----------------------------------------------------
AMENDED AND RESTATED
REGISTRATION RIGHTS AGREEMENT
among
CARE MANAGEMENT SCIENCE CORPORATION
X. X. XXXXXXX III, L.P.,
WHITNEY STRATEGIC PARTNERS III, L.P.,
FOUNDATION HEALTH SYSTEMS, INC.,
XXXXX X. XXXXXXX,
XXXXXX X. XXXXXX,
XXXXX XXXXXX,
ZEKE INVESTMENT PARTNERS,
and
XXXXXXX XXXXXXXXXXXX
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Dated as of October 2, 2000
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TABLE OF CONTENTS
Page
1. Definitions.............................................................................................1
2. Securities Subject to this Agreement....................................................................4
(a) Registrable Securities.........................................................................4
(b) Holders of Registrable Securities..............................................................4
3. Demand Registration.....................................................................................5
(a) Request for Demand Registration................................................................5
(b) Effective Demand Registration..................................................................5
(c) Expenses.......................................................................................5
(d) Underwriting Procedures........................................................................6
(e) Selection of Underwriters......................................................................6
(f) Limitations on Demand Registrations............................................................6
4. Piggy-Back Registration.................................................................................7
(a) Piggy-Back Rights..............................................................................7
(b) Priority of Registrations......................................................................8
(c) Expenses.......................................................................................8
(d) Conditions and Limitations on Piggyback Registrations..........................................8
5. Holdback Agreements.....................................................................................9
(a) Restrictions on Public Sale by Holders.........................................................9
(b) Restrictions on Public Sale by the Company.....................................................9
6. Registration Procedures.................................................................................9
(a) Obligations of the Company.....................................................................9
(b) Seller Information............................................................................12
(c) Notice to Discontinue.........................................................................12
(d) Sale to Underwriter...........................................................................12
7. Registration Expenses..................................................................................13
8. Indemnification; Contribution..........................................................................13
(a) Indemnification by the Company................................................................13
(b) Indemnification by Holders....................................................................14
(c) Conduct of Indemnification Proceedings........................................................14
TABLE OF CONTENTS
(continued)
Page
(d) Contribution..................................................................................15
9. Rule 144; Other Exemptions.............................................................................16
10. Certain Limitations on Registration Rights.............................................................16
11. Miscellaneous..........................................................................................16
(a) Recapitalizations, Exchanges, etc.............................................................16
(b) No Inconsistent Agreements; Other Registration Rights.........................................16
(c) Remedies......................................................................................17
(d) Amendments and Waivers........................................................................17
(e) Notices.......................................................................................17
(f) Successors and Assigns........................................................................18
(g) Counterparts..................................................................................18
(h) Headings......................................................................................18
(i) Governing Law.................................................................................18
(j) Jurisdiction..................................................................................18
(k) Severability..................................................................................19
(l) Rules of Construction.........................................................................19
(m) Entire Agreement..............................................................................19
(n) Further Assurances............................................................................19
ii
REGISTRATION RIGHTS AGREEMENT
THIS AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT (the
"AGREEMENT"), dated as of October 2, 2000, among CARESCIENCE, INC., a
Pennsylvania corporation (the "COMPANY"), X. X. XXXXXXX III, L.P., a Delaware
limited partnership ("JHW"), WHITNEY STRATEGIC PARTNERS III, L.P., a Delaware
limited partnership ("WSP", together with JHW, collectively referred to herein
as "WHITNEY") FOUNDATION HEALTH SYSTEMS, INC., a Delaware corporation ("FHS"),
XXXXX X. XXXXXXX, XXXXXX X. XXXXXX (Xxxxx X. Xxxxxxx and Xxxxxx X. Xxxxxx
collectively referred to as the ("MANAGEMENT STOCKHOLDERS"), XXXXX XXXXXX,
XXXXXXX XXXXXXXXXXXX and XXXX INVESTMENT PARTNERS, a Pennsylvania partnership
(Xxxxx Xxxxxx, Xxxxxxx Xxxxxxxxxxxx and Xxxx Investment Partners collectively
referred to as the "INDIVIDUAL INVESTORS").
The parties hereto are parties to that certain Registration
Rights Agreement, dated as of December 28, 1998 (the "1998 AGREEMENT"), made in
connection with (i) the Stock Purchase Agreement (the "PURCHASE AGREEMENT"),
dated as of December 28, 1998, among the Company, Whitney and the Individual
Investors relating to the acquisition by Whitney and the Individual Investors of
an aggregate of 2,366,947 shares of Series C Convertible Preferred Stock, no par
value, of the Company (the "SERIES C CONVERTIBLE PREFERRED") for an aggregate
purchase price of $6,175,000.00 and (ii) the Exchange Agreement, dated as of the
date hereof, between FHS and the Company, pursuant to which FHS has agreed to
restructure its existing investment in the Company in return for 994,000 shares
of Series D Convertible Preferred Stock, no par value, of the Company (the
"SERIES D CONVERTIBLE PREFERRED"), 1,658,004 shares of Series E Convertible
Preferred Stock, no par value, of the Company (the "SERIES E CONVERTIBLE
PREFERRED") and 1,560,000 shares of Series G Redeemable Preferred Stock, no par
value, of the Company (the "SERIES G REDEEMABLE PREFERRED").
The parties hereto desire to amend and restate the 1998
Agreement to reflect certain changes to the capital structure of the Company and
certain other rights therein.
The parties hereby agree as follows:
1. DEFINITIONS. As used in this Agreement, and unless
the context requires a different meaning, the following terms have the meanings
indicated:
"1998 AGREEMENT" has the meaning assigned such term
in the third paragraph of this Agreement.
"ACT" means the Securities Act of 1933, as amended,
and the rules and regulations of the SEC promulgated thereunder.
"APPROVED UNDERWRITER" has the meaning assigned such
term in Section 3(e).
"APPROVED UNDERWRITER AMOUNT" has the meaning
assigned such term in Section 3(d).
"BUSINESS DAY" means any day other than a Saturday,
Sunday or other day on which commercial banks in the City of New York are
authorized or required by law or executive order to close.
"COMMON STOCK" means the Common Stock, no par value,
of the Company, or any other capital stock of the Company into which such stock
is reclassified or reconstituted.
"COMPANY UNDERWRITER" has the meaning assigned such
term in Section 4(a).
"DEMAND REGISTRATION" has the meaning assigned such
term in Section 3(a).
"DESIGNATED HOLDER" means Whitney, FHS, the
Management Stockholders, the Individual Investors and any of their respective
transferees to whom Registrable Securities have been transferred other than the
transferee to whom such securities have been transferred pursuant to a
registration statement under the Act or Rule 144 under the Act; provided, that,
for purposes of Section 3(a) hereof, the transferees of any Designated Holder
shall only be entitled to exercise that Designated Holder's Demand Registration
(if not already exercised by such Designated Holder) as a group.
