Exhibit 4.7
AMENDED AND RESTATED STOCKHOLDERS' AGREEMENT
DATED AS OF NOVEMBER 25, 2002
BY AND AMONG
CONCORDE CAREER COLLEGES, INC.
AND
THE STOCKHOLDERS IDENTIFIED HEREIN
AMENDED AND RESTATED STOCKHOLDERS' AGREEMENT
This AMENDED AND RESTATED STOCKHOLDERS' AGREEMENT dated as of November
25, 2002 (this "Agreement") by and among CONCORDE CAREER COLLEGES, INC., a
Delaware corporation (the "Company"); the parties identified on the signature
pages under the heading "Xxxxxx, Xxxxxxx Parties" (the "Xxxxxx, Xxxxxxx
Parties"); and the parties identified on the signature pages under the heading
"Other Holders" (collectively, the "Other Holders"). The Xxxxxx, Xxxxxxx Parties
and the Other Holders are referred to herein collectively as the
"Securityholders."
WHEREAS, the Company entered into a Convertible Preferred Stock
Purchase Agreement, dated February 25, 1997 and amended on March 20, 1997 (the
"Stock Purchase Agreement"), with the Xxxxxx, Xxxxxxx Parties, pursuant to which
the Xxxxxx, Xxxxxxx Parties acquired shares of the Company's Convertible
Preferred Stock on the terms and conditions set forth therein;
WHEREAS, the Company issued and sold, and the Xxxxxx, Xxxxxxx Parties
purchased, Debentures and Warrants pursuant to Debenture and Warrant Purchase
Agreements, between the Company and the Xxxxxx, Xxxxxxx Parties, each dated
February 25, 1997;
WHEREAS, the Estate of Xxxxxx X. Xxxxxxx sold, and the Xxxxxx, Xxxxxxx
Parties purchased, 500,000 shares of common stock of the Company, pursuant to a
Stock Purchase Agreement, dated February 25, 1997, between the Company and the
Xxxxxx, Xxxxxxx Parties;
WHEREAS, on the date hereof, each Securityholder owns the shares of
capital stock of the Company or options exercisable for shares of capital stock
of the Company set forth opposite its name on Exhibit A hereto;
WHEREAS, the Securityholders desire to enter in this Agreement with
the Company;
NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements set forth herein, the parties hereto agree as follows:
ARTICLE 1.
DEFINITIONS
1.1 Defined Terms. The following terms are defined as
follows:
"Qualified Offering" shall mean the consummation of a firm-commitment
underwritten public offering pursuant to an effective registration statement
under the Securities Act covering the offer and sale of Common Stock for the
account of the Company in which (i) the net proceeds of the public offering
price equals or exceeds $20 million and (ii) the public offering price per share
of Common Stock equals or exceeds $8.00.
"Sale of the Company" shall mean (i) consummation of a merger or
consolidation of the Company with or into another person that is not a parent or
subsidiary of the Company as a result of which those persons who were
stockholders of the Company immediately prior to such transaction own, in the
aggregate, less than a majority of the outstanding voting capital stock of the
surviving or resulting corporation, (ii) the consummation of the sale or other
disposition of a majority of the outstanding shares of voting capital stock of
the Company to a person that is not a parent or subsidiary of the Company or
(iii) the consummation of the sale or other disposition of all or substantially
all of the Company's assets to a person that is not a parent or subsidiary of
the Company.
"Securities Act" shall mean the Securities Act of 1933, 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.
"Shares" shall mean any shares of capital stock of the Company,
including, without limitation, Common Stock and Convertible Preferred Stock, now
or hereafter issued.
"Subsidiary" shall mean any corporation of which a majority of the
outstanding voting securities or other voting equity interests are owned,
directly or indirectly, by the Company.
ARTICLE 2.
BOARD; COMMITTEE
2.1 Number and Election of Directors.
(a) Number of Directors. Each Securityholder, who is a party to
this Agreement shall vote or cause to be voted all shares of capital stock
owned by it over which it has voting control and the Company shall take all
necessary or desirable actions within its control so as to elect not more
than six (6) directors to the Board of Directors (the "Directors") which
shall consist of (i) four directors nominated by the Board of Directors or
by the holders of a majority of the shares of Common Stock in accordance
with the Company's Bylaws and who shall serve until their successors are
duly elected and qualified, (ii) Xxxxx X. Xxxxxxx ("Xxxxxxx") or, in the
case of Xxxxxxx'x death or disability, such person designated by the
holders of a majority of the Shares held by the Xxxxxx, Xxxxxxx Parties,
who shall serve for a term of two (2) years, and (iii) Xxxx X. Xxxxxxx
("Brozman"), who shall serve so long as Brozman is President of Company.
All such action shall have been taken as may be necessary to elect such a
Board of Directors of the Company effective upon the Closing of this
Agreement.
(b) Election of Nominees. At each annual meeting of stockholders
of the Company or any special meeting called for the purpose of electing
directors of the Company (or by consent of stockholders in lieu of any such
meeting) or at such other time or times as the Securityholders may agree,
the Securityholders shall vote all of their respective Shares entitled to
vote in favor of the election of all of the persons nominated in accordance
with Section 2.1(a) and no other person.
