Attached files
file | filename |
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8-K - FORM 8-K - REHABCARE GROUP INC | d69880e8vk.htm |
EX-99.8 - EX-99.8 - REHABCARE GROUP INC | d69880exv99w8.htm |
EX-99.9 - EX-99.9 - REHABCARE GROUP INC | d69880exv99w9.htm |
EX-99.1 - EX-99.1 - REHABCARE GROUP INC | d69880exv99w1.htm |
EX-99.6 - EX-99.6 - REHABCARE GROUP INC | d69880exv99w6.htm |
EX-99.4 - EX-99.4 - REHABCARE GROUP INC | d69880exv99w4.htm |
EX-99.2 - EX-99.2 - REHABCARE GROUP INC | d69880exv99w2.htm |
EX-99.3 - EX-99.3 - REHABCARE GROUP INC | d69880exv99w3.htm |
EX-99.5 - EX-99.5 - REHABCARE GROUP INC | d69880exv99w5.htm |
EX-99.7 - EX-99.7 - REHABCARE GROUP INC | d69880exv99w7.htm |
EX-99.10 - EX-99.10 - REHABCARE GROUP INC | d69880exv99w10.htm |
EXHIBIT
99.11
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this Agreement) is made and entered into as of November
3, 2009, by and among RehabCare Group, Inc., a Delaware corporation (the Company), and the
several stockholders signatory hereto (each, a Stockholder and collectively, the Stockholders).
This Agreement is made pursuant to that certain Backstop Securities Agreement, dated as of the
date hereof, by and among the Company and each Stockholder (the Backstop Agreement).
NOW, THEREFORE, IN CONSIDERATION of the mutual covenants contained in this Agreement, and for
other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged,
the Company and each of the Stockholders agree as follows:
1. Definitions. Capitalized terms used and not otherwise defined herein that are
defined in the Backstop Agreement shall have the meanings given such terms in the Backstop
Agreement. As used in this Agreement, the following terms shall have the following meanings:
Advice has the meaning set forth in Section 7(c).
Affiliate means, with respect to any Person, any other Person which directly or indirectly
controls, is controlled by, or is under common control with, such Person.
Aggregate Preferred Stock Issue Price means the sum of (i) the Aggregate Series A Issue
Price plus (ii) the Aggregate Series B Issue Price.
Aggregate Series A Issue Price means, with respect to each Holder, the product of (i) the
number of shares of Series A Preferred Stock issued or issuable to such Holder pursuant to the
Backstop Agreement in accordance with the Merger Agreement multiplied by (ii) the Series A
Original Issue Price.
Aggregate Series B Issue Price means, with respect to each Holder, the product of (i) the
number of shares of Series A Preferred Stock issued or issuable to such Holder pursuant to the
Backstop Agreement in accordance with Merger Agreement multiplied by (ii) the Series B
Original Issue Price.
Agreement has the meaning set forth in the Preamble.
Backstop Agreement has the meaning set forth in the Recitals.
Business Day means a day, other than a Saturday or Sunday, on which banks in New York City
are open for the general transaction of business.
Certificate of Designations means the Certificate of Powers, Designations, Preferences and
Rights of the Series A Convertible Redeemable Preferred Stock and Series B Redeemable Non-Voting
Preferred Stock of RehabCare Group, Inc.
Closing has the meaning set forth in the Backstop Agreement.
Closing Date has the meaning set forth in the Backstop Agreement.
Commission means the Securities and Exchange Commission.
Common Stock means the common stock of the Company, par value $0.01 per share, and any
securities into which such common stock may hereinafter be reclassified.
Company has the meaning set forth in the Preamble and shall include any successor entity
thereto.
Demand Registration Statement has the meaning set forth in Section 2(c)(i).
Effective Date means the date that the Registration Statement filed pursuant to Section
2(a) is first declared effective by the Commission.
Effectiveness Deadline means, with respect to the Initial Registration Statement or the New
Registration Statement, the earlier of (i) the ninetieth (90th) calendar day following
the Closing Date and (ii) the 3rd Trading Day after the date the Company is notified
(orally or in writing, whichever is earlier) by the Commission that such Registration Statement
will not be reviewed or will not be subject to further review; provided that if the Effectiveness
Deadline falls on a Saturday, Sunday or other day that the Commission is closed for business, the
Effectiveness Deadline shall be extended to the next Business Day on which the Commission is open
for business.
Effectiveness Period has the meaning set forth in Section 2(b).
Event has the meaning set forth in Section 2(d).
Event Date has the meaning set forth in Section 2(d).
Exchange Act means the Securities Exchange Act of 1934, as amended, and the rules and
regulations promulgated thereunder.
Filing Deadline means, with respect to the Initial Registration Statement required to be
filed pursuant to Section 2(a), the fifth (5th) Business Day following the
Merger Agreement Closing Date.
Holder or Holders means the holder or holders, as the case may be, from time to time, of
Registrable Securities.
Indemnified Party has the meaning set forth in Section 5(c).
Indemnifying Party has the meaning set forth in Section 5(c).
Initial Registration Statement means the initial Registration Statement filed pursuant to
Section 2(a) of this Agreement.
Initiating Holders has the meaning set forth in Section 2(c)(i).
Liquidated Damages has the meaning set forth in Section 2(d).
Losses has the meaning set forth in Section 5(a).
Merger Agreement means that certain Agreement and Plan of Merger, dated as of the date
hereof, by and among the Company, RehabCare Group East, Inc., RehabCare Merger Sub
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Corporation, Triumph Healthcare Holdings, Inc. and certain other parties named therein, as the
same may be amended, restated, modified or supplemented in accordance with its terms.
Merger Agreement Closing Date means the Closing Date (as such term is defined in the
Merger Agreement).
New Registration Statement has the meaning set forth in Section 2(a).
Person means an individual or corporation, partnership, trust, incorporated or
unincorporated association, joint venture, limited liability company, joint stock company,
government (or an agency or subdivision thereof) or other entity of any kind.
Principal Market means the Trading Market on which the Common Stock is primarily listed on
and quoted for trading, which, as of the Closing Date, shall be the New York Stock Exchange.
Proceeding means an action, claim, suit, investigation or proceeding (including, without
limitation, an investigation or partial proceeding, such as a deposition), whether commenced or
threatened.
Prospectus means the prospectus included in a Registration Statement (including, without
limitation, a prospectus that includes any information previously omitted from a prospectus filed
as part of an effective registration statement in reliance upon Rule 430A promulgated under the
Securities Act), as amended or supplemented by any prospectus supplement, with respect to the terms
of the offering of any portion of the Registrable Securities covered by a Registration Statement,
and all other amendments and supplements to the Prospectus, including post-effective amendments,
and all material incorporated by reference or deemed to be incorporated by reference in such
Prospectus.
Registrable Securities means all of (i) the Shares and (ii) any securities issued or
issuable upon any stock split, dividend or other distribution, recapitalization or similar event
with respect to the foregoing; provided that the Holder has completed and delivered to the Company
a Selling Stockholder Questionnaire; and provided, further, that with respect to a particular
Holder, such Holders Shares shall cease to be Registrable Securities upon a sale pursuant to a
Registration Statement or Rule 144 under the Securities Act (in which case, only such securities
sold by the Holder shall cease to be a Registrable Security). Notwithstanding anything to the
contrary set forth herein, for purposes of calculating the number of Registrable Securities to be
covered by the Registration Statements described in Section 2, such number shall include
(x) the shares of Common Stock issuable upon conversion of the Series A Preferred Stock, (y) the
shares of Common Stock issuable upon conversion of the Series A Preferred Stock to be issued,
subject to obtaining the Stockholder Approval (as defined in the Backstop Agreement), upon
conversion of the Series B Preferred Stock into the Series A Preferred Stock (including any
payment-in-kind dividends with respect the Series B Preferred Stock) and (z) any shares of Common
Stock issued or issuable upon conversion of any payment-in-kind dividends with respect to the
Series A Preferred Stock or the Series B Preferred Stock.
Registration Statements means any one or more registration statements of the Company filed
under the Securities Act that covers the resale of any of the Registrable Securities pursuant to
the provisions of this Agreement, including, without limitation, the Initial Registration
Statement, the New Registration Statement, any Remainder Registration Statements and any Demand
Registration Statements, amendments and supplements to such Registration Statements, including
post-effective amendments, all exhibits and all material incorporated by reference or deemed to be
incorporated by reference in such Registration Statements.
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Remainder Registration Statement has the meaning set forth in Section 2(a).
Rule 144 means Rule 144 promulgated by the Commission pursuant to the Securities Act, as
such Rule may be amended from time to time, or any similar rule or regulation hereafter adopted by
the Commission having substantially the same effect as such Rule.
Rule 415 means Rule 415 promulgated by the Commission pursuant to the Securities Act, as
such Rule may be amended from time to time, or any similar rule or regulation hereafter adopted by
the Commission having substantially the same effect as such Rule.
Rule 424 means Rule 424 promulgated by the Commission pursuant to the Securities Act, as
such Rule may be amended from time to time, or any similar rule or regulation hereafter adopted by
the Commission having substantially the same effect as such Rule.
SEC Guidance means (i) any publicly-available written or oral guidance, comments,
requirements or requests of the Commission staff and (ii) the Securities Act.
Securities Act means the Securities Act of 1933, as amended, and the rules and regulations
promulgated thereunder.
Selling Stockholder Questionnaire means a questionnaire in the form attached as Annex
B hereto, or such other form of questionnaire as may reasonably be adopted by the Company from
time to time.
Series A Original Issue Price means the Series A Original Issue Price (as defined in the
Certificate of Designations).
Series B Original Issue Price means the Series B Original Issue Price (as defined in the
Certificate of Designations).
Series A Preferred Stock means the Series A Convertible Redeemable Preferred Stock of the
Company, par value $0.10 per share, and any securities into which such they may hereinafter be
reclassified.
Series B Preferred Stock means the Series B Non-Voting Redeemable Preferred Stock of the
Company, par value $0.10 per share, and any securities into which such they may hereinafter be
reclassified.
Shares means (i) the shares of Common Stock issued or issuable upon conversion of the Series
A Preferred Stock held by any Stockholder and (ii) the shares of Common Stock issued or issuable
upon conversion of the Series A Preferred Stock held by any Stockholder to be issued, subject to
the approval of the stockholders of the Company, upon conversion of the Series B Preferred Stock
into the Series A Preferred Stock held by any Stockholder, in each case, whether such preferred
shares are now held or hereafter acquired by such Stockholder.
Stockholder or Stockholders has the meaning set forth in the Preamble.
Total Aggregate Preferred Stock Issue Price the sum of the Aggregate Preferred Stock Issue
Prices of the shares of Series A Preferred Stock and Series B Preferred Stock issued or issuable to
the Stockholders pursuant to the Backstop Agreement in accordance with the Merger Agreement.
