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Exhibit 10.5
Voting Agreement between certain holders of common stock in the Registrant
and the Registrant, dated March 17, 1999.
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DICOM IMAGING SYSTEMS, INC.
SHAREHOLDER VOTING AGREEMENT
THIS SHAREHOLDER VOTING AGREEMENT (THE "AGREEMENT") IS MADE AND ENTERED
INTO THIS 17 DAY OF MARCH, 1999, BY AND AMONG DICOM IMAGING SYSTEMS, INC., A
NEVADA CORPORATION (THE "COMPANY" OR "DICOM"), AND THOSE CERTAIN HOLDERS OF THE
COMPANY'S COMMON STOCK AND/OR OPTIONS TO PURCHASE COMMON STOCK WHO HAVE EXECUTED
A COUNTERPART SIGNATURE PAGE HERETO (THE "KEY SHAREHOLDERS").
WITNESSETH:
WHEREAS, THE KEY SHAREHOLDERS ARE THE BENEFICIAL OWNERS OF AN AGGREGATE
OF 2,400,000 SHARES OF THE COMMON STOCK OF THE COMPANY; AND
WHEREAS, IN CONNECTION WITH THE CONSUMMATION OF THE CAPITAL
CONTRIBUTION AGREEMENT DATED MARCH 17, 1999 (THE "CONTRIBUTION AGREEMENT"), THE
COMPANY AND THE KEY SHAREHOLDERS HAVE AGREED TO PROVIDE FOR THE FUTURE VOTING OF
THEIR SHARES OF THE COMPANY'S CAPITAL STOCK AS SET FORTH BELOW;
NOW, THEREFORE, IN CONSIDERATION OF THE MUTUAL COVENANTS CONTAINED
HEREIN AND FOR OTHER GOOD AND VALUABLE CONSIDERATION, THE RECEIPT AND
SUFFICIENCY OF WHICH ARE HEREBY ACKNOWLEDGED, THE PARTIES HERETO AGREE AS
FOLLOWS:
1. VOTING
1.1 SHARES. The Key Shareholders each agree to vote all shares of
voting capital stock of the Company registered in their respective
names or beneficially owned by them as of the date hereof (and any
and all other securities of the Company legally or beneficially
acquired by each of the Key Shareholders after the date hereof,
including stock received upon exercise of options now held or
hereafter received) (hereinafter collectively referred to as the
"Common Shares") in accordance with the provisions of this
Agreement.
1.2 ELECTION OF DIRECTORS. The Key Shareholders each agree that until
such time as this Agreement is terminated, the Company's Board of
Directors (the "Board") shall consist of five (5) members, each of
whom shall be elected by the Key Shareholders in the manner
described in this Section 1.2. The Key Shareholders agree to vote
all Common Shares held by them (or the holders thereof shall
consent pursuant to an action by written consent of the
shareholders) so as to nominate and elect members of the Company's
Board of Directors as follows:
1.2.1 Four (4) nominees shall be selected by the holders of
those shares of Dicom Common Stock issued to Torchmark pursuant to the
Contribution Agreement (the "Torchmark Shares").
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1.2.2 One (1) nominee shall be selected by Xxxxxxx Xxxxxx or a
designee thereof.
1.2.3 Any vote taken to remove any director elected pursuant
to this Section 1.2, or to fill any vacancy created by the resignation
of a director elected pursuant to this Section 1.2, shall also be
subject to the provisions of this Section 1.2.
1.3 The Key Shareholders each agree that until such time as this
Agreement is terminated, they will vote all Common Shares held by
them (or the holders thereof shall consent pursuant to an action by
written consent of the shareholders) against an amendment to the
Company's Articles of Incorporation to increase the number of
authorized shares of the Company.
