Exhibit 4.10
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT dated March 12, 2004 (the
"Agreement") is entered into by and among Team Health, Inc., a Tennessee
corporation (the "Company"), the guarantors listed in Schedule 1 hereto (the
"Guarantors"), and X.X. Xxxxxx Securities Inc., Banc of America Securities LLC
and Xxxxxxx Xxxxx Xxxxxx Xxxxxx & Xxxxx Incorporated (the "Initial Purchasers").
The Company, the Guarantors and the Initial Purchasers are
parties to the Purchase Agreement dated March 12, 2004 (the "Purchase
Agreement"), which provides for the sale by the Company to the Initial
Purchasers of $180,000,000 aggregate principal amount of the Company's 9% Senior
Subordinated Notes due 2012 (the "Securities"), which will be guaranteed on an
unsecured senior subordinated basis by each of the Guarantors. As an inducement
to the Initial Purchasers to enter into the Purchase Agreement, the Company and
the Guarantors have agreed to provide to the Initial Purchasers and their direct
and indirect transferees the registration rights set forth in this Agreement.
The execution and delivery of this Agreement is a condition to the closing under
the Purchase Agreement.
In consideration of the foregoing, the parties hereto agree as
follows:
1. Definitions. As used in this Agreement, the following
terms shall have the following meanings:
"Business Day" shall mean any day that is not a Saturday,
Sunday or other day on which commercial banks in New York City are authorized or
required by law to remain closed.
"Closing Date" shall mean the Closing Date as defined in the
Purchase Agreement.
"Company" shall have the meaning set forth in the preamble and
shall also include the Company's successors.
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended from time to time.
"Exchange Dates" shall have the meaning set forth in Section
2(a)(ii) hereof.
"Exchange Offer" shall mean the exchange offer by the Company
and the Guarantors of Exchange Securities for Registrable Securities pursuant to
Section 2(a) hereof.
"Exchange Offer Registration" shall mean a registration under
the Securities Act effected pursuant to Section 2(a) hereof.
"Exchange Offer Registration Statement" shall mean an exchange
offer registration statement on Form S-4 (or, if applicable, on another
appropriate form) and all amendments
and supplements to such registration statement, in each case including the
Prospectus contained therein, all exhibits thereto and any document incorporated
by reference therein.
"Exchange Securities" shall mean senior subordinated notes
issued by the Company and guaranteed by the Guarantors under the Indenture
containing terms identical to the Securities (except that the Exchange
Securities will not be subject to restrictions on transfer or to any increase in
annual interest rate for failure to comply with this Agreement) and to be
offered to Holders of Securities in exchange for Securities pursuant to the
Exchange Offer.
"Guarantors" shall have the meaning set forth in the preamble
and shall also include any Guarantor's successors.
"Holders" shall mean the Initial Purchasers, for so long as
they own any Registrable Securities, and each of their successors, assigns and
direct and indirect transferees who become owners of Registrable Securities
under the Indenture; provided that for purposes of Sections 4 and 5 of this
Agreement, the term "Holders" shall include Participating Broker-Dealers.
"Initial Purchasers" shall have the meaning set forth in the
preamble.
"Indenture" shall mean the Indenture relating to the
Securities dated as of March 23, 2004 among the Company, the Guarantors and The
Bank of New York, as trustee, and as the same may be amended from time to time
in accordance with the terms thereof.
"Majority Holders" shall mean the Holders of a majority of the
aggregate principal amount of outstanding Registrable Securities; provided that
whenever the consent or approval of Holders of a specified percentage of
Registrable Securities is required hereunder, Registrable Securities owned
directly or indirectly by the Company or any of its affiliates shall not be
counted in determining whether such consent or approval was given by the Holders
of such required percentage or amount.
"Participating Broker-Dealer" shall have the meaning set forth
in Section 4(a) hereof.
"Person" shall mean an individual, partnership, limited
liability company, corporation, trust or unincorporated organization, or a
government or agency or political subdivision thereof.
"Prospectus" shall mean the prospectus included in a
Registration Statement, including any preliminary prospectus, and any such
prospectus as amended or supplemented by any prospectus supplement, including a
prospectus supplement with respect to the terms of the offering of any portion
of the Registrable Securities covered by a Shelf Registration Statement, and by
all other amendments and supplements to such prospectus, and in each case
including any document incorporated by reference therein.
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"Purchase Agreement" shall have the meaning set forth in the
preamble.
"Registrable Securities" shall mean the Securities; provided
that the Securities shall cease to be Registrable Securities (i) when a
Registration Statement with respect to such Securities has been declared
effective under the Securities Act and such Securities have been exchanged or
disposed of pursuant to such Registration Statement, (ii) when such Securities
are eligible to be sold pursuant to Rule 144(k) (or any similar provision then
in force, but not Rule 144A) under the Securities Act or (iii) when such
Securities cease to be outstanding.
