REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT, dated as of May 18, 2001 (the
"Agreement"), is made between THE FEMALE HEALTH COMPANY, a Wisconsin corporation
(the "Company"), and HEARTLAND BANK, a federal savings bank (the "Holder").
RECITALS
A. The Company and the Holder have entered into a Loan Agreement,
dated as of the date of this Agreement (the "Loan Agreement"), which provides,
among other things, for a $2,000,000 loan from the Holder to the Company.
B. The Company has agreed to issue a warrant (the "Warrant") to
the Holder to purchase a number of shares of the Company's Common Stock, par
value $0.01 per share (the "Common Stock") equal to (a) $500,000 (the "Guarantee
Amount"), divided by (b) the Warrant purchase price (as determined in accordance
with the provisions set forth in the Warrant) as of the date of exercise to
induce the Holder to execute and deliver the Loan Agreement. The shares of the
Common Stock for which the Warrant is exercisable are collectively referred to
herein as the "Common Shares."
C. The Company wishes to execute and deliver this Agreement in
order to induce the Holder to provide the loan under the Loan Agreement and has
agreed to provide certain registration rights under the Securities Act of 1933,
as amended, and the rules and regulations thereunder, or any similar successor
statute (collectively, the "1933 Act"), and applicable state securities laws
with respect to the Common Shares.
AGREEMENTS
In consideration of the premises and the mutual covenants contained
herein and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, and intending to be legally bound hereby, the
Company and the Holder hereby agree as follows:
1. Definitions. As used in this Agreement, the following terms
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shall have the following meanings:
(a) "1934 Act" shall mean the Securities Exchange Act of
1934, as amended, and the rules and regulations promulgated thereunder.
(b) "Guarantors" shall mean any guarantor who executes a
guarantee at any time in connection with that certain Loan Agreement dated as of
May __, 2001 between the initial Holder and the Company, including any
amendments thereto.
(c) "Guarantor Warrants" shall mean the Guarantors' warrants
for the purchase of shares in the Company which are subject to the Pledge
Agreements (as defined below).
(d) "Holder" shall have the meaning set forth in the first
paragraph hereof, as well as any transferee or assignee of the initial Holder
who agrees to become bound by the provisions of this Agreement in accordance
with section 10 hereof.
(e) "Pledge Agreements" shall mean any pledge agreements
entered into at any time by and between the initial Holder and each Guarantor in
connection with that certain Loan Agreement dated as of May __, 2001 between the
Holder and the Company, including any amendments thereto, whereby each Guarantor
pledges, to the initial Holder, its interest in certain warrants for the
purchase of stock in the Company, and the corresponding shares of stock issuable
upon exercise of the warrant..
(f) "Registrable Securities" means the Warrant and the Common
Shares, together with any shares of Common Stock which may be issued as a
dividend or other distribution and any additional shares of Common Stock which
may be issued due to anti-dilution adjustments with respect to the Warrant and
Common Shares, which are required to be included in a Registration Statement
pursuant to section 2 below. Upon the occurrence of an Event of Default (as
defined in the Pledge Agreements), the term "Registrable Securities" may also
include, at the election of the initial Holder, the Guarantor Warrants and the
corresponding shares of Common Stock in the event the Guarantor Warrants are
exercised, together with any shares of Common Stock which may be issued as a
dividend or other distribution and any additional shares of Common Stock which
may be issued due to anti-dilution adjustments with respect to the Guarantor
Warrants and shares of Common Stock underlying the Guarantor Warrants.
(g) "Registration Period" means the period between the date
of this Agreement and the earlier of (i) the date on which all of the
Registrable Securities have been sold pursuant to a Registration Statement or
Rule 144, or (ii) the date on which the Registrable Securities, may be
immediately sold without registration by a Holder who is not an affiliate of the
Company pursuant to Rule 144(k) under the 1933 Act or any similar or successor
rule (provided that the Holder has received an opinion of the Company's counsel
who is reasonably acceptable to the Holder covering the matters referred to in
this clause (ii) and such opinion is reasonably satisfactory to the Holder).
Notwithstanding the foregoing, if the Registration Period for one type of
Registrable Security shall expire, the Registration Period for all other types
of Registrable Securities shall remain unchanged until such time as they are
sold in accordance with clause (i) above or may be sold in accordance with
clause (ii) above.
(h) "Registration Statement" means a registration statement
filed with the Securities and Exchange Commission (the "SEC") under the 1933
Act.