"EXCHANGE ACT" means the Securities and Exchange Act
of 1934, as amended, and the rules and regulations of the SEC thereunder.
"HOLDER" has the meaning assigned such term in
Section 2(b).
"HOLDERS' COUNSEL" means (a) with respect to any
Demand Registration that has been requested pursuant to Section 3, the one
counsel selected by the Initiating Holder in such registration and (b) with
respect to a request for registration of Registrable Securities pursuant to
Section 4, the one counsel selected by the Holders holding a majority of the
Registrable Securities held by all Holders being registered in such
registration.
"INDEMNIFIED PARTY" has the meaning assigned such
term in Section 8(c).
"INDEMNIFYING PARTY" has the meaning assigned such
term in Section 8(c).
"INITIAL PUBLIC OFFERING" shall mean the sale in an
underwritten offering by the Company of its capital stock pursuant to a
registration statement on Form S-1 or otherwise under the Act.
"INITIATING HOLDER" has the meaning assigned to such
term in Section 3(a).
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"INSPECTOR" has the meaning assigned such term in
Section 6(a)(viii).
"NASD" has the meaning assigned such term in Section
6(a)(xv).
"PERSON" means any individual, firm, corporation,
partnership, trust, incorporated or unincorporated association, joint venture,
joint stock company, government (or an agency or political subdivision thereof)
or other entity of any kind, and shall include any successor (by merger or
otherwise) of any such entity.
"PURCHASE AGREEMENT" has the meaning assigned such
term in the second paragraph of this Agreement.
"REGISTRABLE SECURITIES" means, subject to
Section 2(a), each of the following: (a) any shares of Common Stock issued or
issuable upon conversion or in exchange for shares of the Series C Convertible
Preferred, Series D Convertible Preferred, Series E Convertible Preferred or
Series F Redeemable Preferred; (b) any shares of Common Stock held by the
Management Stockholders or any of their respective permitted transferees; and
(c) any shares of Common Stock issued or issuable in respect of shares of Common
Stock issued, issuable or held pursuant to clause (a) or (b) above by way of a
stock dividend or stock split or in connection with a combination of shares,
recapitalization, merger, consolidation or other reorganization or otherwise.
"REGISTRATION EXPENSES" has the meaning assigned such
term in Section 7.
"RULE 144" means Rule 144 under the Act (or any
similar rule adopted after the date hereof).
"SEC" means the Securities and Exchange Commission.
"SERIES C CONVERTIBLE PREFERRED" has the meaning
assigned such term in the second paragraph of this Agreement and is further
defined to include any other capital stock of the Company into which such stock
is reclassified or reconstituted.
"SERIES D CONVERTIBLE PREFERRED" means the Series D
Convertible Preferred Stock, no par value, of the Company (or any warrants to
purchase such stock), or any other capital stock of the Company into which such
stock is reclassified or reconstituted.
"SERIES E CONVERTIBLE PREFERRED" means the Series E
Convertible Preferred Stock, no par value, of the Company (or any warrants to
purchase such stock), or any other capital stock of the Company into which such
stock is reclassified or reconstituted.
"SERIES F REDEEMABLE PREFERRED" means the Series F
Redeemable Preferred Stock, no par value, of the Company (or any warrants to
purchase such stock), or any other capital stock of the Company into which such
stock is reclassified or reconstituted.
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"SERIES G REDEEMABLE PREFERRED" means the Series G
Redeemable Preferred, no par value, of the Company.
"SERIES PREFERRED" means, collectively, the Series C
Convertible Preferred, Series D Convertible Preferred, Series E Convertible
Preferred, Series F Redeemable Preferred and Series G Redeemable Preferred.
"SHARES" means the Common Stock, the Series
Preferred, any class of common stock of the Company authorized after the date of
this Agreement and any other class of stock resulting from successive changes or
reclassifications of the Shares.
"SHAREHOLDERS' AGREEMENT" means the Shareholders'
Agreement, dated the date hereof, among the Company, Whitney, FHS, the
Management Stockholders and the Individual Investors.
"TOTAL SECURITIES" has the meaning assigned such term
in Section 4(a).
"UNDERWRITERS" has the meaning assigned such term in
Section 6(d).
"VALID BUSINESS REASON" has the meaning assigned such
term in Section 3(f).
"WHITNEY DIRECTOR" means a person appointed by
Whitney to the Board of Directors of the Company pursuant to the Shareholders'
Agreement.
2. SECURITIES SUBJECT TO THIS AGREEMENT.
(a) REGISTRABLE SECURITIES. For the purposes
of this Agreement, Registrable Securities will cease to be Registrable
Securities when (i) a registration statement covering such Registrable
Securities has been declared effective under the Act by the SEC and such
Registrable Securities have been disposed of pursuant to such effective
registration statement or (ii) the entire amount of Registrable Securities
proposed to be sold in a single sale are or, in the opinion of counsel
satisfactory to the Company and the Holder, each in their reasonable judgment,
may, be distributed to the public pursuant to Rule 144 in compliance with the
requirements of paragraphs (c), (e), (f) and (g) of Rule 144 (notwithstanding
the provisions of paragraph (k) of such Rule) (or any successor provision then
in effect) under the Act.
(b) HOLDERS OF REGISTRABLE SECURITIES. A
Person is deemed to be a holder of Registrable Securities (a "HOLDER") whenever
such Person (i) is a party to this Agreement (or a permitted transferee of such
party that has become a party hereto) and (ii) owns of record Registrable
Securities, or holds a security convertible into or exercisable or exchangeable
for, Registrable Securities, whether or not such purchase or conversion has
actually been effected and disregarding any legal restrictions upon the exercise
of such rights. If the Company receives conflicting instructions, notices or
elections from two or more persons with respect to the same Registrable
Securities, the Company may act upon the basis of the instructions, notice or
election received from the registered owner of such Registrable Securities.
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Registrable Securities issuable upon conversion of another security shall be
deemed outstanding for the purposes of this Agreement.
3. DEMAND REGISTRATION.
(a) REQUEST FOR DEMAND REGISTRATION. Subject
to Section 3(f) below, at any time after 6 months from the date of the
consummation of an Initial Public Offering, each of the Designated Holders
(other than the Individual Investors who, for purposes of this Section 3, shall
be deemed to be part of any Demand Registration in which Whitney is the
Initiating Holder) (each an "INITIATING HOLDER") shall have the right to make
one request in writing that the Company register Registrable Securities under
the Act, and under the securities or blue sky laws of any jurisdiction
designated by such holder or holders (each such registration under this Section
3(a) that satisfies the requirements set forth in Section 3(b) is referred to
herein as a "DEMAND REGISTRATION"); PROVIDED, HOWEVER, that the Management
Stockholders shall only be entitled to one demand right as a group.
