Exhibit 4.9
AMENDED AND RESTATED STOCKHOLDERS AGREEMENT
BY AND AMONG
HEALTHGATE DATA CORP.
AND
THE STOCKHOLDERS LISTED ON
THE SIGNATURE PAGES HEREOF
DATED AS OF APRIL 7, 1999
AMENDED AND RESTATED STOCKHOLDERS AGREEMENT (3/99)
THIS AMENDED AND RESTATED STOCKHOLDERS AGREEMENT (this "AGREEMENT") is
made and entered into as of the 7th day of April, 1999, by and among HealthGate
Data Corp., formerly known as Medical Data Interface Design, Inc., a Delaware
corporation (the "COMPANY"), Xxxxx X. Xxxxxx, Xxxxxxx X. Xxxxx and Xxxxx X.
Xxxxxx (collectively Xx. Xxxxxx, Xx. Xxxxx and Xx. Xxxxxx shall be referred to
herein as the "FOUNDERS"), Xxxxxxx Research Corporation ("NRC"), Xxxxxxxxx
Science Ltd. ("BSL"), GE Capital Equity Investments, Inc., ("GE"), and each
other stockholder and option holder of the Company who executes a counterpart of
this Agreement (the Founders, NRC, BSL, GE and the other stockholders who
execute a copy of this Agreement shall be referred to individually as a
"STOCKHOLDER" and collectively as the "STOCKHOLDERS").
W I T N E S S E T H :
WHEREAS, each of the Existing Stockholders is the owner and holder of
shares of stock of the Company, including, without limitation, Common Stock,
Series A Preferred Stock, Series B Preferred Stock, Series C Preferred Stock and
Series D Preferred Stock or options for the purchase of shares of stock of the
Company;
WHEREAS, each of the Existing Stockholders and the Company are parties
to an Amended and Restated Stockholders Agreement, dated December 1996 (the
"DECEMBER 1996 AGREEMENT");
WHEREAS, pursuant to a Purchase Agreement between the Company, BSL and
GE, dated April 7, 1999 (the "Purchase Agreement"), GE is purchasing from the
Company 436,681 shares of Series E Convertible Redeemable Preferred Stock (the
"SERIES E PREFERRED"), par value $.01 per share, for an aggregate purchase price
of approximately $5,000,000 (collectively with the Common Stock, Series A
Preferred Stock, Series B Preferred Stock, Series C Preferred Stock and Series D
Preferred Stock, the "STOCK") and BSL is purchasing 174,672 shares of Series E
Preferred for a purchase price of approximately $2,000,000 payable by
cancellation of the Company's outstanding $2,000,000 Convertible Bridge
Promissory Note to BSL.
WHEREAS, it is a condition to the consummation of the foregoing
transactions that the parties hereto terminate the December 1996 Agreement and
enter into this Agreement;
WHEREAS, in connection with the sale of Series E Preferred to GE and
BSL, the parties hereto desire to terminate the December 1996 Agreement pursuant
to Section 6.2 thereof, and the parties hereto deem it to be in their best
interests to enter into
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this Agreement establishing and setting forth their agreement with respect to
certain rights and obligations associated with ownership of shares of Stock;
WHEREAS, the Stockholders desire to provide for continuity and
stability of policy and management of the Company.
NOW, THEREFORE, in consideration of the mutual covenants contained
herein and other good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, the parties hereby agree as follows:
1. DEFINITIONS.
As used herein, the following terms shall have the following meanings
(capitalized terms used herein and not defined herein shall have the meanings
assigned to such terms in the Purchase Agreement):
"AFFILIATE" has the meaning ascribed to such term in Rule 12b-2 of the
General Rules and Regulations under the Securities Exchange Act of 1934, as
amended.
"BSL" has the meaning assigned to it in the first paragraph hereof.
"COMMON STOCK" means the Company's common stock, $.01 par value per
share, having the rights set forth in Article 4 of the Certificate of
Incorporation.
"COMMON STOCK EQUIVALENTS" means rights, options, scrip, warrants or
other securities convertible into, or exchangeable or exercisable for, shares of
Common Stock.
"COMPANY" has the meaning assigned to it in the first paragraph hereof.
"DECEMBER 1996 AGREEMENT" has the meaning assigned to it in the third
paragraph hereof.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended,
or any successor Federal statute, and the rules and regulations of the
Commission thereunder, all as the same shall be in effect at the time. Reference
to a particular section of the Securities Exchange Act of 1934, as amended,
shall include reference to the comparable section, if any, of any such successor
Federal statute.
"EXISTING STOCKHOLDERS" means Stockholders other than GE.
"FOUNDERS" has the meaning assigned to it in the first paragraph
hereof.
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"FULLY DILUTED" means the number of shares of Common Stock outstanding,
plus (x) the number of shares of Common Stock into which all outstanding
Convertible Securities of the Company would be convertible and (y) the number of
shares of Common Stock which would be issuable upon the exercise of all
warrants, rights or options to purchase shares of Common Stock then outstanding.
"GE" has the meaning assigned to it in the first paragraph hereof.
"NRC" has the meaning assigned to it in the first paragraph hereof.
"PERMITTED TRANSFER" means any assignment, transfer or other
disposition (i) by an individual Stockholder to such Stockholder's spouse,
child, parent, siblings and descendants, whether natural or adopted
(collectively, "RELATIVES") or to or among a trust of which there are no
principal beneficiaries other than one or more Relatives of such Stockholder;
and (ii) by any Stockholder to any of its Affiliates or partners.
"PERSON" means an individual, a partnership, a corporation, a limited
liability company, limited liability partnership, an association, a joint stock
company, a trust, a joint venture, an unincorporated organization and a
governmental entity or any department, agency or political subdivision thereof.