2.2 Removal of Directors. No Securityholder shall vote any
Shares in favor of the removal of a director nominated by one or more of
the other Securityholders hereunder unless the right of any such
Securityholder to so designate such director shall no longer exist;
provided, however , that upon the request of the Securityholders holding a
majority of the Common Stock to remove a director previously nominated by
such persons, the Securityholders shall vote all of their Shares in favor
of (i) the removal of such director and (ii) the election of any
replacement director as may be designated by such Securityholder(s).
2.3 Vacancies. If any vacancy occurs in the Board because of
death, disability, resignation, retirement or removal of a director in
accordance with this Agreement, the Securityholder that nominated the
person creating such vacancy shall nominate a successor, and all
Securityholders shall vote their Shares in favor of the election of such
successor to the Board. Any vacancy that occurs shall be filled as promptly
as possible upon the request of the group having the right to nominate a
person to fill such vacancy.
2.4 Proxies. Neither the Company nor any Securityholder shall
give any proxy or power of attorney to any person or entity that permits
the holder thereof to vote in his discretion on any matter that may be
submitted to the Company's stockholders for their consideration and
approval, unless such proxy or power of attorney is made subject to and is
exercised in conformity with the provisions of this Agreement.
2.5 Compensation. Each Director shall be reimbursed by the
Company for all direct out-of-pocket expenses reasonably incurred in
connection with their services as directors and each Director shall receive
from the Company an annual director's fee.
2.6 Insurance. The Company agrees to obtain and maintain
insurance, in an amount acceptable to the Directors, to indemnify each
Director against any liability incurred by him or her arising as a result
of his or her acting as a director of the Company.
ARTICLE 3.
TRANSFER OF SHARES
3.1 Restrictions on Transfer.
(a) So long as this Agreement is in effect, no Securityholder
shall sell, assign, transfer, give, encumber, pledge, hypothecate or in any
other way dispose of any Shares or options exercisable for Shares (any of which
being a "Transfer"), except as provided in this Agreement.
(b) Each Securityholder agrees that it will not Transfer any of
its Shares or options exercisable for Shares except as permitted under the
Securities Act or applicable state securities laws or any rule or regulation
promulgated thereunder. No
Transfer in violation of this Agreement shall be made or recorded on the books
of the Company and any such Transfer shall be void and of no force or effect.
Subject to the terms of this Agreement, the Securityholders shall be entitled to
exercise all rights of ownership of their Shares and any such options, and the
transferability of any such options shall, in addition to the terms hereof, be
subject to the terms and conditions contained therein.
3.2 Certain Permitted Transfers. The Company and the
Securityholders acknowledge and agree that any of the following Transfers
shall be deemed to be in compliance with this Agreement (and not subject to
the restrictions on transfer contained in Sections 3.3 and 3.4):
(a) a Transfer through a sale pursuant to an effective
registration statement under the Securities Act or Rule 144 thereunder;
(b) a Transfer from the Xxxxxx, Xxxxxxx Parties to any of their
partners, limited partners or employees;
(c) subject to Section 7.5 hereof, a Transfer upon the death of
a Securityholder to his executors, administrators and testamentary trustees; and
(d) subject to Section 7.5 hereof, a Transfer of Shares made for
nominal consideration or as a gift in compliance with applicable federal and
state securities laws to the Securityholder's spouse, parents or issue or to a
trust, the beneficiaries of which, or to a corporation or partnership the
stockholders or partners of which, include only the Securityholder and such
Securityholder's spouse or issue (any such transferee, together with any
transferee pursuant to this Section 3.2, being a "Permitted Transferee").
3.3 Tag-A-Long. If at any time prior to a Qualified Offering,
any of the Securityholders wish to sell any Shares (the "Subject Shares")
owned by it (the "Selling Party") to any person or entity (the "Purchaser")
other than the Permitted Transferees, the other remaining Securityholders
(the "Remaining Securityholders") shall have the right to offer for sale to
such Purchaser, as part of such sale by the Selling Party, the same
proportion of the Shares owned by the Remaining Securityholders as the
proposed sale represents with respect to the total number of Subject Shares
that the Selling Party owns or has the right to acquire pursuant to
outstanding options, warrants or convertible securities at the same price
per Share and on the same terms and conditions as involved in such sale by
the Selling Party. The Selling Party shall notify the Remaining
Securityholders of the terms and conditions, including price, on which the
Selling Party proposes to sell to the Purchaser ("Offer"). Each of the
Remaining Securityholders shall notify the Selling Party of its intention
to sell any Shares pursuant to the terms of the Offer as soon as
practicable after receipt of the Offer, but in no event later than 30 days
after receipt thereof. The Selling Party and the Remaining Securityholders
intending to sell Shares hereunder (a "Participating Securityholder") shall
sell to the Purchaser all, or at the option of the Purchaser, any part of
the Subject Shares proposed to be sold by them at not less than
the price per Share and upon other terms and conditions, if any, not more
favorable to the Purchaser than those in the Offer; provided, however, that
any purchase of less than all of such Subject Shares by the Purchaser shall
be made from the Selling Party and each Participating Securityholder pro
rata based upon the number of Shares proposed to be sold by each.