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(i) The terms "register," "registered," and "registration"
refer to a registration effected by preparing and filing a Registration
Statement in compliance with the 1933 Act, and the declaration or ordering of
effectiveness of such Registration Statement by the SEC.
(j) "Rule 144" shall mean Rule 144 promulgated under the 1933
Act or any successor rule thereto.
2. Registration. The Company covenants and agrees:
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(a) At any time and from time to time, the Holder may make a
written request to the Company (a "Demand Notice") that the Company register the
offer and sale of all or any part of the Holder's Registrable Securities under
the 1933 Act (a "Demand Registration"). Upon receipt of a Demand Notice, the
Company will use its reasonable best efforts to file within 60 days after the
date of the Demand Notice a Registration Statement with the SEC registering the
Registrable Securities included in the Demand Notice for resale. The Company
will use its reasonable best efforts to cause such Registration Statement to be
declared effective by the SEC within 120 days after the date of the Demand
Notice. Such reasonable best efforts shall include, but not be limited to,
promptly responding to all comments received from the staff of the SEC. Should
the Company receive notification from the SEC that the Registration Statement
will receive no action or no review from the SEC, the Company shall cause such
Registration Statement to become effective within five business days of such SEC
notification. Once declared effective by the SEC, the Company shall use all
reasonable best efforts to cause such Registration Statement to remain
continuously effective throughout the Registration Period. Notwithstanding
anything in this section 2(a) to the contrary, the Holder shall be entitled to
no more than two Demand Registrations.
(b) The offering of such Registrable Securities pursuant to
the Registration Statement shall be in the form of either an underwritten
offering or through the use of brokers or in privately negotiated transactions,
in either case as selected by the Holder within no more than five (5) business
days following the date of the Demand Notice. In the event that the Holder
elects that the offering be an underwritten offering, the Company and the Holder
shall enter into a customary underwriting agreement with such underwriter(s)
(and the Holder may at its option require that the representations, warranties
and covenants of the Company to or for the benefit of the underwriter(s) also
are made for the benefit of the Holder).
(c) Notwithstanding the foregoing, the Company may delay in
filing the Registration Statement and may withhold efforts to cause the
Registration Statement to become effective, if the Company determines in good
faith that such registration will (i) materially and adversely interfere with or
affect the negotiation or completion of any actual or pending material
transaction that is being contemplated by the Company (whether or not a final
decision has been made to undertake such transaction) at the time the right to
delay or withhold efforts is exercised, or (ii) involve initial or continuing
disclosure obligations that are not in the best interests of the Company's
stockholders. The Company may exercise such right to delay or withhold efforts
not more than once and for not more than sixty (60) days. Notwithstanding
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anything to the contrary that may be contained in this Agreement, if the Company
exercises its right to delay or to withhold efforts, the Company shall use its
reasonable best efforts to have the Registration Statement filed or declared
effective, as the case may be, at the earliest practicable date after the
Company's reasons for delaying or withholding efforts are no longer applicable
(but subject to the time limitation in the immediately preceding sentence).
(d) Whenever the Company proposes to register (including on
behalf of a selling stockholder) any of its securities under the 1933 Act
(except for the registration of securities to be offered pursuant to an employee
benefit plan on Form S-8 or pursuant to a registration made on Form S-4, or any
successor forms) at any time other than pursuant to a Demand Registration and
the registration form to be used may be used for the registration of the
Registrable Securities (a "Piggyback Registration"), it will so notify the
Holder in writing no later than the earlier to occur of (i) the tenth (10th) day
following the Company's receipt of notice of exercise of other demand
registration rights, or (ii) 30 days prior to the anticipated date of filing.
Subject to the provisions of section 2(f), the Company will include in the
Piggyback Registration all Registrable Securities with respect to which the
Company has received written requests for inclusion from the Holder with fifteen
(15) business days after the Holder's receipt of the Company's notice. The
Holder may withdraw all or any part of the Registrable Securities from a
Piggyback Registration at any time before ten (10) business days prior to the
effective date of the Piggyback Registration. The Company, the Holder and any
person who hereafter becomes entitled to register its securities in a
registration initiated by the Company shall sell their securities on the same
terms and conditions.
(e) If the managing underwriter gives the Company its written
opinion that the total number of securities requested to be included in the
Piggyback Registration exceeds the number of securities that can be sold, the
Company will include the securities in the registration in the following order
of priority: (i) first, all securities the Company or the shareholder for whom
the Company is effecting the registration, as the case may be, proposes to sell;
(ii) second, up to the full number of Registrable Securities requested to be
included in the registration; and (iii) third, any other securities requested to
be included, allocated among the holders of such securities in such proportions
as the Company and those holders may agree.
