulative basis, to the extent and in the manner
permitted by applicable federal and state securities laws. All certificates for
the Registrable Securities shall be endorsed with an appropriate legend
referring to this Agreement
ARTICLE III
REGISTRATION PROCEDURES
3.1 FILINGS; INFORMATION.
(a) The Company will prepare and file with the SEC the Registration
Statement covering sales of the Registrable Securities by the Holder on a form
which shall be appropriate for the sale of the Registrable Securities to be
registered thereunder in accordance with the intended method of distribution
thereof and shall use its reasonable best efforts to cause such Registration
Statement to be declared effective by the SEC as soon as practicable after
filing. The Company shall furthermore keep such Registration Statement effective
until the shares covered thereby are no longer Registrable Securities and shall
comply in all material respects with the applicable requirements of the
Securities Exchange Act of 1934, as amended, including, but not limited to,
timely filing of all reports with the SEC as required thereunder.
(b) The Company will, if requested, prior to filing a registration
statement or prospectus or any amendment or supplement thereto, furnish to the
Selling Holder and each Underwriter, if any, of the Registrable Securities
covered by such registration statement, copies of such registration statement as
proposed to be filed, and thereafter the Company will furnish to such Selling
Holder and Underwriter, if any, such number of copies of such registration
statement, each amendment and supplement thereto (in each case including all
exhibits thereto and documents incorporated by reference therein), the
prospectus included in such registration statement (including each preliminary
prospectus) and such other documents as such Selling Holder or Underwriter may
reasonably request in order to facilitate the disposition of the Registrable
Securities owned by such Selling Holder.
(c) After the filing of the Registration Statement, the Company will
promptly notify the Selling Holder of Registrable Securities covered by such
registration statement of any stop order issued or threatened by the SEC and
take all reasonable actions required to prevent the entry of such stop order or
to remove it if entered.
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(d) The Company will use its best efforts to (i) register or qualify
the Registrable Securities under such other securities or blue sky laws of such
jurisdictions in the United States as any Selling Holder reasonably (in light of
such Selling Holder's intended plan of distribution) requests and (ii) cause
such Registrable Securities to be registered with or approved by such other
governmental agencies or authorities as may be necessary by virtue of the
business and operations of the Company and do any and all other acts and things
that may be reasonably necessary or advisable to enable such Selling Holder to
consummate the disposition of the Registrable Securities owned by such Selling
Holder; provided that the Company will not be required to (A) qualify generally
to do business in any jurisdiction where it would not otherwise be required to
qualify but for this Section 3(d), (B) subject itself to taxation in any such
jurisdiction, or (C) consent to general service of process in any such
jurisdiction.
(e) The Company will immediately notify the Selling Holder of such
Registrable Securities, at any time when a prospectus relating thereto is
required to be delivered under the Securities Act, of the occurrence of an event
requiring the preparation of a supplement or amendment to such prospectus so
that, as thereafter delivered to the purchasers of such Registrable Securities,
such prospectus will not contain an 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 not misleading and promptly make available to the Selling
Holder any such supplement or amendment.
(f) The Company and the Selling Holder will enter into customary
agreements and take such other actions as are reasonably required in order to
expedite or facilitate the disposition of such Registrable Securities.
(g) The Company will make available for inspection by any Selling
Holder, any Underwriter participating in any disposition pursuant to such
registration statement and any attorney, accountant or other professional
retained by any such Selling Holder or Underwriter (collectively, the
"Inspectors"), all financial and other records, pertinent corporate documents
and properties of the Company (collectively, the "Records") as shall be
reasonably necessary to enable them to exercise their due diligence
responsibility, and cause the officers, directors and employees of the Company
to supply all information reasonably requested by any Inspectors in connection
with such registration statement. Records which the Company determines, in good
faith, to be confidential and which it, in writing, notifies the Inspectors are
confidential shall not be disclosed by the Inspectors unless (i) the disclosure
of such Records is necessary to avoid or correct a misstatement or omission in
such registration statement or (ii) the release of such Records is ordered
pursuant to a subpoena or other order from a court of competent jurisdiction.
The Selling Holder of such Registrable Securities agrees that information
designated by the Company as confidential and obtained by it as a result of such
inspections shall be deemed confidential and shall not be used by it as the
basis for any market transactions in the securities of the Company or its
affiliates unless and until such is made generally available to the public. The
Selling Holder of such Registrable Securities further sees that it will, upon
learning that the disclosure of such Records is sought in a court of competent
jurisdiction, give notice to the Company and allow the Company, at its expense,
to undertake appropriate action to prevent disclosure of the Records deemed
confidential.
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(h) The Company will otherwise use its best efforts to comply with
all applicable rules and regulations of the SEC, and make available to its
security holders, as soon as reasonably practicable, an earnings statement
covering a period of twelve (12) months, beginning within three (3) months after
the effective date of the registration statement, which earnings statement shall
satisfy the provisions of Section 11(a) of the Securities Act.