3.4 Put Option. In the event a Participating Securityholder is
not permitted to participate or is otherwise excluded from participating in
the sale of its Subject Shares pursuant to and in accordance with the terms
and conditions set forth in Section 3.3 (including, without limitation, the
Participating Securityholder failing to give notice as required
thereunder), the Participating Securityholder shall have the right, but not
the obligation, to require the Selling Party to purchase from such
Participating Securityholder the same amount of Shares the Participating
Securityholder is entitled to sell pursuant to the terms and conditions of
Section 3.3.
ARTICLE 4.
TERMINATION
This Agreement shall terminate automatically upon the consummation of
(a) a Qualified Offering, or (b) a Sale of the Company.
ARTICLE 5.
REPRESENTATIONS
5.1 Representation of Company. The execution, delivery, and
performance by the Company of this Agreement and all other agreements in
connection with this Agreement required to be executed by the Company and
the consummation by the Company of the transactions contemplated hereby and
thereby, have been duly authorized by all necessary corporate action. This
Agreement and all other agreements have been duly executed and delivered by
the Company and constitute valid and binding obligations of the Company
enforceable in accordance with their respective terms. The execution of and
performance of the transactions contemplated by this Agreement and all
other agreements and compliance with their provisions by the Company will
not violate any provision of law and will not conflict with or result in
any breach of any of the terms, conditions, or provisions of, or constitute
a default under, or require a consent or waiver under, its Certificate of
Incorporation or by-laws or any indenture, lease, agreement or other
instrument to which the company is a party or by which it or any of its
properties is bound, or any decree, judgment, order, statute, rule or
regulation applicable to the Company.
5.2 Representation of Xxxxxx, Xxxxxxx Purchasers. The execution,
delivery, and performance by the Xxxxxx, Xxxxxxx Parties of this Agreement
and all other agreements required to be executed by the Xxxxxx, Xxxxxxx
Parties and the consummation by the Xxxxxx, Xxxxxxx Parties of the
transactions contemplated hereby and thereby, have been duly authorized by
all necessary action. This
Agreement and all other agreements have been duly executed and delivered by
the Xxxxxx, Xxxxxxx Parties and constitute valid and binding obligations of
the Xxxxxx, Xxxxxxx Parties enforceable in accordance with their respective
terms. The execution of and performance of the transactions contemplated by
this Agreement and all other agreements and compliance with their
provisions by the Xxxxxx, Xxxxxxx Parties will not violate any provision of
law and will not conflict with or result in any breach of any of the terms,
conditions, or provisions of, or constitute a default under, or require a
consent or waiver under any agreements applicable to the Xxxxxx, Xxxxxxx
Parties.
5.3 Representation of the Brozman Trust. The execution, delivery,
and performance by the Trustee of the Xxxxxx X. Xxxxxxx Trust Under
Agreement dated December 28, 1989 (the "Brozman Trust") of this Agreement
and all other agreements required to be executed by the Trustee of the
Brozman Trust and the consummation by the Trustee of the Brozman Trust of
the transactions contemplated hereby and thereby, have been duly authorized
by all necessary action by the Brozman Trust. This Agreement and all other
agreements have been duly executed and delivered by the Trustee of the
Brozman Trust and constitute valid and binding obligations of the Brozman
Trust enforceable in accordance with their respective terms. The execution
of and performance of the transactions contemplated by this Agreement and
all other agreements and compliance with their provisions by the Brozman
Trust will not violate any provision of law and will not conflict with or
result in any breach of any of the terms, conditions, or provisions of, or
constitute a default under, or require a consent or waiver under any
applicable agreements applicable to the Brozman Trust.
ARTICLE 6.
COVENANTS
6.1 Registration Rights. In the event the S-3 registration
statement filed with the Securities and Exchange Commission (the
"Commission") under Rule 415 of the Securities Act in connection with that
certain Conversion and Exchange Agreement by and among the Xxxxxx Xxxxxxx
Parties and the Company, dated of even date herewith, does not remain
effective prior to the sale of all shares of Common Stock registered
thereunder, the holders of such Common Stock (the "Conversion Parties")
shall have the right, but not the obligation, to:
(a) Demand Registration. At any time and from time to time, request,
in writing, that the Company cause the registration of all or at least 250,000
shares of the Common Stock issued (the "Demand"). The Company shall promptly
thereafter (and in any event within 10 days after its receipt of such Demand)
cause to be prepared an amended registration statement, file the amended
registration statement within 60 days after the date of such request (45 days in
the case of a Form S-3) (using Form S-3 or other "short form," if available and
advised by counsel), to the end that such Common Stock may be sold thereunder as
soon as it becomes effective, and the Company will use
its reasonable best efforts to ensure that a distribution of the Common
Stock pursuant to the amended registration statement may continue for up to
nine months from the date of the effective date of the amended registration
statement. Such registration shall hereinafter be called a "Demand
Registration." The Demand Registration includes the right of the Conversion
Parties to require the Company to file a registration statement on Form S-3
(or if Form S-3 is unavailable to the Company, such other form as is
available) for an offering to be made on a continuous basis pursuant to a
"shelf" registration statement under Rule 415 promulgated under the
Securities Act. The Conversion Parties shall be entitled to request one
Demand Registration. A Demand Registration shall not count as such until a
registration statement becomes effective and remains effective for nine
months or until all of the shares thereunder are sold; provided, that if,
after it has become effective, the offering pursuant to the registration
statement is interfered with by any stop order, injunction or other order
or requirement of the Commission or any other governmental authority, such
registration be deemed not to have been effected unless such stop order,
injunction or other order shall subsequently have been vacated or otherwise
removed. The Conversion Parties shall select the underwriters of any
offering pursuant to a registration statement filed pursuant to this
Section 6.1(a), subject to the approval of the Company, which approval
shall not be unreasonably withheld. Any selected underwriter shall be a
well-recognized firm in good standing.
