EXHIBIT 10.7
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "Agreement") is made and entered
into the _____ day of November, 1996 by and between HealthCare Financial
Partners, Inc., a Delaware corporation, and the stockholders of the Company who
are parties hereto.
The parties hereto agree as follows:
1. Certain Definitions.
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For purposes of this Agreement, the following terms have the following
meanings when used herein:
(a) "Business Day" means any Monday, Tuesday, Wednesday, Thursday or
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Friday that is not a day on which banking institutions in New York, New York are
authorized by law, regulation or executive order to close.
(b) "Commission" means the Securities and Exchange Commission or any
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other federal agency at the time administering the Securities Act.
(c) "Common Stock" means the Common Stock, par value $.01 per share,
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of the Company.
(d) "Company" means HealthCare Financial Partners, Inc., a Delaware
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corporation, and its successors and assigns.
(e) "Demand Registration" means any registration of Registrable
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Securities effected pursuant to Section 2 hereof.
(f) "Effective Date" means the effective date of the Company's
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initial registration of Common Stock under the Securities Act.
(g) "Exchange Act" means the Securities Exchange Act of 1934, as
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amended (or any similar successor federal statute), and the rules and
regulations thereunder, as in effect from time to time.
(h) "Holder" means a stockholder of the Company who is a party to
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this Agreement, including such successors and assigns as acquire Registrable
Securities, directly or indirectly, from such Person. For purposes of this
Agreement, the Company may deem and treat the registered holder of a Registrable
Security as the Holder and absolute owner thereof.
(i) "Majority Registered Holders" means in the case of any
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registration statement, the Holders of a majority of the Registrable Securities
proposed to be covered (or so covered) in such registration statement.
(j) "Majority Sellers" means (i) in the case of any offering or
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proposed offering, the Holders of a majority of the Registrable Securities so
offered or proposed to be so offered, and (ii) in the
case of any other offering or proposed offering pursuant to any Registration,
the Majority Registered Holders of the applicable registration statement.
(k) "Person" means any individual, partnership, corporation
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(including a business trust), limited liability company, joint stock company,
trust, unincorporated association, joint venture, or other entity, or a
government or any political subdivision or agency.
(l) "Piggyback Registration" means any registration of Registrable
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Securities effected pursuant to Section 3 hereof.
(m) "Registrable Securities" means (i) the shares of Common Stock
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held by a Holder on the date hereof as shown on Annex A hereto and (ii) any
securities issued or issuable in respect of or in exchange for any of the shares
of Common Stock referred to in clause (i) above by way of a stock dividend or
other distribution on the Common Stock, stock split or combination of shares,
recapitalization, reclassification, merger, consolidation or exchange offer. For
purposes of this Agreement, a Registrable Security ceases to be a Registrable
Security when either (1) it has been effectively registered under the Securities
Act and sold or distributed to any Person pursuant to an effective registration
statement covering it or (2) it has been sold or distributed to any Person
pursuant to Rule 144.
(n) "Registration" means any Demand Registration or Piggyback
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Registration.
(o) "Rule 10b-6" means Rule 10b-6 promulgated by the Commission under
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the Exchange Act, as such Rule may be amended from time to time, or any similar
successor rule that may be promulgated by the Commission.
(p) "Rule 144", "Rule 145", "Rule 415", "Rule 424" and "Rule 462"
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mean, respectively, Rule 144, Rule 145, Rule 415, Rule 424 and Rule 462, each
promulgated by the Commission under the Securities Act, in each case as amended
from time to time, or any similar successor rule thereto that may be promulgated
by the Commission.
(q) "Securities Act" means the Securities Act of 1933, as amended (or
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any similar successor federal statute), and the rules and regulations
thereunder, as the same are in effect from time to time.
2. Demand Registrations.
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(a) At any time after six months following the Effective Date, upon
written notice to the Company from any Holder of Registrable Securities
identified on Annex B hereto (the "Initiating Holder") requesting that the
Company effect, pursuant to this Section 2, the registration of such Initiating
Holder's Registrable Securities under the Securities Act having a market value
at the time of such notice of not less than $5,000,000 (which notice shall
specify the Registrable Securities so requested to be registered, the proposed
amounts thereof (which shall be Registrable Securities having a market value of
at least $5,000,000) and the intended method or methods of disposition by such
Initiating Holder (including whether or not the proposed offering is to be
underwritten)), the Company shall promptly (but in any event within 20 days)
give written notice of such requested registration to all Holders, and thereupon
the Company shall, as expeditiously as possible, use its best efforts to effect
the registration under the Securities Act of:
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(A) the Registrable Securities that the Initiating Holder has
requested the Company to register, for disposition in accordance with the
intended method or methods of disposition stated in their notice to the
Company; and
(B) all other Registrable Securities the Holders of which shall have
made a written request to the Company for registration thereof (which
request shall specify such Registrable Securities and the proposed amounts
thereof) within 15 days after the receipt of such written notice from the
Company,
all to the extent requisite to permit the disposition by Holders of the
securities then constituting Registrable Securities so to be registered;
provided, however, notwithstanding the foregoing provisions of this Section
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2(a), the Holders listed on Annex C shall be treated as one Holder for purposes
of determining the amount to be registered pursuant to this Section 2(a) and if
the Holders listed on Annex C request that the Company register for sale all the
remaining aggregate Registerable Securities then held by such Holders, the
market value of such securities shall be not less than $2,000,000, rather than
$5,000,000 as specified above.
