Exhibit 10.11
SECOND AMENDED AND RESTATED
REGISTRATION RIGHTS AGREEMENT
("Agreement") dated July 30, 2003, among
THE PROVIDENCE SERVICE CORPORATION, a
Delaware corporation (the
"Corporation"), and the INVESTORS (as
herein defined).
The Investors own or have the right to purchase or otherwise acquire
shares of the Common Stock (as hereinafter defined) of the Corporation. The
Corporation and the Investors deem it to be in their respective best interests
to set forth the rights of the Investors in connection with public offerings and
sales of the Common Stock. This Agreement shall become effective upon
consummation of the Corporation's initial public offering.
NOW, THEREFORE, in consideration of the premises and mutual covenants
and obligations hereinafter set forth, the Corporation and the Investors hereby
agree as follows:
Section 1. Definitions. As used in this Agreement, the following terms
shall have the following meanings:
"Camelot Stockholders" means the persons set forth on Schedule II
hereto.
"Commission" means the Securities and Exchange Commission or any other
Federal agency at the time administering the Securities Act.
"Common Stock" means the Common Stock, $.001 par value per share, of
the Corporation.
"Eos I" means Eos Partners SBIC, L.P.
"Eos II" means Eos Partners SBIC II, L.P.
"Exchange Act" means the Securities Exchange Act of 1934 or any
successor Federal statute, and the rules and regulations of the Commission
promulgated thereunder, all as the same shall be in effect from time to time.
"Investors" means, collectively, the Persons set forth on Schedule I
and each additional Person who shall execute a counterpart signature page
hereto, and includes any successor to, or assignee or transferee of, any such
Person who or which agrees in writing to be treated as an Investor hereunder and
to be bound by the terms and comply with all applicable provisions hereof.
"Other Shares" means at any time those shares of Common Stock which do
not constitute Primary Shares or Registrable Shares and are entitled to
registration rights.
"Petra/Harbinger Stockholders" Petra Mezzanine Fund, L.P. and Harbinger
Mezzanine Partners, L.P. shall have the meaning ascribed to such term in the
Stockholders' Agreement.
"Person" shall be construed broadly and shall include, without
limitation, an individual, a partnership, an investment fund, a limited
liability company, a corporation, an association, a joint stock company, a
trust, a joint venture, an unincorporated organization and a governmental entity
or any department, agency or political subdivision thereof.
"Primary Shares" means at any time the authorized but unissued shares
of Common Stock and shares of Common Stock held by the Corporation in its
treasury.
"Registrable Shares" means Restricted Shares that constitute Common
Stock.
"Restricted Shares" means shares of Common Stock held or issuable upon
the conversion of shares of Series A Preferred, Series B Preferred, Series C
Preferred, Series D Preferred, or any other options, warrants or other rights
to purchase any Common Stock held by the Investors. As to any particular
Restricted Shares, once issued, such Restricted Shares shall cease to be
Restricted Shares when (i) they have been registered under the Securities Act,
the registration statement in connection therewith has been declared effective
and they have been disposed of pursuant to such effective registration
statement, (ii) they are eligible to be sold or distributed pursuant to Rule 144
within any consecutive three month period other than pursuant to Rule
144(k)) without volume limitations, or (iii) they shall have ceased to be
outstanding. For greater certainty, the Corporation shall not be required to
effect any registration of any shares of preferred stock, any warrants, options
or other rights to purchase Common Stock or any promissory notes or other
indebtedness.
"Registration Date" means the date upon which the registration
statement pursuant to which the Corporation shall have initially registered
shares of Common Stock under the Securities Act for sale to the public shall
have been declared effective.
"Rule 144" means Rule 144 promulgated under the Securities Act or any
successor rule thereto or any complementary rule thereto (such as Rule 144A).
"Securities Act" means the Securities Act of 1933 or any successor
Federal statute, and the rules and regulations of the Commission thereunder, all
as the same shall be in effect from time to time.
"Securities Purchase Agreements" means the Securities Purchase
Agreements dated November 26, 1997, October 14, 1998, and December 6, 1999,
respectively, among the Corporation, Eos I and Eos II.