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Trading Day means (i) a day on which the Common Stock is listed or quoted and traded on its
Principal Market (other than the OTC Bulletin Board), or (ii) if the Common Stock is not listed on
a Trading Market (other than the OTC Bulletin Board), a day on which the Common Stock is traded in
the over-the-counter market, as reported by the OTC Bulletin Board, or (iii) if the Common Stock is
not quoted on any Trading Market, a day on which the Common Stock is quoted in the over-the-counter
market as reported in the pink sheets by Pink Sheets LLC (or any similar organization or agency
succeeding to its functions of reporting prices); provided that in the event that the Common Stock
is not listed or quoted as set forth in (i), (ii) or (iii) hereof, then Trading Day shall mean a
Business Day.
Trading Market means whichever of the New York Stock Exchange, the American Stock Exchange,
the NASDAQ Global Select Market, the NASDAQ Global Market, the NASDAQ Capital Market or OTC
Bulletin Board on which the Common Stock is listed or quoted for trading on the date in question.
2. Registration.
(a) On or prior to the Filing Deadline, the Company shall prepare and file with the Commission
a Registration Statement covering the resale of all of the Registrable Securities for an offering
to be made on a continuous basis pursuant to Rule 415 or, if Rule 415 is not available for offers
and sales of the Registrable Securities, by such other means of distribution of Registrable
Securities as the Holders may reasonably specify (the Initial Registration Statement). The
Initial Registration Statement shall be on Form S-3 (except if the Company is then ineligible to
register for resale the Registrable Securities on Form S-3, in which case such registration shall
be on such other form available to register for resale the Registrable Securities as a secondary
offering) subject to the provisions of Section 2(f) and shall contain (except if otherwise
required pursuant to written comments received from the Commission upon a review of such
Registration Statement) the Plan of Distribution section attached hereto as Annex A
(which may be modified to respond to comments, if any, provided by the Commission).
Notwithstanding the registration obligations set forth in this Section 2, in the event the
Commission informs the Company that all of the Registrable Securities cannot, as a result of the
application of Rule 415, be registered for resale as a secondary offering on a single registration
statement, the Company agrees to promptly (i) inform each of the Holders thereof and use its
reasonable best efforts to file amendments to the Initial Registration Statement as required by the
Commission and/or (ii) withdraw the Initial Registration Statement and file a new registration
statement (a New Registration Statement), in either case covering the maximum number of
Registrable Securities permitted to be registered by the Commission, on Form S-3 or such other form
available to register for resale the Registrable Securities as a secondary offering; provided,
however, that prior to filing such amendment or New Registration Statement, the Company shall be
obligated to use its reasonable best efforts to advocate with the Commission for the registration
of all of the Registrable Securities in accordance with the SEC Guidance, including, without
limitation, the Manual of Publicly Available Telephone Interpretations D.29. Notwithstanding any
other provision of this Agreement and subject to the payment of Liquidated Damages (as defined in
Section 2(d)), if any SEC Guidance sets forth a limitation of the number of Registrable
Securities permitted to be registered on a particular Registration Statement as a secondary
offering (and notwithstanding that the Company used reasonable best efforts to advocate with the
Commission for the registration of all or a greater number of Registrable Securities), unless
otherwise directed in writing by a Holder as to its Registrable Securities, the number of
Registrable Securities to be registered on such Registration Statement will be reduced on a pro
rata basis based on the total number of unregistered Registrable Securities issuable to such
Holders, subject to a determination by the Commission that certain Holders must be reduced first
based on the number of Registrable Securities issuable to such Holders). In the event the Company
amends the Initial Registration Statement or files a New Registration Statement, as the case may
be, the Company will use its reasonable best efforts to file
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with the Commission, as promptly as allowed by Commission or SEC Guidance provided to the
Company or to registrants of securities in general, one or more registration statements on Form S-3
or such other form available to register for resale those Registrable Securities that were not
registered for resale on the Initial Registration Statement, as amended, or the New Registration
Statement (the Remainder Registration Statements).
(b) The Company shall use its reasonable best efforts to cause each Registration Statement to
be declared effective by the Commission as soon as practicable and, with respect to the Initial
Registration Statement or the New Registration Statement, as applicable, no later than the
Effectiveness Deadline (including filing with the Commission a request for acceleration of
effectiveness in accordance with Rule 461 promulgated under the Securities Act), and shall use its
reasonable best efforts to keep each Registration Statement continuously effective under the
Securities Act until the earlier of (i) such time as all of the Registrable Securities covered by
such Registration Statement have been publicly sold by the Holders or (ii) the date that all
Registrable Securities covered by such Registration Statement may be sold by the Stockholders
without volume or manner-of-sale restrictions pursuant to Rule 144, without the requirement for the
Company to be in compliance with the current public information requirement under Rule 144 as
determined by counsel to the Company pursuant to a written opinion letter to such effect, addressed
and reasonably acceptable to the Companys transfer agent (the Effectiveness Period); provided,
however, that if such Registration Statement is no longer continuously effective due to the
occurrence of the event specified in clause (ii) and at any time thereafter the event specified in
clause (ii) ceases to be true for any reason, then the Company shall use its reasonable best
efforts to cause a new Registration Statement covering the resale of all of the Registrable
Securities to be declared effective by the Commission as soon as practicable, and the Company shall
be subject to the terms and conditions of this Agreement with respect to any such new Registration
Statement. The Company shall request effectiveness of a Registration Statement as of 5:00 p.m. New
York City time on a Trading Day. The Company shall promptly notify the Holders via facsimile or
electronic mail of a .pdf format data file of the effectiveness of a Registration Statement on
the same Trading Day that the Company telephonically confirms effectiveness with the Commission.
The Company shall use its reasonable best efforts to file, by 9:30 a.m. New York City time on the
first Trading Day after the Effective Date, a final Prospectus with the Commission, as required by
Rule 424(b). Failure to so notify the Holders on or before the second Trading Day after such
notification of effectiveness is required to be given or the failure to file a final Prospectus
within the aforementioned timeframe shall be deemed an Event under Section 2(d).
(c) Demand Registrations.
(i) At any time after the Closing Date, the Holders of a majority of the then outstanding
Registrable Securities held by all Holders (the Initiating Holders) may request that the Company
register under the Securities Act all or any portion of the Registrable Securities held by such
Initiating Holders (a Demand Registration Statement). Upon receipt of such request, the Company
shall promptly deliver notice of such request to all other Holders, if any, who shall then have ten
(10) Business Days to notify the Company in writing of their desire to be included in such
registration. If the request for registration contemplates an underwritten public offering, the
Company shall state such in the written notice and in such event the right of any Holder to
participate in such registration shall be conditioned upon such Holders participation in such
underwritten public offering and the inclusion of their Registrable Securities in the underwritten
public offering to the extent provided herein. The Company shall use its reasonable best efforts
to effect the registration of all Registrable Securities whose Holders request, pursuant to this
Section 2(c)(i), participation in such registration under the Securities Act and to qualify
such Registrable Securities for sale under any state blue sky law; provided that the Company shall
not be required to qualify generally to do business in any jurisdiction where it is not then so
qualified, subject the Company to any material tax in any such jurisdiction where it is not then so
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subject or file a general consent to service of process in any such jurisdiction; provided
further that (A) the Company shall not be required to effect registration pursuant to a request
under this Section 2(c)(i) more than two (2) times if the Total Aggregate Preferred Stock
Issue Price is greater than or equal to $50,000,000 and (B) the Company shall not be required to
effect registration pursuant to a request under this Section 2(c)(i) more than one (1) time
if the Total Aggregate Preferred Stock Issue Price is greater than or equal to $25,000,000 and less
than $50,000,000, it being understood that the Company shall have no obligation to effect
registration pursuant to a request under this Section 2(c)(i) if the Total Aggregate
Preferred Stock Issue Price is less than $25,000,000. Notwithstanding anything to the contrary
contained herein, no request may be made under this Section 2(c)(i) within ninety (90) days
after the effective date of a Registration Statement filed by the Company covering a firm
commitment underwritten public offering in which the Holders shall have been entitled to join
pursuant to this Section 2(c)(i) or Section 2(g) hereof and in which there shall
have been effectively registered all shares of Registrable Securities as to which registration
shall have been so requested subject to the ability of the managing underwriter or underwriters of
such firm commitment underwritten public offering to reduce the number of Registrable Securities
pursuant to Section 2(c)(ii). A registration will not count as a requested registration
under this Section 2(c)(i) until the Demand Registration Statement relating to such
registration has been declared effective by the Commission at the request of the Initiating
Holders; provided, however, that if the Initiating Holders shall request, in writing, that the
Company withdraw a Demand Registration Statement which has been filed under this Section
2(c)(i) but has not yet been declared effective, the Initiating Holders may thereafter request
the Company to reinstate such Demand Registration Statement, if permitted under the Securities Act,
or to file another Demand Registration Statement, in accordance with the procedures set forth
herein. In addition, a registration will not count as a requested registration under this
Section 2(c)(i) in the event that any Registrable Securities sought to be included by the
Holders in such registration are excluded from such registration in accordance with Section
2(c)(ii) or Section 2(g).
(ii) If the managing underwriter or underwriters of an underwritten public offering reasonably
determine in writing that the number of securities sought to be offered should be limited due to
market conditions, then the number of securities to be included in such underwritten public
offering shall be reduced to a number deemed satisfactory by such managing underwriter or
underwriters; provided, however, that securities shall be excluded in the following
sequence: (i) first, shares of Common Stock held by any stockholder not having rights to include
such shares in the underwritten public offering; (ii) second, Registrable Securities held by all
Holders other than the Initiating Holders; (iii) third, Registrable Securities held by the
Initiating Holders; and (iv) fourth, shares of Common Stock sought to be registered by the Company
for its own account. If there is a reduction of some but not all of the number of shares pursuant
to clauses (i) through (iv), such reduction shall be made on a pro rata basis (based upon the
aggregate number of securities held by the holders in the applicable category and subject to the
priorities set forth in the preceding sentence).
(iii) With respect to a request for registration pursuant to Section 2(c)(i), which is
for an underwritten public offering, the managing underwriter shall be chosen by the Initiating
Holders, subject to the consent of the Company, which consent shall not be unreasonably withheld or
delayed. The Company shall not be required to register any Registrable Securities pursuant to this
Section 2(c) unless the Holders of such Registrable Securities accept the terms of the
underwriting agreed upon between the Company and the managing underwriter or underwriters. All
Holders proposing to distribute their securities through such underwriting shall (together with the
Company and any other stockholders proposing to distribute their securities through such
underwriting) enter into an underwriting agreement in customary form with the underwriters.