(f) If any Piggyback Registration is an underwritten
offering, the Company and the Holder shall enter into a customary underwriting
agreement with the underwriter(s) administering the offering. The Holder may
not participate in any Piggyback Registration without (i) agreeing to sell
securities on the basis provided in the underwriting arrangements approved by
the Company, and (ii) completing all questionnaires, powers of attorney,
indemnities, underwriting agreements and other documents required by the
underwriting arrangements.
(g) Upon the occurrence of an Event of Default (as defined in
the Pledge Agreements) and the transfer of the Guarantor Warrants thereunder to
the initial Holder pursuant to the terms of the Pledge Agreements and by law,
the Company hereby agrees, at the election of the initial Holder, to be
exercised by notice in writing to the Company within sixty (60) days of such
transfer, the terms and conditions of this Agreement shall also cover the
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Guarantor Warrants and the corresponding shares of Common Stock in the event the
Guarantor Warrants are exercised, together with any shares of Common Stock which
may be issued as a dividend or other distribution and any additional shares of
Common Stock which may be issued due to anti-dilution adjustments with respect
to the Guarantor Warrants and shares of Common Stock underlying the Guarantor
Warrants.
3. Additional Obligations of the Company. In connection with the
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registration of the Registrable Securities, the Company shall have the following
additional obligations:
(a) The Company shall keep the Registration Statement
effective pursuant to Rule 415 under the 1933 Act at all times during the
Registration Period as defined in section 1(g) above.
(b) The Registration Statement (including any amendments or
supplements thereto and prospectuses contained therein) filed by the Company
shall not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein, or necessary to make the statements
therein, in light of the circumstances in which they were made, not misleading.
The Company shall prepare and file with the SEC such amendments (including
post-effective amendments) and supplements to the Registration Statement and the
prospectus used in connection with the Registration Statement as may be
necessary to keep the Registration Statement effective at all times during the
Registration Period, and, during such period, shall comply with the provisions
of the 1933 Act applicable to the Company with respect to the disposition of all
Registrable Securities of the Company covered by the Registration Statement
until such time as all of such Registrable Securities have been disposed of in
accordance with the intended methods of disposition by the sellers thereof as
set forth in the Registration Statement. In the event the number of shares of
Common Stock included in a Registration Statement filed pursuant to this
Agreement is insufficient to cover all of the Registrable Securities, the
Company shall amend the Registration Statement and/or file a new Registration
Statement so as to cover all of the Registrable Securities as soon as
practicable. The Company shall use its reasonable best efforts to cause such
amendment and/or new Registration Statement to become effective as soon as
practicable following the filing thereof.
(c) The Company shall furnish to each Holder whose
Registrable Securities are included in the Registration Statement (i) promptly
after the same is prepared and publicly distributed, filed with the SEC or
received by the Company, one copy of the Registration Statement and any
amendment thereto, each preliminary prospectus and final prospectus and each
amendment or supplement thereto, and each substantive letter written by or on
behalf of the Company to the SEC and each item of each substantive
correspondence from the SEC, in each case relating to such Registration
Statement (other than any portion of any item thereof which contains information
for which the Company has sought confidential treatment); and (ii) such number
of copies of a prospectus, including a preliminary prospectus, and all
amendments and supplements thereto, and such other documents as such Holder may
reasonably request in order to facilitate the disposition of the Registrable
Securities owned by such Holder.
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(d) The Company shall use its reasonable best efforts to (i)
register and qualify the Registrable Securities covered by the Registration
Statement under such other securities or blue sky laws of such jurisdictions as
the Holder reasonably requests, (ii) prepare and file in those jurisdictions
such amendments (including post-effective amendments) and supplements to such
registrations as may be necessary to maintain the effectiveness thereof during
the Registration Period, (iii) take such other actions as may be necessary to
maintain such registrations and qualifications in effect at all times during the
Registration Period, and (iv) take all other actions reasonably necessary or
advisable to qualify the Registrable Securities for sale in such jurisdictions.
Notwithstanding the foregoing provision, the Company shall not be required in
connection therewith or as a condition thereto to (i) qualify to do business in
any jurisdiction where it would not otherwise be required to qualify but for
this section 3(d), (ii) subject itself to general taxation in any such
jurisdiction, (iii) file a general consent to service of process in any such
jurisdiction, (iv) provide any undertakings that cause more than nominal expense
or burden to the Company, or (v) make any change in its charter or bylaws, which
in each case the Board of Directors of the Company determines to be contrary to
the best interests of the Company and its stockholders.