"Series A Preferred" means the Series A Convertible Preferred Stock,
$.001 par value per share, of the Corporation, issued to Eos I pursuant to the
Securities Purchase Agreement dated November 26, 1997.
"Series B Preferred" means the Series B Convertible Preferred Stock,
$.001 par value per share, of the Corporation, issued to the Eos I pursuant to
the Securities Purchase Agreement
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dated October 14, 1998.
"Series C Preferred" means the Series C Convertible Preferred Stock,
$.001 par value per share, of the Corporation, issued to Eos II pursuant to the
Securities Purchase Agreement dated December 6, 1999.
"Series D Preferred" means the Series D Convertible Preferred Stock,
$.001 par value per share, of the Corporation, issued to Eos II pursuant to the
Securities Purchase Agreement dated December 6, 1999.
Section 2. Required Registration. On any date after 180 days following
the Registration Date, if the Corporation shall be requested by the holders
(other than Camelot Stockholders) of at least thirty percent (30%) (on a Common
Stock equivalent basis) of the Restricted Shares then outstanding to effect the
registration under the Securities Act of Registrable Shares, the Corporation
shall promptly use its best efforts to effect the registration under the
Securities Act of the Registrable Shares which the Corporation has been so
requested to register; provided, however, that the Corporation shall not be
obligated to effect any registration under the Securities Act except in
accordance with the following provisions:
(a) the Corporation shall not be obligated to use its best
efforts to file and cause to become effective (i) more than two
registration statements initiated pursuant to this Section 2 under
which a substantial portion of the Registrable Shares requested to be
included therein have been effectively sold thereunder, (ii) any
registration statement during any period in which any other
registration statement (other than on Form S-4 or Form S-8 promulgated
under the Securities Act or any successor forms thereto) pursuant to
which Primary Shares are to be or were sold has been filed and not
withdrawn or has been declared effective within the prior 90 days or
(iii) any registration statement initiated pursuant to this Section 2
unless such registration statement relates to Registrable Shares having
a minimum aggregate offering price of $10,000,000 (based on the then
current market price or fair value of the Common Stock);
(b) the Corporation may delay the filing or effectiveness of any
registration statement for a period of up to 90 days after the date of
a request for registration pursuant to this Section 2 if at the time of
such request (i) the Corporation is engaged, or has fixed plans to
engage within 90 days of the time of such request, in a firm commitment
underwritten public offering of Primary Shares in which the holders of
Registrable Shares may include Registrable Shares pursuant to Section 3
or (ii) the Corporation reasonably determines that such registration
and offering would interfere with any material transaction involving
the Corporation, as approved by the Board of Directors, provided that
the Corporation may only so delay the filing or effectiveness of a
registration statement once pursuant to clause (i) above and once
pursuant to clause (ii) above; and
(c) with respect to any registration pursuant to this Section 2,
the Corporation shall give notice of such registration to the Investors
who do not request registration
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hereunder and to the holders of all Other Shares which are entitled to
registration rights and the Corporation may include in such
registration any Primary Shares or Other Shares; provided, however,
that if the managing underwriter advises the Corporation that the
inclusion of all Registrable Shares, Primary Shares and/or Other Shares
proposed to be included in such registration would interfere with the
successful marketing (including pricing) of the Registrable Shares
proposed to be included in such registration, then the number of
Registrable Shares, Primary Shares and/or Other Shares proposed to be
included in such registration shall be included in the following order:
(i) first, the Registrable Shares requested to be included in
such registration pursuant to the demand right above (or, if
necessary, such Registrable Shares pro rata among the holders
thereof based upon the number of Registrable Shares requested to
be registered by each such holder);
(ii) second, the Primary Shares; and
(iii) third, the Other Shares that are entitled to registration
rights and any Registrable Shares held by the Camelot
Stockholders and the Petra/Harbinger Stockholders that are
entitled to registration rights (or, if necessary, such
Registrable Shares and Other Shares pro rata among the holders
thereof based upon the number of such Registrable Shares and
Other Shares requested to be registered by each such holder).