(b) Frequency; Duration. The Company shall not be required to effect
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a Demand Registration pursuant to this Section 2: (i) if it shall have so
effected a Demand Registration during the previous six months or (ii) if the
Initiating Holder is a Holder identified on Annex C hereto and the Company shall
have at any prior time effected a Demand Registration at the request of any
Initiating Holder identified on Annex C or (iii) after the eighth anniversary
of the Effective Date; provided, however, that a Demand Registration shall not
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be deemed to have been effected for purposes of Section 2(b)(i) or (ii) if the
applicable registration statement has not been declared effective and kept
effective until the earlier of (1) eight months following the date on which such
registration statement was declared effective and (2) the sale pursuant to such
registration statement of the Registrable Securities covered thereby; provided,
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however, if the Holders identified on Annex C first request registration of such
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Holders' Registrable Securities pursuant to this Section 2 and solely because of
a cut-back by the managing underwriter or underwriters pursuant to Section 2(c)
hereof, some Registrable Securities are sold for the account of such Holders but
such Holders are unable to sell all such Registrable Securities with respect to
which such Holders requested registration, such Holders will not be deemed to
have made a demand for registration of Registrable Securities under this Section
2 and notwithstanding the foregoing provisions of this Section 2(b), the Company
will be obligated to effect one (but only one) additional Demand Registration
for such Holders on the terms set forth in this Section 2.
(c) Inclusion of Other Securities; Cut-Back. The Company shall not
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register any securities other than (i) for its own account, or (ii) Registrable
Securities in any Demand Registration without the prior written consent of
Holders of a majority of the Registrable Securities requested to be included in
such Demand Registration. If any securities other than Registrable Securities
are so registered, securities to be registered by the Company for sale for its
own account with aggregate estimated net proceeds therefrom to the Company (at
the time of filing such registration statement) of up to $15,000,000 shall have
absolute priority over securities requested to be registered by Holders or third
parties.
Notwithstanding the provisions of Section 2(a) hereof, if the managing
underwriter or underwriters of a proposed underwritten offering of Registrable
Securities pursuant to Section 2(a) hereof (which may also include an offering
of securities for the account of the Company), deliver written advice to the
Holders requesting inclusion of their Registrable Securities stating that the
total mount or kind of securities that they and any other Persons (other than
the Company) seek to include in such offering would materially and adversely
affect the success of such offering, then the amount or kind of Registrable
Securities to be offered for the accounts of Holders shall be reduced pro rata
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based on the number of Registrable Securities then owed by the Holders to the
extent necessary to reduce the total amount of Registrable Securities to be
included in such offering to that recommended by such managing underwriter
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or underwriters (which amount may be zero); provided, however, that if the
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amount of any kind of Registrable Securities to be offered for the accounts of
holders is reduced in accordance with this Section 2(c), the Company may not
include in such offering any securities other than (i) Registrable Securities
and (ii) securities, if any, that the Company is offering for sale for its own
account in a primary underwritten offering.
(d) Company's Right to Delay Registration. Notwithstanding the
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foregoing, the Company may delay filing a registration statement, and may
withhold its efforts to cause the registration statement to become effective, if
the Company determines in good faith that such registration might (i) interfere
with or affect the negotiation or completion of any 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 is exercised, or (ii)
involve initial or continuing disclosure obligations that might not be in the
best interests of the Company's stockholders.
3. Piggyback Registrations.
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(a) Effective Registration. If the Company proposes to file a
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registration statement under the Securities Act with respect to any class of
equity securities (other than in connection with the registration of equity
securities issued or issuable pursuant to an employee stock option, stock
purchase, stock bonus or similar plan or pursuant to a merger, exchange offer or
transaction of the type specified in Rule 145(a) under the Securities Act) at
any time on or prior to the eighth anniversary of the Effective Date, then the
Company shall give written notice of such proposed filing to the Holders at
least 20 days before the anticipated filing date, and such notice shall offer
the Holders the opportunity to register such amount of Registrable Securities as
each such Holder may request. The Company shall use its reasonable efforts to
cause the managing underwriter or underwriters of a proposed underwritten
offering to permit the inclusion therein of any Registrable Securities the
Holders of which request, within 15 days after receiving written notice of the
proposed filing from the Company, such inclusion, on the same terms and
conditions as any similar securities of the Company so included. Any Holder's
request for such inclusion may be withdrawn, in whole or in part, at any time
prior to the effective date of the registration statement for such offering.
(b) Cut-Backs. Notwithstanding the provisions of Section 3(a)
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hereof, if the managing underwriter or underwriters of a proposed underwritten
offering as described in such Section 3(a) deliver written advice to the Holders
requesting inclusion of their Registrable Securities stating that the total
amount or kind of securities that they and any other Persons seek to include in
such offering would materially and adversely affect the success of such
offering, then the amount or kind of Registrable Securities to be offered for
the accounts of Holders shall be reduced pro rata based on the number of
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Registrable Securities then owed by the Holders to the extent necessary to
reduce the total amount of Registrable Securities to be included in such
offering to that recommended by such managing underwriter or underwriters (which
amount may be zero); provided, however, that if the amount of any kind of
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Registrable Securities to be offered for the accounts of Holders is reduced in
accordance with this Section 3(b), the Company may not include in such offering
any securities other than (i) Registrable Securities and (ii) securities, if
any, that the Company is offering for sale for its own account in a primary
underwritten offering.
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4. Holdback Agreements.