"Registration Expenses" shall mean any and all expenses
incident to performance of or compliance by the Company and the Guarantors with
this Agreement, including, without limitation, (i) all SEC, stock exchange or
National Association of Securities Dealers, Inc. registration and filing fees,
(ii) all fees and expenses incurred in connection with compliance with state
securities or blue sky laws (including reasonable fees and disbursements of
counsel for any Underwriters or Holders in connection with blue sky
qualification of any Exchange Securities or Registrable Securities), (iii) all
expenses of any Persons in preparing or assisting in preparing, word processing,
printing and distributing any Registration Statement, any Prospectus and any
amendments or supplements thereto, any underwriting agreements, securities sales
agreements or other similar agreements and any other documents relating to the
performance of and compliance with this Agreement, (iv) all rating agency fees,
(v) all fees and disbursements relating to the qualification of the Indenture
under applicable securities laws, (vi) the fees and disbursements of the Trustee
and its counsel, (vii) the fees and disbursements of counsel for the Company and
the Guarantors and, in the case of a Shelf Registration Statement, the fees and
disbursements of one counsel for the Holders (which counsel shall be selected by
the Majority Holders and which counsel may also be counsel for the Initial
Purchasers) and (viii) the fees and disbursements of the independent public
accountants of the Company and the Guarantors, including the expenses of any
special audits or "comfort" letters required by or incident to the performance
of and compliance with this Agreement, but excluding fees and expenses of
counsel to the Underwriters (other than fees and expenses set forth in clause
(ii) above) or the Holders and underwriting discounts and commissions and
transfer taxes, if any, relating to the sale or disposition of Registrable
Securities by a Holder.
"Registration Statement" shall mean any registration statement
of the Company and the Guarantors that covers any of the Exchange Securities or
Registrable Securities pursuant to the provisions of this Agreement and all
amendments and supplements to any such registration statement, including
post-effective amendments, in each case including the Prospectus contained
therein, all exhibits thereto and any document incorporated by reference
therein.
"SEC" shall mean the Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933, as
amended from time to time.
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"Shelf Effectiveness Period" shall have the meaning set forth
in Section 2(b) hereof.
"Shelf Registration" shall mean a registration effected
pursuant to Section 2(b) hereof.
"Shelf Registration Statement" shall mean a "shelf"
registration statement of the Company and the Guarantors that covers all the
Registrable Securities (but no other securities unless approved by the Holders
whose Registrable Securities are to be covered by such Shelf Registration
Statement) on an appropriate form under Rule 415 under the Securities Act, or
any similar rule that may be adopted by the SEC, and all amendments and
supplements to such registration statement, including post-effective amendments,
in each case including the Prospectus contained therein, all exhibits thereto
and any document incorporated by reference therein.
"Trust Indenture Act" shall mean the Trust Indenture Act of
1939, as amended from time to time.
"Trustee" shall mean the trustee with respect to the
Securities under the Indenture.
"Underwriter" shall have the meaning set forth in Section 3
hereof.
"Underwritten Offering" shall mean an offering in which
Registrable Securities are sold to an Underwriter for reoffering to the public.
2. Registration Under the Securities Act. (a) To the
extent not prohibited by any applicable law or applicable interpretations of the
Staff of the SEC, the Company and the Guarantors shall use their reasonable best
efforts to (i) cause to be filed an Exchange Offer Registration Statement
covering an offer to the Holders to exchange all the Registrable Securities for
Exchange Securities and (ii) have such Registration Statement remain effective
until 180 days after the closing of the Exchange Offer. The Company and the
Guarantors shall commence the Exchange Offer promptly after the Exchange Offer
Registration Statement is declared effective by the SEC and use their
commercially reasonable efforts to complete the Exchange Offer not later than 60
days after such effective date.
The Company and the Guarantors shall commence the Exchange
Offer by mailing the related Prospectus, appropriate letters of transmittal and
other accompanying documents to each Holder stating, in addition to such other
disclosures as are required by applicable law,
(i) that the Exchange Offer is being made pursuant to this
Agreement and that all Registrable Securities validly tendered
and not properly withdrawn will be accepted for exchange;
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(ii) the dates of acceptance for exchange (which shall be a period
of at least 20 Business Days from the date such notice is
mailed) (the "Exchange Dates");
(iii) that any Registrable Security not tendered will remain
outstanding and continue to accrue interest but will not
retain any rights under this Agreement;
(iv) that any Holder electing to have a Registrable Security
exchanged pursuant to the Exchange Offer will be required to
surrender such Registrable Security, together with the
appropriate letters of transmittal, to the institution and at
the address (located in the Borough of Manhattan, The City of
New York) and in the manner specified in the notice, prior to
the close of business on the last Exchange Date; and
(v) that any Holder will be entitled to withdraw its election, not
later than the close of business on the last Exchange Date, by
sending to the institution and at the address (located in the
Borough of Manhattan, The City of New York) specified in the
notice, a telegram, telex, facsimile transmission or letter
setting forth the name of such Holder, the principal amount of
Registrable Securities delivered for exchange and a statement
that such Holder is withdrawing its election to have such
Securities exchanged.