(d) If the method of disposition requested by the holders,
pursuant to this Section 2, is an underwritten public offering, the
majority of the holders of Registrable Shares to be included therein
shall have the right to designate the managing underwriter of such
offering, which underwriter shall be a top 15 investment bank as rated
by Securities Data Corp. at the time of the request.
(e) At any time before the registration statement covering such
Registrable Shares becomes effective, the holders of a majority of such
Registrable Shares, may request the Corporation to withdraw or not to
file the registration statement. In that event, if such request of
withdrawal shall not have been caused by, or made in response to, the
material adverse effect of an event on the business, properties,
condition, financial or otherwise, or operations of the Corporation,
such holders shall have used one of their demand registration rights
under this Section 2 and the Corporation shall no longer be obligated
to register Registrable Shares pursuant to the exercise of such one
registration right pursuant to this Section 2 unless the remaining
holders shall pay to the Corporation the expenses incurred by the
Corporation through the date of such request.
Section 3. Piggyback Registration. If the Corporation at any time
proposes for any reason to register Primary Shares or Other Shares under the
Securities Act (other than on Form S-4 or Form S-8 promulgated under the
Securities Act or any successor forms thereto), it shall promptly give written
notice to the Investors of its intention to so register such Primary Shares or
Other Shares and, upon the written request, delivered to the Corporation within
30 days after
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delivery of any such notice by the Corporation, of the Investors to include in
such registration Registrable Shares (which request shall specify the number of
Registrable Shares proposed to be included in such registration), the
Corporation shall use its best efforts to cause all such Registrable Shares to
be included in such registration on the same terms and conditions as the
securities otherwise being sold in such registration; provided, however, that if
the managing underwriter advises the Corporation that the inclusion of all
Registrable Shares requested to be included in such registration would interfere
with the successful marketing (including pricing) of the Primary Shares or Other
Shares proposed to be registered by the Corporation, then the number of Primary
Shares, Registrable Shares and Other Shares proposed to be included in such
registration shall be included in the following order:
(a) if the Corporation proposes to register Primary Shares:
(i) first, the Primary Shares; and
(ii) second, the Registrable Shares requested to be included in
such registration (or, if necessary, such Registrable Shares pro
rata among the holders thereof based upon the number of
Registrable Shares requested to be registered by each such
holder); and
(iii) third, the Other Shares requested to be included in such
registration (or, if necessary, such Other Shares pro rata among
the holders thereof based upon the number of Other Shares
requested to be registered by each such holder); or
(b) if the Corporation proposes to register Other Shares pursuant
to a request for registration by the holders of such Other Shares that
are entitled to registration rights:
(i) first, the Other Shares held by the parties demanding such
registration;
(ii) second, the Registrable Shares and Other Shares (other than
shares registered pursuant to Section 3(b)(i) hereof) requested
to be registered by the holders hereof (or, if necessary, pro
rata among the holders thereof based on the number of Registrable
Shares and Other Shares requested to be registered by such
holders); and
(iii) third, the Primary Shares.
Section 4. Registrations on Form S-3. Anything contained in Section 2
to the contrary notwithstanding, at such time as the Corporation shall have
qualified for the use of Form S-3 promulgated under the Securities Act or any
successor form thereto, the holders of at least twenty-five percent (25%) of the
Registrable Shares then outstanding, shall have the right to request in writing
two registrations per twelve month period thereafter on Form S-3 or such
successor form of Registrable Shares, which request or requests shall (i)
specify the number of Registrable Shares intended to be sold or disposed of and
the holders thereof, (ii) state the
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intended method of disposition of such Registrable Shares and (iii) relate to
Registrable Shares having anticipated net proceeds of at least $3,000,000. A
requested registration on Form S-3 or any such successor form in compliance with
this Section 4 shall not count as a registration statement initiated pursuant to
Section 2 but shall otherwise be treated as a registration initiated pursuant
to, and shall, except as otherwise expressly provided in this Section 4, be
subject to Section 2.