(d) If: (i) the Initial Registration Statement is not filed with the Commission on or prior to
the Filing Deadline, (ii) the Initial Registration Statement or the New Registration Statement, as
applicable, is not declared effective by the Commission (or otherwise does not become effective)
for any
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reason on or prior to the Effectiveness Deadline, (iii) after its Effective Date, (A) such
Registration Statement ceases for any reason (including, without limitation, by reason of a stop
order, or the Companys failure to update the Registration Statement) to remain continuously
effective as to all Registrable Securities included in such Registration Statement or (B) the
Holders are not permitted to utilize the Prospectus therein to resell such Registrable Securities
for any reason for more than an aggregate of twenty (20) consecutive calendar days or forty (40)
calendar days (which need not be consecutive days) during any twelve (12) month period, or (iv) the
Company fails to satisfy the current public information requirement pursuant to Rule 144(c)(1) as a
result of which the Holders who are not Affiliates are unable to sell Registrable Securities
without restriction under Rule 144 (or any successor thereto) (any such failure or breach in
clauses (i) through (iv) above being referred to as an Event, and, for purposes of clauses (i),
(ii) or (iv), the date on which such Event occurs, or for purposes of clause (iii), the date on
which such twenty (20) or forty (40) calendar day period is exceeded, being referred to as an
Event Date), then, in addition to any other rights the Holders may have hereunder or under
applicable law, on each such Event Date and on each monthly anniversary of each such Event Date (if
the applicable Event shall not have been cured by each such monthly anniversary date) until the
earlier of (1) the applicable Event is cured or (2) the date that all Registrable Securities
covered by such Registration Statement may be sold by the Stockholders without volume or
manner-of-sale restrictions pursuant to Rule 144, without the requirement for the Company to be in
compliance with the current public information requirement under Rule 144 as determined by counsel
to the Company pursuant to a written opinion letter to such effect, addressed and reasonably
acceptable to the Companys transfer agent, the Company shall pay to each Holder an amount in cash,
as partial liquidated damages and not as a penalty (Liquidated Damages), equal to one and
one-half percent (1.5%) of the Aggregate Preferred Stock Issue Price. The parties agree that (1)
notwithstanding anything to the contrary herein or in the Backstop Agreement, no Liquidated Damages
shall be payable with respect to any period after the expiration of the Effectiveness Period
(except in respect of an Event described in Section 2(d)(iv) herein) (it being understood
that this sentence shall not relieve the Company of any Liquidated Damages accruing prior to the
Effectiveness Deadline), and in no event shall the aggregate amount of Liquidated Damages
(excluding Liquidated Damages payable in respect of an Event described in Section 2(d)(iv)
herein) payable to a Holder exceed, in the aggregate, ten percent (10%) of the Aggregate Preferred
Stock Issue Price per annum (calculated on a rolling twelve-month basis) (or twelve percent (12%)
of the Aggregate Preferred Stock Issue Price per annum (calculated on a rolling twelve-month basis)
if the only Event is of the type described in Section 2(d)(iv) herein) and (2) in no event
shall the Company be liable in any thirty (30) day period for Liquidated Damages under this
Agreement in excess of one and one-half percent (1.5%) of the Aggregate Preferred Stock Issue
Price. If the Company fails to pay any Liquidated Damages pursuant to this Section 2(d) in
full within five (5) Business Days after the date on which such Liquidated Damages become due and
payable, the Company shall pay interest thereon at a rate of one and one-half percent (1.5%) per
month (or such lesser maximum amount that is permitted to be paid by applicable law) to the Holder,
accruing daily from the date such Liquidated Damages are due until such amounts, plus all such
interest accrued but unpaid thereon, are paid in full. The Liquidated Damages described in this
Section 2(d) shall apply on a daily pro-rata basis for any portion of a month prior to the
cure of an Event, except in the case of the first Event Date. The Company shall not be liable for
Liquidated Damages under this Agreement as to any Registrable Securities which are not permitted by
the Commission to be included in a Registration Statement due solely to SEC Guidance from the time
that it is determined that such Registrable Securities are not permitted to be registered until
such time as the provisions of this Agreement as to the Remainder Registration Statements required
to be filed hereunder are triggered, in which case the provisions of this Section 2(d)
shall once again apply, if applicable. In such case, the Liquidated Damages shall be calculated to
only apply to the percentage of Registrable Securities which are permitted in accordance with SEC
Guidance to be included in such Registration Statement. The Effectiveness Deadline for a
Registration Statement shall be extended without default or Liquidated Damages hereunder in the
event that the Companys failure to obtain the effectiveness of the Registration Statement on a
timely basis results from the failure of a Stockholder to timely provide the
8
Company with information requested by the Company and necessary to complete the Registration
Statement in accordance with the requirements of the Securities Act (in which case the
Effectiveness Deadline would be extended with respect to Registrable Securities held by such
Stockholder).
(e) Each Holder has furnished to the Company a completed Selling Stockholder Questionnaire
prior to the date hereof. At least ten (10) Trading Days prior to the first anticipated filing
date of a Registration Statement for any registration under this Agreement, the Company will notify
each Holder of the information the Company requires from that Holder other than the information
contained in the Selling Stockholder Questionnaire, if any, which shall be completed and delivered
to the Company promptly upon request and, in any event, at least three (3) Trading Days prior to
the applicable anticipated filing date. Each Holder further agrees that it shall not be entitled
to be named as a selling securityholder in the Registration Statement or use the Prospectus for
offers and resales of Registrable Securities at any time, unless such Holder has returned to the
Company a completed and signed Selling Stockholder Questionnaire and a response to any requests for
further information as described in the previous sentence. If a Holder of Registrable Securities
returns a Selling Stockholder Questionnaire or a request for further information, in either case,
after its respective deadline, the Company shall use its reasonable best efforts to take such
actions as are required to name such Holder as a selling securityholder in the Registration
Statement or any pre-effective or post-effective amendment thereto and to include (to the extent
not theretofore included) in the Registration Statement the Registrable Securities identified in
such late Selling Stockholder Questionnaire or request for further information. Each Holder
acknowledges and agrees that the information in the Selling Stockholder Questionnaire or request
for further information as described in this Section 2(e) will be used by the Company in
the preparation of the Registration Statement and hereby consents to the inclusion of such
information in the Registration Statement.
(f) In the event that Form S-3 is not available for the registration of the resale of
Registrable Securities hereunder, the Company shall (i) register the resale of the Registrable
Securities on another appropriate form reasonably acceptable to the Holders and (ii) undertake to
register the Registrable Securities on Form S-3 promptly after such form is available, provided
that the Company shall maintain the effectiveness of the Registration Statement then in effect
until such time as a Registration Statement on Form S-3 covering the Registrable Securities has
been declared effective by the Commission.
(g) If the Company proposes to register in an underwritten offering any of its shares of
Common Stock under the Securities Act for sale to the public (other than a registration effected
solely to implement an employee benefit plan or a transaction to which Rule 145 of the Securities
Act is applicable, or a registration statement on Form S-4, S-8 or another form not available for
registering the Registrable Securities for sale to the public), each such time it will give prior
written notice to each Holder. Upon the written request of any of such Holders, given within ten
(10) Business Days after receipt by such Person of such notice, the Company shall, subject to the
limits contained in this Section 2(g), use its reasonable best efforts to cause all
Registrable Securities requested by such Holders to be registered under the Securities Act and
qualified for sale under any state securities or blue sky law, to the extent required to permit
the sale of their Registrable Securities in such underwritten public offering; provided,
however, that if the managing underwriter or underwriters of such offering reasonably
determine in writing that the number of securities sought to be offered should be limited due to
market conditions, then the number of securities to be included in such underwritten public
offering shall be reduced to a number deemed satisfactory by such managing underwriter or
underwriters; provided, however, that securities shall be excluded in the following
sequence: (i) first, shares of Common Stock held by any stockholder not having rights to include
such shares in the underwritten public offering; (ii) second, Registrable Securities held by all
Holders; and (iii) third, shares of Common Stock sought to be registered by the Company for its own
account. If there is a reduction of some but not all of the number of shares pursuant to clauses
(i) through (ii), such reduction shall be made on a pro rata basis (based upon
9
the aggregate number of securities held by the holders in the applicable category and subject
to the priorities set forth in the preceding sentence). Additionally, the Company shall not be
required to register any Registrable Securities pursuant to this Section 2(g) unless the
Holders of such Registrable Securities accept the terms of the underwriting agreed upon between the
Company and the underwriters selected by the Company (or by other persons entitled to select the
underwriters). All Holders proposing to distribute their securities through such underwriting
shall (together with the Company and any other stockholders proposing to distribute their
securities through such underwriting) enter into an underwriting agreement in customary form with
the underwriters.
3. Registration Procedures
In connection with the Companys registration obligations hereunder, the Company shall:
(a) Not less than five (5) Trading Days prior to the filing of the Initial Registration
Statement, not less than ten (10) Trading Days prior to the filing of any other Registration
Statement and not less than two (2) Trading Days prior to the filing of any related Prospectus or
any amendment or supplement thereto (except for Annual Reports on Form 10-K, Quarterly Reports on
Form 10-Q, Current Reports on Form 8-K and any similar or successor reports), (i) furnish to the
Holder copies of such Registration Statement, Prospectus or amendment or supplement thereto, as
proposed to be filed, the selling stockholder and other applicable information contained therein,
which will be subject to the review of such Holder (it being acknowledged and agreed that if a
Holder does not object to or comment on the aforementioned portions of the documents within such
five (5) Trading Day, ten (10) Trading Day or two (2) Trading Day period, as the case may be, then
the Holder shall be deemed to have consented to and approved the use of such documents) and (ii)
use reasonable best efforts to cause its officers and directors, counsel and independent registered
public accountants to respond to such inquiries as shall be necessary, in the reasonable opinion of
respective counsel to each Holder, to conduct a reasonable investigation within the meaning of the
Securities Act. The Company shall not file any Registration Statement or amendment or supplement
thereto in a form to which a Holder reasonably objects in good faith, provided that, the Company is
notified of such objection in writing within the five (5) Trading Day, ten (10) Trading Day or two
(2) Trading Day period described above, as applicable.