Notwithstanding the foregoing, in no event shall the Company be required to
effect more than three Demand Registrations. Each request for a Demand
Registration by an Initiating Holder in respect thereof shall specify the amount
of the Registrable Securities proposed to be sold, the intended method of
disposition thereof and the jurisdictions in which registration is desired. Upon
a request for a Demand Registration, the Company shall promptly take such steps
as are necessary or appropriate to prepare for the registration of the
Registrable Securities to be registered. Within fifteen (15) days after the
receipt of such request, the Company shall give written notice thereof to all
other Designated Holders and include in such registration all Registrable
Securities held by a Designated Holder from whom the Company has received a
written request for inclusion therein at least ten (10) days prior to the filing
of the registration statement. Each such request will also specify the number of
Registrable Securities to be registered, the intended method of disposition
thereof and the jurisdictions in which registration is desired. Subject to
Section 3(d), the Company shall be entitled to include in any registration
statement and offering made pursuant to a Demand Registration, authorized but
unissued shares of Common Stock, shares of Common Stock held by the Company as
treasury shares or shares of Common Stock held by stockholders other than the
Designated Holders; PROVIDED, that such inclusion shall be permitted only to the
extent that it is pursuant to and subject to the terms of the underwriting
agreement or arrangements, if any, entered into by the Initiating Holder
exercising the Demand Registration rights.
(b) EFFECTIVE DEMAND REGISTRATION. The Company
shall use its best efforts to cause any Demand Registration to become effective
not later than ninety (90) days after it receives a request under Section 3(a).
A registration requested pursuant to Section 3(a) hereof shall not count as the
demand to which the Designated Holders are entitled thereunder unless such
registration statement is declared effective and remains effective for at least
the lesser of (i) such time as all Registrable Securities covered by such
registration statement have been disposed of in accordance with such
registration statement or (ii) ninety (90) days.
(c) EXPENSES. In any registration initiated as
a Demand Registration, the Company shall pay all Registration Expenses in
connection therewith, whether or not such requested Demand Registration becomes
effective.
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(d) UNDERWRITING PROCEDURES. If the Initiating
Holder to which the requested Demand Registration relates so elects, the
offering of such Registrable Securities pursuant to such requested Demand
Registration shall be in the form of a firm commitment underwritten offering and
the managing underwriter or underwriters selected for such offering shall be the
Approved Underwriter selected in accordance with Section 3(e). In such event, if
the Approved Underwriter advises the Company in writing that, in its opinion,
the aggregate amount of such Registrable Securities requested to be included in
such offering (including those securities requested by the Company to be
included in such registration) is sufficiently large to have an adverse effect
on the success of such offering, then the Company shall include in such
registration only the aggregate amount of Registrable Securities that in the
opinion of the Approved Underwriter may be sold without any such effect on the
success of such offering (the "APPROVED UNDERWRITER AMOUNT"), and (i) all
Registrable Securities that the Initiating Holder proposes to register
(including, in the case of Whitney, Registrable Securities held by the
Individual Investors) shall be included in the registration up to the Approved
Underwriter Amount, (ii) to the extent that the number of Registrable Securities
to be included by the Initiating Holder is less than the Approved Underwriter
Amount, securities proposed to be registered by the Designated Holders (other
than the Initiating Holder) shall be included ratably in the registration based
on the amounts of Registrable Securities sought to be registered by such
Designated Holders in their request for participation in the Demand Registration
and (iii) to the extent that the number of Registrable Securities to be included
under clauses (i) and (ii) above is less than the Approved Underwriter Amount,
securities that the Company proposes to register shall also be included in the
registration.
If, as a result of the proration provision of this
Section 3(d), any Designated Holder shall not be entitled to include all
Registrable Securities in a registration that such Designated Holder has
requested to be included in, such Designated Holder may elect to withdraw his
request to include Registrable Securities in such registration or may reduce the
number requested to be included; PROVIDED, HOWEVER, that (x) such request must
be made in writing prior to the earlier of the execution of the underwriting
agreement or the execution of the custody agreement with respect to such
registration and (y) such withdrawal or reduction shall be irrevocable.
(e) SELECTION OF UNDERWRITERS. If any requested
Demand Registration is in the form of an underwritten offering, the Initiating
Holder shall select and obtain an investment banking firm of national reputation
to act as the managing underwriter of the offering (the "APPROVED UNDERWRITER");
PROVIDED that such underwriter shall be reasonably satisfactory to a majority of
the Designated Holders (other than the Initiating Holders) and the Company.
(f) LIMITATIONS ON DEMAND REGISTRATIONS. The
Demand Registration rights granted to the Designated Holders in Section 3(a) are
subject to the following limitations: (i) each registration in respect of a
Demand Registration must include Registrable Securities having an aggregate
market value of at least [$5,000,000], which market value shall be determined by
multiplying the number of Registrable Securities to be included in the Demand
Registration by the proposed per share offering price; PROVIDED that the
limitation set forth in this clause (i) shall not be in effect at any time the
Designated Holders' Registrable Securities are not able to be sold under Rule
144 under the Act because of the Company's failure to comply with the
information requirements thereunder, unless at such time, the Company's outside
counsel
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(which shall be reasonably acceptable to the Designated Holders requesting such
registration) delivers a written opinion of counsel to such Designated Holders
to the effect that such Designated Holders' Registrable Securities may be
publicly offered and sold without registration under the Act; (ii) the Company
shall not be required to cause a registration pursuant to Section 3(a) to be
declared effective within a period of 150 days after the effective date of any
registration statement of the Company effected in connection with a Demand
Registration; and (iii) if the Board of Directors of the Company, in its good
faith judgment, determines that any registration of Registrable Securities
should not be made or continued because it would materially interfere with any
material financing, acquisition, corporate reorganization or merger or other
transaction involving the Company or any of its subsidiaries (a "VALID BUSINESS
REASON"), the Company may (x) postpone filing a registration statement relating
to a Demand Registration until such Valid Business Reason no longer exists, but
in no event for more than ninety (90) days, and (y) in case a registration
statement has been filed relating to a Demand Registration, if the Valid
Business Reason has not resulted from actions taken by the Company, the Company,
upon the approval of a majority of the Company's Board of Directors, may cause
such registration statement to be withdrawn and its effectiveness terminated or
may postpone amending or supplementing such registration statement. The Company
shall give written notice of its determination to postpone or withdraw a
registration statement under Section 3(f)(iii) and of the fact that the Valid
Business Reason for such postponement or withdrawal no longer exists, in each
case, promptly after the occurrence thereof. Notwithstanding anything to the
contrary contained herein, the Company may not postpone or withdraw a filing
under Section 3(f)(iii) hereof more than once in any twelve-month period.