As a condition to participating in the Exchange Offer, a
Holder will be required to represent to the Company and the Guarantors that (i)
any Exchange Securities to be received by it will be acquired in the ordinary
course of its business, (ii) at the time of the commencement of the Exchange
Offer it has no arrangement or understanding with any Person to participate in
the distribution (within the meaning of the Securities Act) of the Exchange
Securities in violation of the provisions of the Securities Act, (iii) it is not
an "affiliate" (within the meaning of Rule 405 under Securities Act) of the
Company or any Guarantor and (iv) if such Holder is a broker-dealer that will
receive Exchange Securities for its own account in exchange for Registrable
Securities that were acquired as a result of market-making or other trading
activities, then such Holder will deliver a Prospectus in connection with any
resale of such Exchange Securities.
As soon as practicable after the last Exchange Date, the
Company and the Guarantors shall
(i) accept for exchange Registrable Securities or portions thereof
validly tendered and not properly withdrawn pursuant to the
Exchange Offer; and
(ii) deliver, or cause to be delivered, to the Trustee for
cancellation all Registrable Securities or portions thereof so
accepted for exchange by the Company and issue, and cause the
Trustee to promptly authenticate and deliver to each Holder,
Exchange Securities equal in principal amount to the principal
amount of the Registrable Securities surrendered by such
Holder.
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The Company and the Guarantors shall use their commercially
reasonable efforts to complete the Exchange Offer as provided above and shall
comply with the applicable requirements of the Securities Act, the Exchange Act
and other applicable laws and regulations in connection with the Exchange Offer.
The Exchange Offer shall not be subject to any conditions, other than that the
Exchange Offer does not violate any applicable law or applicable interpretations
of the Staff of the SEC.
(b) In the event that (i) the Company and the Guarantors
determine that the Exchange Offer Registration provided for in Section 2(a)
above is not available or may not be completed as soon as practicable after the
last Exchange Date because it would violate any applicable law or applicable
interpretations of the Staff of the SEC, (ii) the Exchange Offer is not for any
other reason completed by the date that is 210 days after the Closing Date or
(iii) upon completion of the Exchange Offer any Initial Purchaser shall so
request in connection with any offering or sale of Registrable Securities, the
Company and the Guarantors shall use their reasonable best efforts to cause to
be filed as soon as practicable after such determination, date or request, as
the case may be, a Shelf Registration Statement providing for the sale of all
the Registrable Securities by the Holders thereof and to have such Shelf
Registration Statement declared effective by the SEC.
In the event that the Company and the Guarantors are required
to file a Shelf Registration Statement pursuant to clause (iii) of the preceding
sentence, the Company and the Guarantors shall use their reasonable best efforts
to file and have declared effective by the SEC both an Exchange Offer
Registration Statement pursuant to Section 2(a) with respect to all Registrable
Securities and a Shelf Registration Statement (which may be a combined
Registration Statement with the Exchange Offer Registration Statement) with
respect to offers and sales of Registrable Securities held by the Initial
Purchasers after completion of the Exchange Offer.
The Company and the Guarantors agree to use their reasonable
best efforts to keep the Shelf Registration Statement continuously effective
until the expiration of the period referred to in Rule 144(k) under the
Securities Act with respect to the Registrable Securities or such shorter period
that will terminate when all the Registrable Securities covered by the Shelf
Registration Statement have been sold pursuant to the Shelf Registration
Statement (the "Shelf Effectiveness Period"). The Company and the Guarantors
further agree to supplement or amend the Shelf Registration Statement and the
related Prospectus if required by the rules, regulations or instructions
applicable to the registration form used by the Company for such Shelf
Registration Statement or by the Securities Act or by any other rules and
regulations thereunder for shelf registration or if reasonably requested by a
Holder of Registrable Securities with respect to information relating to such
Holder, and to use their commercially reasonable efforts to cause any such
amendment to become effective and such Shelf Registration Statement and
Prospectus to become usable as soon as thereafter practicable. The Company and
the Guarantors agree to furnish to the Holders of Registrable Securities copies
of any such supplement or amendment promptly after its being used or filed with
the SEC.
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(c) The Company and the Guarantors shall pay all
Registration Expenses in connection with the registration pursuant to Section
2(a) and Section 2(b) hereof. Each Holder shall pay all underwriting discounts
and commissions and transfer taxes, if any, relating to the sale or disposition
of such Holder's Registrable Securities pursuant to the Shelf Registration
Statement.