(b) (i) Prepare and file with the Commission such amendments (including post-effective
amendments) and supplements to each Registration Statement and the Prospectus used in connection
therewith as may be necessary to keep such Registration Statement continuously effective as to the
applicable Registrable Securities for its Effectiveness Period; (ii) cause the related Prospectus
to be amended or supplemented by any required Prospectus supplement (subject to the terms of this
Agreement), and, as so supplemented or amended, to be filed pursuant to Rule 424; (iii) respond as
promptly as reasonably practicable to any comments received from the Commission with respect to
each Registration Statement or any amendment thereto and, as promptly as reasonably practicable,
provide the Holders true and complete copies of all correspondence from and to the Commission
relating to such Registration Statement that pertains to the Holders as Selling Stockholders but
not any comments that would result in the disclosure to the Holders of material and non-public
information concerning the Company; and (iv) comply with the provisions of the Securities Act and
the Exchange Act with respect to the disposition of all Registrable Securities covered by a
Registration Statement until such time as all of such Registrable Securities (A) shall have been
disposed of (subject to the terms of this Agreement) in accordance with the intended methods of
disposition by the Holders thereof as set forth in such Registration Statement as so amended or in
such Prospectus as so supplemented or (B) covered by such Registration Statement may be sold by the
Stockholders without volume or manner-of-sale restrictions pursuant to Rule 144, without the
requirement for the Company to be in compliance with the current public information requirement
under Rule 144 as determined by counsel to the Company pursuant to a written opinion letter to such
effect, addressed and reasonably acceptable to the Companys transfer
10
agent; provided, however, that each Stockholder shall be responsible for the delivery of the
Prospectus to the Persons to whom such Stockholder sells any of its Shares (including in accordance
with Rule 172 under the Securities Act), and each Stockholder agrees to dispose of Registrable
Securities in compliance with the Plan of Distribution described in the Registration Statement
and otherwise in compliance with applicable federal and state securities laws. In the case of
amendments and supplements to a Registration Statement which are required to be filed pursuant to
this Agreement (including pursuant to this Section 3(b)) by reason of the Company filing a
report on Form 10-K, Form 10-Q or Form 8-K or any analogous report under the Exchange Act, the
Company shall have incorporated such report by reference into such Registration Statement, if
applicable, or shall file such amendments or supplements with the Commission on the same day on
which the Exchange Act report which created the requirement for the Company to amend or supplement
such Registration Statement was filed.
(c) Notify the Holders (which notice shall, pursuant to clauses (iii) through (vi) hereof, be
accompanied by an instruction to suspend the use of the Prospectus until the requisite changes have
been made) as promptly as reasonably practicable (and, in the case of (i)(A) below, not less than
two (2) Trading Days prior to such filing) and (if requested by any such Person) confirm such
notice in writing no later than two (2) Trading Day following the day: (i)(A) when a Prospectus or
any Prospectus supplement or post-effective amendment to a Registration Statement is proposed to be
filed; (B) when the Commission notifies the Company whether there will be a review of such
Registration Statement and whenever the Commission comments in writing on any Registration
Statement (in which case the Company shall provide to each of the Holders true and complete copies
of all comments that pertain to the Holders as a Selling Stockholder or to the Plan of
Distribution and all written responses thereto, but not information that the Company believes
would constitute material and non-public information); and (C) with respect to each Registration
Statement or any post-effective amendment, when the same has become effective; (ii) of any request
by the Commission or any other Federal or state governmental authority for amendments or
supplements to a Registration Statement or Prospectus or for additional information that pertains
to the Holders as Selling Stockholders or the Plan of Distribution; (iii) of the issuance by
the Commission or any other federal or state governmental authority of any stop order suspending
the effectiveness of a Registration Statement covering any or all of the Registrable Securities or
the initiation of any Proceedings for that purpose; (iv) of the receipt by the Company of any
notification with respect to the suspension of the qualification or exemption from qualification of
any of the Registrable Securities for sale in any jurisdiction, or the initiation or threatening of
any Proceeding for such purpose; (v) of the occurrence of any event or passage of time that makes
the financial statements included in a Registration Statement ineligible for inclusion therein or
any statement made in such Registration Statement or Prospectus or any document incorporated or
deemed to be incorporated therein by reference untrue in any material respect or that requires any
revisions to such Registration Statement, Prospectus or other documents so that, in the case of
such Registration Statement or the Prospectus, as the case may be, 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, form of Prospectus or
supplement thereto, in the light of the circumstances under which they were made), not misleading
and (vi) of the occurrence or existence of any pending corporate development with respect to the
Company that the Company believes may be material and that, in the determination of the Company,
makes it not in the best interest of the Company to allow continued availability of a Registration
Statement or Prospectus; provided that any and all such information shall remain confidential to
each Holder until such information otherwise becomes public, unless disclosure by a Holder is
required by law; and provided, further, that notwithstanding each Holders agreement to keep such
information confidential, each such Holder makes no acknowledgement that any such information is
material, non-public information.
(d) Use reasonable best efforts to avoid the issuance of, or, if issued, obtain the withdrawal
of (i) any order suspending the effectiveness of a Registration Statement, or (ii) any
11
suspension of the qualification (or exemption from qualification) of any of the Registrable
Securities for sale in any jurisdiction, as soon as practicable.
(e) If requested by a Holder, furnish to such Holder, without charge, at least one conformed
copy of each Registration Statement and each amendment thereto and all exhibits to the extent
requested by such Person (including those previously furnished or incorporated by reference)
promptly after the filing of such documents with the Commission; provided that the Company shall
have no obligation to provide any document pursuant to this clause (e) that is available on the
Commissions EDGAR system.
(f) Prior to any resale of Registrable Securities by a Holder, use its reasonable best efforts
to register or qualify or cooperate with the selling Holders in connection with the registration or
qualification (or exemption from the registration or qualification) of such Registrable Securities
for the resale by the Holder under the securities or Blue Sky laws of such jurisdictions within the
United States as any Holder reasonably requests in writing, to keep each registration or
qualification (or exemption therefrom) effective during the Effectiveness Period and to do any and
all other acts or things reasonably necessary to enable the disposition in such jurisdictions of
the Registrable Securities covered by each Registration Statement; provided that the Company shall
not be required to qualify generally to do business in any jurisdiction where it is not then so
qualified, subject the Company to any material tax in any such jurisdiction where it is not then so
subject or file a general consent to service of process in any such jurisdiction.
(g) If requested by a Holder, cooperate with such Holder to facilitate the timely preparation
and delivery of certificates representing Registrable Securities to be delivered to a transferee
pursuant to the Registration Statement, which certificates shall be free of all restrictive
legends, to the extent permitted by the Backstop Agreement and under law, and to enable such
Registrable Securities to be in such denominations and registered in such names as any such Holder
may reasonably request.
(h) Following the occurrence of any event contemplated by Section 3(c), as promptly as
reasonably practicable, prepare a supplement or amendment, including a post-effective amendment, to
the affected Registration Statement or a supplement to the related Prospectus or any document
incorporated or deemed to be incorporated therein by reference, and file any other required
document so that, as thereafter delivered, no Registration Statement nor any Prospectus will
contain any untrue statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein (in the case of any Prospectus, form of
Prospectus or supplement thereto, in the light of the circumstances under which they were made),
not misleading. If the Company notifies the Holders in accordance with clauses (iii) through (vi)
of Section 3(c) above to suspend the use of any Prospectus until the requisite changes to
such Prospectus have been made, then the Holders shall suspend use of such Prospectus. The Company
will use its reasonable best efforts to ensure that the use of the Prospectus may be resumed as
promptly as is practicable. The Company shall be entitled to exercise its right under this
Section 3(h) to suspend the availability of a Registration statement and Prospectus,
subject to the payment of partial Liquidated Damages otherwise required pursuant to Section
2(d), for a period not to exceed forty (40) calendar days (which need not be consecutive days)
in any twelve (12) month period.
(i) Have the option to require each selling Holder to furnish to the Company a certified
statement as to (i) the number of Shares beneficially owned by such Holder and any Affiliate
thereof, (ii) any Financial Industry Regulatory Authority (FINRA) affiliations, (iii) any natural
persons who have the power to vote or dispose of the Shares and (iv) any other information as may
be requested by the Commission, FINRA or any state securities commission. During any periods that
the Company is unable to meet its obligations hereunder with respect to the registration of
Registrable Securities because
12
any Holder fails to furnish such information within five (5) Trading Days of the Companys
request, any Liquidated Damages that are accruing at such time as to such Holder only shall be
tolled and any Event that may otherwise occur solely because of such delay shall be suspended as to
such Holder only, until such information is delivered to the Company.
(j) Cooperate with any registered broker through which a Holder proposes to resell its
Registrable Securities in effecting a filing with FINRA pursuant to FINRA Rule 5110 as requested by
any such Holder and the Company shall pay the filing fee required for the first such filing within
two (2) Business Days of the request therefor.
(k) With respect to any underwritten or agented offering, (i) make available members of the
management of the Company for reasonable assistance in selling efforts related to such offering
(including, without limitation, senior management attendance at due diligence meetings with
underwriters and their counsel and road shows), (ii) enter into underwriting or placement agency
agreements containing usual and customary terms and conditions for such types of offerings and
(iii) take all such other actions in connection therewith customarily undertaken by issuers in
order to expedite or facilitate the disposition of Registrable Securities in connection therewith,
including, without limitation: (A) making such reasonable and customary representations and
warranties to the underwriters or placement agents with respect to the business of the Company, the
Registration Statement pursuant to which the sale of the Registrable Securities is to be
registered, the Prospectus and any documents, if any, incorporated or deemed to be incorporated by
reference therein, as may reasonably be required by the underwriters or placement agents; (B)
obtaining reasonable and customary opinions of counsel to the Company and updates thereof,
addressed to the Holders and each of the underwriters or placement agents; (C) obtaining reasonable
and customary cold comfort letters and updates thereof from the independent certified public
accountants of the Company addressed to the Holders and each of the underwriters; (D) ensuring
that, if an underwriting agreement or placement agency agreement is entered into, such agreement
shall contain indemnification provisions and procedures that are usual and customary for an
offering of such size; (E) filing with the SEC a final Prospectus with respect to the offering that
satisfies the requirements of Section 10(a) of the Securities Act as soon as practicable following
the pricing of the offering and, in any event, prior to the first scheduled date for delivery by
the Holders to the underwriters, placement agents or purchasers of Registrable Securities in the
offering; and (F) delivering such documents and certificates as may be reasonably requested by the
underwriters, placement agents or purchasers and their respective counsel to evidence the continued
validity of the representations and warranties made pursuant to clause (A) of this Section
3(k).
4. Registration Expenses. All fees and expenses incident to the Companys performance
of or compliance with its obligations under this Agreement (excluding any underwriting discounts
and selling commissions) shall be borne by the Company whether or not any Registrable Securities
are sold pursuant to a Registration Statement. The fees and expenses referred to in the foregoing
sentence shall include, without limitation, (i) all registration and filing fees (including,
without limitation, fees and expenses (A) with respect to filings required to be made with any
Trading Market on which the Common Stock is then listed for trading, (B) with respect to compliance
with applicable state securities or Blue Sky laws (including, without limitation, fees and
disbursements of counsel for the Company in connection with Blue Sky qualifications or exemptions
of the Registrable Securities and determination of the eligibility of the Registrable Securities
for investment under the laws of such jurisdictions as requested by the Holders), (C) if not
previously paid by the Company in connection with Section 3(j) above, with respect to any
filing that may be required to be made by any broker through which a Holder intends to make sales
of Registrable Securities with FINRA pursuant to the FINRA Rule 5110, so long as the broker is
receiving no more than a customary brokerage commission in connection with such sale and (D) with
respect to any underwritten or agented offering), (ii) printing expenses (including, without
limitation, expenses of printing certificates for Registrable Securities and of printing
prospectuses if the printing of
13
prospectuses is reasonably requested by the Holders of a majority of the Registrable
Securities included in the Registration Statement), (iii) messenger, telephone and delivery
expenses, (iv) fees and disbursements of counsel for the Company, including, without limitation,
fees incurred in connection with obtaining any legal opinions, (v) customary fees and expenses for
independent certified public accountants retained by the Company (including the expenses of any
comfort letters, or costs associated with the delivery by independent certified public accountants
of a comfort letter or comfort letters, if such comfort letter or comfort letters is required by
the managing underwriter), (vi) with respect to each registration or underwritten offering, fees
and disbursements, up to a maximum of $100,000, of one counsel selected by Holders of a majority of
the then outstanding Registrable Securities, (vii) Securities Act liability insurance, if the
Company so desires such insurance, and (viii) fees and expenses of all other Persons retained by
the Company in connection with the consummation of the transactions contemplated by this Agreement.