(e) The Company shall notify each Holder who holds
Registrable Securities being sold pursuant to a Registration Statement of the
happening of any event of which the Company has knowledge as a result of which
the prospectus included in the Registration Statement as then in effect includes
an untrue statement of a material fact or omits to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading (a "Suspension Event"). The Company shall make such notification as
promptly as practicable after the Company becomes aware of such Suspension
Event, shall promptly use its reasonable best efforts to prepare a supplement or
amendment to the Registration Statement to correct such untrue statement or
omission, and shall deliver a copy of such supplement or amendment to each
Holder.
(f) The Company shall use its reasonable best efforts to
prevent the issuance of any stop order or other suspension of effectiveness of a
Registration Statement and, if such an order is issued, shall use its reasonable
best efforts to obtain the withdrawal of such order at the earliest possible
time and to notify each Holder who holds Registrable Securities being sold of
the issuance of such order and the resolution thereof.
(g) The Company shall permit a single firm of counsel
designated by the Holder to review the Registration Statement and all amendments
and supplements thereto (as well as all requests for acceleration or
effectiveness thereof) a reasonable period of time prior to their filing with
the SEC, and shall not file any document in a form to which such counsel
reasonably objects.
(h) The Company shall make available for inspection by the
Holder whose Registrable Securities are being sold pursuant to such registration
and any attorney, accountant or other agent retained by any such Holder
(collectively, the "Inspectors"), all pertinent financial and other records,
pertinent corporate documents and properties of the Company (collectively, the
"Records"), as shall be reasonably necessary to enable each Inspector
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to exercise its due diligence responsibility, and cause the Company's officers,
directors and employees to supply all information which any Inspector may
reasonably request for purposes of such due diligence; provided, however, that
each Inspector shall hold in confidence and shall not make any disclosure
(except to a Holder) of any Record or other information unless (i) the
disclosure of such Records is necessary to avoid or correct a misstatement or
omission in any Registration Statement, (ii) the release of such Records is
ordered pursuant to a subpoena or other order from a court or government body of
competent jurisdiction, or (iii) the information in such Records has been made
generally available to the public other than by disclosure in violation of this
or any other agreement. The Company shall not be required to disclose any
confidential information in such Records to any Inspector until and unless such
Inspector shall have entered into confidentiality agreements (in form and
substance reasonably satisfactory to the Company) with the Company with respect
thereto, substantially in the form of this section 3(h). The Holder agrees that
it shall, upon learning that disclosure of such Records is sought in or by a
court or governmental body of competent jurisdiction or through other means,
give prompt notice to the Company and allow the Company, at the Company's
expense, to undertake appropriate action to prevent disclosure of, or to obtain
a protective order for, the Records deemed confidential. Nothing herein shall
be deemed to limit the Holder's ability to sell Registrable Securities in a
manner which is otherwise consistent with applicable laws and regulations.
(i) The Company shall cooperate with the Holder of
Registrable Securities and each underwriter participating in the disposition of
such Registrable Securities, if any, and their respective counsel in connection
with any filings required to be made with the National Association of Securities
Dealers, Inc.
(j) In the event of a underwritten offering, the Company
shall enter into and perform its obligations under an underwriting agreement, in
usual and customary form, with the underwriter(s) of such offering, with such
terms and conditions as the Company and the underwriter(s) may agree. The
Holder, if participating in such underwriting, shall also enter into and perform
its obligations under such an agreement.
(k) The Company shall take all other reasonable actions
reasonably requested by the Holder which are necessary to expedite and
facilitate disposition by the Holder of the Registrable Securities pursuant to
the Registration Statement.
4. Obligations of the Holder. In connection with the registration
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of the Registrable Securities, the Holder shall have the following obligations:
(a) It shall be a condition precedent to the obligations of
the Company to take any action pursuant to this Agreement with respect to the
Holder that the Holder shall furnish in writing to the Company such information
regarding the Holder, the Registrable Securities held by the Holder and the
intended method of disposition of the Registrable Securities held by the Holder
as shall be required to effect the registration of the Registrable Securities
and shall execute such documents in connection with such registration as the
Company may reasonably request.