Each Holder of Registrable Securities agrees that,
upon receipt of any notice from the Company that the Company has determined to
withdraw any registration statement pursuant to clause (iii) above, such Holder
will discontinue its disposition of Registrable Securities pursuant to such
registration statement and, if so directed by the Company, will deliver to the
Company (at the Company's expenses) all copies, other than permanent file
copies, then in such Holder's possession, of the prospectus covering such
Registrable Securities that was in effect at the time of receipt of such notice.
If the Company shall give any notice of postponement or withdrawal of a
registration statement, the Company shall, at such time as the Valid Business
Reason that caused such postponement or withdrawal no longer exists (but in no
event later than ninety (90) days after the date of the postponement), use its
best efforts to promptly effect the registration under the Act of the
Registrable Securities covered by the postponed or withdrawn registration
statement in accordance with this Section 3 (unless the Designated Holder(s)
delivering the Demand Registration request shall have withdrawn such request, in
which case the Company shall not be considered to have effected an effective
registration for the purposes of this Agreement), and such registration shall
not be postponed or withdrawn pursuant to clause (iii) above.
4. PIGGY-BACK REGISTRATION.
(a) PIGGY-BACK RIGHTS. If the Company proposes
to file a registration statement under the Act with respect to an offering by
the Company for its own account of any class of security (other than a
registration statement on Form S-4 or S-8 (or any successor form thereto)) under
the Act, then the Company shall give written notice of such proposed filing to
each of the Holders at least twenty (20) days before the anticipated filing
date, and such notice
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shall describe in detail the proposed registration and distribution (including
those jurisdictions where registration under the securities or blue sky laws is
intended) and offer such Holders the opportunity to register the number of
Registrable Securities as each such Holder may request. The Company shall use
its best efforts (within ten (10) days of the notice provided for in the
preceding sentence) to permit the Holders who have requested to participate in
the registration for such offering to include such Registrable Securities in
such offering on the same terms and conditions as the securities of the Company
included therein. Notwithstanding the foregoing, if such registration involves
an underwritten offering and the managing underwriters or underwriters (the
"COMPANY UNDERWRITER") shall advise the Holders of Registrable Securities in
writing that, in its opinion, the total amount of securities requested to be
included in such offering (the "TOTAL SECURITIES") is sufficiently large so as
to have an adverse effect on the success of the distribution of the Total
Securities, then the Company shall include in such registration, to the extent
of the number of securities which the Company is so advised can be sold in (or
during the time of) such offering, FIRST, all securities that the Company
proposes to register, and, SECOND the securities proposed to be included in such
registration by all Holders pro rata among them, and, THIRD, all other
securities proposed to be registered. Notwithstanding anything in this Section 4
to the contrary, the Company shall not be required to include any Registrable
Securities in its Initial Public Offering.
(b) PRIORITY OF REGISTRATIONS. Subject to the
provisions of Section 3(f)(iii), if the Company proposes to register securities
pursuant to Section 4(a) hereof on the same day that the Designated Holders
request a registration pursuant to Section 3(a) hereof, then the Demand
Registration requested pursuant to Section 3(a) hereof shall be given priority.
(c) EXPENSES. The Company shall bear all
Registration Expenses in connection with any registration pursuant to this
Section 4.
(d) CONDITIONS AND LIMITATIONS ON PIGGYBACK
REGISTRATIONS. If, at any time after giving written notice of its intention to
register any securities and prior to the effective date of the registration
statement filed in connection with such registration, the Company shall
determine for any reason not to register or to delay registration of such
securities, the Company may, at its election, give written notice of such
determination to all Holders of record of Registrable Securities and (i) in the
case of a determination not to register, shall be relieved of its obligation to
register the Registrable Securities in connection with such abandoned
registration, without prejudice, however, to the rights of Holders under Section
3, and (ii) in the case of a determination to delay the registration of its
securities, shall be permitted to delay the registration of such Registrable
Securities for the same period as the delay in registering such other equity
securities.
Any Holder shall have the right to withdraw its
request for inclusion of its Registrable Securities in any registration
statement pursuant to this Section 4 by giving the written notice to the Company
of its request to withdraw; PROVIDED, HOWEVER, that (i) such request must be
made in writing prior to the earlier of the execution of the underwriting
agreement or the execution of the custody agreement with respect to such
registration and (ii) such withdrawal shall be irrevocable and, after making
such withdrawal, a Holder shall no longer have any right to include Registrable
Securities in the registration as to which such withdrawal was made.
8
5. HOLDBACK AGREEMENTS.
(a) RESTRICTIONS ON PUBLIC SALE BY HOLDERS. To
the extent not inconsistent with applicable law, each Holder agrees not to
effect any public sale or distribution of any Registrable Securities being
registered or of any securities convertible into or exchangeable or exercisable
for such Registrable Securities, including a sale pursuant to Rule 144 under the
Act, during the seven (7) days prior to or the ninety (90) day period beginning
on the effective date of such Demand Registration or Piggy-Back Registration or
other underwritten offering (except as part of such registration), if and to the
extent requested by any other Holder, in the case of a non-underwritten public
offering, or if and to the extent requested by the Company Underwriter, in the
case of an underwritten public offering. To the extent not inconsistent with
applicable law, each Holder also agrees that, during the period of duration (not
to exceed 180 days) specified by the Company and an underwriter of Common Stock
in connection with an Initial Public Offering, following the effective date of a
registration statement of the Company filed under the Act relating to such
Initial Public Offering, it shall not, to the extent requested by the Company
and such underwriter, directly or indirectly sell, offer to sell, contract to
sell (including, without limitation, any short sale), grant any option to
purchase or otherwise transfer or dispose of (other than to donees who agree to
be similarly bound) any securities of the Company held by it at any time during
such period (except Registrable Securities included in such registration).
(b) RESTRICTIONS ON PUBLIC SALE BY THE COMPANY.
The Company agrees not to effect any public sale or distribution of any of its
securities for its own account (except pursuant to registrations on Form S-4 or
S-8 (or any successor form thereto) under the Act) during the ninety (90) day
period beginning on the effective date of any registration statement in which
the Holders are participating (except to the extent that such sale or
distribution is made pursuant to such registration).