In addition, the Company shall be responsible for all of its internal expenses incurred in
connection with the consummation of the transactions contemplated by this Agreement (including,
without limitation, all salaries and expenses of its officers and employees performing legal or
accounting duties), the expense of any annual audit and the fees and expenses incurred in
connection with the listing of the Registrable Securities on any securities exchange as required
hereunder. In no event shall the Company be responsible for any underwriting, broker or similar
fees or commissions of any Holder or, except to the extent provided for in the Transaction
Documents, any legal fees or other costs of the Holders.
5. Indemnification.
(a) Indemnification by the Company. The Company shall, notwithstanding any
termination of this Agreement, indemnify, defend and hold harmless each Holder, the officers,
directors, agents, partners, members, managers, stockholders, Affiliates and employees of any such
Holder, each Person who controls any such Holder (within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act) and the officers, directors, partners, members,
managers, stockholders, agents and employees of any such controlling Person, to the fullest extent
permitted by applicable law, from and against any and all losses, claims, damages, liabilities,
costs (including, without limitation, reasonable costs of preparation and investigation and
reasonable attorneys fees) and expenses (collectively, Losses), as incurred, that arise out of
or are based upon (i) any untrue or alleged untrue statement of a material fact contained in any
Registration Statement, any Prospectus or any form of Prospectus or in any amendment or supplement
thereto or in any preliminary prospectus, or arising out of or relating to any omission or alleged
omission to state a material fact required to be stated therein or necessary to make the statements
therein (in the case of any Prospectus or form of Prospectus or supplement thereto, in light of the
circumstances under which they were made) not misleading, or (ii) any violation or alleged
violation by the Company of the Securities Act, the Exchange Act or any state securities law or any
rule or regulation thereunder, in connection with the performance of its obligations under this
Agreement, except to the extent, but only to the extent, that (A) such untrue statements, alleged
untrue statements, omissions or alleged omissions are based solely upon information regarding such
Holder furnished in writing to the Company by such Holder expressly for use therein, or to the
extent that such information relates to such Holder or such Holders proposed method of
distribution of Registrable Securities and was reviewed and approved in writing by such Holder
expressly for use in the Registration Statement, such Prospectus or such form of Prospectus or in
any amendment or supplement thereto (it being understood that each Holder has approved Annex
A hereto for this purpose) or (B) in the case of an occurrence of an event of the type
specified in Section 3(c)(iii)-(vi), related to the use by a Holder of an outdated
or defective Prospectus after the Company has notified such Holder in writing that the Prospectus
is outdated or defective and prior to the receipt by such Holder of the Advice contemplated and
defined in Section 7(c) below, to the extent that following the receipt of the Advice the
misstatement or omission giving rise to such Loss would have been corrected or (C) to the extent
that any such Losses arise out of the Stockholders (or any other indemnified Persons) failure to
send or give a copy of the Prospectus or supplement (as then
14
amended or supplemented), if required, pursuant to Rule 172 under the Securities Act (or any
successor rule) to the Persons asserting an untrue statement or alleged untrue statement or
omission or alleged omission at or prior to the written confirmation of the sale of Registrable
Securities to such Person if such statement or omission was corrected in such Prospectus or
supplement. The Company shall notify the Holders promptly of the institution, threat or assertion
of any Proceeding arising from or in connection with the transactions contemplated by this
Agreement of which the Company is aware. Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of an Indemnified Party (as defined in
Section 5(c)) and shall survive the transfer of the Registrable Securities by the Holders.
(b) Indemnification by Holders. Each Holder shall, severally and not jointly,
indemnify and hold harmless the Company, its directors, officers, agents and employees, each Person
who controls the Company (within the meaning of Section 15 of the Securities Act and Section 20 of
the Exchange Act), and the directors, officers, agents or employees of such controlling Persons, to
the fullest extent permitted by applicable law, from and against all Losses, as incurred, arising
out of or based solely upon any untrue or alleged untrue statement of a material fact contained in
any Registration Statement, any Prospectus, or any form of Prospectus, or in any amendment or
supplement thereto or in any preliminary prospectus, or arising out of or relating to any omission
or alleged omission of a material fact required to be stated therein or necessary to make the
statements therein (in the case of any Prospectus, or any form of Prospectus or supplement thereto,
in light of the circumstances under which they were made) not misleading (i) to the extent that
such untrue statements or omissions are based solely upon information regarding such Holder
furnished in writing to the Company by such Holder expressly for use therein or (ii) to the extent
that such information relates to such Holder or such Holders proposed method of distribution of
Registrable Securities and was reviewed and approved in writing by such Holder expressly for use in
a Registration Statement (it being understood that the Holder has approved Annex A hereto
for this purpose), such Prospectus or such form of Prospectus or in any amendment or supplement
thereto or (iii) in the case of an occurrence of an event of the type specified in Section
3(c)(iii)-(vi), to the extent related to the use by such Holder of an outdated or
defective Prospectus after the Company has notified such Holder in writing that the Prospectus is
outdated or defective and prior to the receipt by such Holder of the Advice contemplated in
Section 7(c). In no event shall the liability of any selling Holder hereunder be greater
in amount than the dollar amount of the net proceeds received by such Holder upon the sale of the
Registrable Securities giving rise to such indemnification obligation.
(c) Conduct of Indemnification Proceedings.
(i) If any Proceeding shall be brought or asserted against any Person entitled to indemnity
hereunder (an Indemnified Party), such Indemnified Party shall promptly notify the Person from
whom indemnity is sought (the Indemnifying Party) in writing; provided that the failure of any
Indemnified Party to give such notice shall not relieve the Indemnifying Party of its obligations
or liabilities pursuant to this Agreement, except (and only) to the extent that it shall be finally
determined by a court of competent jurisdiction (which determination is not subject to appeal or
further review) that such failure shall have materially and adversely prejudiced the Indemnifying
Party.
(ii) An Indemnified Party shall have the right to employ separate counsel in any such
Proceeding and to participate in the defense thereof, but the fees and expenses of such counsel
shall be at the expense of such Indemnified Party or Parties unless: (1) the Indemnifying Party
has agreed in writing to pay such fees and expenses or (2) the named parties to any such Proceeding
(including any impleaded parties) include both such Indemnified Party and the Indemnifying Party,
and such Indemnified Party shall have been advised by counsel that a conflict of interest exists if
the same counsel were to represent such Indemnified Party and the Indemnifying Party; provided that
the Indemnifying Party shall not be liable for the fees and expenses of more than one separate firm
of attorneys at any time
15
for all Indemnified Parties. The Indemnifying Party shall not be liable for any settlement of
any such Proceeding effected without its prior written consent, which consent shall not be
unreasonably withheld, delayed or conditioned. No Indemnifying Party shall, without the prior
written consent of the Indemnified Party, settle any pending Proceeding in respect of which any
Indemnified Party is a party, unless such settlement includes an unconditional release of such
Indemnified Party from all liability for claims that are the subject matter of such Proceeding.
(iii) Subject to the terms of this Agreement, all fees and expenses of the Indemnified Party
(including reasonable fees and expenses to the extent incurred in connection with investigating or
preparing to defend such Proceeding in a manner not inconsistent with this Section 5) shall
be paid to the Indemnified Party, as incurred, within fifteen (15) Trading Days of written notice
thereof to the Indemnifying Party; provided that the Indemnified Party shall promptly reimburse the
Indemnifying Party for that portion of such fees and expenses applicable to such actions for which
such Indemnified Party is finally judicially determined to not be entitled to indemnification
hereunder. The failure to deliver written notice to the Indemnifying Party within a reasonable time
of the commencement of any such action shall not relieve such Indemnifying Party of any liability
to the Indemnified Party under this Section 5, except to the extent that the Indemnifying
Party is materially and adversely prejudiced in its ability to defend such action.
(d) Contribution.
(i) If a claim for indemnification under Section 5(a) or 5(b) is unavailable
to an Indemnified Party or insufficient to hold an Indemnified Party harmless for any Losses, then
each 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, in such proportion as
is appropriate to reflect the relative fault of the Indemnifying Party and Indemnified Party in
connection with the actions, statements or omissions that resulted in such Losses as well as any
other relevant equitable considerations. The relative fault 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 of a material fact, has been taken or made by, or relates to information supplied
by, such Indemnifying Party or Indemnified Party, and the parties relative intent, knowledge,
access to information and opportunity to correct or prevent such action, statement or omission.
The amount paid or payable by a party as a result of any Losses shall be deemed to include, subject
to the limitations set forth in this Agreement, any reasonable attorneys fees or other reasonable
fees or expenses incurred by such party in connection with any Proceeding to the extent such party
would have been indemnified for such fees or expenses if the indemnification provided for in this
Section 5 was available to such party in accordance with its terms.
(ii) The parties hereto agree that it would not be just and equitable if contribution pursuant
to this Section 5(d) were determined by pro rata allocation or by any other method of
allocation that does not take into account the equitable considerations referred to in the
immediately preceding paragraph. Notwithstanding the provisions of this Section 5(d), (A)
no Holder shall be required to contribute, in the aggregate, any amount in excess of the amount by
which the net proceeds actually received by such Holder from the sale of the Registrable Securities
subject to the Proceeding exceeds the amount of any damages that such Holder has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission or alleged
omission and (B) no contribution shall be required under circumstances where the maker of such
contribution would not have been required to indemnify the Indemnified Party under the fault
standards set forth in this Section 5. No Person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from
any Person who was not guilty of such fraudulent misrepresentation.
16
(iii) The indemnity and contribution agreements contained in this Section 5 are
in addition to any liability that the Indemnifying Parties may have to the Indemnified Parties and
are not in diminution or limitation of the indemnification provisions under the Backstop Agreement.