"PUBLIC OFFERING" means the closing of a firm commitment for an initial
public offering underwritten by a nationally recognized investment bank pursuant
to an effective registration statement under the Securities Act covering the
offer and sale of the Company's Common Stock to the public at an aggregate net
offering price of not less than $20 million, an implied Company equity value of
at least $100,000,000 and an Offering Price that results in a minimum annualized
compounded rate of return of 20% to holders of Series E Preferred Shares.
"PURCHASE AGREEMENT" has the meaning assigned to it in the fourth
paragraph hereof.
"SECURITIES ACT" means the Securities Act of 1933, as amended, or any
successor Federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time. Reference to a
particular section of the Securities Act of 1933, as amended, shall include
reference to the comparable section, if any, of any such successor Federal
statute.
"SELL" means, as to any Stock, to sell, or in any other way directly or
indirectly transfer, assign, distribute, or encumber, or otherwise dispose of
such Stock, either voluntarily or involuntarily; and the terms "SALE" and "SOLD"
have the meanings correlative to the foregoing. A Permitted Transfer shall not
constitute a sale for purposes of this Agreement.
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"SERIES E PREFERRED" has the meaning assigned to it in the fourth
paragraph hereof.
"STOCK" has the meaning assigned to it in the fourth paragraph hereof.
"STOCKHOLDER" and "STOCKHOLDERS" have the meanings assigned to such
terms in the first paragraph hereof; PROVIDED that any transferee of Stock
pursuant to a Permitted Transfer shall be treated as a Stockholder for purposes
of this Agreement and shall be entitled to the benefits of, and shall be bound
by, the provisions of this Agreement.
2. CORPORATE GOVERNANCE.
2.1. BOARD OF DIRECTORS OF THE COMPANY (THE "BOARD").
(a) MEMBERS. Consistent with the provisions of Section 4.3 of the
Purchase Agreement, each Stockholder in his, her or its capacity as a
Stockholder of the Company, agrees to vote or cause to be voted all shares of
Stock owned by such Stockholder so as to:
(i) fix the number of the directors of the Company (the "DIRECTORS") at
seven, and
(ii) elect as Directors of the Company (v) one person designated by GE
(such person so designated, and any successor thereto, being referred to herein
as the "GE DESIGNEE"), (w) one person designated by BSL (initially Xxx Xxxxxxxx;
Xx. Xxxxxxxx and any successor thereto, being referred to herein as the "BSL
DESIGNEE"), (x) two persons designated by the Founders (initially, Xxxxxxx X.
Xxxxx and Xxxxx X. xx Xxxxxx; Messrs. Xxxxx and xx Xxxxxx and any successors
thereto, being referred to herein as the "FOUNDERS DESIGNEES"), (y) two persons
designated by the holders of the Series A Preferred Stock (initially, Xxxxx
Xxxxxx and Xxxx Xxxxx; Mr. Friend and Xx. Xxxxx and any successors thereto,
being referred to herein as the "SERIES A DESIGNEES"), and (z) one person
designated by the holders of Series B Preferred (initially, Xxxxx X. Xxxxxx; Xx.
Xxxxxx and any successors thereto, being referred to herein as the "SERIES B
DESIGNEE"). Each of the GE Designee, the BSL Designee, the Founders Designees,
the Series A Designees, and the Series B Designee is referred to as a
"Designee". At each annual meeting of the Stockholders of the Company, or at any
meeting of the Stockholders of the Company at which members of the Board of
Directors of the Company are to be elected, or whenever members of the Board of
Directors are to be elected by written consent, the Stockholders shall take such
action as shall be necessary to cause the GE Designee, the BSL Designee, the
Founders Designees, the Series A Designees, and the Series B Designee to be
elected as directors.
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(b) VACANCIES. Each Designee shall hold office until his death,
resignation or removal or until his successor shall have been duly elected and
qualified. If any Designee shall cease to serve as a Director of the Company for
any reason, the vacancy resulting thereby shall be filled by another person
designated by the holders entitled to designate such Designee. In the event that
at any time there exist vacancies on the Board such that there is no GE
Designee, no action may be taken by the Board until such vacancy is filled,
unless GE elects not to designate a successor Designee within a reasonable time
period not greater than 45 days. If GE chooses not to exercise its right to
elect the GE Designee, then GE will have Board Observer Rights, as set forth in
paragraph (c) below.
(c) BOARD OBSERVER RIGHTS OF GE. In the event that GE does not exercise
its right to elect the GE Designee to the Company's Board, then GE shall have
the right to designate one representative to attend all meetings of the
Company's Board and Committees of the Board in a nonvoting observer capacity,
and, in this respect, the Company shall give GE copies of all notices, minutes,
consents, and other materials that the Company provides to its Directors.
Nothing in this Section 2.1 (c) shall be deemed to abridge GE's rights with
respect to the election of Directors or access to information as provided by
applicable law, the Company's Bylaws or the Purchase Agreement.
(d) COMMITTEES. Each Stockholder in his, her or its capacity as a
Stockholder of the Company agrees to vote or cause to be voted all shares owned
by such Stockholder, and otherwise use his, her or its best efforts so as to:
(i) establish an Executive Committee of the Board,
(ii) fix the number of the members of the Executive Committee of the
Board at three (3), and
(iii) cause the directors of the Company to select as members of the
Executive Committee (x) the GE Designee, (y) one Founders Designee, and (z) one
Series D Designee.
Each Stockholder agrees to cause any Designee designated by it to take
all necessary actions so as to cause the GE Designee to be appointed to and be
at all times a standing member of each of the Board's Audit, Compensation and
Executive Committees, and each of the committees of the Board as may be
requested at any time or from time to time by GE, as the case may be.
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3. SALE OF STOCK BY STOCKHOLDERS AND RESTRICTIONS ON SALE.