(b) "Piggyback" Registration Rights. Subject to applicable stock
exchange rules and securities regulations, at least 30 days prior to any
public offering of any of its Common Stock for the account of the Company
or any other person (other than a registration statement on Form S-4 or S-8
(or any successor forms under the Securities Act) or other registrations
relating solely to employee benefit plans or any transaction governed by
Rule 145 of the Securities Act), other than pursuant to the exercise of any
Demand Registration pursuant to Section 6.1(a), the Company shall give
written notice of such proposed filing and of the proposed date thereof to
the remaining Securityholders and if, on or before the twentieth (20th) day
following the date on which such notice is given, the Company shall receive
a written request from any such Securityholder requesting that the Company
include among the securities covered by such registration statement any
Shares of Common Stock, or the exercise of options to purchase Common Stock
owned by such Securityholder for offering for sale in a manner and on terms
set forth in such request, the Company shall include such Shares in such
registration statement, if filed, so as to permit such Shares to be sold or
disposed of in the manner and on the terms of the offering thereof set
forth in such request. Each such registration shall hereinafter be called a
"Piggyback Registration." The Company shall select the underwriters of any
offering pursuant to a registration statement filed pursuant to this
Section 6.1(b), subject to the approval of the Securityholders, which
approval shall not be unreasonably withheld.
(c) Terms, and Conditions of Registration or Qualification. In
connection with any registration statement filed pursuant to Sections
6.1(a) or 6.1(b) hereof, the following provisions shall apply.
(i) The obligations of the Company to use its reasonable
best efforts to cause the registration of Shares under the Securities
Act are subject to
the limitation, condition and qualification that the Company shall be
entitled to postpone for a reasonable period of time (but not
exceeding 90 days in any one year period) the filing of any
registration statement otherwise required to be filed by it if the
Company in good faith determines that such registration and offering
would (A) interfere with any financing, acquisition, corporate
reorganization or other material transaction or event involving the
Company or any of its subsidiaries or (B) require premature disclosure
thereof or of conditions, circumstances or events affecting the
Company or the Company's industry which are not yet fully developed or
ripe for disclosure, in which event the Company shall promptly give
the Securityholders requesting registration thereof written notice of
such determination and an approximation of the anticipated delay. If
the Company shall so postpone the filing of a registration statement,
the Securityholders requesting registration shall have the right to
withdraw the request for registration by giving written notice to the
Company within 30 days after receipt of the notice of postponement
and, in the event of such withdrawal, such request shall not be
counted for purposes of the requests for registration to which
Securityholders are entitled under this Agreement.
(ii) If the managing underwriter advises that the inclusion
in such registration or qualification of some or all of the Shares
sought to be registered exceeds the number (the "Saleable Number")
that can be sold in an orderly fashion or without adversely affecting
the offering, then the number of Shares offered shall be limited to
the Saleable Number and shall be allocated as follows:
(A) If such registration is being effected pursuant to
a Piggyback Registration, (1) first, all the Shares the Company
(or in the exercise of demand registration rights by other
stockholders of the Company, the selling stockholder(s)
exercising such rights) proposes to register and (2) second, the
difference between the Saleable Number and the number to be
included pursuant to clause (1) above, allocated to the
Securityholders pro rata on the basis of the relative number of
Shares offered for sale by each Securityholder; and
(B) if such registration is being effected pursuant to
a Demand Registration, (1) first, the entire Saleable Number
allocated first to the Conversion Parties pro rata on the basis
of the relative number of Shares offered for sale by each such
Conversion Party, and then among all other selling
Securityholders pro rata on the basis of the relative number of
Shares offered for sale by each such Securityholder and (2)
second, the difference (if positive) between the Saleable Number
and the number to be included pursuant to clause (1) above,
allocated to the Company.
(iii) The selling Securityholders will promptly provide the
Company with such information as the Company shall reasonably request
in order to prepare such registration statement and, upon the
Company's request, each selling Securityholder shall provide such
information in writing and signed by
such holder and stated to be specifically for inclusion in the registration
statement. In the event that the distribution of the Shares covered by the
registration statement shall be effected by means of an underwriting, the
right of any selling Securityholder to include its Shares in such
registration shall be conditioned on such holder's execution and delivery
of a customary underwriting agreement with respect thereto; provided,
however, that except with respect to information concerning such holder and
such holder's intended manner of distribution of the Shares, no selling
Securityholder shall be required (as a selling Securityholder exercising
registration rights) to make any representations or warranties in such
agreement as a condition to the inclusion of its Shares in such
registration.