6. Market Stand-off.
(a) Each Holder agrees, if requested by the Company and the managing underwriter of
Registrable Securities in connection with any equity financing closed by the Company prior to the
Merger Agreement Closing Date, not to directly or indirectly lend, pledge, offer, sell, contract to
sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any
option, right or warrant for the sale of or otherwise dispose of or transfer any equity securities
of the Company held by it for forty-five (45) days following the effective date of the registration
statement filed under the Securities Act in connection with such financing, as such underwriter
shall specify reasonably and in good faith; provided that, in the event that any Person subject to
a similar lock up arrangement in connection with such financing is released from such lock up in
whole or in part (notice of such release to be given by the managing underwriters and/or the
Company to all Holders at least five (5) Business Days in advance), all Holders shall at the time
of such release automatically be released to the same extent so that, for the avoidance of doubt,
if 50% of a Persons equity interests in the Company are released, 50% of each Holders Registrable
Securities are also so released. Each Investor shall enter into customary letter agreements to the
foregoing effect if so requested by the Company and any managing underwriter.
(b) In order to enforce the foregoing covenant, the Company may impose stop-transfer
instructions with respect to the securities of the Company held by each Holder (and the securities
of every other person subject to the foregoing restriction) until the end of such period.
7. Miscellaneous.
(a) Remedies. In the event of a breach by the Company or by a Holder of any of their
respective obligations under this Agreement, each Holder or the Company, as the case may be, in
addition to being entitled to exercise all rights granted by law and under this Agreement,
including recovery of damages, shall be entitled to injunctive relief and/or specific performance
of its rights under this Agreement. The Company and each Holder agree that monetary damages would
not provide adequate compensation for any losses incurred by reason of a breach by it of any of the
provisions of this Agreement and hereby further agrees that, in the event of any action for
injunctive relief and/or specific performance in respect of such breach, it shall waive the defense
that a remedy at law would be adequate.
(b) No Piggyback on Registrations; Prohibition on Filing Other Registration
Statements. Except and to the extent specified in the disclosure schedules to the Backstop
Agreement, neither the Company nor any of its securityholders (other than the Holders in such
capacity pursuant hereto) may include previously issued and outstanding securities of the Company
in a Registration Statement other than the Registrable Securities and the Company shall not enter
into any agreement providing any such right to any of its securityholders prior to the Effective
Date. The Company shall not file with the Commission a registration statement relating to an
offering for its own account under the Securities Act of any of its equity securities other than a
registration statement on Form S-8 or, in connection with an acquisition, on Form S-4 until the
date that is ninety (90) days after the Initial Registration Statement or New Registration
Statement, as the case may be, is declared effective. For the avoidance of doubt, the Company
shall not be prohibited from preparing and filing with the Commission a registration statement
relating to an offering of Common Stock by existing stockholders of the Company under the
Securities Act pursuant to the terms of registration rights held by such stockholders or from
filing amendments to registration statements filed prior to the date of this Agreement.
17
(c) Discontinued Disposition. By its acquisition of Registrable Securities, each
Holder agrees that, upon receipt of a notice from the Company of the occurrence of any event of the
kind described in Section 3(c)(iii)-(vi), such Holder will forthwith discontinue
disposition of such Registrable Securities under a Registration Statement until it is advised in
writing (the Advice) by the Company that the use of the applicable Prospectus (as it may have
been supplemented or amended) may be resumed. The Company will use its reasonable best efforts
to ensure that the use of the Prospectus may be resumed as promptly as is practicable. The Company
agrees and acknowledges that any periods during which the Holder is required to discontinue the
disposition of the Registrable Securities hereunder shall be subject to the provisions of
Section 2(d).
(d) No Inconsistent Agreements. Neither the Company nor any of its Subsidiaries has
entered into, as of the date hereof, nor shall the Company or any of its Subsidiaries, on or after
the date hereof, enter into, any agreement with respect to its securities that would have the
effect of impairing the rights granted to the Holders in this Agreement or otherwise conflicts with
the provisions hereof.
(e) Amendments and Waivers; Termination. The provisions of this Agreement, including
the provisions of this sentence, may not be amended, modified or supplemented, or waived unless the
same shall be in writing and signed by the Company and Holders holding no less than a majority of
the then outstanding Registrable Securities held by the Holders, provided that any party may give a
waiver as to itself; provided further that no amendment, modification or waiver shall be made or
granted in a manner that by its terms materially and adversely affects a Holders rights hereunder
without the approval of such Holder, unless such modification, amendment or waiver adversely
affects all Holders in the same manner proportionate to their respective holdings of Registrable
Securities. Notwithstanding the foregoing, a waiver or consent to depart from the provisions
hereof with respect to a matter that relates exclusively to the rights of Holders and that does not
directly or indirectly affect the rights of other Holders may be given by Holders of all of the
Registrable Securities to which such waiver or consent relates; provided, however, that the
provisions of this sentence may not be amended, modified, or supplemented except in accordance with
the provisions of the immediately preceding sentence. Notwithstanding anything to the contrary
contained in this Agreement or in the Merger Agreement, if the Merger (as defined in the Merger
Agreement) is not consummated in accordance with the terms and conditions set forth in the Merger
Agreement and no Backstop Securities are issued or issuable under the terms and conditions of the
Backstop Agreement, then this Agreement shall automatically terminate and be of no further force or
effect.
(f) Notices. Any and all notices or other communications or deliveries required or
permitted to be provided hereunder shall be delivered as set forth in the Backstop Agreement.
(g) Successors and Assigns. This Agreement shall inure to the benefit of and be
binding upon the successors and permitted assigns of each of the parties and shall inure to the
benefit of each Holder and each pledgee, donee, transferee, distributee or successor in interest of
any or all of such Holders Registrable Securities. Nothing in this Agreement, express or implied,
is intended to confer upon any party other than the parties hereto or their respective successors
and permitted assigns any rights, remedies, obligations, or liabilities under or by reason of this
Agreement, except as expressly provided in this Agreement. The Company may not assign its rights
(except by merger or consolidation or in connection with another entity acquiring all or
substantially all of the Companys assets) or obligations hereunder without the prior written
consent of all of the Holders of the then outstanding Registrable Securities.
(h) Execution and Counterparts. This Agreement may be executed in two or more
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 and shall become effective when
counterparts have
18
been signed by each party and delivered to the other party, it being understood that both
parties need not sign the same counterpart. In the event that any signature is delivered by
facsimile transmission or by e-mail delivery of a .pdf format data file, such signature shall
create a valid and binding obligation of the party executing such signature (or on whose behalf
such signature is executed) with the same force and effect as if such facsimile or .pdf signature
were the original thereof.
(i) Governing Law. All questions concerning the construction, validity, enforcement
and interpretation of this Agreement shall be determined in accordance with the provisions of the
Backstop Agreement.
(j) Cumulative Remedies. The remedies provided herein are cumulative and not
exclusive of any other remedies provided by law.
(k) Severability. If any term, provision, covenant or restriction of this Agreement
is held by a court of competent jurisdiction to be invalid, illegal, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in
full force and effect and shall in no way be affected, impaired or invalidated, and the parties
hereto shall use their reasonable best efforts to find and employ an alternative means to achieve
the same or substantially the same result as that contemplated by such term, provision, covenant or
restriction. It is hereby stipulated and declared to be the intention of the parties that they
would have executed the remaining terms, provisions, covenants and restrictions without including
any of such that may be hereafter declared invalid, illegal, void or unenforceable.
(l) Headings. The headings in this Agreement are for convenience only and shall not
limit or otherwise affect the meaning hereof.
(m) Independent Nature of Stockholders Obligations and Rights. The obligations of
each Stockholder under this Agreement are several and not joint with the obligations of any other
Stockholder hereunder, and no Stockholder shall be responsible in any way for the performance of
the obligations of any other Stockholder hereunder. Nothing contained herein or in any other
agreement or document delivered at any closing, and no action taken by any Stockholder pursuant
hereto or thereto, shall be deemed to constitute the Stockholders as a partnership, an association,
a joint venture or any other kind of entity, or create a presumption that the Stockholders are in
any way acting in concert with respect to such obligations or the transactions contemplated by this
Agreement. Each Stockholder shall be entitled to protect and enforce its rights, including,
without limitation, the rights arising out of this Agreement, and it shall not be necessary for any
other Stockholder to be joined as an additional party in any Proceeding for such purpose.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
19
IN WITNESS WHEREOF, the parties have executed this Registration Rights Agreement as of the
date first written above.
REHABCARE GROUP, INC. |
||||
By: | /s/ Patricia S. Williams | |||
Name: | Patricia S. Williams | |||
Title: | Senior Vice President, General Counsel and Secretary |
|||
[Signature Page to Registration Rights Agreement]
IN
WITNESS WHEREOF, the parties have executed this Registration Rights Agreement as of the date
first written above.
NAME OF INVESTING ENTITY | ||||||
TA IX, L.P. | ||||||
AUTHORIZED SIGNATORY | ||||||
By: | TA Associates IX LLC | |||||
Its: | General Partner | |||||
By: | TA Associates, Inc. | |||||
Its: | Manager | |||||
By: | /s/ Michael Berk | |||||
Name: | Michael Berk | |||||
Its: | Managing Director | |||||
ADDRESS FOR NOTICE | ||||||
c/o: | ||||||
Street: | ||||||
City/State/Zip: | ||||||
Attention: | ||||||
Tel: | ||||||
Fax: | ||||||
Email: | ||||||
[Signature Page to Registration Rights Agreement]
IN
WITNESS WHEREOF, the parties have executed this Registration Rights Agreement as of the date
first written above.
NAME OF INVESTING ENTITY | ||||||
TA/ATLANTIC AND PACIFIC IV L.P. | ||||||
AUTHORIZED SIGNATORY | ||||||
By: | TA Associates AP IV L.P. | |||||
Its: | General Partner | |||||
By: | TA Associates, Inc. | |||||
Its: | Manager | |||||
By: | /s/ Michael Berk | |||||
Name: | Michael Berk | |||||
Its: | Managing Director | |||||
ADDRESS FOR NOTICE | ||||||
c/o: | ||||||
Street: | ||||||
City/State/Zip: | ||||||
Attention: | ||||||
Tel: | ||||||
Fax: | ||||||
Email: | ||||||
[Signature Page to Registration Rights Agreement]
IN
WITNESS WHEREOF, the parties have executed this Registration Rights Agreement as of the date
first written above.
NAME OF INVESTING ENTITY | ||||||
TA STRATEGIC PARTNERS FUND A L.P. | ||||||
AUTHORIZED SIGNATORY | ||||||
By: | TA Associates SPF L.P. | |||||
Its: | General Partner | |||||
By: | TA Associates, Inc. | |||||
Its: | General Partner | |||||
By: | /s/ Michael Berk | |||||
Name: | Michael Berk | |||||
Its: | Managing Director | |||||
ADDRESS FOR NOTICE | ||||||
c/o: | ||||||
Street: | ||||||
City/State/Zip: | ||||||
Attention: | ||||||
Tel: | ||||||
Fax: | ||||||
Email: | ||||||
[Signature Page to Registration Rights Agreement]
IN
WITNESS WHEREOF, the parties have executed this Registration Rights Agreement as of the date
first written above.