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(b) The Holder, by acceptance of the Registrable Securities,
agrees to cooperate with the Company as reasonably requested by the Company in
connection with the preparation and filing of the Registration Statement
hereunder unless such Holder has notified the Company in writing of such
Holder's election to exclude all of such Holder's Registrable Securities from
the Registration Statement.
(c) The Holder agrees that, upon receipt of any notice from
the Company of the happening of any event of the kind described in section 3(e)
or 3(f), such Holder will immediately discontinue disposition of Registrable
Securities pursuant to the Registration Statement covering such Registrable
Securities until such Holder's receipt of the copies of the supplemented or
amended prospectus contemplated by section 3(e) or 3(f) and, if so directed by
the Company, such Holder shall deliver to the Company (at the expense of the
Company) or destroy (and deliver to the Company a certificate of destruction )
all copies in such Holder's possession, of the prospectus covering such
Registrable Securities current at the time of receipt of such notice. The
Company shall use its reasonable best efforts to limit the duration of any
discontinuance of disposition of Registrable Securities pursuant to this
paragraph.
5. Expenses of Registration. All expenses, other than discounts
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and commissions attributable to the sale of any Registrable Securities, incurred
in connection with registrations, filings or qualifications pursuant to section
2, including, without limitation, all registration, listing and qualifications
fees, printers and accounting fees, and the fees and disbursements of counsel
for the Company, shall be borne by the Company.
6. Indemnification. In the event any Registrable Securities are
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included in a Registration Statement under this Agreement:
(a) The Company will indemnify and hold harmless each Holder
who holds such Registrable Securities, the directors, if any, of such Holder,
the officers and employees, if any, of such Holder, each person, if any, who
controls any Holder within the meaning of the 1933 Act (each, an "Indemnified
Person"), against any losses, claims, damages, expenses or liabilities (joint or
several) or actions in respect thereof (collectively "Claims") to which any of
them become subject under the 1933 Act or otherwise, insofar as such Claims (or
actions or proceedings, whether commenced or threatened, in respect thereof)
arise out of or are based upon any of the following statements, omissions or
violations in the Registration Statement, or any post-effective amendment
thereof, or any prospectus included therein: (i) any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement or any post-effective amendment thereof or 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, (ii) any untrue
statement or alleged untrue statement of a material fact contained in any
preliminary prospectus if used prior to the effective date of such Registration
Statement, or contained in the final prospectus (as amended or supplemented, if
the Company files any amendment thereof or supplement thereto with the SEC) or
the omission or alleged omission to state therein any material fact necessary to
make the statements made therein, in light of the circumstances under which the
statements therein were made, not misleading, or (iii) any violation or alleged
violation by the Company of the 1933 Act or any state securities law or any
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rule or regulation (the matters in the foregoing clauses (i) through (iii)
being, collectively, "Violations"). Subject to the restrictions set forth in
section 6(c) with respect to the number of legal counsel, the Company shall
reimburse the Holder and each such underwriter or controlling person, promptly
as such expenses are incurred and are due and payable, for any legal fees or
other expenses reasonably incurred by them in connection with investigating or
defending any such Claim. Notwithstanding anything to the contrary contained
herein, the indemnification agreement contained in this section 6(a): (A) shall
not apply to a Claim arising out of or based upon a Violation which occurs in
reliance upon and in conformity with information furnished in writing to the
Company by any Indemnified Person or underwriter for such Indemnified Person
expressly for use in connection with the preparation of the Registration
Statement or any such amendment thereof or supplement thereto; (B) with respect
to any preliminary prospectus shall not inure to the benefit of any such person
from whom the person asserting any such Claim purchased the Registrable
Securities that are the subject thereof (or to the benefit of any person
controlling such person) if the untrue statement or omission of material fact
contained in the preliminary prospectus was corrected in the prospectus, as then
amended or supplemented, if a prospectus was timely made available by the
Company pursuant to section 3(c) hereof; and (C) shall not apply to amounts paid
in settlement of any Claim if such settlement is effected without the prior
written consent of the Company, which consent shall not be unreasonably
withheld. Such indemnity shall remain in full force and effect regardless of
any investigation made by or on behalf of the Indemnified Persons and shall
survive the transfer of the Registrable Securities by the Holder pursuant to
section 10. In connection with a firm or best efforts underwritten offering, to
the extent customarily required by the managing underwriter, the Company will
indemnify the underwriters, their officers, directors, trustees, partners,
employees, advisors and agents, and each person who controls the underwriters
(within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934
Act), together with all officers, directors, trustees, partners, employees,
advisors and agents of such controlling person, to the extent customary in such
agreements.