1.4 LEGEND.
1.4.1 Concurrently with the execution of this Agreement, there
shall be imprinted or otherwise placed, on certificates representing
the Common Shares the following restrictive legend (the "Legend"):
"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE
TERMS AND CONDITIONS OF A SHAREHOLDERS AGREEMENT DATED
___________, 1999 WHICH PLACES CERTAIN RESTRICTIONS ON THE
VOTING OF THE SHARES REPRESENTED HEREBY. ANY PERSON ACCEPTING
ANY INTEREST IN SUCH SHARES SHALL BE DEEMED TO AGREE TO AND
SHALL BECOME BOUND BY ALL THE PROVISIONS OF SUCH AGREEMENT. A
COPY OF SUCH SHAREHOLDERS AGREEMENT WILL BE FURNISHED TO THE
RECORD HOLDER OF THIS CERTIFICATE WITHOUT CHARGE UPON WRITTEN
REQUEST TO THE COMPANY AT ITS PRINCIPAL PLACE OF BUSINESS."
1.4.2 The Company agrees that, during the term of this
Agreement, it will not remove, and will not permit to be removed (upon
registration of transfer, reissuance or otherwise), the Legend from any
such certificate and will place or cause to be placed the Legend on any
new certificate issued to represent Common Shares.
1.5 SUCCESSORS. The provisions of this Agreement shall be binding upon
the successors in interest to any of the Common Shares. The Company
shall not permit the transfer of any of the Common Shares on its
books or issue a new certificate representing any of the Common
Shares unless and until the person to whom such security is to be
transferred shall have executed a written agreement, substantially
in the form of this Agreement, pursuant to which such person
becomes a party to this Agreement and agrees to be bound by all the
provisions hereof as if such person were a Key Shareholder.
1.6 OTHER RIGHTS. Except as provided by this Agreement, each Key
Shareholder shall exercise the full rights of a shareholder with
respect to the Common Shares.
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2. REGISTRATION RIGHTS
2.1 REGISTRATION AND QUALIFICATION.
2.1.1 PIGGYBACK REGISTRATION. If the Company proposes to
register any equity security (as defined in Section 3(a)(11) of the Securities
Exchange Act of 1934, as amended) under the Securities Act of 1933, as amended
(the "Securities Act"), on any registration form prescribed by the Securities
and Exchange Commission (the "Commission") permitting a secondary offering or
distribution other than Form S-4 or S-8 (and other than a registration filed in
connection with an exchange offering or an offering of securities solely to
existing holders of the Company's securities), not less than 30 days prior to
each such registration, the Company shall give to the Key Shareholders written
notice of such proposal which shall describe in detail the proposed registration
and distribution (including those jurisdictions where registration or
qualification under the securities or blue sky laws is intended) and, upon the
written request of any Key Shareholder given within 15 days after the date of
any such notice, proceed to include in such registration such Common Shares as
have been requested by any such Key Shareholders to be included in such
registration. The Company will in each instance use its commercially reasonable
best efforts to cause any Common Shares (but not for when-issued trading), the
Key Shareholders of which shall have so requested registration thereof, to be
registered under the Securities Act and qualified under the securities or blue
sky laws of any jurisdiction requested by a prospective seller; provided, that
in the event such registration is an underwritten primary offering on behalf of
the Company and the managing underwriters advise the Company in writing that, in
their opinion, the number of securities requested to be included in such
registration exceeds the number which can be sold in such offering, the Company
will include in such registration, in descending order of priority, (i) first,
the aggregate number of securities to be issued by the Company, (ii) second, the
Common Shares requested by the Key Shareholders to be included in such
registration, and (iii) third, other securities requested to be included in such
registration; and provided further, that to the extent such priority violates
any agreement of the Company with respect to registration of its equity
securities, the shares covered in any such agreement shall be treated on a pro
rata basis with the Common Shares requested by the Key Shareholders to be
included in such registration. The Company will select the managing underwriters
for any offering made pursuant to this Section 2.1.1.