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(a) Restrictions on Public Sales by Holders of Registrable
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Securities. To the extent not inconsistent with applicable law, each Holder of
Registrable Securities eligible for inclusion in a registration statement that
is timely notified in writing by the managing underwriter or underwriters of any
securities being registered in an underwritten offering (other than pursuant to
an employee stock option, stock purchase, stock bonus or similar plan, pursuant
to a merger, exchange offer or a transaction of the type specified in Rule
145(a) under the Securities Act or pursuant to a "shelf" registration), shall
not effect any public sale or distribution (including a sale pursuant to Rule
144) of any Registrable Securities that are similar to any such securities or
any Registrable Securities convertible into or exchangeable or exercisable for
any such securities, during the 10-day period prior to, and during the 90-day
period (or such shorter period as may be requested by the managing underwriter
or underwriters) beginning on, the effective date of the applicable registration
statement, except as part of such registration.
(b) Restrictions on Sales by the Company. The Company shall not
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effect any sale of any securities of the Company similar to any Registrable
Securities being offered in an underwritten offering under a registration
statement filed pursuant to this Agreement or any securities of the Company
convertible into or exchangeable or exercisable for any such Registrable
Securities, during the 10-day period prior to, and during the 90-day period (or
such shorter period as may be requested by the managing underwriter or
underwriters) beginning on, the effective date of the applicable registration
statement, except as part of such registration or pursuant to employee benefit
plans maintained by the Company at the beginning of such restricted period.
5. Registration Procedures.
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(a) Company Procedures. Whenever the Company is required by this
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Agreement to effect the registration of any Registrable Securities under the
Securities Act pursuant to a registration statement, the Company shall use its
best efforts to effect each such registration to permit the sale of such
Registrable Securities in accordance with the intended method or methods of
disposition thereof, and pursuant thereto the Company shall, as soon as
practicable:
(i) prepare and file with the Commission the requisite
registration statement to effect such registration and thereafter use its best
efforts to cause such registration statement to be declared effective as soon as
practicable and to remain continuously effective for the time period required by
this Agreement to the extent permitted under the Securities Act, provided that
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as soon as practicable but in no event later than three Business Days before
filing such registration statement, any related prospectus or any amendment or
supplement thereto, other than any amendment or supplement made solely as a
result of incorporation by reference of documents filed with the Commission
subsequent to the filing of such registration statement or a registration
statement filed pursuant to Rule 462 and the underwriters, if any, copies of all
such documents proposed to be filed, which documents shall be subject to the
review of such Holders and underwriters; the Company shall not file any
registration statement or amendment thereto or any prospectus or any supplement
thereto (other than any amendment or supplement made solely as a result of
incorporation by reference of documents filed with the Commission subsequent to
the filing of such registration statement) to which the managing underwriters of
the applicable offering, if any, or the Majority Registered Holders shall have
reasonably objected in writing within two Business Days after receipt of such
documents to the effect that such registration statement or amendment thereto or
prospectus or supplement thereto does not comply in all material respects with
the requirements of the Securities Act (provided that the foregoing shall not
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limit the right of any Holder whose Registrable Securities are covered by a
registration statement to reasonably object, within two Business Days after
receipt of such documents,
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to any particular information that is to be contained in such registration
statement, amendment, prospectus or supplement and relates specifically to such
Holder, including, without limitation, any information describing the manner in
which such Holder acquired such Registrable Securities and the intended method
or methods of distribution of such Registrable Securities), and if the Company
is unable to file any such document due to the objections of such underwriters
or such Holders, the Company shall use its best efforts to cooperate with such
underwriters and Holders to prepare, as soon as practicable, a document that is
responsive in all material respects to the reasonable objections of such
underwriters and Holders;
(ii) prepare and file with the Commission such amendments and post-
effective amendments to such registration statement as may be necessary to keep
such registration statement continuously effective and current for the period
required by this Agreement to the extent permitted under the Securities Act; and
cause each related prospectus to be supplemented by any prospectus supplement as
may be required, and as so supplemented to be filed pursuant to Rule 424; and
otherwise comply with the provisions of the Securities Act as may be necessary
to facilitate the disposition of all Registrable Securities covered by such
registration statement during the applicable period in accordance with the
intended method or methods of disposition by the Selling Holders thereof set
forth in such registration statement or such prospectus or prospectus
supplement;
(iii) notify the Holders and the managing underwriters, if any, of
the applicable offering (providing, if requested by any such Persons,
confirmation in writing) as soon as practicable after becoming aware of: (A) the
filing of any prospectus or prospectus supplement or the filing or effectiveness
(or anticipated date of effectiveness) of such registration statement or any
post-effective amendment thereto; (B) any request by the Commission for
amendments or supplements to such registration statement or the related
prospectus or for additional information; (C) the issuance by the Commission of
any stop order suspending the effectiveness of such registration statement or
the initiation of any proceedings for that purpose; (D) the receipt by the
Company of any notification with respect to the suspension of the qualification
or registration (or exemption therefrom) of any Registrable Securities for sale
in any jurisdiction in the United States or the initiation or threatening of any
proceeding for such purposes; or (E) the happening of any event that makes any
statement made in such registration statement or in any related prospectus,
prospectus supplement, amendment or document incorporated therein by reference
untrue in any material respect or that requires the making of any changes in