(b) In connection with any Registration Statement in which
the Holder is participating, the Holder agrees to indemnify and hold harmless,
to the same extent and in the same manner set forth in section 6(a), the
Company, each of its directors, each of its officers who signs the Registration
Statement, each person, if any, who controls the Company within the meaning of
the 1933 Act (an "Indemnified Party"), against any Claim to which any of them
may become subject, under the 1933 Act or otherwise, insofar as such Claim
arises out of or is based upon any Violation, in each case to the extent (and
only to the extent) that such Violation occurs in reliance upon and in
conformity with written information furnished to the Company by such Holder
expressly for use in connection with such Registration Statement, and such
Holder will reimburse any legal fees or other expenses reasonably incurred by
them in connection with investigating or defending any such Claim; provided,
however, that the indemnity agreement contained in this section 6(b) shall not
apply to amounts paid in settlement of any Claim if such settlement is effected
without the prior written consent of such Holder, which consent shall not be
unreasonably withheld; provided further, however, that the Holder shall be
liable under this section 6(b) for only that amount of a Claim as does not
exceed the net proceeds to such Holder as a result of the sale of Registrable
Securities pursuant to such Registration Statement. Such indemnity shall remain
in full force and effect regardless of any investigation made by or on
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behalf of such Indemnified Party and shall survive the transfer of the
Registrable Securities by the Holder pursuant to section 10. In connection with
a firm or best efforts underwritten offering, to the extent customarily required
by the managing underwriter, the Holder will indemnify the underwriters, their
officers, directors, trustees, partners, employees, advisors and agents, and
each person who controls the underwriters (within the meaning of Section 15 of
the 1933 Act or Section 20 of the 1934 Act), together with all officers,
directors, trustees, partners, employees, advisors and agents of such
controlling person, to the extent customary in such agreements.
(c) Promptly after receipt by an Indemnified Person or
Indemnified Party under this section 6 of notice of the commencement of any
action (including any governmental action), such Indemnified Person or
Indemnified Party shall, if a Claim in respect thereof is to be made against any
indemnifying party under this section 6, deliver to the indemnifying party a
written notice of the commencement thereof and this indemnifying party shall
have the right to participate in, and, to the extent the indemnifying party so
desires, jointly with any other indemnifying party similarly noticed, to assume
control of the defense thereof with counsel mutually satisfactory to the
indemnifying parties; provided, however, that an Indemnified Person or
Indemnified Party shall have the right to retain its own counsel, with the fees
and expenses to be paid by the indemnifying party, if, in the reasonable opinion
of counsel retained by the indemnifying party, the representation by such
counsel of the Indemnified Person or Indemnified Party and the indemnifying
party would be inappropriate due to actual or potential differing interests
between such Indemnified Person or Indemnified Party and other party represented
by such counsel in such proceeding. The Company shall pay for only one separate
legal counsel for the Holder; such legal counsel shall be selected by the
Holder. The failure to deliver written notice to the indemnifying party within
a reasonable time of the commencement of any such action shall not relieve such
indemnifying party of any liability to the Indemnified Person or Indemnified
Party under this section 6, except to the extent that the indemnifying party is
prejudiced in its ability to defend such action. The indemnification required
by this section 6 shall be made by periodic payments of the amount thereof
during the course of the investigation or defense, as such expense, loss, damage
or liability is incurred and is due and payable.
7. Contribution. If for any reason the indemnification provided
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for in section 6 is unavailable to an Indemnified Party or an Indemnified Person
or is insufficient to hold it harmless as payable by the Indemnified Party or an
Indemnified Person as contemplated therein, the indemnifying party agrees to
make the maximum contribution with respect to any amounts for which it would
otherwise be liable under section 6, provided, however, that (i) no contribution
shall be made under circumstances where the maker would not have been liable for
indemnification under the fault standards set forth in section 6, (ii) no seller
of Registrable Securities guilty of fraudulent misrepresentation (within the
meaning of section 11(f) of the 0000 Xxx) shall be entitled to contribution from
any seller of Registrable Securities who was not guilty of such fraudulent
misrepresentation, and (iii) contribution by any seller of Registrable
Securities shall be limited in amount to the net amount of proceeds received by
such seller from the sale of such Registrable Securities.