(iv) The Company shall bear all expenses in connection with the
preparation of any registration statement filed pursuant to Section 6.1(a),
including the fees and disbursements of one counsel for the selling
Securityholders.
(v) The Company shall bear all expenses in connection with the
preparation of any registration statement filed pursuant to Section 6.1(b),
excluding (A) the fees and disbursements of counsel for the selling
Securityholders, and (B) the underwriting fees, discounts or commissions
with respect to Shares of the selling Securityholders, which shall be borne
by the selling Securityholders.
(vi) Following the effective date of such registration
statement, the Company shall, upon the request of the selling
Securityholders, forthwith supply such number of prospectuses (including
preliminary prospectuses and amendments and supplements thereto) meeting
the requirements of the Securities Act or such other securities laws where
the registration statement or prospectus has been filed and such other
documents as are referred to in the registration statement as shall be
requested by the selling Securityholders to permit such holders to make a
public distribution of their Shares, provided that the selling
Securityholders furnish the Company with such appropriate information
relating to such holders' intentions in connection therewith as the Company
shall reasonably request in writing.
(vii) The Company shall prepare and file such amendments and
supplements to such registration statement as may be necessary to keep such
registration statement effective and to comply with the provisions of the
Securities Act or such other securities laws where the registration
statement has been filed with respect to the offer and sale or other
disposition of the shares covered by such registration statement during the
period required for distribution of the Shares, which period shall not be
in excess of nine (9) months from the effective date of such registration
statement.
(viii) The Company shall use its reasonable best efforts to
register or qualify the Shares of the selling Securityholders covered by
any such registration statement under such securities or Blue Sky laws in
such jurisdictions
as the Securityholders may reasonably request; provided, however, that the
Company shall not be required to execute a general consent to service of
process or to qualify to do business as a foreign corporation in any
jurisdiction where it is not so qualified in order to comply with such
request.
(ix) In connection with any registration pursuant to Article 6,
the Company will as expeditiously as possible:
(A) cause the Shares covered by such registration
statement 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 to enable the selling Securityholders to
consummate the disposition of such Shares;
(B) notify each selling Securityholder at any time of the
happening of any event as a result of which the prospectus included in
such registration statement contains an untrue statement of a material
fact or omits to state any material fact required to be stated therein
or necessary to make the statements therein not misleading, and the
Company will prepare a supplement or amendment to such prospectus so
that, as thereafter delivered to the purchasers of such Shares, 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;
(C) cause all Shares covered by the registration
statement to be listed on each securities exchange on which similar
securities issued by the Company are then listed and, unless the same
already exists, provide a transfer agent, registrar and CUSIP number
for all such Shares not later than the effective date of the
registration statement;
(D) enter into such customary agreements (including an
underwriting agreement in customary form) and take all such other
actions as the holders of a majority of the voting power of the Shares
being sold or the underwriters retained by such holders, if any,
reasonably request in order to expedite or facilitate the disposition
of such Shares;
(E) make available for inspection by any selling
Securityholder, any underwriter participating in any disposition
pursuant to such registration statement, and any attorney, accountant
or other agent retained by any such seller or underwriter
(collectively, the "Inspectors"), all financial and other records,
pertinent corporate documents and properties of the Company as shall
be necessary to enable them to exercise their due diligence
responsibility, and cause the Company's officers, directors and
employees to supply all information reasonably requested by any such
Inspector in connection with such registration statement,
provided that such Inspectors shall have first executed and delivered
to the Company a confidentiality agreement in customary form
protecting the confidentiality of such information;
(F) obtain "cold comfort" letters and updates thereof
from the Company's independent public accountants and an opinion from
the Company's counsel in customary form and covering such matters of
the type customarily covered by "cold comfort" letters and opinion of
counsel, respectively, as the holders of a majority of the voting
power of the Shares of the selling Securityholders shall reasonably
request; and
(G) otherwise comply with all applicable rules and
regulations of the Commission, and make available to its
Securityholders, as soon as reasonably practicable, an earnings
statement covering a period of 12 months, beginning within three
months after the effective date of the registration statement, which
earnings statement shall satisfy the provisions of Section 11(a) of
the Securities Act and Rule 158 thereunder.
(x) Each selling Securityholder agrees that, upon receipt of
any notice from the Company of the happening of any event of the kind
described in Section 6.1(c)(ix)(B), such holder will forthwith discontinue
disposition of its Shares pursuant to the registration statement covering
such Shares until such holder's receipt of the copies of the supplemented
or amended prospectus contemplated by such Section 6.1(c)(ix)(B) and, if so
directed by the Company, such holder will deliver to the Company (at the
Company's expense) all copies, other than permanent file copies then in
such holder's possession, of the prospectus covering such Shares current at
the time of receipt of such notice.
(d) Exceptions to Registration Obligations. The Company, however,
shall not be required to effect any registration of Shares pursuant to Section
6.1(a) or Section 6.1(b) hereof if it shall deliver to the selling
Securityholders requesting such registration an opinion of counsel reasonably
satisfactory to such selling Securityholder to the effect that all such Shares
held by such selling Securityholder may be sold in the public market pursuant to
Rule 144(k) and without registration under the Securities Act and any applicable
state securities laws.