Section 5. Holdback Agreement. If the Corporation at any time shall
register shares of Common Stock under the Securities Act (including any
registration pursuant to Sections 2, 3 or 4 hereof) for sale to the public, the
Investors shall not sell publicly, make any short sale of, grant any option for
the purchase of, or otherwise dispose publicly of, any Registrable Shares (other
than those shares of Common Stock included in such registration pursuant to
Sections 2, 3 or 4 hereof) without the prior written consent of the Corporation,
for a period designated by the Corporation in writing to the Investors, which
period shall begin not more than 10 days prior to the effectiveness of the
registration statement pursuant to which such public offering shall be made and
shall not last more than 90 days after the effective date of such registration
statement. The Corporation shall obtain the agreement of any person permitted to
sell shares of stock in a registration to be bound by and to comply with this
Section 5 as if such person was an Investor hereunder.
Section 6. Preparation and Filing. If and whenever the Corporation is
under an obligation pursuant to the provisions of this Agreement to use its best
efforts to effect the registration of any Registrable Shares, the Corporation
shall, as expeditiously as practicable:
(a) use its best efforts to cause a registration statement that
registers such Registrable Shares to become and remain effective for a
period of 90 days or until all of such Registrable Shares have been
disposed of (if earlier);
(b) furnish, at least five business days before filing a
registration statement that registers such Registrable Shares, a
prospectus relating thereto or any amendments or supplements relating
to such a registration statement or prospectus, to one counsel selected
by the Investors (the "Investors' Counsel"), copies of all such
documents proposed to be filed (it being understood that such
five-business-day period need not apply to successive drafts of the
same document proposed to be filed so long as such successive drafts
are supplied to the Investors' Counsel in advance of the proposed
filing by a period of time that is customary and reasonable under the
circumstances);
(c) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in
connection therewith as may be necessary to keep such registration
statement effective for at least a period of 90 days or until all of
such Registrable Shares have been disposed of (if earlier) and to
comply with the provisions of the Securities Act with respect to the
sale or other disposition of such Registrable Shares;
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(d) notify in writing the Investors' Counsel promptly (i) of the
receipt by the Corporation of any notification with respect to any
comments by the Commission with respect to such registration statement
or prospectus or any amendment or supplement thereto or any request by
the Commission for the amending or supplementing thereof or for
additional information with respect thereto, (ii) of the receipt by the
Corporation of any notification with respect to the issuance by the
Commission of any stop order suspending the effectiveness of such
registration statement or prospectus or any amendment or supplement
thereto or the initiation or threatening of any proceeding for that
purpose and (iii) of the receipt by the Corporation of any notification
with respect to the suspension of the qualification of such Registrable
Shares for sale in any jurisdiction or the initiation or threatening of
any proceeding for such purposes;
(e) use its best efforts to register or qualify such Registrable
Shares under such other securities or blue sky laws of such
jurisdictions as the Investors reasonably request and do any and all
other acts and things which may be reasonably necessary or advisable to
enable the Investors to consummate the disposition in such
jurisdictions of the Registrable Shares owned by the Investors;
provided, however, that the Corporation will not be required to qualify
generally to do business, subject itself to general taxation or consent
to general service of process in any jurisdiction where it would not
otherwise be required to do so but for this paragraph (e) or to provide
any material undertaking or make any changes in its By-laws or
Certificate of Incorporation which the Board of Directors determines to
be contrary to the best interests of the Corporation;
(f) furnish to the Investors holding such Registrable Shares such
number of copies of a summary prospectus, if any, or other prospectus,
including a preliminary prospectus, in conformity with the requirements
of the Securities Act, and such other documents as such Investors may
reasonably request in order to facilitate the public sale or other
disposition of such Registrable Shares;
(g) use its best efforts to cause such Registrable Shares to be
registered with or approved by such other governmental agencies or
authorities as may be necessary by virtue of the business and
operations of the Corporation to enable the Investors holding such
Registrable Shares to consummate the disposition of such Registrable
Shares;
(h) notify the Investors holding such Registrable Shares on a
timely basis at any time when a prospectus relating to such Registrable
Shares is required to be delivered under the Securities Act within the
appropriate period mentioned in subparagraph (a) of this Section 6, of
the happening of any event as a result of which the prospectus included
in such registration statement, as then in effect, includes an untrue