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8. Changes in Capital Stock. If, and as often as, there is any
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change in the capital stock of the Company by way of a stock split, stock
dividend, combination or reclassification, or through a merger, consolidation,
reorganization or recapitalization, or by any other means, appropriate
adjustment shall be made in the provisions hereof so that the rights and
privileges granted hereby shall continue with respect to the capital stock as so
changed.
9. Rule 144 Reporting. With a view to making available to the
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Holder the benefits of Rule 144 and any other rule or regulation of the SEC that
may at any time permit a Holder to sell securities of the Company to the public
without registration, the Company agrees to:
(a) Make and keep public information available, as those
terms are understood and defined in Rule 144, at all times after the date
hereof;
(b) File with the SEC in a timely manner all reports and
other documents required of the Company under the 1933 Act and the 1934 Act; and
(c) Furnish to any Holder, so long as the Holder owns any
Registrable Securities, upon request (i) a written statement by the Company as
to its compliance with the reporting requirements of the 1933 Act and the 1934
Act (at any time after it has become subject to such reporting requirements), or
as to its qualification as a registrant whose securities may be resold pursuant
to Form S-3 or any registration form under the 1933 Act subsequently adopted by
the SEC that permits the inclusion or incorporation of substantial information
by reference to other documents filed by the Company with the SEC (at any time
after it so qualifies), (ii) a copy of the most recent annual or quarterly
report of the Company and such other reports and documents so filed by the
Company, and (iii) such other information as may be reasonably requested in
availing any Holder of any rule or regulation of the SEC which permits the
selling of any such securities without registration or pursuant to such form.
10. Assignment of Registration Rights. The rights to have the
------------------------------------
Company register Registrable Securities pursuant to this Agreement shall be
automatically assigned by the Holder to transferees or assignees of all or any
portion of such Registrable Securities if (i) the Holder agrees in writing with
the transferee or assignee to assign such rights, and a copy of such agreement
is furnished to the Company within a reasonable time after such assignment, (ii)
the Company is, within a reasonable time after such transfer or assignment,
furnished with written notice of the name and address of such transferee or
assignee and the securities with respect to which such registration rights are
being transferred or assigned, (iii) following such transfer or assignment the
further disposition of such securities by the transferee or assignee is
restricted under the 1933 Act and applicable state securities laws, and (iv) at
or before the time the Company received the written notice contemplated by
clause (ii) of this sentence, the transferee or assignee agrees in writing with
the Company to be bound by all of the provisions contained herein. Upon a
transfer in compliance with this section 10 , all references in this Agreement
to "Holder" shall be deemed to refer in addition to any transferee hereunder
with respect to such transferred Registrable Securities. Notwithstanding
anything to the contrary that may be contained in this Agreement, in the event
that the Holder does not transfer all of the Registrable
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Securities or transfers the Registrable Securities to more than one transferee,
the holders of the Registrable Securities thereafter shall be entitled to take
any action hereunder by the approval of not less than thirty-three percent (33%)
of all Registrable Securities or by the approval of not less than thirty-three
percent (33%) of the Registrable Securities which are the subject of such
registration, as appropriate.
11. Amendment of Registration Rights. Provisions of this
-----------------------------------
Agreement may be amended and the observance thereof may be waived (either
generally or in a particular instance and either retroactively or prospectively)
only with the written consent of the Company and the Holder(s) who hold a
majority interest of the Registrable Securities. Any amendment or waiver
effected in accordance with this section 11 shall be binding upon each Holder
and the Company.
12. Miscellaneous.
-------------
(a) Conflicting Instructions. A person or entity is deemed
-------------------------
to be a Holder of Registrable Securities whenever such person or entity owns of
record such Registrable Securities. If the Company receives conflicting
instructions, notices or elections from two or more persons or entities with
respect to the same Registrable Securities, the Company shall act upon the basis
of instructions, notice or election received from the registered owner of such
Registrable Securities.
(b) Notices. Any notices required or permitted to be given
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under the terms of this Agreement shall be sent by certified or registered mail
(with return receipt requested) or delivered personally or by courier (including
a nationally recognized overnight delivery service) or by facsimile
transmission. Any notice so given shall be deemed effective three days after
being deposited in the U.S. Mail, or upon receipt if delivered personally or by
courier or facsimile transmission, in each case addressed to a party at the
following address or such other address as each such party furnishes to the
other in accordance with this section 12(b):
If to the Company:
The Female Health Company
000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xx. X.X. Xxxxxxx
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with a copy to:
Reinhart, Boerner, Van Deuren,
Xxxxxx & Rieselbach, s.c.