3.1 RIGHT OF FIRST REFUSAL
If any Stockholder shall elect to sell (other than in a Permitted
Transfer) any or all of the Stock now owned or subsequently acquired by him,
such Stockholder shall first offer to sell such shares of Stock to the Company
and GE in writing, at the same price and upon the same terms and conditions
offered to such Stockholder by the prospective purchaser of such Stock. Each of
the Company and GE shall have the option to purchase such shares of Stock, in
whole or in part, for a period of fourteen (14) days following receipt of such
written offer, on the same terms and conditions contained in such offer and, if
the Company and GE each desire to exercise such right so that the number of
shares desired to be purchased by each of them exceeds the number of shares
proposed to be sold, such shares shall be allocated between the Company and GE
pro rata in proportion to the number of shares desired to be purchased by each
of them. Such option may be exercised by written notice of such exercise to the
selling Stockholder. Each of the Company and GE shall have until the later of
(x) thirty (30) days from the date of such notice and (y) ten (10) days after
the receipt of all required governmental and third party consents and approvals
to consummate the purchase of the shares to be purchased by it, upon which date
the closing of the transaction effecting the purchase and sale of Stock shall
occur.
3.2 STOCKHOLDERS' RIGHT OF REFUSAL.
If the Company and GE shall fail to exercise the option described in
Section 3.1 hereof as to all of the shares of Stock to be sold, the selling
Stockholder shall thereupon offer to sell the remaining shares of Stock to each
other Stockholder in writing, in amounts proportionate to their then record
ownership of Stock, at the same price and on the same terms and conditions as
offered to the Company. Each other Stockholder shall have the option to purchase
such shares of Stock for a period of fourteen (14) days following receipt of
such written offer. Such option may be exercised by a Stockholder by giving
written notice of such exercise to the selling Stockholder. Each Stockholder
shall have until the later of (x) thirty (30) days from the date of such notice
and (y) ten (10) days after the receipt of all required governmental and third
party consents and approvals to consummate the purchase of such shares of Stock,
upon which date the closing of the transaction effecting the purchase and sale
of Stock shall occur.
If one or more, but not all, parties to whom Stock has been offered
pursuant to this Section 3.2 shall duly exercise said option, the exercising
parties shall be notified in writing by the offering Stockholder of failure by
other Stockholder(s) to exercise said
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option. The exercising parties shall have the option, for a further period of
fourteen (14) days, to purchase a proportionate share of the offered Stock as to
which options to purchase were not exercised, based upon the aggregate record
ownership of the Stock of the exercising parties. This process shall be repeated
until options to purchase all of the offered Stock shall have been exercised, or
until no party shall exercise an option to purchase the offered Stock.
If every party to whom Stock has been so offered shall fail, within
said fourteen (14) day period, to exercise said option as to any portion of the
offered Stock, the offering Stockholder shall be free, for a period of sixty
(60) days thereafter, to sell such portion of the offered Stock to any purchaser
at the same price and on the same terms and conditions as offered to the parties
hereto, free of the restrictions imposed by this Section; provided that no sale
may be made to any prospective purchaser unless such prospective purchaser
agrees in writing to be bound by the provisions of this Agreement. If at the end
of the sixty (60) day period described in this Section 3.2, the offering
Stockholder has not completed the sale of the offered Stock as aforesaid, all
the restrictions on sale, transfer, or assignment contained in this Section
shall again be in effect with respect to such Stock.
4. INVOLUNTARY TRANSFERS.
4.1. DEATH OF A STOCKHOLDER.
Upon the death of a Stockholder, the Stock held by such Stockholder may
be transferred to any executor or administrator of such Stockholder's estate, to
the beneficiaries under the will of such Stockholder, or to the heirs-at-law of
such Stockholder, if he should die intestate. No transfer of the Stock may
thereafter be made by any of the above persons unless and until the shares of
Stock, which are proposed to be transferred, are first offered in writing by the
proposed transferor to the Company and GE. Each of the Company and GE shall have
the right to accept or reject such offer, in whole or in part, within a period
of ninety (90) days after receipt of such offer. If the Company and GE each
desire to exercise such right so that the number of shares desired to be
purchased by each of them exceeds the number of shares proposed to be
transferred, such shares shall be allocated between the Company and GE pro rata
in proportion to the number of shares desired to be purchased by each of them.
If the Company and/or GE, as the case may be, shall so accept such offer, the
Company and/or GE, as the case may be, shall be obligated to purchase such
shares of Stock, and such shares of Stock shall be sold to the Company and/or
GE, as the case may be, at an appraised value per share to be determined in
accordance with the following procedure. The value for such shares of Stock
shall be determined by three appraisers: one to be designated by the Company
and/or GE, as the case may be, one to be designated by the proposed transferor,
and the third to be designated by the first two. Such designation of appraisers
shall be made as soon as practicable after acceptance by the Company and/or GE
of such offer of sale as
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aforesaid. Within ten (10) days after the report of the appraisers as aforesaid,
the shares of Stock to be so sold to and purchased as aforesaid shall be
tendered to the Company and/or GE, as the case may be by delivery of
certificates representing such shares endorsed in blank and in proper form for
transfer, and the Company and/or GE shall make payment of the purchase price
therefor by certified or bank check, or wire transfer.
4.2. INVOLUNTARY TRANSFERS OTHER THAN UPON THE DEATH OF A
STOCKHOLDER.