6. REGISTRATION PROCEDURES.
(a) OBLIGATIONS OF THE COMPANY. Whenever
registration of Registrable Securities has been requested pursuant to Section 3
or 4 of this Agreement, the Company shall use its best efforts to effect the
registration and sale of such Registrable Securities in accordance with the
intended method of distribution thereof as quickly as practicable, and in
connection with any such request, the Company shall, as expeditiously as
possible:
(i) prepare and file with the SEC (in
any event not later than sixty (60) Business Days after receipt of a request to
file a registration statement with respect to Registrable Securities) a
registration statement on any form on which registration is requested for which
the Company then qualifies, which counsel for the Company and Holders' Counsel
shall deem appropriate and which shall be available for the sale of such
Registrable Securities in accordance with the intended method of distribution
thereof, and use its best efforts to cause such registration statement to become
effective; PROVIDED, HOWEVER, that before filing a registration statement or
prospectus or any amendments or supplements thereto, the Company shall (A)
provide Holders' Counsel with an adequate and appropriate opportunity to
participate in the preparation of such registration statement and each
prospectus included therein (and each
9
amendment or supplement thereto) to be filed with the SEC, which documents shall
be subject to the review of Holders' Counsel, and (B) notify Holders' Counsel
and each seller of Registrable Securities pursuant to such registration
statement of any stop order issued or threatened by the SEC and take all
reasonable action required to prevent the entry of such stop order or to remove
it if entered;
(ii) prepare and file with the SEC such
amendments and supplements to such registration statement and the prospectus
used in connection therewith as may be necessary to keep such registration
statement effective and to comply with the provisions of the Act with respect to
the disposition of all Registrable Securities covered by such registration
statement until the earlier of (a) such time as all of such Registrable
Securities and other securities have been disposed of in accordance with the
intended methods of disposition by the sellers thereof set forth in such
registration statement and (b) 180 days after the effective date of such
registration statement, except with respect to any such registration statement
filed pursuant to Rule 415 (or any successor Rule) under the Act if the Company
is eligible to file a registration statement on Form S-3, in which case such
period shall be two (2) years;
(iii) as soon as reasonably possible,
furnish to each seller of Registrable Securities, prior to filing a registration
statement, copies of such registration statement as it is proposed to be filed,
and thereafter such number of copies of such registration statement, each
amendment and supplement thereto (in each case including all exhibits thereto),
the prospectus included in such registration statement (including each
preliminary prospectus) and such other documents as each such seller may
reasonably request in order to facilitate the disposition of the Registrable
Securities owned by such seller;
(iv) use its best efforts to register
or qualify such Registrable Securities under such other securities or blue sky
laws of such jurisdictions as any seller of Registrable Securities may request,
and to continue such qualification in effect in each such jurisdiction for as
long as is permissible pursuant to the laws of such jurisdiction, or for as long
as any such seller requests or until all of such Registrable Securities are
sold, whichever is shortest, and do any and all other acts and things which may
be reasonably necessary or advisable to enable any such seller to consummate the
disposition in such jurisdictions of the Registrable Securities owned by such
seller; PROVIDED, HOWEVER, that the Company shall not be required to (A) qualify
generally to do business in any jurisdiction where it would not otherwise be
required to qualify but for this Section 6(a)(iv), (B) subject itself to
taxation in any such jurisdiction or (C) consent to general service of process
in any such jurisdiction;
(v) use its best efforts to obtain all
other approvals, covenants, exemptions or authorizations from such governmental
agencies or authorities as may be necessary to enable the sellers of such
Registrable Securities to consummate the disposition of such Registrable
Securities;
(vi) notify each seller of Registrable
Securities at any time when a prospectus relating thereto is required to be
delivered under the Act, upon discovery that, or upon 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
10
material fact required to be stated therein or necessary to make the statements
therein not misleading in light of the circumstances under which they were made,
and the Company shall promptly prepare a supplement or amendment to such
prospectus and furnish to each such seller a reasonable number of copies of a
supplement to or amendment of such prospectus as may be necessary so that, after
delivery to the purchasers of such Registrable Securities, such prospectus shall
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 in light of the circumstances under which they were made;
(vii) enter into and perform customary
agreements (including an underwriting agreement in customary form with the
Approved Underwriter or Company Underwriter, if any, selected as provided in
Section 3 or 4; PROVIDED, that the underwriting agreement, if any, shall be
reasonably satisfactory in form and substance to the Company) and take such
other actions as are reasonably required in order to expedite or facilitate the
disposition of such Registrable Securities;
(viii) make available for inspection by
any seller of Registrable Securities, any managing underwriter participating in
any disposition pursuant to such registration statement, Holders' Counsel and
any attorney, accountant or other agent retained by any such seller or any
managing underwriter (each, an "INSPECTOR" and, collectively, the "INSPECTORS"),
all financial and other records, pertinent corporate documents and properties of
the Company and any subsidiaries thereof as may be in existence at such time
(collectively, the "RECORDS") as shall be reasonably necessary to enable them to
exercise their due diligence responsibility, and cause the Company's and any
subsidiaries' officers, directors and employees, and the independent public
accountants of the Company, to supply all information reasonably requested by
any such Inspector in connection with such registration statement; PROVIDED,
that such Inspector agrees to keep all such information confidential.
(ix) obtain a "cold comfort" letter
from the Company's independent public accountants in customary form and covering
such matters of the type customarily covered by "cold comfort" letters, as
Holders' Counsel or the managing underwriter reasonably request;
(x) furnish, at the request of any
seller of Registrable Securities on the date such securities are delivered to
the underwriters for sale pursuant to such registration or, if such securities
are not being sold through underwriters, on the date the registration statement
with respect to such securities becomes effective, an opinion, dated such date,
of counsel representing the Company for the purposes of such registration,
addressed to the underwriters, if any, and to the seller making such request,
covering such legal matters with respect to the registration in respect of which
such opinion is being given as such seller may reasonably request and as are
customarily included in such opinions;
(xi) otherwise use its best efforts to
comply with all applicable rules and regulations of the SEC, and make available
to its security holders, as soon as reasonably practicable but no later than
fifteen (15) months after the effective date of the registration statement, an
earnings statement covering a period of twelve (12) months beginning
11
after the effective date of the registration statement, in a manner which
satisfies the provisions of Section 11(a) of the Act;
(xii) cause all such Registrable
Securities to be listed on each securities exchange on which similar securities
issued by the Company are then listed (if any) if the listing of such
Registrable Securities is then permitted under the rules of such exchange or, if
no similar securities are then so listed, cause all such Registrable Securities
to be listed on an exchange on which the Initiating Holders request that such
Registrable Securities be listed, subject to the satisfaction of the applicable
listing requirements of each such exchange;
(xiii) keep each seller of Registrable
Securities advised in writing as to the initiation and progress of any
registration under Section 3 or 4 hereunder;
(xiv) provide officers' certificates and
other customary closing documents;
(xv) cooperate with each seller of
Registrable Securities and each underwriter participating in the disposition of
such Registrable Securities and their respective counsel in connection with any
filings required to be made with the National Association of Securities Dealers,
Inc. (the "NASD"); and
(xvi) use its best efforts to take all
other steps necessary to effect the registration of the Registrable Securities
contemplated hereby.