(e) Transfer Restrictions. The transfer restrictions contained in
Article 3 of this Agreement shall not apply to any offering of Shares pursuant
to this Section 6.1.
(f) Indemnification.
(i) In the event of the registration or qualification of any
Shares of the Securityholders under the Securities Act or any other
applicable securities laws pursuant to the provisions of this Section 6.1,
the Company agrees to indemnify and hold harmless each Securityholder
(including its officers, directors, members, stockholders, partners, legal
counsel and accountants) thereby offering such Shares for sale (a
"Seller"), underwriter, broker or dealer, if any, of
such Shares, and each other person, if any, who controls any such Seller,
underwriter, broker or dealer within the meaning of the Securities Act or
any other applicable securities laws, from and against any and all losses,
claims, damages or liabilities (or actions in respect thereof), joint or
several, to which such Securityholders, underwriter, broker or dealer or
controlling person may become subject under the Securities Act or any other
applicable securities laws 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 Shares were
registered or qualified under the Securities Act or any other applicable
securities laws, any preliminary prospectus or final prospectus relating to
such Shares, or any amendment or supplement thereto, 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, or any violation by the Company of any rule or
regulation under the Securities Act or any other applicable securities laws
applicable to the Company or relating to any action or inaction required by
the Company in connection with any such registration or qualification and
will reimburse each such Securityholders, underwriter, broker or dealer and
each such controlling person for any legal or other expenses reasonably
incurred by such Securityholders, underwriter, broker or dealer or
controlling person 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 to the extent that any such
loss, claim, damage or liability arises out of or is based upon an untrue
statement or omission made in such registration statement, such preliminary
prospectus, such final prospectus or such amendment or supplement thereto
or violation in reliance upon and in conformity with written information
furnished to the Company by such Securityholders, underwriter, broker,
dealer or controlling person specifically and expressly for use in the
preparation thereof; and provided, further, that the Company shall not be
liable to any person who participates as an underwriter in the offering or
sale of Shares or any other person, if any, who controls such underwriter
within the meaning of the Securities Act, in any such case to the extent
that any such loss, claim, damage, liability (or action or proceeding in
respect thereof) or expense arises out of such person's failure to send or
give a copy of the final prospectus, as the same may be then supplemented
or amended, to the person asserting an untrue statement or alleged untrue
statement or omission or alleged omission at or prior to the written
confirmation of the sale of Shares to such person if such statement or
omission was corrected in such final prospectus so long as such final
prospectus, and any amendments or supplements thereto, have been furnished
to such underwriter.
(ii) In the event of the registration or qualification of any
Shares of the Securityholders under the Securities Act or any other
applicable securities laws for sale pursuant to the provisions of this
Section 6.1, each selling Securityholder, each underwriter, broker and
dealer, if any, of such Shares, and each other person, if any, who controls
any such selling Securityholder, underwriter, broker or dealer within the
meaning of the Securities Act, agrees
severally, and not jointly to indemnify and hold harmless the Company, each
person who controls the Company within the meaning of the Securities Act,
and each officer and director of the Company from and against any and all
losses, claims, damages or liabilities (or actions in respect thereof),
joint or several, to which the Company, such controlling person or any such
officer or director may become subject under the Securities Act or any
other applicable securities laws 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 of any material fact contained in
any registration statement under which such Shares were registered or
qualified under the Securities Act or any other applicable securities laws,
any preliminary prospectus or final prospectus relating to such Shares, or
any amendment or supplement thereto, or arise out of or are based upon an
untrue statement or the omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not
misleading or any violation by the Company of any rule or regulation under
the Securities Act or any other applicable securities laws applicable to
the Company or relating to any action or inaction required by the Company
in connection with any such registration or qualification and will
reimburse each such Securityholders, underwriter, broker or dealer and each
such controlling person for any legal or other expenses reasonably incurred
by such Securityholders, underwriter, broker or dealer or controlling
person in connection with investigating or defending any such loss, claim,
damage, liability or action, which untrue statement or omission or
violation was made therein in reliance upon and in conformity with written
information furnished to the Company by such selling Securityholder,
underwriter, broker, dealer or controlling person specifically for use in
connection with the preparation thereof, and will reimburse the Company,
such controlling person and each such officer or director for any legal or
any other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or
action; provided, however, that no selling Securityholder will be liable
under this Section 6.1(f)(ii) for any amount in excess of the net proceeds
paid to such selling Securityholder of Shares sold by it unless such
liability arises from such written information furnished to the Company
with knowledge of its misleading nature or an intent to defraud.