The following provisions shall apply with respect to any transfer of
Stock to any guardian or conservator of a Stockholder, to a transfer of Stock
upon the insolvency or bankruptcy of a Stockholder, or to any other transfer of
Stock by operation of law, except as provided in Section 4.1 herein. No such
transfer of Stock may be made unless and until the shares of Stock which are
proposed to be transferred are first offered in writing by the proposed
transferee to the Company and GE. Each of the Company and GE shall have the
right to accept or reject such offer, in whole or in part, within a period of
ninety (90) days after receipt of the offer. If the Company and GE each desire
to exercise such right so that the number of shares desired to be purchased by
each of them exceeds the number of shares proposed to be transferred, such
shares shall be allocated between the Company and GE pro rata in proportion to
the number of shares desired to be purchased by each of them. If the Company
and/or GE, as the case may be, shall so accept such offer, the Company and/or
GE, as the case may be, shall be obligated to purchase such shares of Stock, and
such shares of Stock shall be sold to the Company and/or GE, as the case may be,
all in accordance with the valuation and procedure set forth in Section 4.1 of
this Agreement.
4.3. CONTINUED RESTRICTIONS ON TRANSFER.
For any transfer of Stock effected pursuant to Section 4.1 or Section
4.2 hereof, the transferee shall, at or prior to such transfer, become bound by
the provisions of Sections 3 and 4 of this Agreement with respect to such Stock
by executing an agreement to be so bound, and any subsequent sale or transfer of
such Stock by such transferee shall be subject to the provisions of this
Agreement.
5. PRE-EMPTIVE RIGHTS.
5.1 LIMITATION ON PRE-EMPTIVE RIGHTS.
All Stockholders acknowledge that the holders of Series A Preferred
Stock, Series B Preferred Stock, Series C Preferred Stock and Series D Preferred
Stock shall not have any of the pre-emptive rights described in the following
paragraphs 5.2, 5.3, 5.4, 5.5 and 5.6, so long as any Series E Preferred holder
chooses to exercise its prior rights under Sections 2 and 4.5 of the Purchase
Agreement. To the extent (and only to the extent) that any Series E Preferred
holder chooses not to exercise its rights under the Purchase
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Agreement, the holders of Series A Preferred Stock, Series B Preferred Stock,
Series C Preferred Stock and Series D Preferred Stock shall be able to exercise
their pre-emptive rights described in the following paragraphs 5.2, 5.3, 5.4,
5.5, and 5.6, with respect to new investors; provided that each Stockholder
agrees that each of such pre-emptive rights shall not apply to New Securities
(as defined in the Purchase Agreement) issued (i) pursuant to the acquisition of
another corporation or other entity by the Company by merger, share exchange,
purchase of substantially all of the assets, or reorganization, (ii) to
employees, consultants, officers or directors pursuant to an equity incentive
plan approved by the Board, or (iii) in amounts less than $500,000 in any single
transaction (a "Minor Transaction") where the purchase price is not less than
the then applicable Conversion Price per share (as defined in the Amendment to
the Certificate of Incorporation), provided that the aggregate amount of all
Minor Transactions shall not exceed $1.5 million.
5.2. PRE-EMPTIVE RIGHTS OF HOLDERS OF SERIES A PREFERRED STOCK.
All Stockholders acknowledge that the Company has granted certain
holders of Series A Preferred Stock certain pre-emptive rights as set forth in
Section 4.5 of the Purchase Agreement, dated as of March 16, 1995, between the
Company, Xxxxx Xxxxxx and Xxxxxxx X. Xxxxxx (the "FIRST PURCHASE AGREEMENT").
5.3. PRE-EMPTIVE RIGHT OF HOLDERS OF SERIES B PREFERRED STOCK.
All Stockholders acknowledge that the Company has granted holders of
Series B Preferred Stock certain pre-emptive rights as set forth in Section 4.5
of the Stock Purchase Agreement, dated on or about October 18, 1995, between the
Company and NRC (the "SECOND PURCHASE AGREEMENT").
5.4. PRE-EMPTIVE RIGHTS OF FOUNDERS.
To conform the Founder's pre-emptive rights with the pre-emptive rights
of certain of the holders of Series A Preferred Stock, Series B Preferred Stock,
Series C Preferred Stock and Series D Preferred Stock, the Company agrees as
follows:
Except for the Series E Preferred issued pursuant to the Purchase
Agreement, the Company will not authorize, issue or enter into any agreement
providing for the issuance (contingent or otherwise) of any equity security of
the Company ("NEW SECURITIES") (or any securities convertible into, or
exchangeable or exercisable for, any New Securities) unless:
(A) The Company delivers written notice (the "EQUITY NOTICE") of such
issue or agreement to issue to each Founder at least 15 days prior to such
proposed issue, but in any event not more than 15 days after entering into any
agreement to issue any such securities. The Equity Notice will set forth in
reasonable detail the terms and
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conditions of such proposed issue, and will be deemed to be an offer to each
Founder to purchase their respective Allotments (as defined in (B) below) of the
securities described in the Equity Notice, at the same price and on the same
terms as those set forth in the Equity Notice;
(B) Each Founder shall be entitled to purchase up to the amount of the
securities described in the Equity Notice equal to the product of (i) the number
that results from dividing the number of shares of Common Stock held by such
Founder immediately prior to the proposed issue by the number of shares of
Common Stock outstanding on a fully diluted basis immediately prior to the
proposed issue, and (ii) the number of such securities proposed to be issued by
the Company (his "ALLOTMENT");
(C) Each Founder shall inform the Company in writing within 15 days
after receipt of the Equity Notice whether he elects to purchase all or any part
of his Allotment, and shall have until the later of the closing of the sale of
the securities described in the Equity Notice or 30 days after the date of the
Equity Notice to consummate the purchase of such part of his Allotment as he
timely elected to purchase;
The provisions of this Section 5.4 shall not apply to the issuance of
shares of Common Stock (as proportionally adjusted for any stock split, stock
dividend or recapitalization affecting the Common Stock), including options or
warrants to acquire Common Stock, in connection with any employee stock option
or stock ownership plan, any consulting agreement or arrangement or any
restricted stock agreement providing for the issuance of Common Stock to an
employee or employees of the Company at a price equal to the fair market value
of such shares as of the time of issuance as determined by the Company's board
of directors in good faith.