such registration statement or in any such prospectus, supplement, amendment or
other such document so that it will not contain any 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 (in the case of any prospectus in
the light of the circumstances under which they were made) not misleading;
(iv) make every reasonable effort to obtain at the earliest possible
moment the withdrawal of any order or other action suspending the effectiveness
of any such registration statement or suspending the qualification or
registration (or exemption therefrom) of the Registrable Securities for sale in
any jurisdiction;
(v) if reasonably requested by the managing underwriters, if any,
of the applicable offering, or by the Majority Sellers, as soon as practicable
incorporate in a prospectus supplement or post-effective amendment such
information as such underwriters or the Majority Sellers, as the case may be,
agree should be included therein relating to the sale and offering of the
applicable Registrable Securities, including, without limitation, information
with respect to the number of Registrable Securities being sold to any
underwriters, the purchase price being paid therefor by any such underwriters
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and any other terms of the offering of the Registrable Securities; and make all
required filings of such prospectus supplement or post-effective amendment as
soon as practicable following receipt of notice of the matters to be
incorporated therein;
(vi) as soon as practicable after filing such documents with the
Commission, furnish to the Holders and each of the underwriters, if any, without
charge, at least one manually signed or conformed copy of such registration
statement and any post-effective amendment thereto, including financial
statements and schedules; and as soon as practicable after the request of any
Holder or underwriter, furnish to such Holder or underwriter, as the case may
be, at least one copy of any document incorporated by reference in such
registration statement or in any related prospectus, prospectus supplement or
amendment, together with all exhibits thereto (including those previously
furnished or incorporated by reference);
(vii) deliver to the Holders and to each of the underwriters, if any,
without charge, as many copies of the prospectus or prospectuses (including each
preliminary prospectus) and any amendment or supplement thereto as such Persons
may reasonably request; subject to Section 5(b)(i) hereof, the Company consents
to the use of any such prospectus or any amendment or supplement thereto by the
Holders and the underwriters, if any, in connection with the offering and sale
of the Registrable Securities covered by any such prospectus or any amendment or
supplement thereto;
(viii) prior to any public offering of Registrable Securities,
register or qualify (or obtain an exemption therefrom), or cooperate with the
Holders, the underwriters, if any, and their respective counsel in connection
with the registration or qualification (or exemption therefrom) of, such
Registrable Securities for offer and sale under the securities or blue sky laws
of such jurisdictions in the United States as the Holders or the underwriters,
if any, shall reasonably request in writing; keep each such registration or
qualification (or exemption therefrom) effective during the period during which
such registration statement is required to be kept effective pursuant to this
Agreement; and do any and all other acts and things reasonably necessary or
advisable to facilitate the disposition in such jurisdictions of the Registrable
Securities covered by such registration statement; provided that the Company
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shall not be required to qualify generally to do business in any jurisdiction
where it would not be required to qualify but for this Section 5(a)(viii);
(ix) cooperate with Holders participating in such registration and
the underwriters, if any, to facilitate the timely preparation and delivery of
certificates representing the Registrable Securities to be sold; and enable such
Registrable Securities to be in such denominations and registered in such names
as the underwriters, if any, may request at least two Business Days prior to any
sale of Registrable Securities to the underwriters;
(x) use its best efforts to cause the Registrable Securities
covered by such registration statement to be registered with or approved by such
other governmental agencies or authorities in the United States as may be
reasonably necessary to enable the Holders or the underwriters, if any, to
consummate the disposition of such Registrable Securities;
(xi) as soon as practicable after the occurrence of any event
described in Section 5(a)(iii)(E) hereof, prepare a supplement or post-effective
amendment to such registration statement or to the related prospectus or any
document incorporated therein by reference, or file any other required document
so that, as thereafter delivered to the purchasers of the Registrable Securities
being sold
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thereunder, such prospectus shall not contain an untrue statement of a material
fact or omit to state any material fact necessary to make the statements therein
not misleading; if any event described in Section 5(a)(iii)(B) hereof occurs,
use its best efforts to cooperate with the Commission to prepare, as soon as
practicable, any amendment or supplement to such registration statement or such
related prospectus and any other additional information, or to take other action
that may have been requested by the Commission;
(xii) use its best efforts to cause all Common Stock constituting
Registrable Securities covered by such registration statement to be listed on
each securities exchange (or quotation system operated by a national securities
association) on which the Common Stock of the Company is then listed (or
included), if so requested by the Majority Registered Holders or the
underwriters, if any, and enter into customary agreements including, if
necessary, a listing application and indemnification agreement in customary
form, and provide a transfer agent for such Registrable Securities no later than
the effective date of such registration statement; use its best efforts to cause
any other Registrable Securities covered by such registration statement to be
listed (or included) on each securities exchange (or quotation system operated
by a national securities association) on which securities of the same class and
series, if any, are then listed (or included) (or on any exchange or quotation
system on which any Person other than a Holder shall have the right to have
securities of the same class and series, if any, listed or included), if so
requested by the Majority Registered Holders or the underwriters, if any, and
enter into customary agreements including, if necessary, a listing application
and indemnification agreement in customary form, and, if necessary, provide a
transfer agent for such securities no later than the effective date of such
registration statement;
(xiii) enter into customary agreements (including, in the case of an
underwritten offering, an underwriting agreement in customary form for the
managing underwriters with respect to issuers of similar market capitalization
and reporting and financial histories) and take all such other reasonable
actions in connection therewith in order to expedite or facilitate the
disposition of the Registrable Securities included in such registration