2.1.2 DEMAND REGISTRATION. The holders may: (i) on two (2)
occasions require the Company to effect the registration of Common Shares on
Form S-3 (or any successor form thereto, a "Short Form Registration); and (ii)
in the event a Short Form Registration is unavailable at the time of such
request on one (1) occasion, require the Company to effect the registration (but
not for when-issued trading) of Common Shares on Form S-1 (or any successor form
thereto, a "Long Form Registration"), in each case pursuant to the provisions of
this Section 2.1.2. If one or more Key Shareholders holding at least a majority
in interest of the Common Shares held by all Key Shareholders shall give notice
to the Company to the effect that such Key Shareholders desire to transfer
Common Shares pursuant to a public distribution (within the meaning of the
Securities Act), then the Company shall, as promptly as practicable after
receipt of such notice (but in any event within 90 days after receipt of such
notice), file a registration statement on the appropriate form pursuant to the
Securities Act and cause Common Shares to be registered under the Securities Act
and qualified under the securities or blue sky laws of any jurisdiction
requested by a prospective seller, to the end that such Common Shares may be
sold by the holders thereof under the Securities Act and pursuant to the
securities or blue sky laws of the jurisdictions requested, as promptly as is
practicable thereafter and the Company will use its best efforts to cause any
such registration to become effective and to keep the prospectus included
therein current until the distribution shall have been completed; provided that
such holders shall furnish the Company with such appropriate information in
connection therewith as the Company may reasonably request in writing.
Notwithstanding the foregoing, the Company shall not be required to effect any
registration hereunder for less than 100,000 Common Shares (subject to
appropriate adjustment in the case of stock dividends, stock splits,
recapitalizations and the like). The managing underwriters, if any, for any
offering made pursuant to this Section 2.1.2 shall be selected by the Company,
subject to the consent of the Key Shareholders participating in such offering,
which consent shall not be unreasonably withheld.
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2.1.3 TERMINATION OF REGISTRATION RIGHTS. The registration
rights contained in this Section 2 terminate at such time as all of the Common
Shares held by the Key Shareholders are either sold pursuant to an effective
registration statement under the Securities Act or are eligible for sale in any
period of three consecutive months pursuant to Rule 144 under the Securities
Act.
2.2 REGISTRATION AND QUALIFICATION PROCEDURES. Whenever the Company is
required by the provisions of Section 2.1 to use its commercially reasonable
best efforts to effect the registration of any of its securities under the
Securities Act, the Company will, as expeditiously as is practicable:
2.2.1 prepare and file with the Commission a registration
statement with respect to such securities;
2.2.2 prepare and file with the Commission 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
the prospectus current and to comply with the provisions of the Securities Act
with respect to the sale of all securities covered by such registration
statement whenever the seller of such securities shall desire to sell the same;
2.2.3 furnish to each seller such number of copies of the
registration statement, preliminary prospectuses and prospectuses and each
supplement or amendment thereto and such other documents as each seller may
reasonably request in order to facilitate the sale or other disposition of the
securities owned by such seller in conformity with (i) the requirements of the
Securities Act and (ii) the seller's proposed method of distribution;
2.2.4 register or qualify, or utilize an exemption from
registration or qualification with respect to, the securities covered by such
registration statement under the securities or blue sky laws of such
jurisdictions within the United States as each seller shall reasonably request,
to the extent possible, and do such other reasonable acts and things as may be
required of it to enable each seller to consummate the sale or other
disposition, in such jurisdictions, of the securities owned by such seller;
2.2.5 provide and cause to be maintained a transfer agent and
registrar for securities covered by such registration statement from and after a
date not later than the effective date of such registration statement;
2.2.6 if requested by the underwriters for any underwritten
offering of securities pursuant to a registration requested under Section 2.1,
the Company will enter into an underwriting agreement with such underwriters for
such offering, such agreement to contain such representations and warranties by
the Company and such other terms and provisions as are customarily contained in
underwriting agreements with respect to secondary distributions, including,
without limitation, provisions with respect to indemnities and contribution as
are reasonably satisfactory to such underwriters and the sellers; and the
sellers on whose behalf securities are to be distributed by such underwriters
will be parties to any such underwriting agreement and the representations and