5.5. PRE-EMPTIVE RIGHTS OF HOLDERS OF SERIES C PREFERRED STOCK.
All Stockholders acknowledge that the Company has granted certain
holders of Series C Preferred Stock certain pre-emptive rights as set forth in
Section 4.5 of the Stock Purchase Agreement, dated as of August 21, 1996,
between the Company and the stockholders thereto (the "SERIES C PURCHASE
AGREEMENT").
5.6. PRE-EMPTIVE RIGHT OF HOLDERS OF SERIES D PREFERRED STOCK.
All Stockholders acknowledge that the Company has granted holders of
Series D Preferred Stock certain pre-emptive rights as set forth in Section 4.5
of the Stock Purchase Agreement, dated on or about December 20, 1996, between
the Company and BSL (the "SERIES D PURCHASE AGREEMENT").
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5.7. PRE-EMPTIVE RIGHT OF HOLDERS OF SERIES E PREFERRED STOCK.
All Stockholders acknowledge that the Company has granted holders of
Series E Preferred Stock certain pre-emptive rights as set forth in Section 4.5
of the Series E Preferred Purchase Agreement.
5.8. NO OTHER PRE-EMPTIVE RIGHTS.
Each Stockholder acknowledges that except as set forth in this
Agreement, no other Stockholder holds any pre-emptive or similar rights with
respect to future issuances of the Company's Stock.
6. TAG-ALONG RIGHTS.
6.1. RIGHT.
In the event that any Existing Stockholder who presently beneficially
owns more than 5% of the Company's Common Stock on a Fully-Diluted basis
("SELLING STOCKHOLDER(S)") shall enter into an agreement to sell or otherwise
propose to sell to any Person (such Person, the "TAG-ALONG TRANSFEREE"), in one
transaction or a series of related transactions, shares of Common Stock or
Common Stock Equivalents of the Company, excluding shares of Common Stock of the
Company owned by Xxxxxxxxx-Wissenschaft Verlag GmbH, BSL's German subsidiary,
held by such Selling Stockholder (the "TAG-ALONG SALE"), then GE shall have the
right (the "TAG-ALONG RIGHT") to participate in the sale of shares, by selling a
number of shares of Common Stock equal to GE's Proportionate Share, as part of
the Tag-Along Sale by the Selling Stockholders, on the same terms as those
applicable to the Tag-Along Sale (except that, if the Tag-Along Sale involves
Common Stock Equivalents, the economic terms of such Sale shall be appropriately
adjusted to reflect that GE is selling Common Stock). "Proportionate Share"
means a number of shares of Common Stock which bears the same ratio to the
number of shares of Common Stock beneficially owned by GE on a Fully Diluted
basis as the number of shares to be sold or proposed to be sold in the Tag-Along
Sale bears to the number of shares of Common Stock beneficially owned by the
Selling Stockholders on a Fully Diluted basis.
6.2. PROCEDURE.
The Selling Stockholders shall mail written notice of any Tag-Along
Sale (the "TAG-ALONG NOTICE"), first class postage prepaid, to GE, not less than
fifteen (15) days prior to the Tag-Along Sale, notifying GE of the Tag-Along
Sale and setting forth the terms and conditions of the Tag-Along Sale,
including, without limitation, the number
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of shares proposed to be sold or transferred, the nature of such sale or
transfer, the consideration to be paid, and the name(s) and address(es) of the
Tag-Along Transferee(s) of the Stock. GE shall have the right to exercise its
Tag-Along Right within ten (10) days of its receipt of the Tag-Along Notice. The
Tag-Along Right shall be at the same price and upon the same terms and
conditions of the Tag-Along Sale.
6.3. ADDITIONAL RESTRICTIONS.
In no event shall a Selling Stockholder be able to enter into an
agreement to sell or transfer or otherwise propose to sell or transfer to any
Person, in one or more transactions, more than 10% in the aggregate of the
number of shares of Stock beneficially owned by such Selling Stockholder as of
the date of this Agreement on a Fully Diluted basis (with such number of shares
being subject to adjustment for stock splits, stock dividends, reverse stock
splits, reclassifications and similar events), without the prior written consent
of (i) the Company and (ii) the holders of not less than 66 2/3% of the Series E
Preferred Stock outstanding, so long as such holders continue to beneficially
own in the aggregate more than 5% of the Company's Common Stock on a Fully
Diluted basis. Unless earlier terminated pursuant to Section 7 hereof, this
requirement for the written consent of the holders of Series E Preferred Stock
shall expire when GE no longer beneficially owns at least 5% of the Company's
Common Stock on a Fully Diluted Basis.
7. TERM.
7.1. TERM AND EXTENSIONS.
This Agreement shall become effective (and the December 1996 Agreement
shall be terminated) only upon the Company's execution of this Agreement and the
Company's sale of Series E Preferred Stock to GE pursuant to the Purchase
Agreement. This Agreement shall remain in effect until the expiration of GE's
redemption rights under Article FOURTH, Part G (4) of the Certificate of
Amendment of Amended and Restated Certificate of Incorporation of the Company to
be filed with the Secretary of State of the State of Delaware in connection with
the Company's sale of Series E Preferred Stock to GE pursuant to the Purchase
Agreement.
7.2. EARLIER TERMINATION EVENTS.
Notwithstanding Section 7.1, this Agreement shall terminate immediately
upon the occurrence of either of the following events: (i) the closing of a
Public Offering by the Company of its Common Stock, or (ii) Stockholders
representing (1) a majority of the Series A Preferred Stock, (2) a majority of
the Series B Preferred Stock, (3) a majority of the Series D Preferred Stock,
(4) a majority of Series E Preferred Stock, and (5) a majority of Stock held by
the Founders, each elect in writing to terminate this Agreement.