statement and, in the case of an underwritten offering: (A) make representations
and warranties to each Holder of Registrable Securities participating in such
offering and to each of the underwriters, in such form, substance and scope as
are customarily made to the managing underwriters by issuers of similar market
capitalization and reporting and financial histories and confirm the same to the
extent customary if and when requested; (B) obtain opinions of counsel to the
Company and updates thereof addressed to each Holder of Registrable Securities
participating in such offering and to each of the underwriters, such opinions
and updates to be in customary form and covering the matters customarily covered
in opinions obtained in underwritten offerings by the managing underwriters for
issuers of similar market capitalization and reporting and financial histories;
(C) obtain "comfort" letters and updates thereof from the Company's independent
certified public accountants addressed to each Holder of Registrable Securities
participating in such offering and to each of the underwriters, such letters to
be in customary form and covering matters of the type customarily covered in
"comfort" letters to the managing underwriters in connection with underwritten
offerings by them for issuers of similar market capitalization and reporting and
financial histories; (D) provide, in the underwriting agreement to be entered
into in connection with such offering, indemnification provisions and procedures
no less favorable than those set forth in Section 7 hereof with respect to all
parties to be indemnified pursuant to such Section 7; and (E) deliver such
customary documents and certificates as may be reasonably requested by the
Majority Sellers and the managing underwriters to evidence compliance with
clause (A) of this paragraph (xiv) and with any customary conditions contained
in the underwriting agreement entered into by the Company in connection with
such offering;
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(xiv) in the case of any non-underwritten offering: (A) obtain an
opinion of counsel to the Company at the time of effectiveness of such
registration statement covering such offering and an update thereof at the time
of effectiveness of any post-effective amendment to such registration statement
(other than by reason of incorporation by reference of documents filed with the
Commission) addressed to each Holder of any Registrable Securities covered by
such registration statement, covering matters that are no more extensive in
scope than would be customarily covered in opinions obtained in underwritten
offerings by issuers with similar market capitalization and reporting and
financial histories; (B) obtain a "comfort" letter from the Company's
independent certified public accountants at the time of effectiveness of such
registration statement and, upon the request of the Majority Sellers, updates
thereof, in each case addressed to each Holder of Registrable Securities
participating in such offering and covering matters that are no more extensive
in scope than would be customarily covered in "comfort" letters and updates
obtained in underwritten offerings by issuers with similar market capitalization
and reporting and financial histories; and (C) deliver a certificate of a senior
executive officer of the Company at the time of effectiveness of such
registration statement and, upon the request of the Majority Sellers, updates
thereof, such certificates to cover matters no more extensive in scope than
those matters customarily covered in officers' certificates delivered in
connection with underwritten offerings by issuers with similar market
capitalization and reporting and financial histories;
(xv) make available, for inspection by the Holders of the
Registrable Securities included in such registration, any underwriter
participating in any disposition of Registrable Securities pursuant to such
registration statement, and any attorney, accountant or other representative
retained by such selling Holders or by any such underwriter, all pertinent
financial and other records, pertinent corporate documents and properties of the
Company, and cause the Company's officers, directors and employees to supply all
information reasonably requested by any such underwriter, attorney, accountant
or other representative in connection with such registration;
(xvi) otherwise use its best efforts to comply with all applicable
rules and regulations of the Commission relating to such registration and the
distribution of the securities being offered (including, without limitation,
Rule 10b-6, with respect to which the Company shall also use its best efforts
timely to apprise each Holder of any bids and purchases by the Company, and of
any known bids and purchases by each "affiliated purchaser" (as defined in Rule
10b-6) of the Company, that would in the opinion of the Company be prohibited
under Rule 10b-6 in connection with a "distribution" (as so defined) by such
Holder) and make generally available to its security holders earning statements
satisfying the provisions of Section 11(a) of the Securities Act, no later than
60 days after the end of any 12-month period (or 90 days, if such period is a
fiscal year) commencing at the end of any fiscal quarter in which the
Registrable Securities are sold to underwriters in a firm commitment or best
efforts underwritten offering, or, if not sold to underwriters in such an
offering, beginning with the first month of the Company's first fiscal quarter
commencing after the effective date of such registration statement, which
earning statements shall cover such 12-month periods;
(xvii) cooperate and assist in any filings required to be made with
the National Association of Securities Dealers, Inc. and in the performance of
any customary or required due diligence investigation by any underwriter; and
(xviii) use its best efforts to take all other reasonable
steps necessary and appropriate to effect such registration in the manner
contemplated by this Agreement.
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(b) Holder Procedures.
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(i) Each Holder agrees, by acquisition of the Registrable
Securities that, upon receipt of any notice from the Company of the happening of
any event described in Section 5(a) paragraphs (iii)(B), (iii)(C), (iii)(D) or
(iii)(E) hereof, such Holder shall forthwith discontinue disposition of any
Registrable Securities (but, in the case of an event described in Section
5(a)(iii)(D), in the affected jurisdiction or jurisdictions only) covered by the
affected registration statement or prospectus until such Holder's receipt of the
copies of the supplemented or amended prospectus contemplated by Section 5(a)
paragraphs (iii) or (xi) hereof or until such Holder is (it being agreed by the
Company that the underwriters, if any, shall also be) advised in writing (the
"Advice") by the Company that the use of the applicable prospectus may be
resumed. If the Company shall have given any such notice during a period when a
Demand Registration is in effect, the eight-month period mentioned in Section
3(b) hereof, shall be extended by the number of days from and including the date
of the giving of such notice to and including the date when each Holder of
Registrable Securities included in such Registration shall have received the
copies of the supplemented or amended prospectus contemplated by Section 5(a)
paragraphs (iii) or (xi) hereof or the Advice, as the case may be.