warranties by, and the other agreements on the part of, the Company to and for
the benefit of such underwriters, will also be made to and for the benefit of
such sellers;
2.2.7 furnish, at the request of any seller, 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, (i) an opinion, dated such date, of the counsel representing the
Company for the purposes of such registration, addressed to the underwriters, if
any, covering such legal matters with respect to the registration in respect of
which such opinion is being given as are customarily included in such opinion
and (ii) letters, dated, respectively, (1) the effective date of the
registration statement and (2) the date such securities are delivered to the
underwriters, if any, for sale pursuant to such registration, from a firm of
independent certified public accountants of recognized standing selected by the
Company, addressed to the underwriters, if any, covering such financial,
statistical and accounting matters with respect to the registration in respect
of which such letters are being given as are customarily included in such
letters;
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2.2.8 otherwise use its commercially reasonable best efforts
to comply with all applicable rules and regulations of the Commission, and make
available to its security holders as soon as reasonably practicable, but not
later than 16 months after the effective date of the registration statement, an
earnings statement covering a period of at least 12 months beginning after the
effective date of the registration statement, which earnings statement shall
satisfy the provisions of Section 10(a) of the Securities Act;
2.2.9 make available for inspection by the sellers, any
underwriter participating in any disposition pursuant to such registration
statement, and any attorney, accountant or other agent retained by the sellers
or underwriter, all financial and other records, pertinent corporate documents
and properties of the Company, and cause the Company's officers, directors,
employees and independent accountants to supply all information reasonably
requested by the sellers, underwriter, attorney, accountant or agent in
connection with such registration statement;
2.2.10 keep each seller advised in writing as to the
initiation and progress of any registration under Section 2.1, as the case may
be; and
2.2.11 during the period when the registration statement is
required to be effective, notify each seller of the happening of any event as a
result of which the prospectus included in the registration statement contains
an untrue statement of a material fact or omits to state any material fact
required to be stated therein or necessary to make the statements therein not
misleading, and prepare a supplement or amendment to such prospectus so that, as
thereafter delivered to the purchasers of such securities, such prospectus will
not contain an untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein
not misleading.
2.2.12 Holder covenants and agrees that it will provide
customary representations and warranties and opinion of counsel, if requested by
the underwriters, if any, in any registered offering effected pursuant to
Section 2.1.
2.3 ALLOCATION OF EXPENSES. If the Company is required by the provision
of Section 2.1 to use its commercially reasonable best efforts to effect the
registration or qualification under the Securities Act or any state securities
or blue sky laws of any Common Shares, the Company will pay all expenses (other
than underwriters' discounts and commissions with respect to such shares and
legal fees and expenses of the Holders) in connection therewith, including,
without limitation, (a) all expenses incident to filing with the National
Association of Securities Dealers, Inc., (b) registration fees, (c) printing
expenses, (d) accounting and legal fees and expenses, (e) expenses of any
special audits incident to or required by any such registration or qualification
of the Company, (f) expenses of complying with the securities or blue sky laws
of any jurisdictions in connection with such registration or qualification and
(g) all listing and other stock exchange or Nasdaq fees.
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3. TERMINATION
3.1 This Agreement will continue in full force and effect from the date
hereof through the earliest of the following dates, on which it shall terminate
in its entirety (with the exception of the provisions of Section 2, which shall
survive any such termination until the period specified in Section 2.1.3):
3.1.1 the date on which the Company's Common Stock is first
listed on either (i) the Nasdaq National Market, or (ii) the New York
Stock Exchange; or
3.1.2 ten (10) years from the date of this Agreement;
4. MISCELLANEOUS
4.1 OWNERSHIP. Each Key Shareholder represents and warrants that (a)
she/he now owns the Common Shares, free and clear of liens or encumbrances, and
has not, prior to or on the date of this Agreement, executed or delivered any
proxy or entered into any other voting agreement or similar arrangement other
than one which has expired or terminated prior to the date hereof, and (b) such
Key Shareholder has full power and capacity to execute, deliver and perform this
Agreement, which has been duly executed and delivered by, and evidences the
valid and binding obligation of, such Key Shareholder enforceable in accordance
with its terms.