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8. MISCELLANEOUS.
8.1. NO ASSIGNMENT.
This Agreement is personal to each party hereto, and no such party may
assign his, her or its rights hereunder without the consent in writing of all
other parties hereto, including the Company.
8.2. AMENDMENTS.
This Agreement may be amended only by a writing signed by all parties
hereto.
8.3. GOVERNING LAW.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO THE PRINCIPLES OF
CONFLICTS OF LAW. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND
UNCONDITIONALLY CONSENTS TO SUBMIT TO THE EXCLUSIVE JURISDICTION OF THE COURTS
OF THE STATE OF NEW YORK AND OF THE UNITED STATES OF AMERICA, IN EACH CASE
LOCATED IN THE COUNTY OF NEW YORK, FOR ANY ACTION, PROCEEDING OR INVESTIGATION
IN ANY COURT OR BEFORE ANY GOVERNMENTAL AUTHORITY ("LITIGATION") ARISING OUT OF
OR RELATING TO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY (AND
AGREES NOT TO COMMENCE ANY LITIGATION RELATING THERETO EXCEPT IN SUCH COURTS),
AND FURTHER AGREES THAT SERVICE OF ANY PROCESS, SUMMONS, NOTICE OR DOCUMENT BY
U.S. REGISTERED MAIL TO ITS RESPECTIVE ADDRESS SET FORTH IN THIS AGREEMENT SHALL
BE EFFECTIVE SERVICE OF PROCESS FOR ANY LITIGATION BROUGHT AGAINST IT IN ANY
SUCH COURT. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY
WAIVES ANY OBJECTION TO THE LAYING OF VENUE OF ANY LITIGATION ARISING OUT OF
THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY IN THE COURTS OF THE
STATE OF NEW YORK OR THE UNITED STATES OF AMERICA, IN EACH CASE LOCATED IN THE
COUNTY OF NEW YORK, AND HEREBY FURTHER IRREVOCABLY AND UNCONDITIONALLY WAIVES
AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH LITIGATION
BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. EACH OF THE
PARTIES IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED
BY APPLICABLE LAW, ANY AND ALL RIGHTS
-13-
TO TRIAL BY JURY IN CONNECTION WITH ANY LITIGATION ARISING OUT OF OR RELATING TO
THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
8.4. SUCCESSORS; ASSIGNS.
This Agreement shall, except to the extent otherwise expressly provided
herein, be binding upon and inure to the benefit of the heirs, executors,
administrators and permitted assigns of the parties hereto.
8.5. ADDITION AND DELETION OF SHAREHOLDERS.
The Stockholders hereby agree that this Agreement shall be binding on
all signatories thereto, notwithstanding the existence or possible existence of
a stockholder or stockholders of the Company who have not executed and delivered
to the Company a counterpart of this Agreement. Furthermore, the Stockholders
hereby agree that additional or future stockholders of the Company shall become
a Stockholder pursuant to this Agreement, upon the execution and delivery by
both the Company and such stockholder of an agreement to be bound by the terms
of this Agreement (and such signed agreement between the Company and the new
stockholder shall not require the approval or signature of any other
Stockholder). Furthermore, all rights of each Stockholder under this Agreement
shall terminate when such Stockholder no longer owns any shares of Stock of the
Company.
8.6. 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 invalid, illegal or
unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability shall not affect
any other provision or any other jurisdiction, but this Agreement shall be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision had never been contained therein.
8.7. FAILURE TO DELIVER SHARES.
If a Stockholder becomes obligated to sell Stock under this Agreement
and fails to deliver certificates representing such Stock in accordance with the
terms of this Agreement, the purchaser of such Shares may, at his option, in
addition to all other remedies he may have, send to the Stockholder by
registered mail, return receipt requested, the purchase price for such Stock as
is herein specified. Thereupon, the Company, upon written notice to the
Stockholder, (i) shall cancel on its books the certificate or certificates
representing the Stock to be sold; and (ii) shall issue, in lieu
-14-
thereof, a new certificate or certificates in the name of the purchaser
representing such Stock; and thereupon all of the Stockholder's rights in and to
such Stock shall terminate.
8.8. GENDER; NUMBER.
Use herein of any gender shall be deemed to include all genders when
appropriate, and use of the singular number shall be deemed to include the
plural when appropriate, and vice versa in each instance.
8.9. NOTICES.
Any notice required to be given pursuant to the terms of this Agreement
shall be in writing and shall be sent by certified mail, postage prepaid, return
receipt requested, as follows:
IF TO THE COMPANY: HealthGate Data Corp.
00 Xxxxxxxxx Xxxxx
Xxxxx 000
Xxxxxxxxxx, XX 00000
Attn: President
WITH A COPY TO: Xxxxxxx X. Xxxx, Esq.
Rich, May, Xxxxxxxx & Xxxxxxxx, P.C.
000 Xxxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
IF TO A STOCKHOLDER: To the Stockholder's address
on the Company's books and
records
IF TO GE: GE Capital Equity Investments, Inc.
000 Xxxx Xxxxx Xxxx
Xxxxxxxx, XX 00000
Attention: General Counsel
WITH A COPY TO: Xxxxxx xx Xxxx, Esq.
Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx
Xxx Xxx Xxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
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8.10 LEGEND.