(i) The Company will use its best efforts to cause all Registrable
Securities to be listed for trading on each securities exchange or other
securities market on which similar securities issued by the Company are then
listed.
(j) The Company may require the Selling Holder of Registrable
Securities to promptly furnish in writing to the Company such information
regarding the distribution of the Registrable Securities as the Company may from
time to time reasonably request and such other information as may be legally
required in connection with such registration.
(k) The Selling Holder shall, upon receipt of any notice from the
Company of the happening of any event of the kind described in Section 3.1(e)
hereof, forthwith discontinue disposition of Registrable Securities pursuant to
the registration statement covering such Registrable Securities until such
Selling Holder's receipt of the copies of the supplemented or amended prospectus
contemplated by Section 3.1(e) hereof, and, if so directed by the Company, such
Selling Holder will deliver to the Company all copies, other than permanent file
copies then in such Selling Holder's possession, of the most recent prospectus
covering such Registrable Securities at the time of receipt of such notice. In
the event the Company shall give such notice, the Company shall extend the
period during which such registration statement shall be maintained effective by
the number of days during the period from and including the date of the giving
of notice pursuant to Section 3.1(e) hereof to the date when the Company shall
make available to the Selling Holder of Registrable Securities covered by such
registration statement a prospectus supplemented or amended to conform with the
requirements of Section 3.1(e) hereof.
3.2 REGISTRATION EXPENSES. In addition to the expenses payable under
Section 4.1, in connection with any registration statement required to be filed
hereunder, the Company shall pay all registration expenses incurred in
connection with the registration hereunder (the "Registration Expenses"),
including the following: (i) all registration and filing fees, (ii) fees and
expenses of compliance with securities or blue sky laws (including reasonable
fees and disbursements of counsel in connection with blue sky qualifications of
the Registrable Securities), (iii) printing expenses, (iv) internal expenses
(including, without limitation, all salaries and expenses of its officers and
employees performing legal or accounting duties), (v) the fees and expenses
incurred in connection with the listing of the Registrable Securities and (vi)
reasonable fees and disbursements of counsel for the Company and customary fees
and expenses for independent certified public accountants retained by the
Company. The Company shall not have any obligation to pay any underwriting fees,
discounts or commission attributable to the sale of Registrable Securities, or
any out-of-pocket expenses of the Holder (or the agents who manage their
accounts) or the Underwriter or any fees and expenses of Underwriter's counsel
or counsel to the Selling Holder.
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ARTICLE IV
INDEMNIFICATION
4.1 INDEMNIFICATION BY THE COMPANY. The Company agrees to indemnify and
hold harmless the Selling Holder from and against any and all losses, claims,
damages, liabilities and expenses (including reasonable counsel fees) caused by
any untrue statement or alleged untrue statement of a material fact contained in
any registration statement or prospectus relating to the Registrable Securities
(as amended or supplemented if the Company shall have furnished any amendments
or supplements thereto) or any preliminary prospectus, or caused by any omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, except
insofar as such losses, claims, damages, liabilities and expenses are caused by
any such untrue statement or omission or alleged untrue statement or omission
based upon information furnished in writing to the Company by such Selling
Holder or on such Selling Holder's behalf expressly for use therein; provided,
however, that with respect to any untrue statement or omission or alleged untrue
statement or omission made in any preliminary prospectus, or in any prospectus,
as the case may be, the indemnity contained in this Section 41 shall not apply
to the extent any such loss, claim, damage, liability and expense results from
the fact that a copy of the current prospectus (as amended and supplemented, if
applicable) was not sent or given to the Person asserting any such loss, claim,
damage or liability at or prior to the written confirmation of the sale of the
Registrable Securities concerned to such Person if it is determined that the
Company has provided such current prospectus in accordance with Section 3.1(b)
and it was the responsibility of such Selling Holder to provide such Person with
a copy of such current prospectus and such copy of such current prospectus would
have cured the defect giving rise to such loss, claim, damage, liability or
expense.
4.2 INDEMNIFICATION BY HOLDER OF REGISTRATION SECURITIES. The Selling
Holder agrees to indemnify and hold harmless the Company, its officers,
directors and agents and each Person, if any, who controls the Company within
the meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act to the same extent as the foregoing indemnity from the Company to
such Selling Holder, but only with reference to information relating to such
Selling Holder furnished in writing by such Selling Holder or on such Selling
Holder's behalf expressly for use in any registration statement or prospectus
relating to the Registrable Securities, or any amendment or supplement thereto,
or any preliminary prospectus. In case any action or proceeding shall be brought
against the Company or any of its officers, directors or agents or any such
controlling Person, in respect of which indemnity may be sought against such
Selling Holder, such Selling Holder shall have the rights and duties given to
the Company, and the Company and its respective officers, directors and agents
and such controlling person shall have the rights and duties given to such
Selling Holder, by the preceding and succeeding paragraphs.