(b) SELLER INFORMATION. The Company may
require as a condition precedent of the Company's obligations under this Section
6 that each seller of Registrable Securities as to which any registration is
being effected furnish to the Company such information regarding such seller and
the distribution of such securities as the Company may from time to time
reasonably request in writing.
(c) NOTICE TO DISCONTINUE. Each Holder agrees
that, upon receipt of any notice from the Company of the happening of any event
of the kind described in Section 6(a)(vi), such Holder shall forthwith
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
6(a)(vi) and, if so directed by the Company, such Holder shall 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 Registrable
Securities which is current at the time of receipt of such notice. If the
Company shall give any such notice, the Company shall extend the period during
which such registration statement shall be maintained effective pursuant to this
Agreement (including, without limitation, the period referred to in Section
6(a)(ii)) by the number of days during the period from and including the date of
the giving of such notice pursuant to Section 6(a)(vi) to and including the date
when the Holder shall have received the copies of the supplemented or amended
prospectus contemplated by and meeting the requirements of Section 6(a)(vi).
(d) SALE TO UNDERWRITER. Subject to the
limitations on inclusion of Registrable Securities in a registration under
Sections 3(d) and 4(a), in lieu of converting any
12
shares of Series C Convertible Preferred, Series D Convertible Preferred or
Series E Convertible Preferred into Registrable Securities to be included in a
registration under Section 3 or 4 prior to or simultaneously with the filing or
the effectiveness of any registration statement filed pursuant thereto, the
holder of such preferred stock may sell such stock to the Approved Underwriter
or the Company Underwriter, as the case may be, and any other underwriters of
the offering being registered (collectively, the Approved Underwriter or Company
Underwriter, as the case may be, and such other underwriters, the
"UNDERWRITERS") if the Underwriters consent thereto and if the Underwriters
undertake to convert such shares of Series C Convertible Preferred, Series D
Convertible Preferred or Series E Convertible Preferred into Registrable
Securities before making any distribution pursuant to such registration
statement and to include such Registrable Securities among the Registrable
Securities being offered pursuant to such registration statement. Assuming
timely delivery by the Holder of the Series C Convertible Preferred
certificates, Series D Convertible Preferred certificates or Series E
Convertible Preferred certificates to or for the account of the Underwriters,
the Company agrees to cause the relevant Registrable Securities to be issued so
as to permit the Underwriters to make and complete the distribution (including
the distribution of such Registrable Securities) contemplated by the
underwriting.
7. REGISTRATION EXPENSES. The Company shall pay all expenses
(other than underwriting discounts and commissions) arising from or incident to
the performance of, or compliance with, this Agreement, including, without
limitation, (a) SEC, stock exchange and NASD registration and filing fees, (b)
all fees and expenses incurred in complying with securities or blue sky laws
(including, without limitation, reasonable fees, charges and disbursements of
counsel in connection with blue sky qualifications of the Registrable
Securities), (c) all printing, messenger and delivery expenses, (d) the fees,
charges and disbursements of counsel to the Company and of its independent
public accountants and any other accounting and legal fees, charges and expenses
incurred by the Company (including, without limitation, any expenses arising
from any special audits incident to or required by any registration or
qualification) and (e) the reasonable fees, charges and expenses of any special
experts retained by the Company in connection with any requested Demand
Registration or Piggy-Back Registration pursuant to the terms of this Agreement,
regardless of whether the registration statement filed in connection with such
registration is declared effective. In connection with each registration
hereunder, the Company shall reimburse the Holders of Registrable Securities
being registered in such registration for the reasonable fees, charges and
disbursements of not more than one Holders' Counsel. All of the expenses
described in this Section 7 are referred to in this Agreement as "REGISTRATION
EXPENSES." Notwithstanding the foregoing provisions of this Section 7, in
connection with any registration hereunder, each Holder of Registrable
Securities being registered shall pay all underwriting discounts and commissions
and any capital gains, income or transfer taxes, if any, attributable to the
sale of such Registrable Securities, PRO RATA with respect to payments of
discounts and commissions in accordance with the number of shares sold in the
offering.
8. INDEMNIFICATION; CONTRIBUTION.
(a) INDEMNIFICATION BY THE COMPANY. In the
event of any proposed registration of securities of the Company pursuant to
Section 3 or Section 4, the Company agrees to indemnify and hold harmless each
Holder, its directors, officers, partners, employees, advisors and agents, and
each Person who controls (within the meaning of the Act or the Exchange Act)
13
such Holder, to the extent permitted by law, from and against any and all
losses, claims, damages, expenses (including, without limitation, reasonable
costs of investigation and fees, disbursements and other charges of counsel) or
other liabilities resulting from or arising out of or based upon any untrue, or
alleged untrue, statement of a material fact contained in any registration
statement, prospectus or preliminary prospectus or notification or offering
circular (as amended or supplemented if the Company shall have furnished any
amendments or supplements thereto) or arising out of or based upon any omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, except insofar as the
same are caused by or contained in any information furnished in writing to the
Company by or on behalf of such Holder expressly for use therein. The Company
shall also indemnify any Underwriters of the Registrable Securities, their
officers, directors and employees, and each Person who controls any such
Underwriter (within the meaning of the Act and the Exchange Act) to the same
extent as provided above with respect to the indemnification of the Holders of
Registrable Securities.
(b) INDEMNIFICATION BY HOLDERS. In connection
with any proposed registration in which a Holder is participating pursuant to
Section 3 or 4 hereof, each such Holder shall furnish to the Company in writing
such information with respect to such Holder as the Company may reasonably
request or as may be required by law for use in connection with any registration
statement or prospectus to be used in connection with such registration and each
Holder agrees to indemnify and hold harmless the Company, any Underwriter
retained by the Company and their respective directors, officers, employees and
each Person who controls (within the meaning of the Act and the Exchange Act)
the Company or such Underwriter to the same extent as the foregoing indemnity
from the Company to the Holders (subject to the proviso to this sentence and
applicable law), but only with respect to any such information furnished in
writing by or on behalf of such Holder expressly for use therein; PROVIDED,
HOWEVER, that the liability of any Holder under this Section 8(b) shall be
limited to the amount of the net proceeds received by such Holder in the
offering giving rise to such liability.
(c) CONDUCT OF INDEMNIFICATION PROCEEDINGS.