(ii) In connection with any underwritten public offering of
Registrable Securities pursuant to a Piggyback Registration or Demand
Registration, the managing underwriter or underwriters of such offering shall be
an investment banking firm selected by the Company which shall be reasonably
acceptable to the Majority Sellers.
6. Registration Expenses.
---------------------
All Registration Expenses, as hereinafter defined, in connection with a
Demand Registration in which no securities are registered for the account of the
Company, shall be prorated among and borne by the Holders of Registerable
Securities included in such Demand Registration based upon the number of shares
of Registrable Securities included in such Demand Registration. All
Registration Expenses in connection with a Piggyback Registration or with a
Demand Registration in which securities are registered for the account of the
Company, shall be borne by the Company. The term "Registration Expenses" shall
mean all expenses incident to the Company's performance of or compliance with
this Agreement, including without limitation all registration and filing fees,
fees and expenses of compliance with securities or blue sky laws (including
reasonable fees and disbursements of counsel in connection with blue sky
qualifications or registrations (or the obtaining of exemptions therefrom) of
the Registrable Securities), printing expenses (including expenses of printing
prospectuses), messenger and delivery expenses, internal expenses (including,
without limitation, all salaries and expenses of its officers and employees
performing legal or accounting duties), fees and disbursements of its counsel
and its independent certified public accountants (including the expenses of any
special audit or "comfort" letters required by or incident to such performance
or compliance), securities acts liability insurance (if the Company elects to
obtain such insurance), reasonable fees and expenses of any special experts
retained by the Company in connection with any registration hereunder;
reasonable fees and expenses of other Persons retained by the Company and up to
$10,000 of fees and expenses of one counsel chosen by the Majority Registered
Holders to represent the Holders with respect to such registration ("Holders'
Counsel"); provided that Registration Expenses shall not include any
--------
underwriting discounts, commissions or fees attributable to the sale of the
Registrable Securities or fees and expenses of counsel for any of the Holders
other than Holders' Counsel or out-of-pocket expenses of any of the
Holders.
10
7. Indemnification; Contribution.
-----------------------------
(a) Indemnification by the Company. The Company shall indemnify, to
------------------------------
the full extent permitted by law, each Holder of Registrable Securities, its
officers, directors, employees and agents, each Person who controls such Holder
(within the meaning of the Securities Act) and any investment adviser thereof or
agent therefor, against all losses, claims, damages, liabilities and expenses
(including reasonable costs of investigation and legal expenses) arising out of
or based upon any untrue or alleged untrue statement of a material fact
contained in any registration statement covering any Registrable Securities, any
related prospectus or preliminary prospectus, or any amendment or supplement
thereto, or any omission or alleged omission to state in any thereof a material
fact required to be stated therein or necessary to make the statements therein
(in the case of a prospectus or prospectus supplement, in light of the
circumstances under which they were made) not misleading, except in each case
insofar, but only insofar, as the same arises out of or is based upon an untrue
statement or alleged untrue statement of a material fact or an omission or
alleged omission to state a material fact in such registration statement,
prospectus, preliminary prospectus, amendment or supplement, as the case may be,
made or omitted, as the case may be, in reliance upon and in conformity with
written information furnished to the Company by such Holder expressly for use
therein. This indemnity is in addition to any liability that the Company may
otherwise have. The Company shall, if requested by the managing underwriter or
underwriters of such offering, also indemnify any underwriters of the
Registrable Securities, selling brokers, dealer managers and similar securities
industry professionals participating in the distribution and their officers and
directors and each Person who controls such underwriters or other Persons
(within the meaning of the Securities Act) to the same extent as provided above
with respect to the indemnification of Holders and other specified Persons.
(b) Indemnification by Holders of Registrable Securities. In
----------------------------------------------------
connection with any registration statement covering Registrable Securities, each
Holder any of whose Registrable Securities are covered thereby shall furnish to
the Company in writing such information and affidavits with respect to such
Holder as the Company reasonably requests for use in connection with such
registration statement, any related prospectus or preliminary prospectus, or any
amendment or supplement thereto, and shall indemnify, to the full extent
permitted by law, the Company, the Company's directors, officers, employees and
agents, each Person who controls the Company (within the meaning of the
Securities Act) and any investment adviser thereof or agent therefor, against
all losses, claims, damages, liabilities and expenses (including reasonable
costs of investigation and legal expenses) arising out of or based upon any
untrue or alleged untrue statement of a material fact contained in any
registration statement covering any Registrable Securities, any related
prospectus or preliminary prospectus, or any amendment or supplement thereto, or
any omission or alleged omission to state in any thereof a material fact
required to be stated therein or necessary to make the statements therein (in
the case of a prospectus or prospectus supplement, in light of the circumstances
under which they were made) not misleading, in each case to the extent, but only
to the extent, that the same arises out of or is based upon an untrue statement
or alleged untrue statement of a material fact or an omission or alleged
omission to state a material fact in such registration statement or in such
related prospectus, preliminary prospectus, amendment or supplement, as the case
may be, made or omitted, as the case may be, in reliance upon and in conformity
with written information furnished to the Company by such Holder expressly for
use therein; provided, however, that in no event shall the liability of any
-------- -------
Holder for indemnification under this Section 7(b) exceed the proceeds received
by such Holder from the sale of Registrable Securities under the applicable
registration statement. This indemnity is in addition to any liability that a
Holder may otherwise have. Each Holder participating in an offering of
Registrable Securities shall, if requested by the managing underwriter or
underwriters of such offering, also indemnify any underwriters of such
Registrable Securities, selling brokers, dealer managers and similar
11
securities industry professionals participating in the distribution of such
Registrable Securities and their officers and directors and each Person who
controls such underwriters or other Persons (within the meaning of the
Securities Act) to the same extent as provided above with respect to the
indemnification of the Company and other specified Persons.