4.2 FURTHER ACTION. If and whenever the Common Shares are sold, the Key
Shareholders or the personal representative of the Key Shareholders shall do all
things and execute and deliver all documents and make all transfers, and cause
any transferee of the Common Shares to do all things and execute and deliver all
documents, as may be necessary to consummate such sale consistent with this
Agreement.
4.3 SPECIFIC PERFORMANCE. The parties hereto hereby declare that it is
impossible to measure in money the damages which will accrue to a party hereto
or to their heirs, personal representatives, or assigns by reason of a failure
to perform any of the obligations under this Agreement and agree that the terms
of this Agreement shall be specifically enforceable. If any party hereto or his
heirs, personal representatives, or assigns institutes any action or proceeding
to specifically enforce the provisions hereof, any person against whom such
action or proceeding is brought hereby waives the claim or defense therein that
such party or such personal representative has an adequate remedy at law, and
such person shall not offer in any such action or proceeding the claim or
defense that such remedy at law exists.
4.4 AMENDMENT OR WAIVER. This Agreement may be amended (or provisions
of this Agreement waived) only by an instrument in writing signed by (i) the
Company, and (ii) all of the Key Shareholders. Any amendment or waiver so
effected shall be binding upon the Company, each of the parties hereto and any
assignee of any such party.
4.5 SEVERABILITY. If any provision of this Agreement is held to be
invalid or unenforceable, the validity and enforceability of the remaining
provisions of this Agreement shall not be affected thereby unless such
construction would clearly be contrary to the intention of the parties or would
result in an unconscionable injustice.
4.6 SUCCESSORS. This Agreement shall inure to the benefit of and be
binding upon the parties hereto and their respective heirs, successors, assigns,
administrators, executors and other legal representatives.
4.7 ADDITIONAL SHARES. In the event that subsequent to the date of this
Agreement any shares or other securities (other than any shares or securities of
another corporation issued to the Company's shareholders pursuant to a plan of
merger) are issued on, or in exchange for, any of the Common Shares by reason of
any stock dividend, stock split, consolidation of shares, reclassification or
consolidation involving the Company, such shares or securities shall be deemed
to be Common Shares for purposes of this Agreement.
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4.8 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which will be deemed an original but all of which together
shall constitute one and the same agreement.
4.9 WAIVER. No waivers of any breach of this Agreement extended by any
party hereto to any other party shall be construed as a waiver of any rights or
remedies of any other party hereto or with respect to any subsequent breach.
4.10 ATTORNEY'S FEES. In the event that any dispute among the parties
to this Agreement should result in litigation, the most prevailing party in such
dispute shall be entitled to recover from the other party all fees, costs and
expenses reasonably incurred to enforce any right of such prevailing party under
or with respect to this Agreement, including without limitation, such reasonable
fees and expenses of attorneys, which shall include, without limitation,
reasonable fees, costs and expenses of appeals.
4.11 ENTIRE AGREEMENT. This Agreement and the Exhibits hereto, along
with the Capital Contribution Agreement and each of the associated agreements,
Annexes, and schedules thereto, constitute the full and entire understanding and
agreement between the parties with regard to the subjects hereof and thereof and
no party shall be liable or bound to any other in any manner by any
representations, warranties, covenants and agreements except as specifically set
forth herein and therein.
4.12 GOVERNING LAW. This Agreement shall be governed by and construed
under the laws of the State of Nevada, without application of its conflict of
laws provisions. The parties hereby irrevocably and unconditionally submit in
any legal action or proceeding relating to this Agreement to the non-exclusive
general jurisdiction of the courts of the State of Nevada and of the United
States located in Xxxxx County, Nevada and, in any such action or proceeding,
consent to jurisdiction in such courts and waive any objection to the venue in
any such court.
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IN WITNESS WHEREOF, the parties hereto have executed this Shareholders
Agreement as of the date first above written.
COMPANY:
DICOM IMAGING SYSTEMS, INC.
By:
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Title:
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KEY SHAREHOLDERS:
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Torchmark Holdings
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Xxxxx Xxxxxx
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Xxxxxx Xxxxx
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