statement of a material fact or omits to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading in light of the circumstances then existing and, at the
request of the Investors, prepare and furnish to such Investors a
reasonable number of copies of a supplement to or an amendment of such
prospectus as may be necessary so that, as thereafter delivered to the
offerees of such shares, such prospectus shall not include an untrue
statement of a material fact or omit to state a material fact required
to
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be stated therein or necessary to make the statements therein not
misleading in light of the circumstances then existing;
(i) subject to the execution of confidentiality agreements in
form and substance satisfactory to the Corporation, make available upon
reasonable notice and during normal business hours, for inspection by
the Investors holding such Registrable Shares, any underwriter
participating in any disposition pursuant to such registration
statement and any attorney, accountant or other agent retained by the
Investors or underwriter (collectively, the "Inspectors"), all
pertinent financial and other records, pertinent corporate documents
and properties of the Corporation (collectively, the "Records"), as
shall be reasonably necessary to enable them to exercise their due
diligence responsibility, and cause the Corporation's officers,
directors and employees to supply all information (together with the
Records, the "Information") reasonably requested by any such Inspector
in connection with such registration statement. Any of the Information
which the Corporation determines in good faith to be confidential, and
of which determination the Inspectors are so notified, shall not be
disclosed by the Inspectors unless (i) the disclosure of such
Information is necessary to avoid or correct a misstatement or omission
in the registration statement, (ii) the release of such Information is
ordered pursuant to a subpoena or other order from a court of competent
jurisdiction or (iii) such Information has been made generally
available to the public; the Investors agree that they will, upon
learning that disclosure of such Information is sought in a court of
competent jurisdiction, give notice to the Corporation and allow the
Corporation, at the Corporation's expense, to undertake appropriate
action to prevent disclosure of the Information deemed confidential;
(j) use its best efforts to obtain from its independent certified
public accountants "cold comfort" letters in customary form and at
customary times and covering matters of the type customarily covered by
cold comfort letters;
(k) use its best efforts to obtain from its counsel an opinion or
opinions in customary form;
(l) provide a transfer agent and registrar (which may be the same
entity and which may be the Corporation) for such Registrable Shares;
(m) issue to any underwriter to which the Investors holding such
Registrable Shares may sell shares in such offering, certificates
evidencing such Registrable Shares;
(n) list such Registrable Shares on any national securities
exchange on which any shares of the Common Stock are listed or, if the
Common Stock is not listed on a national securities exchange, use its
best efforts to qualify such Registrable Shares for inclusion on the
automated quotation system of the National Association of Securities
Dealers, Inc. (the "NASD"), or such other national securities exchange
as the holders of a majority of such Registrable Shares shall
reasonably request;
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(o) otherwise use its best efforts to comply with all applicable
rules and regulations of the Commission and make available to its
securityholders, as soon as reasonably practicable, earnings statements
(which need not be audited) covering a period of 12 months beginning
within three months after the effective date of the registration
statement, which earnings statements shall satisfy the provisions of
Section 11(a) of the Securities Act; and
(p) use its best efforts to take all other steps necessary to
effect the registration of such Registrable Shares contemplated hereby.
Each holder of the Registrable Shares, upon receipt of any notice
from the Corporation of any event of the kind described in Section 6(h) hereof,
shall forthwith discontinue disposition of the Registrable Shares pursuant to
the registration statement covering such Registrable Shares until such holder's
receipt of the copies of the supplemented or amended prospectus contemplated by
Section 6(h) hereof, and, if so directed by the Corporation, such holder shall
deliver to the Corporation all copies, other than permanent file copies then in
such holder's possession, of the prospectus covering such Registrable Shares at
the time of receipt of such notice.
Section 7. Expenses. All expenses (other than underwriting discounts
and commissions relating to the Registrable Shares, as provided in the last
sentence of this Section 7) incurred by the Corporation in complying with
Section 6, including, without limitation, all registration and filing fees
(including all expenses incident to filing with the NASD), fees and expenses of
complying with securities and blue sky laws, printing expenses, fees and
expenses of the Corporation's counsel and accountants and reasonable fees and
expenses of the Investors' Counsel, shall be paid by the Corporation; provided,
however, that all underwriting discounts and selling commissions applicable to
the Registrable Shares and Other Shares shall be borne by the holders selling
such Registrable Shares and Other Shares, in proportion to the number of
Registrable Shares and Other Shares sold by each such holder.