(c) Conduct of Indemnification Proceedings. Any Person entitled to
--------------------------------------
indemnification under this Section 7 agrees to give prompt written notice to the
indemnifying party after the receipt by such Person of any written notice of the
commencement of any action, suit, proceeding or investigation or threat thereof
made in writing for which such Person will claim indemnification or contribution
pursuant to this Agreement and, unless in the reasonable judgment of such
indemnified party a conflict of interest may exist between such indemnified
party and the indemnifying party with respect to such claim, permit the
indemnifying party to assume the defense of such claim with counsel reasonably
satisfactory to such indemnified party. If the indemnifying party is not
entitled to, or elects not to, assume the defense of a claim, it shall not be
obligated to pay the reasonable fees and expenses of more than one counsel with
respect to such claim, unless in the reasonable judgment of counsel to such
indemnified party, expressed in a writing delivered to the indemnifying party, a
conflict of interest may exist between such indemnified party and any other
indemnified party with respect to such claim, in which event the indemnifying
party shall be obligated to pay the reasonable fees and expenses of such
additional counsel or counsels (which shall be limited to one counsel per
indemnified party, treating as one each Holder and any of its officers and
directors and each Person who controls such Holder). The indemnifying party
shall not be subject to any liability for any settlement made without its
consent, which consent shall not be unreasonably withheld.
(d) Contribution.
------------
(i) If the indemnification provided for in this Section 7 from
the indemnifying party is unavailable to an indemnified party hereunder in
respect of any losses, claims, damages, liabilities or expenses 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, liabilities or expenses in such
proportion as is appropriate to reflect the relative fault of the indemnifying
party and indemnified parties in connection with the actions that resulted in
such losses, claims, damages, liabilities or expenses, as well as any other
relevant equitable considerations; provided, however, that in no event shall the
-------- -------
liability of any Holder or the Company, as the case may be, for contribution
under this Section 7(d) exceed the proceeds received by such Holder or the
Company, as the case may be, from the sale of Registrable Securities under the
applicable registration statement. The relative fault of such indemnifying
party and indemnified parties 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, has been made by, or relates to information supplied by, such indemnifying
party or indemnified parties, and the parties' 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,
liabilities and expenses referred to above shall be deemed to include, subject
to the limitations set forth in Section 7(c) hereof, any legal or other fees or
expenses reasonably incurred by such party in connection with any investigation
or proceeding.
(ii) The parties hereto agree that it would not be just and
equitable if contribution pursuant to this Section 7(d) were determined by pro
---
rata allocation or by any other method of allocation that 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
12
11(f) of the Securities Act) shall be entitled to contribution from any Person
who was not guilty of such fraudulent misrepresentation.
(iii) If indemnification is available under this Section 7, the
indemnifying parties shall indemnify each indemnified party to the full extent
provided in Section 7(a) and Section 7(b) hereof without regard to the relative
fault of said indemnifying party or indemnified party or any other equitable
consideration provided for in this Section 7(d).
8. Participation in Underwritten Registrations
-------------------------------------------
No Person may participate in any underwritten registration hereunder
unless such Person (a) agrees to sell such Person's securities on the basis
provided in any underwriting arrangements approved by the Persons entitled
hereunder to approve such arrangements, (b) completes and executes all
questionnaires, powers of attorney, indemnities, underwriting agreements and
other documents reasonably required under the terms of such underwriting
arrangements and (c) agrees to pay such Person's pro rata portion of all
--- ----
underwriting discounts and commissions and the fees and expenses of such
Person's counsel.
9. Cooperation with the Company.
----------------------------
Each Holder by the acceptance of Registrable Securities agrees to use
his or its best efforts to cooperate with the Company in all reasonable respects
in connection with the preparation and filing of Registrations hereunder in
which such Registrable Securities are included or requested to be included.
10. Miscellaneous.
-------------
(a) No Inconsistent Agreements. The Company shall not hereafter
--------------------------
enter into any agreement with respect to any of its securities that contains
provisions more favorable to the holders thereof than the provisions contained
in this Agreement without providing for the granting of comparable rights to the
Holders in this Agreement or that contains provisions that conflict with the
provisions hereof.
(b) Remedies. Each Holder of Registrable Securities, in addition to
--------
being entitled to exercise all rights in an action at law, including recovery of
damages, shall be entitled to specific performance of its 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 Provisions and hereby agrees to waive the defense in any action for
specific performance that a remedy at law would be adequate.
(c) 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 hereof may not be given
unless the company shall have obtained the prior written consent of (i) the
Holders of a majority of the securities then constituting Registrable Securities
and (ii) each Holder materially and adversely affected by such amendment,
modification, supplement, waiver or departure.