NAME OF INVESTING ENTITY | ||||||
TA STRATEGIC PARTNERS FUND B L.P. | ||||||
By: | TA Associates SPF L.P. | |||||
Its: | General Partner | |||||
By: | TA Associates, Inc. | |||||
Its: | General Partner | |||||
By: | /s/ Michael Berk | |||||
Name: | Michael Berk | |||||
Its: | Managing Director | |||||
ADDRESS FOR NOTICE | ||||||
c/o: | ||||||
Street: | ||||||
City/State/Zip: | ||||||
Attention: | ||||||
Tel: | ||||||
Fax: | ||||||
Email: | ||||||
[Signature Page to Registration Rights Agreement]
IN
WITNESS WHEREOF, the parties have executed this Registration Rights Agreement as of the date
first written above.
NAME OF INVESTING ENTITY | ||||||
TA INVESTORS II, L.P. | ||||||
AUTHORIZED SIGNATORY | ||||||
By: | TA Associates, Inc. | |||||
Its: | General Partner | |||||
By: | /s/ Michael Berk | |||||
Name: | Michael Berk | |||||
Its: | Managing Director | |||||
ADDRESS FOR NOTICE | ||||||
c/o: | ||||||
Street: | ||||||
City/State/Zip: | ||||||
Attention: | ||||||
Tel: | ||||||
Fax: | ||||||
Email: | ||||||
[Signature Page to Registration Rights Agreement]
IN
WITNESS WHEREOF, the parties have executed this Registration Rights Agreement as of the date
first written above.
NAME OF INVESTING ENTITY | ||||||
TA SUBORDINATED DEBT FUND, L.P. | ||||||
AUTHORIZED SIGNATORY | ||||||
By: | TA Associates, Inc. | |||||
Its: | General Partner | |||||
By: | /s/ Michael Berk | |||||
Name: | Michael Berk | |||||
Its: | Managing Director | |||||
ADDRESS FOR NOTICE | ||||||
c/o: | ||||||
Street: | ||||||
City/State/Zip: | ||||||
Attention: | ||||||
Tel: | ||||||
Fax: | ||||||
Email: | ||||||
[Signature Page to Registration Rights Agreement]
IN
WITNESS WHEREOF, the parties have executed this Registration Rights Agreement as of the date
first written above.
NAME OF INVESTING ENTITY | ||||||
PARIBAS NORTH AMERICA, INC. | ||||||
AUTHORIZED SIGNATORY | ||||||
By: | /s/ Everett Schenk | |||||
Name: | Everett Schenk | |||||
Title: | President/CEO | |||||
ADDRESS FOR NOTICE | ||||||
c/o: | ||||||
Street: | ||||||
City/State/Zip: | ||||||
Attention: | ||||||
Tel: | ||||||
Fax: | ||||||
Email: | ||||||
[Signature Page to Registration Rights Agreement]
IN
WITNESS WHEREOF, the parties have executed this Registration Rights Agreement as of the date
first written above.
NAME OF INVESTING ENTITY | ||||||
PARIBAS NORTH AMERICA, INC. | ||||||
AUTHORIZED SIGNATORY | ||||||
By: | /s/ Dennis Lerner | |||||
Name: | Dennis Lerner | |||||
Title: | Tax Director | |||||
ADDRESS FOR NOTICE | ||||||
c/o: | ||||||
Street: | ||||||
City/State/Zip: | ||||||
Attention: | ||||||
Tel: | ||||||
Fax: | ||||||
Email: | ||||||
[Signature Page to Registration Rights Agreement]
IN WITNESS WHEREOF, the parties have executed this Registration Rights Agreement as of the
date first written above.
NAME OF INVESTING PERSON |
||||
/s/ Charles Allen | ||||
CHARLES ALLEN | ||||
ADDRESS FOR NOTICE
c/o:
Street:
City/State/Zip:
Attention:
Tel:
Fax:
Email:
[Signature Page to Registration Rights Agreement]
IN WITNESS WHEREOF, the parties have executed this Registration Rights Agreement as of the
date first written above.
NAME OF INVESTING
PERSON |
||||
/s/ Lawrence A. Humphrey | ||||
LAWRENCE A. HUMPHREY | ||||
ADDRESS FOR NOTICE
c/o:
Street:
City/State/Zip:
Attention:
Tel:
Fax:
Email:
[Signature Page to Registration Rights Agreement]
IN WITNESS WHEREOF, the parties have executed this Registration Rights Agreement as of the
date first written above.
NAME OF INVESTING PERSON |
||||
/s/ William Brock Hardaway | ||||
WILLIAM BROCK HARDAWAY | ||||
ADDRESS FOR NOTICE
c/o:
Street:
City/State/Zip:
Attention:
Tel:
Fax:
Email:
[Signature Page to Registration Rights Agreement]
ANNEX A
PLAN OF DISTRIBUTION
We are registering the shares of Common Stock issued or issuable to the selling stockholders
to permit the resale of these shares of Common Stock by the holders thereof from time to time after
the date of this prospectus. We will not receive any of the proceeds from the sale by the selling
stockholders of the shares of Common Stock. We will bear all fees and expenses incident to our
obligation to register the shares of Common Stock.
The selling stockholders (or their pledgees, donees, transferees, distributees or successors
in interest) may sell all or a portion of the shares of Common Stock beneficially owned by them and
offered hereby from time to time directly or through one or more underwriters, broker-dealers or
agents. If the shares of Common Stock are sold through underwriters or broker-dealers, the selling
stockholders will be responsible for underwriting discounts or commissions or agents commissions.
The shares of Common Stock may be sold on any national securities exchange or quotation service on
which the securities may be listed or quoted at the time of sale, in the over-the-counter market or
in transactions otherwise than on these exchanges or systems or in the over-the-counter market and
in one or more transactions at fixed prices, at prevailing market prices at the time of the sale,
at varying prices determined at the time of sale, or at negotiated prices. These sales may be
effected in transactions, which may involve crosses or block transactions. The selling
stockholders may use any one or more of the following methods when selling shares:
| purchases by underwriters, brokers, dealers, and agents who may receive compensation in the form of underwriting discounts, concessions, or commissions from the selling stockholders and/or the purchasers of the shares for whom they may act as agent; |
| ordinary brokerage transactions and transactions in which the broker solicits purchasers; |
| one or more block trades in which a broker or dealer so engaged will attempt to sell the shares as agent, but may position and resell a portion of the block as principal to facilitate the transaction or, in crosses, in which the same broker acts as agent on both sides; |
| purchases by a broker or dealer (including a specialist or market maker) as principal and resale by such broker or dealer for its account pursuant to this prospectus; |
| face-to-face transactions between sellers and purchasers without a broker-dealer; |
| the pledge of shares as security for any loan or obligation, including pledges to brokers or dealers who may from time to time effect distributions of the shares or other interests in the shares; |
| settlement of short sales or transactions to cover short sales relating to the shares entered into after the effective date of the registration statement of which this prospectus is a part; |
| distributions to creditors, equity holders, partners, and members of the selling stockholders; |
| transactions in options, swaps or other derivatives (whether listed on an exchange or otherwise); |
A-1
| sales in other ways not involving market makers or established trading markets, including direct sales to institutions or individual purchasers; and |
| any combination of the foregoing or by any other legally available means. |
The selling stockholders also may resell all or a portion of the shares of Common Stock in
open market transactions in reliance upon Rule 144 under the Securities Act, as permitted by that
rule, or Section 4(1) under the Securities Act, if available, rather than under this prospectus,
provided that they meet the criteria and conform to the requirements of those provisions.
Brokers or dealers engaged by the selling stockholders may arrange for other brokers or
dealers to participate in sales. If the selling stockholders effect such transactions by selling
shares of Common Stock to or through underwriters, brokers, dealers or agents, such underwriters,
brokers, dealers or agents may receive compensation in the form of discounts, concessions or
commissions from the selling stockholders. Underwriters, brokers, dealers or agents may also
receive compensation from the purchasers of shares of Common Stock for whom they act as agents or
to whom they sell as principals, or both. Such commissions will be in amounts to be negotiated,
but, except as set forth in a supplement to this Prospectus, in the case of an agency transaction
will not be in excess of a customary brokerage commission in compliance with NASD Rule 2440; and in
the case of a principal transaction a markup or markdown in compliance with NASD IM-2440.
In connection with sales of the shares of Common Stock or otherwise, the selling stockholders
(or their pledgees, donees, transferees, distributees or successors in interest) may enter into
hedging transactions with broker-dealers or other financial institutions, which may in turn engage
in short sales of shares of Common Stock in the course of hedging in positions they assume. The
selling stockholders may also sell shares of Common Stock short, and if such short sale shall take
place after the date that this Registration Statement is declared effective by the Commission, the
selling stockholders may deliver the shares of Common Stock covered by this prospectus to close out
short positions and to return borrowed shares in connection with such short sales. The selling
stockholders may also loan or pledge shares of Common Stock to broker-dealers that in turn may sell
such shares, to the extent permitted by applicable law. The selling stockholders may also enter
into option or other transactions with broker-dealers or other financial institutions or one or
more derivative transactions which require the delivery to such broker-dealer or other financial
institution of shares offered by this prospectus, which shares such broker-dealer or other
financial institution may resell pursuant to this prospectus (as supplemented or amended to reflect
such transaction). Notwithstanding the foregoing, the selling stockholders have been advised that
they may not use shares registered on this registration statement to cover short sales of our
common stock made prior to the date the registration statement, of which this prospectus forms a
part, has been declared effective by the SEC.
The selling stockholders (or their pledgees, donees, transferees, distributees or successors
in interest) may, from time to time, pledge or grant a security interest in some or all of the
shares of Common Stock owned by them and, if they default in the performance of their secured
obligations, the pledgees or secured parties may offer and sell the shares of Common Stock from
time to time pursuant to this prospectus or any amendment to this prospectus under Rule 424(b)(3)
or other applicable provision of the Securities Act, amending, if necessary, the list of selling
stockholders to include the pledgee, transferee or other successors in interest as selling
stockholders under this prospectus. The selling stockholders (or their pledgees, donees,
transferees, distributees or successors in interest) also may transfer and donate the shares of
Common Stock in other circumstances in which case the transferees, donees, pledgees or other
successors in interest thereof will be the selling beneficial owners for purposes of this
prospectus.
A-2
The selling stockholders (or their pledgees, donees, transferees, distributees or successors
in interest) and any broker-dealers or agents participating in the distribution of the shares of
Common Stock may be deemed to be underwriters within the meaning of Section 2(11) of the
Securities Act in connection with such sales. In such event, any profits realized by the selling
stockholders and any compensation earned by such broker-dealers or agents may be deemed to be
underwriting commissions or discounts under the Securities Act. Selling stockholders (or their
pledgees, donees, transferees, distributees or successors in interest) who are underwriters
within the meaning of Section 2(11) of the Securities Act will be subject to the applicable
prospectus delivery requirements of the Securities Act including Rule 172 thereunder and may be
subject to certain statutory liabilities of, including, but not limited to, Sections 11, 12 and 17
of the Securities Act and Rule 10b-5 under the Exchange Act. We will make copies of this
prospectus (as it may be amended or supplemented from time to time) available to the selling
stockholders (or their pledgees, donees, transferees, distributees or successors in interest) for
the purpose of satisfying any prospectus delivery requirements.