(iii) Promptly after receipt by a person entitled to
indemnification under this Section 6.2(f) (an "indemnified party") of
notice of the commencement of any action or claim relating to any
registration statement filed under Section 6.1(a) or 6.1(b) or as to which
indemnity may be sought hereunder, such indemnified party will, if a claim
for indemnification hereunder in respect thereof is to be made against any
other parry hereto (an "indemnifying party"), give written notice to such
indemnifying party of the commencement of such action or claim, but the
omission to so notify the indemnifying party will not relieve the
indemnifying party from any liability that it may have to any indemnified
party otherwise than pursuant to the provisions of this Section 6.2(f) and
shall also not relieve the indemnifying party of its obligations under this
Section 6.2(f) except to the extent that the indemnifying party is actually
prejudiced thereby. In case any such action is brought against an
indemnified
party, and it notifies an indemnifying party of the commencement thereof,
the indemnifying party will be entitled (at its own expense) to participate
in and, to the extent that it may wish, jointly with any other indemnifying
party similarly notified, to assume the defense, with counsel reasonably
satisfactory to such indemnified party, of such action and/or to settle
such action and, after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party will not be liable to such indemnified party for any
legal or other expenses subsequently incurred by such indemnified party in
connection with the defense thereof, other than the reasonable cost of
investigation; provided, however, that no indemnifying party shall enter
into any settlement agreement without the prior written consent of the
indemnified party unless such indemnified party is fully released and
discharged from any such liability. Notwithstanding the foregoing, the
indemnified party shall have the right to employ its own counsel in any
such case, but the fees and expenses of such counsel shall be at the
expense of such indemnified party unless (A) the employment of such counsel
shall have been authorized in writing by the indemnifying party in
connection with the defense of such suit, action, claim or proceeding, (B)
the indemnifying party shall not have employed counsel (reasonably
satisfactory to the indemnified party) to take charge of the defense of
such action, suit, claim or proceeding, or (C) such indemnified party shall
have reasonably concluded, based upon the advice of counsel, that there may
be defenses available to it that are different from or additional to those
available to the indemnifying party which, if the indemnifying party and
the indemnified party were to be represented by the same counsel, could
result in a conflict of interest for such counsel or materially prejudice
the prosecution of the defenses available to such indemnified party. If any
of the events specified in clauses (A), (B) or (C) of the preceding
sentence shall have occurred or shall otherwise be applicable, then the
fees and expenses of one counsel or firm of counsel selected by a majority
in interest of the indemnified parties (and reasonably acceptable to the
indemnifying party) shall be borne by the indemnifying party. If, in any
such case, the indemnified parry employs separate counsel, the indemnifying
party shall not have the right to direct the defense of such action, suit,
claim or proceeding on behalf of the indemnified party and the indemnified
party shall assume such defense and/or settle such action; provided,
however, that an indemnifying party shall not be liable for the settlement
of any action, suit, claim or proceeding effected without its prior written
consent, which consent shall not be unreasonably withheld.
ARTICLE 7.
MISCELLANEOUS
7.1 Certificate Legend. Upon execution of this Agreement, the
stock certificates representing Shares held by the Stockholders shall
contain substantially the following legend, in addition to any other
legends deemed reasonably appropriate or necessary by the Company:
"This certificate is transferable only upon compliance with and
subject to the provisions of a Stockholders' Agreement among the
Company and certain Securityholders, a copy of which Agreement is on
file in the office of the Secretary of the Company at its principal
place of business. The Company will furnish a copy of such Agreement
to the record holder of this Certificate, without charge, upon written
request to the Company at its principal place of business or
registered office."
7.2 Negotiable Form. Whenever any Shares are to be delivered or
sold pursuant to this Agreement, the person selling such Shares shall
deliver such certificates or other instruments duly endorsed or accompanied
by appropriate stock powers or assignments separate from the certificate or
instrument.
7.3 Enforcement. No Shares shall be Transferred on the books of
the Company and no Transfer thereof shall be effective unless and until the
terms and provisions of this Agreement are complied with, and in cases of
violation of this agreement by the attempted Transfer of the Shares without
compliance with the terms and provisions thereof, such Transfer shall be
invalid and of no effect, and the Company and/or any of the Securityholders
who are not attempting to Transfer the Shares shall have the right to
compel the Securityholder who is attempting to Transfer the Shares, and/or
the purported transferee, to Transfer and deliver the same in accordance
with the applicable provisions of this Agreement.
7.4 Specific Performance. The parties hereto recognize that it
is to the benefit of the Company and the Securityholders that this
Agreement be carried out; and for those and other reasons, the parties
hereto would be irreparably damaged if this Agreement is not specifically
enforced in the event of a breach hereof. If any controversy concerning the
rights or obligations to purchase or sell any Shares arises, or if this
Agreement is breached, the parties hereto hereby agree that remedies at law
might be inadequate and that, therefore, such rights and obligations, and
this Agreement, shall be enforceable by specific performance. The remedy of
specific performance shall not be an exclusive remedy, but shall be
cumulative of all other rights and remedies of the parties hereto at law,
in equity or under this Agreement.
7.5 Transferees. The Company and the Securityholders shall cause
any transferee of any Shares or options exercisable for shares held by any
Securityholder to execute a consent, in form and substance reasonably
acceptable to the Company, to be bound by the terms and conditions of this
Agreement and upon execution thereof such future Securityholder shall be
entitled to the rights of an owner of the Shares held by such transferee
hereunder, provided that the foregoing shall not apply to Shares that have
been sold pursuant to an effective registration statement under the
Securities Act or Rule 144 thereunder.