0000 Xxxxx Xxxxx Xxxxxx
Xxxxx 0000
Xxxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xx. Xxxxx X. Xxxxxx, Esq.
If to the Holder:
Heartland Bank
000 X. Xxxxxxx Xxxxxx
Xx. Xxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxx Xxxxxxxxx and Xxxxxx X. Love
with a copy to:
Xxxxx Xxxx LLP
Xxx Xxxxxxxxxxxx Xxxxxx
Xxxxx 0000
Xx. Xxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xx. Xxxx X. Xxxxxx, Esq.
(c) Waiver. Failure of any party to exercise any right or
------
remedy under this Agreement or otherwise, or delay by a party in exercising such
right or remedy, shall not operate as a waiver thereof.
(d) Governing Law. This Agreement shall be enforced,
--------------
governed by and construed in accordance with the laws of the State of Missouri
applicable to the agreements made and to be performed entirely within such
state, without giving effect to rules governing the conflict of laws.
(e) Any legal action or proceeding with respect to this
Agreement may be brought in the courts of the State of Missouri located in St.
Louis County or the City of St. Louis or of the United States for the Eastern
District of Missouri, and, by execution and delivery of this Agreement, the
Company irrevocably accepts for itself and in respect of its property, generally
and unconditionally, the non-exclusive jurisdiction of the aforesaid courts. The
Company hereby waives personal service of any and all process upon it and
consents that all
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such service of process may be made by registered mail (return receipt
requested) directed to the Company at its address set forth in section 12(b) and
service so made shall be deemed to be completed five (5) days after the same
shall have been deposited in the U.S. mails. Nothing herein shall affect the
right of the Holder to serve process in any other manner permitted by law or to
commence legal proceedings or otherwise proceed against the Company in any other
jurisdiction.
(f) The Company hereby irrevocably waives any objection which
it may now or hereafter have to the laying of venue of any of the aforesaid
actions or proceedings arising out of or in connection with this Agreement
brought in the courts referred to in clause (e) above and hereby further
irrevocably waives and agrees not to plead or claim in any such court that any
such action or proceeding brought in any such court has been brought in an
inconvenient forum.
(g) Severability. In the event that any provision of this
------------
Agreement is invalid or unenforceable under any applicable statute or rule of
law, then such provision shall be deemed inoperative to the extent that it may
conflict therewith and shall be deemed modified to conform with such statute or
rule of law. Any provision hereof which may prove invalid or unenforceable
under any law shall not affect the validity or enforceability of any other
provision hereof.
(h) Entire Agreement. This Agreement constitutes the entire
-----------------
agreement among the parties hereto with respect to the subject matter hereof.
There are no restrictions, promises, warranties or undertakings, other than
those set forth or referred to herein or therein. This Agreement supersedes all
prior agreements and understandings among the parties hereto with respect to the
subject matter hereof.
(i) Successors and Assigns. Subject to the requirements of
------------------------
section 10 hereof, this Agreement shall inure to the benefit of and be binding
upon the successors and assigns of each of the parties hereto.
(j) Use of Pronouns. All pronouns and any variations thereof
---------------
refer to the masculine, feminine or neuter, singular or plural, as the context
may require.
(k) Headings. The headings and subheadings in the Agreement
--------
are for convenience of reference only and shall not limit or otherwise affect
the meaning hereof.
(l) Counterparts. This Agreement may be executed in two or
------------
more counterparts, each of which shall be deemed an original but all of which
shall constitute one and the same agreement. This Agreement, once executed by a
party, may be delivered to the other party hereto by facsimile transmission, and
facsimile signatures shall be binding on the parties hereto.
(m) Further Acts. Each party shall do and perform, or cause
-------------
to be done and performed, all such further acts and things, and shall execute
and deliver all such other
14
agreements, certificates, instruments and documents, as the other party may
reasonably request in order to carry out the intent and accomplish the purposes
of this Agreement and the consummation of the transactions contemplated hereby.
(n) Consents. All consents and other determinations to be
--------
made by the Holder pursuant to this Agreement shall be made by Holder(s) holding
a majority of the Registrable Securities, determined as if all Warrants then
outstanding had been converted into or exercised for Common Shares.
[Signatures on the following page]
15
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the date first above written.
COMPANY:
THE FEMALE HEALTH COMPANY
By:_____________________________________
X.X. Xxxxxxx, Chairman and Chief
Executive Officer
HOLDER:
HEARTLAND BANK
By:_____________________________________
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