(d) Notices. All notices, requests, waivers, releases, consents, and
-------
other communications required or permitted by this Agreement (collectively,
"Notices") shall be in writing. Notices shall be deemed sufficiently given for
all purposes under this Agreement when delivered in person,
13
when dispatched by telegram or (upon written confirmation of receipt) by
electronic facsimile transmission or (upon written confirmation of receipt),
when dispatched by a nationally recognized overnight courier service, or five
Business Days after being deposited in the mail, postage prepaid, if mailed. All
Notices shall be delivered as follows:
(i) if to a Holder of Registrable Securities, at the address
indicated for such Holder on the Company's stock register or at such other
address as such Holder may have furnished to the Company in writing; and
(ii) if to the Company, at:
HealthCare Financial Partners, Inc.
0 Xxxxxxxxx Xxxxxx
Xxxxx 000
Xxxxx Xxxxx, Xxxxxxxx 00000
Attention: President
Telephone Number: (000) 000-0000
Fax Number: (000) 000-0000
with a copy to:
G. Xxxxxxx Xxxxx, Esq.
Powell, Goldstein, Xxxxxx & Xxxxxx
16th Floor
000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxx, Xxxxxxx 00000
Telephone Number: (000) 000-0000
Fax Number: (000) 000-0000
(e) Successors and Assigns. This Agreement shall inure to the
----------------------
benefit of and be binding upon the successors and assigns of each of the parties
hereto, including any successors by merger to the Company.
(f) 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.
(g) Headings; Construction. The headings in this Agreement are for
----------------------
convenience of reference only and shall not limit or otherwise affect the
meaning hereof. Unless the context otherwise requires, all references to
Sections are to Sections of this Agreement, "or" is inclusively disjunctive, and
words in the singular include the plural and vice versa. In computing any
---- -----
period of time specified in this Agreement, the date of the act or event from
which such period of time is to be measured shall be included, any such period
shall expire at 5:00 p.m., Washington, D.C. time, on the last day of such
period, and any such period denominated in months shall expire on the date in
the last month of such period that has the same numerical designation as the
date of the act or event from which such period is to be measured; provided,
--------
however, that if there is no date in the last month of such period that has the
-------
same numerical
14
designation as the date of such act or event, such period shall expire on the
last day of the last month of such period.
(h) Certain Adjustments. Notwithstanding anything to the contrary
-------------------
contained in this Agreement, the Board of Directors of the Company may make or
provide for such adjustments in the numbers of shares of Common Stock or other
Registrable Securities specified in any other provision of this Agreement
specifying a number or percentage of Registrable Securities, as the Board may
determine after consultation with those Holders that are Initial Holders (or, if
there are no such Holders, Holders holding a majority of the securities then
constituting Registrable Securities), is equitably required to prevent
diminution or enlargement of the rights of Holders that otherwise would result
from any stock dividend, stock split, combination of shares, recapitalization,
or other similar change in the capital structure of the Company.
(i) Governing Law. This Agreement shall be governed by and construed
-------------
in accordance with the internal laws of the State of Delaware, without regard to
the principles of conflicts of laws thereof.
(j) Severability. If 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 the remaining provisions contained herein shall not be in any
way affected or impaired thereby, and the provision held to be invalid, illegal
or unenforceable shall be reformed to the minimum extent necessary, and in a
manner as consistent with the purposes thereof as is practicable, so as to
render it valid, legal and enforceable, it being intended that all of the rights
and privileges of the Holders hereunder shall be enforceable to the fullest
extent permitted by law.
(k) Agreement. This Agreement is intended by the Company and the
---------
Holders to be a final expression thereof and is intended to be a complete and
exclusive statement of the agreement and understanding of the Company and the
Holders in respect of the subject matter contained herein. There are no
restrictions, promises, warranties or undertakings, other than those set forth
or referred to herein. This Agreement supersedes all prior agreements and
understandings among the Company and any Holders with respect to such subject
matter.
15
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
HEALTHCARE FINANCIAL PARTNERS, INC.
By:
-----------------------------------------
Name: Xxxx X. Xxxxxxx
Title: Chairman and Chief Executive
Officer
HOLDERS:
--------------------------------------------
Xxxx X. Xxxxxxx
--------------------------------------------
Xxxxx X. Xxxxx
--------------------------------------------
Xxxxxx X. Xxxxxxxx, Xx.
FARALLON CAPITAL PARTNERS, L.L.C.
By: Farallon Partners, L.L.C.
its General Partner
By:
-----------------------------------------
Name:
Title:
RR CAPITAL PARTNERS, L.P.
By: Farallon Partners, L.L.C.
its General Partner
By:
-----------------------------------------
Name:
Title:
JMR CAPITAL PARTNERS
By:
-----------------------------------------
Name:
Title:
CREATIVE INFORMATION SYSTEMS, LLC
By:
-----------------------------------------
Name:
Title:
16
ANNEX A
-------
Registrable Securities
Name of Holder and Address Shares of Common Stock Held
-------------------------- ---------------------------
Xxxx X. Xxxxxxx 731,113
Xxxxx X. Xxxxx 731,113
Xxxxxx X. Xxxxxxxx, Xx. 731,113
JMR Capital Partners 506,319
Creative Information Systems, LLC 506,319
Farallon Capital Partners, L.P. 466,237
RR Capital Partners, L.P. 83,256
17
ANNEX B
-------
Xxxx X. Xxxxxxx
Xxxxx X. Xxxxx
Xxxxxx X. Xxxxxxxx, Xx.
Farallon Capital Partners, L.P.
RR Capital Partners, L.P.
18
ANNEX C
-------
Farallon Capital Partners, L.P.
RR Capital Partners, L.P.
19