Each certificate of Stock subject to this Agreement issued subsequent
to the date hereof shall bear a legend stating that the shares represented by
such certificate are subject to restrictions upon transfer and voting and other
provisions set forth in this Agreement. The legend may be in substantially the
form as follows:
"THE VOTING AND TRANSFER OF THE SHARES OF STOCK REPRESENTED BY THIS
CERTIFICATE ARE SUBJECT TO THE TERMS AND CONDITIONS OF A CERTAIN AMENDED AND
RESTATED STOCKHOLDERS AGREEMENT, DATED AS OF MARCH __, 1999, A COPY OF WHICH MAY
BE OBTAINED FROM THE COMPANY UPON WRITTEN REQUEST. THE VOTING RIGHTS AND
TRANSFER OR OTHER DISTRIBUTION OF THE SHARES REPRESENTED HEREBY SHALL NOT BE
VALID OR ENTITLE ANY TRANSFEREE TO ANY RIGHT OF A STOCKHOLDER OF THE COMPANY
UNLESS AND UNTIL THE TERMS OF SUCH AGREEMENT SHALL FIRST HAVE BEEN COMPLIED
WITH."
Each Stockholder agrees to deliver to the Company any previously issued
certificates so that the Company may place the foregoing legend on such
certificate.
8.11. CAPTIONS AND HEADINGS.
The headings, titles and captions of the sections of this Agreement are
inserted only to facilitate reference, and they shall not define, limit, extend
or describe the scope or intent of this Agreement or any provision hereof, and
they shall not constitute a part hereof or affect the meaning or interpretation
of this Agreement or any part hereof.
8.12. COUNTERPARTS.
This Agreement may be signed in counterparts, each of which, when
executed and delivered, shall be an original, but such counterparts shall
together constitute one and the same instrument.
8.13. REMEDIES.
Each Stockholder shall be entitled to enforce its rights under this
Agreement specifically to recover damages by reason of any breach of any
provision of this Agreement and to exercise all other rights existing in their
favor. The parties hereto agree and acknowledge that money damages may not be an
adequate remedy for any breach of the provision of this Agreement and that each
party may in its sole discretion apply to any court of law or equity of
competent jurisdiction for specific performance
-16-
and/or injunctive relief (without posting a bond or other security) in order to
enforce or prevent any violation of the provisions of this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Stockholders
Agreement as of April 7, 1999.
HEALTHGATE DATA CORP.
By: /s/ Xxxxxxx X. Xxxxx
-------------------------------
Xxxxxxx X. Xxxxx
President
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SERIES E STOCKHOLDERS
GE CAPITAL EQUITY
INVESTMENTS, INC.
By: /s/ Xxxxxxx Xxxxxx
-------------------------------
Name: Xxxxxxx Xxxxxx
Title: Senior Vice President
XXXXXXXXX SCIENCE, LTD.
By: /s/ Xxxxxxxx X. X. Xxxxxxxx
-------------------------------
Name: Xxxxxxxx X. X. Xxxxxxxx
Title: Executive Director
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COMMON STOCKHOLDERS
/s/ Xxxx Xxxxx
-----------------------------------
Xxxx X. Xxxxx, M.D.
-----------------------------------
Xxxxxx X. Xxxxxxxxx
-----------------------------------
Xxxxxxx X. Xxxxx
/s/ Xxxxx X. xx Xxxxxx
-----------------------------------
Xxxxx xx Xxxxxx
-----------------------------------
Xxxxx Xxxxxx
-----------------------------------
Xxxxxxx Xxxxx
-----------------------------------
Xxxx X. XxXxxx
/s/ Xxxxx X. Xxxxxx
-----------------------------------
Xxxxx X. Xxxxxx
/s/ Xxxxx X. Xxxxxx
-----------------------------------
Xxxxx X. Xxxxxx
/s/ Xxxxx X. Xxxxxx
-----------------------------------
Xxxxx X. Xxxxxx, Trustee u/a 7/5/90
f/b/o Xxxxxxxxx X. Xxxxxx and her children
/s/ Xxxxx X. Xxxxxx
-----------------------------------
Xxxxx X. Xxxxxx, Trustee u/a 7/5/90
f/b/o Xxxx X. Xxxxxx and her children
/s/ Xxxxx X. Xxxxxx
-----------------------------------
Xxxxx X. Xxxxxx, Trustee u/a 5/5/91
f/b/o Xxxxxxx Xxxxxx and his children
/s/ Xxxxxxx X. Xxxxxx
-----------------------------------
Xxxxxxx X. Xxxxxx
XXXXXXX RESEARCH CORPORATION
By: /s/ Xxxxx X. Xxxxxxx
-------------------------------
Title: Chief Financial Officer
-----------------------------------
Xxxxxx X.X. Xxxxx & Xxxx Xxxx Xxxxx
/s/ Xxxxxxx X. Xxxxx
-----------------------------------
Xxxxxxx X. Xxxxx
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SERIES A STOCKHOLDERS
Account Management Corporation Profit
Sharing Plan
By: /s/ Xxxxx xxXxxxxx
-------------------------------
Title: PRESIDENT
----------------------------
-----------------------------------
Xxxxxxxxx Xxxx
/s/ Xxxx Xxxxx
-----------------------------------
Xxxx X. Xxxxx, M.D.