Section 8. Indemnification.
(a) In connection with any registration of any Registrable Shares
under the Securities Act pursuant to this Agreement, the Corporation
shall indemnify and hold harmless the holders of Registrable Shares,
each underwriter, broker or any other person acting on behalf of the
holders of Registrable Shares and each other person, if any, who
controls any of the foregoing persons within the meaning of the
Securities Act against any losses, claims, damages or liabilities,
joint or several (or actions in respect thereof), to which any of the
foregoing persons may become subject under the Securities Act or
otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon an untrue
statement or allegedly untrue statement of a material fact contained in
the registration statement under which such Registrable Shares were
registered under the Securities Act, any preliminary prospectus or
final
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prospectus contained therein or otherwise filed with the Commission,
any amendment or supplement thereto or any document incident to
registration or qualification of any Registrable Shares, or arise out
of or are based upon the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading or, with respect to any prospectus,
necessary to make the statements therein in light of the circumstances
under which they were made not misleading, or any violation by the
Corporation of the Securities Act or state securities or blue sky laws
applicable to the Corporation and relating to action or inaction
required of the Corporation in connection with such registration or
qualification under such state securities or blue sky laws; and shall
reimburse the holders of Registrable Shares, such underwriter, such
broker or such other person acting on behalf of the holders of
Registrable Shares and each such controlling person for any legal or
other expenses reasonably incurred by any of them in connection with
investigating or defending any such loss, claim, damage, liability or
action; provided, however, that the Corporation shall not be liable in
any such case to the extent that any such loss, claim, damage,
liability or action (including any legal or other expenses incurred)
arises out of or is based upon an untrue statement or allegedly untrue
statement or omission or alleged omission made in said registration
statement, preliminary prospectus, final prospectus, amendment,
supplement or document incident to registration or qualification of any
Registrable Shares in reliance upon and in conformity with written
information furnished to the Corporation through an instrument duly
executed by the holders of Registrable Shares or their counsel or
underwriter specifically for use in the preparation thereof; provided
further, however, that the foregoing indemnity agreement is subject to
the condition that, insofar as it relates to any untrue statement,
allegedly untrue statement, omission or alleged omission made in any
preliminary prospectus but eliminated or remedied in the final
prospectus (filed pursuant to Rule 424 of the Securities Act), such
indemnity agreement shall not inure to the benefit of any Investor,
underwriter, broker or other person acting on behalf of holders of the
Restricted Shares from whom the person asserting any loss, claim,
damage, liability or expense purchased the Restricted Shares which are
the subject thereof, if a copy of such final prospectus had been made
available to such person and such Investor, underwriter, broker or
other person acting on behalf of holders of the Registrable Shares and
such final prospectus was not delivered to such person with or prior to
the written confirmation of the sale of such Registrable Shares to such
person.
(b) In connection with any registration of Registrable Shares
under the Securities Act pursuant to this Agreement, each holder of
Registrable Shares shall severally and not jointly indemnify and hold
harmless (in the same manner and to the same extent as set forth in the
preceding paragraph of this Section 8) the Corporation, each director
of the Corporation, each officer of the Corporation who shall sign such
registration statement, each underwriter, broker or other person acting
on behalf of the holders of Registrable Shares and each person who
controls any of the foregoing persons within the meaning of the
Securities Act with respect to any statement or omission from such
registration statement, any preliminary prospectus or final prospectus
contained therein or otherwise filed with the Commission, any amendment
or supplement thereto or any document incident to registration or
qualification of any Registrable Shares, if such
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statement or omission was made in reliance upon and in conformity with
written information furnished to the Corporation or such underwriter
specifically for use in connection with the preparation of such
registration statement, preliminary prospectus, final prospectus,
amendment, supplement or document; provided, however, that the maximum
amount of liability in respect of such indemnification shall be
limited, in the case of each seller of Registrable Shares, to an amount
equal to the net proceeds actually received by such seller from the
sale of Registrable Shares effected pursuant to such registration.