4.3 CONDUCT OF INDEMNIFICATION PROCEEDINGS. If any proceeding (including
any governmental investigation) shall be instituted involving any Person in
respect of which indemnity may be sought pursuant to Section 4.1 or 4.2, such
Person (an "Indemnified party") shall promptly notify the Person against whom
such indemnity may be sought (an "Indemnifying Party") in writing and the
Indemnifying Party shall assume the defense thereof, including the employment of
counsel reasonably satisfactory to such Indemnified Party, and shall assume the
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payment of all fees and expenses. In any such proceeding, any Indemnified Party
shall have the right to retain its own counsel, but the fees and expenses of
such counsel shall be at the expense of such Indemnified Party unless (i) the
Indemnifying Party and the Indemnified Party shall have mutually agreed to the
retention of such counsel or (ii) the named parties to any such proceeding
(including any impleaded parties) include both the Indemnified Party and the
Indemnifying Party and representation of both parties by the same counsel would
be inappropriate due to actual or potential differing interests between them. It
is understood that the Indemnifying Party shall not, in connection with any
proceeding or related proceedings in the same jurisdiction, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys (in
addition to any local counsel) at any time for all such Indemnified Parties, and
that all such fees and expenses shall be reimbursed as they are incurred. In the
case of any such separate firm for the Indemnified Parties, such firm shall be
designated in writing by the Indemnified Parties. The Indemnifying Party shall
not be liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent, or if there be a final judgment for
the plaintiff, the Indemnifying Party shall indemnify and hold harmless such
Indemnified Parties from and against any loss or liability (to the extent stated
above) by reason of such settlement or judgment. No Indemnifying Party shall,
without the prior written consent of the Indemnified Party, effect any
settlement of any pending or threatened proceeding in respect of which any
Indemnified Party is or could have been a party and indemnity could have been
sought hereunder by such Indemnified Party, unless such settlement includes an
unconditional release of such Indemnified Party from all liability arising out
of such proceeding.
ARTICLE V
MISCELLANEOUS
5.1 PARTICIPATION IN UNDERWRITTEN REGISTRATIONS. No Person may
participate in any underwritten registration hereunder unless such Person (a)
agrees to sell such Person's securities on the basis provided in any
underwriting arrangements approved by the Persons entitled hereunder to approve
such arrangements, and (b) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents reasonably
required under the terms of such underwriting arrangements and these
Registration Rights.
5.2 RESTRICTIONS ON PUBLIC SALE. The Selling Holder shall not effect any
public sale or distribution of the securities being registered or a similar
security of the Company, or any securities convertible into or exchangeable or
exercisable for such securities, including a sale pursuant to Rule 144 under the
Securities Act, at any time in violation of any provisions of Federal or state
securities laws.
5.3 AMENDMENT AND MODIFICATION. This Agreement may be amended or
modified, and any provision of this Agreement may be waived, only by written
agreement of the Company and Holder.
5.4 SUCCESSORS: ASSIGNMENT. This Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their respective legal
representatives, successors and
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permitted assigns, except that the Company may not assign its rights and
obligations hereunder. Except as otherwise provided herein, the Shareholder may
assign his rights and obligations under this Agreement upon prior written notice
to the Company, but no such assignment shall relieve the assigning party of his
obligations hereunder.
5.5 NOTICES. Any notice or other communication under this agreement
shall be in writing and shall be considered given upon receipt, if personally
delivered or telecopied, or one day after delivery to a courier for next-day
delivery, to the parties at the addresses set forth below (or at such other
address as a party may specify by notice to the others).
If to the Company, to it at: Accuhealth, Inc.
0000 Xxxxx Xxxxx Xxxxxx
Xxxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxx
Facsimile number: 000-000-0000
with a copy to: Xxxxx & Xxxxxx LLP
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Y. Xxxxx Xxxxx, Esq.
Facsimile number: 000-000-0000
and a copy to Proskauer Rose LLP
0000 Xxxxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx Xxxxxxx, Esq.
Facsimile number: (000) 000-0000
If to the Shareholder to: Xxxxxxx X. Xxxxx, M.D.
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
with a copy to: Xxxx Marks & Xxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Xxxxxx X. Xxxxxxxx, Esq.
Facsimile number: (000)000-0000
5.6 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the law of the state of New York with respect to contracts to be
wholly performed in such State.
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5.7 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original but all of which
shall constitute one and the same agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date set forth above.
ACCUHEALTH, INC.
By: /s/ XXXXX X. XXXXX
----------------------------
Name: Xxxxx X. Xxxxx
Title:
/s/ Xxxxxxx X. Xxxxx, M.D.
----------------------------
XXXXXXX X. XXXXX, M.D.
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