-----------------------------------
Xxxxxxxxxxx xxXxxxxx
-----------------------------------
Xxxxxx xxXxxxxx
/s/ Xxxxx xxXxxxxx
-----------------------------------
Xxxxx xxXxxxxx
/s/ Xxxxx Xxxxxx
-----------------------------------
Xxxxx Xxxxxx
-----------------------------------
Xxxxx X. Xxxxxx
/s/ Xxxxxxx X. Xxxxxx
-----------------------------------
Xxxxxxx X. Xxxxxx
-----------------------------------
Xxxxxx Xxxxxx
-----------------------------------
Xxxxxxxxxxx X. Xxxxxxx
-----------------------------------
Xxxxx X. Xxxxxxx
-----------------------------------
Xxxx X. Xxxxxxx
-----------------------------------
Xxxxxxxx X. Xxxxxxx
-----------------------------------
Xxxxxxx X. Xxxxxxx
-----------------------------------
Xxxxxx & Xxxxx Xxxxxxxx
-2-
SERIES B STOCKHOLDERS
XXXXXXX RESEARCH CORPORATION
By: /s/ Xxxxx X. Xxxxxx
-------------------------------
Xxxxx X. Xxxxxx
Chief Executive Officer
Stockholders Agreement
-1-
SERIES C STOCKHOLDERS
XXXXXXX RESEARCH CORPORATION
By: /s/ Xxxxx X. Xxxxxx
-------------------------------
Xxxxx X. Xxxxxx
Chief Executive Officer
ACCOUNT MANAGEMENT CORP., as
Attorney-in-Fact for Xxxxxxx X. Xxxxx
and Xxxxxx X. Xxxxx
By: /s/ Xxxxx xxXxxxxx
-------------------------------
Title: President
----------------------------
/s/ Xxxxx xxXxxxxx
-----------------------------------
Xxxxx xxXxxxxx
ACCOUNT MANAGEMENT CORP.,
as Attorney-in-Fact for Xxxxxxxx XxXxxx
By: /s/ Xxxxx xxXxxxxx
-------------------------------
Title: President
----------------------------
ACCOUNT MANAGEMENT CORP., as
Attorney-in-Fact for Xxxxxxxxxxx Xxxx
By: /s/ Xxxxx xxXxxxxx
-------------------------------
Title: President
----------------------------
ACCOUNT MANAGEMENT CORP., as
Attorney-in-Fact for Xxxxxxx X. Xxxx,
Trustee of the Xxxxxxx X. Xxxx Revocable
Trust
By: /s/ Xxxxx xxXxxxxx
-------------------------------
Title: President
----------------------------
Stockholders Agreement
ACCOUNT MANAGEMENT CORP., as
Attorney-in-Fact for Xxxxxxx & Xxxxxxx
X. Xxxx, Trustees of the Xxxxxxx X. &
Xxxxxxx X. Xxxx Grandchildrens Trust
By: /s/ Xxxxx xxXxxxxx
-------------------------------
Title: President
----------------------------
ACCOUNT MANAGEMENT CORP., as
Attorney-in-Fact for Xxxxxxx Xxxx,
Trustee of the 1986 Xxxxxxx X. Xxxx Trust
By: /s/ Xxxxx xxXxxxxx
-------------------------------
Title: President
----------------------------
ACCOUNT MANAGEMENT CORP., as
Attorney-in-Fact for Steurart Xxxxx
By: /s/ Xxxxx xxXxxxxx
-------------------------------
Title: President
----------------------------
ACCOUNT MANAGEMENT CORP., as
Attorney-in-Fact for Xxx Xxxxxxxxx
By: /s/ Xxxxx xxXxxxxx
-------------------------------
Title: President
----------------------------
ACCOUNT MANAGEMENT CORP., as
Attorney-in-Fact for Xxxxxx Xxxx
By: /s/ Xxxxx xxXxxxxx
-------------------------------
Title: President
----------------------------
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[SIGNATURES CONTINUED ON NEXT PAGE]
-3-
ACCOUNT MANAGEMENT CORP., as
Attorney-in-Fact for Xxxxxx Xxxxx
By: /s/ Xxxxx xxXxxxxx
-------------------------------
Title: President
----------------------------
ACCOUNT MANAGEMENT CORP., as
Attorney-in-Fact for Xxxxx X. Xxxxxx
By: /s/ Xxxxx xxXxxxxx
-------------------------------
Title: President
----------------------------
ACCOUNT MANAGEMENT CORP., as
Attorney-in-Fact for Xxx X. Xxxxxx
By: /s/ Xxxxx xxXxxxxx
-------------------------------
Title: President
----------------------------
ACCOUNT MANAGEMENT CORP., as
Attorney-in-Fact for Xxxxxxx Xxxxxx
By: /s/ Xxxxx xxXxxxxx
-------------------------------
Title: President
----------------------------
ACCOUNT MANAGEMENT CORP., as
Attorney-in-Fact for Xxxxxxx X. Xxxxxx
By: /s/ Xxxxx xxXxxxxx
-------------------------------
Title: President
----------------------------
ACCOUNT MANAGEMENT CORP., as
Attorney-in-Fact for Xxxxxxx X. Xxxxxx
By: /s/ Xxxxx xxXxxxxx
-------------------------------
Title: President
----------------------------
Stockholders Agreement
ACCOUNT MANAGEMENT CORP., as
Attorney-in-Fact for Xxxxx X. Xxxxxxx
By: /s/ Xxxxx xxXxxxxx
-------------------------------
Title: President
----------------------------
ACCOUNT MANAGEMENT CORP., as
Attorney-in-Fact for Xxxxxx Xxxxxxx
By: /s/ Xxxxx xxXxxxxx
-------------------------------
Title: President
----------------------------
ACCOUNT MANAGEMENT CORP., as
Attorney-in-Fact for Xxxxxx Xxxxxx
By: /s/ Xxxxx xxXxxxxx
-------------------------------
Title: President
----------------------------
ACCOUNT MANAGEMENT COP., as
Attorney-in-Fact for Xxxx Xxxxxxxxxx
By: /s/ Xxxxx xxXxxxxx
-------------------------------
Title: President
----------------------------
ACCOUNT MANAGEMENT CORP., as
Attorney-in-Fact for Xxxxxx and Xxxxx
Xxxxxxxx
By: /s/ Xxxxx xxXxxxxx
-------------------------------
Title: President
----------------------------
[SIGNATURES CONTINUED ON NEXT PAGE]
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