Each selling stockholder has informed the Company that it is not a registered broker-dealer
and does not have any written or oral agreement or understanding, directly or indirectly, with any
person to distribute the Common Stock. Upon the Company being notified in writing by a selling
stockholder at the time a particular offer of shares is made by one or more of the selling
stockholders, a prospectus supplement, if required, will be distributed to set forth the terms of
the specific offering of the shares, including (i) the name of each such selling stockholder and of
the participating broker-dealer(s), (ii) the number of shares offered, (iii) the price at which the
shares of Common Stock are being sold, (iv) the proceeds to the selling stockholders from the sale
of such shares, (v) the specific plan of distribution for such shares, (vi) the names of the
underwriters or agents, if any, (vii) any underwriting discounts, agency fees or other compensation
to underwriters or agents, (viii) any discounts or concessions allowed or paid to dealer(s), where
applicable, and (ix) any other facts material to the transaction. In no event shall any
broker-dealer receive fees, commissions and markups, which, in the aggregate, would exceed eight
percent (8.0%).
Under the securities laws of some states, the shares of Common Stock may be sold in such
states only through registered or licensed brokers or dealers. In addition, in some states the
shares of Common Stock may not be sold unless such shares have been registered or qualified for
sale in such state or an exemption from registration or qualification is available and is complied
with.
The selling stockholders (or their pledgees, donees, transferees, distributees or successors
in interest) may sell the shares covered by this prospectus from time to time, and may also decide
not to sell all or any of the shares they are allowed to sell under this prospectus. The selling
stockholders (or their pledgees, donees, transferees, distributees or successors in interest) will
act independently of us in making decisions regarding the timing, manner, and size of each sale.
There can be no assurance, however, that all or any of the shares will be offered by the selling
stockholders. We know of no existing arrangements between any selling stockholders and any broker,
dealer, finder, underwriter, or agent relating to the sale or distribution of the shares.
Each selling stockholder (or its pledgees, donees, transferees, distributees or successors in
interest) and any other person participating in such distribution will be subject to applicable
provisions of the Exchange Act and the rules and regulations thereunder, including, without
limitation, to the extent applicable, Regulation M of the Exchange Act, which may limit the timing
of purchases and sales of any of the shares of Common Stock by the selling stockholder and any
other participating person. To the extent applicable, Regulation M may also restrict the ability
of any person engaged in the distribution of the shares of Common Stock to engage in market-making
activities with respect to the shares of Common Stock. All of the foregoing may affect the
marketability of the shares of Common Stock and the ability of any person or entity to engage in
market-making activities with respect to the shares of Common Stock.
A-3
We will pay all expenses of the registration of the shares of Common Stock pursuant to the
registration rights agreement, including, without limitation, Securities and Exchange Commission
filing fees and expenses of compliance with state securities or blue sky laws; provided, however,
that each selling stockholder will pay all underwriting discounts and selling commissions, if any,
and any related legal expenses incurred by it. We will indemnify the selling stockholders against
certain liabilities, including some liabilities under the Securities Act, in accordance with the
registration rights agreement, or the selling stockholders will be entitled to contribution. We
may be indemnified by the selling stockholders against civil liabilities, including liabilities
under the Securities Act, that may arise from any written information furnished to us by the
selling stockholders specifically for use in this prospectus, in accordance with the related
registration rights agreements, or we may be entitled to contribution.
To the extent permitted by applicable law, this plan of distribution may be modified in a
prospectus supplement or otherwise.
A-4
ANNEX B
SELLING STOCKHOLDER NOTICE AND QUESTIONNAIRE
The undersigned holder of shares of Series A Convertible Redeemable Preferred Stock, par value
$0.10 per share, of RehabCare Group, Inc. (the Company) issued pursuant to a certain Backstop
Securities Agreement by and among the Company and the Stockholders named therein, dated as of
November 3, 2009 (the Agreement), understands that the Company intends to file with the
Securities and Exchange Commission a registration statement on Form S-3 (the Resale Registration
Statement) for the registration and the resale under Rule 415 of the Securities Act of 1933, as
amended (the Securities Act), of the Registrable Securities in accordance with the terms of the
Agreement. All capitalized terms not otherwise defined herein shall have the meanings ascribed
thereto in the Agreement.
In order to sell or otherwise dispose of any Registrable Securities pursuant to the Resale
Registration Statement, a holder of Registrable Securities generally will be required to be named
as a selling stockholder in the related prospectus or a supplement thereto (as so supplemented, the
"Prospectus), deliver the Prospectus to purchasers of Registrable Securities (including pursuant
to Rule 172 under the Securities Act) and be bound by the provisions of the Agreement (including
certain indemnification provisions, as described below). Holders must complete and deliver this
Notice and Questionnaire in order to be named as selling stockholders in the Prospectus. Holders
of Registrable Securities who do not complete, execute and return this Notice and Questionnaire
within three (3) Trading Days following the date of the Agreement (1) will not be named as selling
stockholders in the Resale Registration Statement or the Prospectus and (2) may not use the
Prospectus for resales of Registrable Securities.
Certain legal consequences arise from being named as a selling stockholder in the Resale
Registration Statement and the Prospectus. Holders of Registrable Securities are advised to
consult their own securities law counsel regarding the consequences of being named or not named as
a selling stockholder in the Resale Registration Statement and the Prospectus.
NOTICE
The undersigned holder (the Selling Stockholder) of Registrable Securities hereby gives
notice to the Company of its intention to sell or otherwise dispose of Registrable Securities owned
by it and listed below in Item (3), unless otherwise specified in Item (3), pursuant to the Resale
Registration Statement. The undersigned, by signing and returning this Notice and Questionnaire,
understands and agrees that it will be bound by the terms and conditions of this Notice and
Questionnaire and the Agreement.
The undersigned hereby provides the following information to the Company and represents and
warrants that such information is accurate and complete:
B-1
QUESTIONNAIRE
1. Name.
(a) | Full Legal Name of Selling Stockholder: | ||
(b) | Full Legal Name of Registered Holder (if not the same as (a) above) through which Registrable Securities Listed in Item 3 below are held: | ||
(c) | Full Legal Name of Natural Control Person (which means a natural person who directly or indirectly alone or with others has power to vote or dispose of the securities covered by the questionnaire): | ||
2. Address for Notices to Selling Stockholder:
Telephone:
Fax:
Contact Person:
E-mail address of Contact Person:
3. Beneficial Ownership of Registrable Securities Issuable Pursuant to the Backstop Agreement:
(a) | Type and Number of Registrable Securities beneficially owned and issued pursuant to the Agreement: | ||
(b) Number of shares of Common Stock to be registered pursuant to this Notice for resale: | |||
B-2
4. Broker-Dealer Status:
(a) | Are you a broker-dealer? |
Yes o No o
(b) | If yes to Section 4(a), did you receive your Registrable Securities as compensation for investment banking services to the Company? |
Yes o No o
Note: | If no, the Commissions staff has indicated that you should be identified as an underwriter in the Registration Statement. |
(c) | Are you an affiliate of a broker-dealer? |
Yes o No o
Note: | If yes, provide a narrative explanation below: | ||
(c) | If you are an affiliate of a broker-dealer, do you certify that you bought the Registrable Securities in the ordinary course of business, and at the time of the purchase of the Registrable Securities to be resold, you had no agreements or understandings, directly or indirectly, with any person to distribute the Registrable Securities? |
Yes o No o
Note: | If no, the Commissions staff has indicated that you should be identified as an underwriter in the Registration Statement. |
5. Beneficial Ownership of Other Securities of the Company Owned by the Selling Stockholder.
Except as set forth below in this Item 5, the undersigned is not the beneficial or registered owner of any securities of the Company other than the Registrable Securities listed above in Item 3. | ||
Type and amount of other securities beneficially owned: | ||
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6. Relationships with the Company:
Except as set forth below, neither the undersigned nor any of its affiliates, officers, directors or principal equity holders (owners of 5% of more of the equity securities of the undersigned) has held any position or office or has had any other material relationship with the Company (or its predecessors or affiliates) during the past three years. | ||
State any exceptions here: | ||
7. Plan of Distribution:
The undersigned has reviewed the form of Plan of Distribution attached as Annex A to the Registration Rights Agreement, and hereby confirms that, except as set forth below, the information contained therein regarding the undersigned and its plan of distribution is correct and complete. | ||
State any exceptions here: | ||
***********
The undersigned agrees to promptly notify the Company of any inaccuracies or changes in the
information provided herein that may occur subsequent to the date hereof and prior to the effective
date of any applicable Resale Registration Statement. All notices hereunder and pursuant to the
Agreement shall be made in writing, by hand delivery, confirmed or facsimile transmission,
first-class mail or air courier guaranteeing overnight delivery at the address set forth below. In
the absence of any such notification, the Company shall be entitled to continue to rely on the
accuracy of the information in this Notice and Questionnaire.
By signing below, the undersigned consents to the disclosure of the information contained herein in
its answers to Items (1) through (7) above and the inclusion of such information in the Resale
Registration Statement and the Prospectus. The undersigned understands that such information will
be relied upon by the Company in connection with the preparation or amendment of any such
Registration Statement and the Prospectus.
By signing below, the undersigned acknowledges that it understands its obligation to comply, and
agrees that it will comply, with the provisions of the Exchange Act and the rules and regulations
thereunder, particularly Regulation M in connection with any offering of Registrable Securities
pursuant to the Resale Registration Statement. The undersigned also acknowledges that it
understands that the answers to this Questionnaire are furnished for use in connection with
Registration Statements filed pursuant to the
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Registration Rights Agreement and any amendments or supplements thereto filed with the Commission
pursuant to the Securities Act.
The undersigned hereby acknowledges and is advised of the following Interpretation A.65 of the July
1997 SEC Manual of Publicly Available Telephone Interpretations regarding short selling:
An Issuer filed a Form S-3 registration statement for a secondary offering of common stock which
is not yet effective. One of the selling stockholders wanted to do a short sale of common stock
against the box and cover the short sale with registered shares after the effective date. The
issuer was advised that the short sale could not be made before the registration statement become
effective, because the shares underlying the short sale are deemed to be sold at the time such sale
is made. There would, therefore, be a violation of Section 5 if the shares were effectively sold
prior to the effective date.
By returning this Questionnaire, the undersigned will be deemed to be aware of the foregoing
interpretation.
I confirm that, to the best of my knowledge and belief, the foregoing statements (including without
limitation the answers to this Questionnaire) are correct.
IN WITNESS WHEREOF the undersigned, by authority duly given, has caused this Questionnaire to
be executed and delivered either in person or by its duly authorized agent.
Dated: | Beneficial Owner: |
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By: | ||||
Name: | ||||
Title: | ||||
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