(c) Promptly after receipt by an indemnified party of notice of
the commencement of any action involving a claim referred to in the
preceding paragraphs of this Section 8, such indemnified party will, if
a claim in respect thereof is made against an indemnifying party, give
written notice to the latter of the commencement of such action. In
case any such action is brought against an indemnified party, the
indemnifying party will be entitled to participate in and to assume the
defense thereof, jointly with any other indemnifying party similarly
notified to the extent that it may wish, with counsel reasonably
satisfactory to such indemnified party, and after notice from the
indemnifying party to such indemnified party of its election so to
assume the defense thereof, the indemnifying party shall not be
responsible for any legal or other expenses subsequently incurred by
the indemnified party in connection with the defense thereof; provided,
however, that if any indemnified party shall have reasonably concluded
that there may be one or more legal or equitable defenses available to
such indemnified party which are additional to or conflict with those
available to the indemnifying party, or that such claim or litigation
involves or could have an effect upon matters beyond the scope of the
indemnity agreement provided in this Section 8, the indemnifying party
shall not have the right to assume the defense of such action on behalf
of such indemnified party and such indemnifying party shall reimburse
such indemnified party and any person controlling such indemnified
party for that portion of the fees and expenses of any counsel retained
by the indemnified party which is reasonably related to the matters
covered by the indemnity agreement provided in this Section 8.
(d) If the indemnification provided for in this Section 8 is held
by a court of competent jurisdiction to be unavailable to an
indemnified party with respect to any loss, claim, damage, liability or
action referred to herein, then the indemnifying party, in lieu of
indemnifying such indemnified party hereunder, shall contribute to the
amounts paid or payable by such indemnified party as a result of such
loss, claim, damage, liability or action in such proportion as is
appropriate to reflect the relative fault of the indemnifying party on
the one hand and of the indemnified party on the other in connection
with the statements or omissions which resulted in such loss, claim,
damage, liability or action as well as any other relevant equitable
considerations. The relative fault of the indemnifying party and of the
indemnified party shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact
relates to information supplied by the indemnifying party or by the
indemnified party and the parties' relative intent, knowledge, access
to information and opportunity to correct or prevent such statement or
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omission.
Section 9. Underwriting Agreement. Notwithstanding the provisions of
Sections 5, 6, 7 and 8, to the extent that the Investors shall enter into an
underwriting or similar agreement, which agreement contains provisions covering
one or more issues addressed in such Sections, the provisions contained in such
agreement addressing such issue or issues shall control; provided, however, that
any such agreement to which the Corporation is not a party shall not be binding
upon the Corporation.
Section 10. Information by Holder. The Investors shall furnish to the
Corporation such written information regarding the Investors and the
distribution proposed by the Investors as the Corporation may reasonably request
in writing and as shall be reasonably required in connection with any
registration, qualification or compliance referred to in this Agreement.
Section 11. Exchange Act Compliance. From the Registration Date or such
earlier date as a registration statement filed by the Corporation pursuant to
the Exchange Act relating to any class of the Corporation's securities shall
have become effective, the Corporation shall comply with all of the reporting
requirements of the Exchange Act applicable to it (whether or not it shall be
required to do so, but specifically excluding Section 14 of the Exchange Act if
not then applicable to the Corporation) and shall comply with all other public
information reporting requirements of the Commission which are conditions to the
availability of Rule 144 for the sale of the Common Stock. The Corporation shall
cooperate with the Investors in supplying such information as may be necessary
for the Investors to complete and file any information reporting forms presently
or hereafter required by the Commission as a condition to the availability of
Rule 144.
Section 12. No Conflict of Rights. The Corporation shall not, after the
date hereof, grant any registration rights which conflict with or impair the
registration rights granted hereby.
Section 13. Termination. This Agreement shall terminate and be of no
further force or effect when there shall no longer be any Registrable Shares
outstanding.
Section 14. Successors and Assigns. This Agreement shall bind and inure
to the benefit of the Corporation and the Investors and, subject to Section 15,
the respective successors and assigns of the Corporation and the Investors.