7.6 Notices. Any notices or other communications required or
permitted hereunder shall be sufficiently given if in writing and
delivered in person, transmitted by telecopier or sent by registered
or certified mail (return receipt requested) or recognized overnight
delivery service, postage pre-paid, addressed as follows, or to such
other address as any such party may notify to the other parties in
writing:
(a) if to the Company:
CONCORDE CAREER COLLEGES, INC.
MISSION CORPORATE CENTRE
0000 XXX XXXXX XXXXX, XXXXX 000
XXXXXXX, XXXXXX 00000
ATTN: XXXX X. XXXXXXX
WITH A COPY TO:
XXXXX XXXX LLP
3500 ONE KANSAS CITY PLACE
0000 XXXX XXXXXX
XXXXXX XXXX, XXXXXXXX 00000
ATTN: XXXXXX X. XXX XXXX
(b) if to the Xxxxxx, Xxxxxxx Parties:
C/X XXXXXX, STRATEGIC PARTNERS, L.P.
XXX XXXXX XXXXXX, XXXXX 0000
XXXXXXXXX, XXXXXXXX 00000
ATTN: XXXXX XXXXXXX
FACSIMILE NO.: (000) 000-0000
WITH A COPY TO:
XXXXXX, XXXXXX & XXXXXXXXX
0000 XXXXXX XXXX.
XXXXXX, XXXXXXXX 00000
ATTN: XXXXXXX X. XXXXX, ESQUIRE
FACSIMILE NO.: (000) 000-0000
(c) if to any of the Other Holders, to the respective Other Holder as
set forth below:
XXXX X. XXXXXXX
0000 XXXXX
XXXXXXX XXXXXXX, XXXXXX 00000
THE BROZMAN TRUST
C/O XXXX X. XXXXXXX
MISSION CORPORATE CENTRE
0000 XXX XXXXX XXXXX, XXXXX 000
XXXXXXX, XXXXXX 00000
A NOTICE OR COMMUNICATION WILL BE EFFECTIVE (I) IF DELIVERED IN PERSON OR BY
OVERNIGHT COURIER, ON THE BUSINESS DAY IT IS DELIVERED, (II) IF TRANSMITTED BY
TELECOPIER, ON THE BUSINESS DAY OF ACTUAL CONFIRMED RECEIPT BY THE ADDRESSEE
THEREOF, AND (III) IF SENT BY REGISTERED OR CERTIFIED MAIL, 3 BUSINESS DAYS
AFTER DISPATCH.
7.7 Binding Effect; Assignment. This Agreement, including the
rights and conditions contained herein in connection with disposition
of Shares, shall be binding upon the parties hereto, together with
their respective executors, administrators, successors, personal
representatives, heirs and assigns permitted under this Agreement.
7.8 Governing Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of Delaware.
7.9 Severability. If any provision of this Agreement is held to
be illegal, invalid or unenforceable under present or future laws
effective during the term hereof, such provisions shall be fully
severable and this Agreement shall be construed and enforced as if
such illegal, invalid or unenforceable provision never comprised a
part hereof; and the remaining provisions hereof shall remain in full
force and effect and shall not be affected by the illegal, invalid or
unenforceable provision or by its severance herefrom. Furthermore, in
lieu of such illegal, invalid or unenforceable provision, there shall
be added automatically as part of this Agreement, a provision as
similar in its terms to such illegal, invalid or unenforceable
provision as may be possible and be legal, valid and enforceable.
7.10 Entire Agreement. This Agreement embodies the entire
agreement and understanding between the parties hereto with respect to
the subject matter hereof and supersedes all prior agreements and
understandings relating to the subject matter hereof.
7.11 Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed an original, but all of
which together shall constitute one instrument.
7.12 Amendments; Waiver. This Agreement may be amended, modified
or supplemented only by a written instrument executed by the Company
and the Securityholders.
7.13 Captions. The captions of this Agreement are for convenience
of reference only and shall not limit or otherwise affect any of the
terms or provisions hereof.
[BALANCE OF PAGE LEFT BLANK INTENTIONALLY -- SIGNATURE PAGE
FOLLOWS]
STOCKHOLDERS' AGREEMENT SIGNATURE PAGE
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the date first above written.
CONCORDE CAREER COLLEGES, INC.
By: /s/ Xxxx X. Xxxxxxx
--------------------
Name: Xxxx X. Xxxxxxx
Title: President
XXXXXX, XXXXXXX PARTIES:
XXXXXX, XXXXXXX STRATEGIC PARTNERS
FUND, L.P.
By: XXXXXX XXXXXXX STRATEGIC
PARTNERS, L.P., its General Partner
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------
Name: Xxxxx X. Xxxxxxx
Title: a General Partner
STRATEGIC ASSOCIATES, L.P.
By: XXXXXX, XXXXXXX STRATEGIC PARTNERS,
L.P., its General Partner
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------
Name: Xxxxx X. Xxxxxxx
Title: A General Partner
S-1
OTHER HOLDERS:
XXXX X. XXXXXXX, in his individual
capacity
By: /s/ Xxxx X. Xxxxxxx
----------------------------------
XXXXXX X. XXXXXXX TRUST UNDER AGREEMENT
DATED DECEMBER 28, 1989
By: /s/ Xxxx X. Xxxxxxx
----------------------------------
Xxxx X. Xxxxxxx, Trustee
S-2