Any Person entitled to indemnification hereunder (the "INDEMNIFIED PARTY")
agrees to give prompt written notice to the indemnifying party (the
"INDEMNIFYING PARTY") after the receipt by the Indemnified Party of any written
notice of the commencement of any action, suit, proceeding or investigation or
threat thereof made in writing for which the Indemnified Party intends to claim
indemnification or contribution pursuant to this Agreement; PROVIDED, that the
failure so to notify the Indemnifying Party shall not relieve the Indemnifying
Party of any liability that it may have to the Indemnified Party hereunder. If
notice of commencement of any such action is given to the Indemnifying Party as
above provided, the Indemnifying Party shall be entitled to participate in and,
to the extent it may wish, jointly with any other Indemnifying Party similarly
notified, to assume the defense of such action at its own expense, with counsel
chosen by it and satisfactory to such Indemnified Party. The Indemnified Party
shall have the right to employ separate counsel in any such action and
participate in the defense thereof, but the fees and expenses of such counsel
(other than reasonable costs of investigation) shall be paid by the Indemnified
Party unless (i) the Indemnifying Party agrees to pay the same, (ii) the
Indemnifying Party fails to assume the defense of such action with counsel
satisfactory to the Indemnified Party in its reasonable judgment, (iii) the
named parties to any such action (including any impleaded parties) have been
14
advised by the Indemnifying Party's counsel that either (A) representation of
such Indemnified Party and the Indemnifying Party by the same counsel would be
inappropriate under applicable standards of professional conduct or (B) there
may be one or more legal defenses available to it which are different from or
additional to those available to the Indemnifying Party; PROVIDED, HOWEVER, that
the Indemnifying Party shall only have to pay the fees and expenses of one firm
of counsel for all Indemnified Parties in each jurisdiction, except to the
extent representation of all Indemnified Parties by the same counsel is
inappropriate under applicable standards of professional conduct. In either of
such cases the Indemnifying Party shall not have the right to assume the defense
of such action on behalf of such Indemnified Party. No Indemnifying Party shall
be liable for any settlement entered into without its written consent, which
consent shall not be unreasonably withheld. No Indemnifying Party shall, without
the written consent of the Indemnified Party, effect the settlement or
compromise of, or consent to the entry of any judgment with respect to, any
pending or threatened action or claim in respect of which indemnification or
contribution may be sought hereunder (whether or not the Indemnified Party is an
actual or potential party to such action or claim) unless such settlement,
compromise or judgment (A) includes an unconditional release of the Indemnified
Party from all liability arising out of such action or claim and (B) does not
include a statement as to or an admission of fault, culpability or a failure to
act, by or on behalf of any Indemnified Party. The rights accorded to any
Indemnified Party hereunder shall be in addition to any rights that such
Indemnified Party may have at common law, by separate agreement or otherwise.
(d) CONTRIBUTION. If the indemnification
provided for in Section 8(a) from the Indemnifying Party is unavailable to an
Indemnified Party in respect of any losses, claims, damages, expenses or other
liabilities referred to therein, then the Indemnifying Party, in lieu of
indemnifying such Indemnified Party, shall contribute to the amount paid or
payable by such Indemnified Party as a result of such losses, claims, damages,
expenses or other liabilities in such proportion as is appropriate to reflect
the relative fault of the Indemnifying Party and Indemnified Party in connection
with the actions which resulted in such losses, claims, damages, expenses or
other liabilities, as well as any other relevant equitable considerations. The
relative faults of such Indemnifying Party and Indemnified Party shall be
determined by reference to, among other things, whether any action in question,
including any untrue or alleged untrue statement of a material fact or omission
or alleged omission to state a material fact, was made by, or relates to
information supplied by, such Indemnifying Party or Indemnified Party, and the
Indemnifying Party's and Indemnified Party's relative intent, knowledge, access
to information and opportunity to correct or prevent such action. The amount
paid or payable by a party as a result of the losses, claims, damages, expenses
or other liabilities referred to above shall be deemed to include, subject to
the limitations set forth in Sections 8(a), 8(b) and 8(c), any legal or other
fees, charges or expenses reasonably incurred by such party in connection with
any investigation or proceeding.
The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 8(d) were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to in the immediately preceding paragraph.
No person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution pursuant to this Section
8(d).
15
9. RULE 144; OTHER EXEMPTIONS. If the Company shall have filed
a registration statement pursuant to the requirements of Section 12 of the
Exchange Act or a registration statement pursuant to the requirements of the Act
in respect of Common Stock or securities of the company convertible into or
exchangeable or exercisable for Common Stock, the Company covenants that it
shall file any reports required to be filed by it under the Exchange Act and the
rules and regulations adopted by the SEC thereunder, and that it shall take such
further action as each Holder may reasonably request (including, but not limited
to, providing any information necessary to comply with Rules 144 and 144A under
the Act), all to the extent required from time to time to enable such Holder to
sell Registrable Securities without registration under the Act within the
limitation of the exemptions provided by (a) Rule 144 or Rule 144A under the
Act, as such rules may be amended from time to time, or (b) any other rules or
regulations now existing or hereafter adopted by the SEC. The Company shall,
upon the request of any Holder, deliver to such Holder a written statement as to
whether the Company has complied with such requirements.
10. CERTAIN LIMITATIONS ON REGISTRATION RIGHTS. In the case of
a registration under Section 4 if the Company has determined to enter into an
underwriting agreement in connection therewith, no person may participate in
such registration unless such person (a) agrees to sell such person's securities
on the basis provided therein and (b) completes and executes all questionnaires,
powers of attorney, indemnities, lock-up agreements, underwriting agreements and
other documents reasonably required under the terms of such underwriting
agreements.
11. MISCELLANEOUS.
(a) RECAPITALIZATIONS, EXCHANGES, ETC. The
provisions of this Agreement shall apply, to the full extent set forth herein
with respect to the Shares, to any and all shares of capital stock of the
Company or any successor or assign of the Company (whether by merger,
consolidation, sale of assets or otherwise) which may be issued in respect of,
in exchange for or in substitution of, the Shares and shall be appropriately
adjusted for any stock dividends, splits, reverse splits, combinations,
recapitalizations and the like occurring after the date hereof.
(b) NO INCONSISTENT AGREEMENTS; OTHER
REGISTRATION RIGHTS. The Company shall not enter into any agreement with respect
to its securities that is inconsistent with or adversely affects the rights
granted to the Holders in this Agreement other than any lock-up agreement with
the underwriters in connection with an underwritten offering pursuant to which
the Company agrees, for a period not in excess of 180 days if such underwritten
offering is an Initial Public Offering or, for a period not in excess of 90 days
if such underwritten offering is not an Initial Public Offering, not to register
for sale, and not to sell or otherwise dispose of, Common Stock or any
securities convertible into or exercisable or exchangeable for Common Stock. The
Company shall not grant any other Person registration rights with terms and
conditions more favorable to such holder than the terms and conditions
applicable to the Designated Holders herein without the written consent of the
Designated Holders holding at least a majority of the Registrable Securities
held by all of the Designated Holders. If the Company shall at any time
hereafter provide to any holder of any securities of the Company rights with
respect to the registration of such securities and such rights are provided on
terms or conditions
16
more favorable to such holder than the terms and conditions applicable to the
Designated Holders herein, the Company shall provide (by way of amendment to
this Agreement or otherwise) such more favorable terms or conditions to the
Designated Holders under this Agreement.