Section 15. Assignment. Each Investor may assign its rights hereunder
to any purchaser or transferee of Registrable Shares; provided, however, that
such purchaser or transferee shall, as a condition to the effectiveness of such
assignment, be required to execute a counterpart to this Agreement agreeing to
be treated as an Investor whereupon such purchaser or transferee shall have the
benefits of, and shall be subject to the restrictions contained in, this
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Agreement as if such purchaser or transferee was originally included in the
definition of an Investor herein and had originally been a party hereto.
Section 16. Entire Agreement. This Agreement, the Securities Purchase
Agreements, and the Stockholders' Agreement, and the other writings referred to
herein or therein or delivered pursuant hereto or thereto, contain the entire
agreement among the Investors and the Company with respect to the subject matter
hereof and supersede all prior and contemporaneous arrangements or
understandings with respect thereto.
Section 17. Notices. All notices, requests, consents and other
communications hereunder to any party shall be deemed to be sufficient if
contained in a written instrument delivered in person or sent by telecopy,
nationally-recognized overnight courier or first class registered or certified
mail, return receipt requested, postage prepaid, addressed to such party at the
address set forth below or such other address as may hereafter be designated in
writing by such party to the other parties:
(i) if to the Corporation, to:
The Providence Service Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇;
with a copy to:
Blank Rome LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Esquire
(ii) if to the Investors, to their respective addresses set forth
on Schedule I hereto.
All such notices, requests, consents and other communications
shall be deemed to have been delivered (a) in the case of personal delivery or
delivery by telecopy, on the date of such delivery, (b) in the case of dispatch
by nationally-recognized overnight courier, on the next business day following
such dispatch and (c) in the case of mailing, on the third business day after
the posting thereof.
Section 18. Modifications; Amendments; Waivers. The terms and
provisions of this Agreement may not be modified or amended, nor may any
provision be waived, except pursuant
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to a writing signed by the Corporation and Investors holding in excess of 50% or
more of the Restricted Shares; provided, however, that (i) any such
modification, amendment or waiver that would materially adversely affect the
Petra/Harbinger Stockholders, as a class, or the Camelot Stockholders, as a
class, without similarly affecting the rights hereunder of all Stockholders,
shall not be effective without the prior written consent of 50% or more of the
Restricted Shares held by the Petra/Harbinger Stockholders or Camelot
Stockholders, as the case may be.
Section 19. Counterparts; Facsimile Signatures. This Agreement may be
executed in any number of counterparts, and each such counterpart hereof shall
be deemed to be an original instrument, but all such counterparts together shall
constitute but one agreement. Facsimile counterpart signatures to this Agreement
shall be acceptable.
Section 20. Headings. The headings of the various sections of this
Agreement have been inserted for convenience of reference only and shall not be
deemed to be a part of this Agreement.
Section 21. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York applicable to
contracts made and to be performed wholly therein.
IN WITNESS WHEREOF, the parties hereto have executed this Amended
and Restated Registration Rights Agreement on the date first written above.
THE PROVIDENCE SERVICE
CORPORATION
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-----------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-----------------
Title: CEO
------------------
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EOS PARTNERS SBIC II, L.P. (with Eos Partners
SBIC, L.P., holders of in excess of 50%
of the Restricted Shares)
By: EOS SBIC GENERAL II, L.P.,
its General Partner
By: EOS SBIC II, INC.,
its General Partner
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
-----------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇
-----------------
Title: Chairman
------------------
EOS PARTNERS SBIC, L.P. (with Eos Partners
SBIC II, L.P., holders of in excess of 50%
of the Restricted Shares)
By: EOS SBIC GENERAL, L.P.,
its General Partner
By: EOS SBIC, INC.,
its General Partner
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
-----------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇
------------------
Title: Chairman
--------------------
PETRA MEZZANINE FUND, L.P.
By: PETRA PARTNERS, LLC,
By:________________________
Name:
Title:
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HARBINGER MEZZANINE PARTNERS, L.P.
By: HARBINGER MEZZANINE GP,
LLC, its General Partner
By: HARBINGER MEZZANINE
MANAGER, INC., its Manager
By:________________________
Name:
Title:
▇▇▇▇▇▇▇▇ FAMILY TRUST
u/a June 26, 1996
---------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Trustee
---------------------------
▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇
---------------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
16