(c) REMEDIES. The Holders, in addition to
being entitled to exercise all rights granted by law, including recovery of
damages, shall be entitled to specific performance of their rights under this
Agreement. The Company agrees that monetary damages would not be adequate
compensation for any loss incurred by reason of a breach by it of the provisions
of this Agreement and hereby agrees to waive in any action for specific
performance the defense that a remedy at law would be adequate.
(d) AMENDMENTS AND WAIVERS. Except as
otherwise provided herein, the provisions of this Agreement may not be amended,
modified or supplemented, and waivers or consents to departures from the
provisions of such section may not be given unless the Company has obtained the
prior written consent of (i) the Designated Holders holding at least a majority
of the Registrable Securities held by all of the Designated Holders and (ii) the
Holders holding at least a majority of the Registrable Securities.
(e) NOTICES. All notices, demands and other
communications provided for or permitted hereunder shall be made in writing and
shall be by registered or certified first-class mail, return receipt requested,
telecopier, courier service or personal delivery:
(i) if to Whitney or the Individual Investors:
c/o X. X. Xxxxxxx & Co.
000 Xxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Telecopier No.: (000) 000-0000
Attention: Xxxxxxx X. Xxx, M.D.
with a copy to:
Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx
1285 Avenue of the Americas
Xxx Xxxx, Xxx Xxxx 00000-0000
Telecopier No.: (000) 000-0000
Attention: Xxxxx X. Xxxxxxxxx, Esq.
(ii) if to FHS:
Foundation Health Systems, Inc.
00000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxx Xxxxx, XX 00000
Telecopier No.: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxx
17
(iii) if to the Company:
CareScience, Inc.
0000 Xxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxxxxxxx, XX 00000
Telecopier No.: (000) 000-0000
Attention: Chief Executive Officer
with a copy to:
Xxxxxx, Xxxxx & Bockius
0000 Xxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Telecopier No.: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxxx
(iv) if to an Existing Shareholder, to its, his or her
address as it appears on the record books of the Company.
All such notices and communications shall be deemed to have
been duly given: when delivered by hand, if personally delivered; when delivered
by courier, if delivered by commercial overnight courier service; five Business
Days after being deposited in the mail, postage prepaid, if mailed; and when
receipt is acknowledged, if telecopied.
(f) SUCCESSORS AND ASSIGNS. This Agreement
shall inure to the benefit of and be binding upon the successors and assigns of
the parties hereto; PROVIDED, HOWEVER, that the registration rights and the
other obligations of the Company contained in this Agreement shall, with respect
to any Registrable Security, be automatically transferred from a Holder to any
subsequent holder of such Registrable Security (including any pledgee).
Notwithstanding any transfer of such rights, all of the obligations of the
Company hereunder shall survive any such transfer and shall continue to inure to
the benefit of all transferees.
(g) COUNTERPARTS. This Agreement may be
executed in any number of counterparts and by the parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
(h) HEADINGS. The headings in this Agreement
are for convenience of reference only and shall not limit or otherwise affect
the meaning hereof.
(i) GOVERNING LAW. This Agreement shall be
governed by and construed in accordance with the laws of the Commonwealth of
Pennsylvania, without regard to the principles of conflicts of law of such
State.
(j) JURISDICTION. Each party to this Agreement
hereby irrevocably agrees that any legal action or proceeding arising out of or
relating to this Agreement or any
18
agreements or transactions contemplated hereby may be brought in the courts of
the State of New York or of the United States of America for the Southern
District of New York and hereby expressly submits to the personal jurisdiction
and venue of such courts for the purposes thereof and expressly waives any claim
of improper venue and any claim that such courts are an inconvenient forum. Each
party hereby irrevocably consents to the service of process of any of the
aforementioned courts in any such suit, action or proceeding by the mailing of
copies thereof by registered or certified mail, postage prepaid, to the address
set forth in Section 10(e), such service to become effective 10 days after such
mailing.
(k) SEVERABILITY. If any one or more of the
provisions contained herein, or the application thereof in any circumstance, is
held invalid, illegal or unenforceable in any respect for any reason, the
validity, legality and enforceability of any such provision in every other
respect and of the remaining provisions hereof shall not be in any way impaired,
it being intended that all of the rights and privileges of the Holders shall be
enforceable to the fullest extent permitted by law.
(l) RULES OF CONSTRUCTION. Unless the context
otherwise requires, "or" is not exclusive, and references to sections or
subsections refer to sections or subsections of this Agreement.
(m) ENTIRE AGREEMENT. This Agreement is
intended by the parties as a final expression of their agreement and intended to
be a complete and exclusive statement of the agreement and understanding of the
parties hereto in respect of the subject matter contained herein. There are no
restrictions, promises, warranties or undertakings in respect of the subject
matter contained herein, other than those set forth or referred to herein. This
Agreement supersedes all prior agreements and understandings between the parties
with respect to such subject matter.
(n) FURTHER ASSURANCES. Each of the parties
shall execute such documents and perform such further acts as may be reasonably
required or desirable to carry out or to perform the provisions of this
Agreement.
19
IN WITNESS WHEREOF, the undersigned have caused this Agreement to be
executed and delivered by their respective officers hereunto duly authorized on
the date first above written.
CARESCIENCE, INC.
By /s/ Xxxxx X. Xxxxxxx
-------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Chief Executive Officer
X.X. XXXXXXX III, L.P.
By X.X. Xxxxxxx Equity Partners III, L.L.C.
Its General Partner
By /s/ Xxxxxx X. X'Xxxxx
-------------------------------------
Name: Xxxxxx X. X'Xxxxx
Managing Member
WHITNEY STRATEGIC PARTNERS III, L.P.
By X.X. Xxxxxxx Equity Partners III, L.L.C.
Its General Partner
By /s/ Xxxxxx X. X'Xxxxx
-------------------------------------
Name: Xxxxxx X. X'Xxxxx
Managing Member
FOUNDATION HEALTH SYSTEMS, INC.
By
-------------------------------------
Name:
Title:
20
ZEKE INVESTMENT PARTNERS
By /s/ Xxxxxx X. Xxxxxxx
-------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: General Partner
/s/ Xxxxx X. Xxxxxxx
------------------------------------------
Xxxxx X. Xxxxxxx
/s/ Xxxxxx X. Xxxxxx
------------------------------------------
Xxxxxx X. Xxxxxx
/s/ Xxxxx Xxxxxx
------------------------------------------
Xxxxx Xxxxxx
/s/ Xxxxxxx Xxxxxxxxxxxx
------------------------------------------
Xxxxxxx Xxxxxxxxxxxx
21