(d) An Exchange Offer Registration Statement pursuant to
Section 2(a) hereof or a Shelf Registration Statement pursuant to Section 2(b)
hereof will not be deemed to have become effective unless it has been declared
effective by the SEC.
In the event that either the Exchange Offer is not completed
or the Shelf Registration Statement, if required hereby, is not declared
effective on or prior to the date that is 210 days after the Closing Date (the
"Target Registration Date"), the interest rate on the Registrable Securities
will be increased by (i) 0.25% per annum for the first 90-day period immediately
following the Target Registration Date and (ii) an additional 0.25% per annum
with respect to each subsequent 90-day period, in each case until the Exchange
Offer is completed or the Shelf Registration Statement, if required hereby, is
declared effective by the SEC or the Securities become freely tradable under the
Securities Act, up to a maximum of 1.00% per annum of additional interest.
If the Shelf Registration Statement has been declared
effective and thereafter either ceases to be effective or the Prospectus
contained therein ceases to be usable at any time during the Shelf Effectiveness
Period, and such failure to remain effective or usable exists for more than 30
days (whether or not consecutive) in any 12-month period, then the interest rate
on the Registrable Securities will be increased by 1.00% per annum commencing on
the 31st day in such 12-month period and ending on such date that the Shelf
Registration Statement has again been declared effective or the Prospectus again
becomes usable.
(e) Without limiting the remedies available to the
Initial Purchasers and the Holders, the Company and the Guarantors acknowledge
that any failure by the Company or the Guarantors to comply with their
obligations under Section 2(a) and Section 2(b) hereof may result in material
irreparable injury to the Initial Purchasers or the Holders for which there is
no adequate remedy at law, that it will not be possible to measure damages for
such injuries precisely and that, in the event of any such failure, the Initial
Purchasers or any Holder may obtain such relief as may be required to
specifically enforce the Company's and the Guarantors' obligations under Section
2(a) and Section 2(b) hereof.
3. Registration Procedures. In connection with their
obligations pursuant to Section 2(a) and Section 2(b) hereof, the Company and
the Guarantors shall:
(a) prepare and file with the SEC a Registration
Statement on the appropriate form under the Securities Act, which form
(x) shall be selected by the Company and the Guarantors, (y) shall, in
the case of a Shelf Registration, be available for the sale of the
Registrable Securities by the selling Holders thereof and (z) shall
comply as
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to form in all material respects with the requirements of the
applicable form and include all financial statements required by the
SEC to be filed therewith; and use their commercially reasonable
efforts to cause such Registration Statement to become effective and
remain effective for the applicable period in accordance with Section 2
hereof;
(b) prepare and file with the SEC such amendments and
post-effective amendments to each Registration Statement as may be
necessary to keep such Registration Statement effective for the
applicable period in accordance with Section 2 hereof and cause each
Prospectus to be supplemented by any required prospectus supplement
and, as so supplemented, to be filed pursuant to Rule 424 under the
Securities Act; and keep each Prospectus current during the period
described in Section 4(3) of and Rule 174 under the Securities Act that
is applicable to transactions by brokers or dealers with respect to the
Registrable Securities or Exchange Securities;
(c) in the case of a Shelf Registration, furnish to each
Holder of Registrable Securities, to counsel for the Initial
Purchasers, to counsel for such Holders and to each Underwriter of an
Underwritten Offering of Registrable Securities, if any, without
charge, as many copies of each Prospectus, including each preliminary
Prospectus, and any amendment or supplement thereto, in order to
facilitate the sale or other disposition of the Registrable Securities
thereunder; and the Company and the Guarantors consent to the use of
such Prospectus and any amendment or supplement thereto in accordance
with applicable law by each of the selling Holders of Registrable
Securities and any such Underwriters in connection with the offering
and sale of the Registrable Securities covered by and in the manner
described in such Prospectus or any amendment or supplement thereto in
accordance with applicable law;
(d) use their commercially reasonable efforts to register
or qualify the Registrable Securities under all applicable state
securities or blue sky laws of such jurisdictions as any Holder of
Registrable Securities covered by a Registration Statement shall
reasonably request in writing by the time the applicable Registration
Statement is declared effective by the SEC; cooperate with the Holders
in connection with any filings required to be made with the National
Association of Securities Dealers, Inc.; and do any and all other acts
and things that may be reasonably necessary or advisable to enable each
Holder to complete the disposition in each such jurisdiction of the
Registrable Securities owned by such Holder; provided that neither the
Company nor any Guarantor shall be required to (i) qualify as a foreign
corporation or other entity or as a dealer in securities in any such
jurisdiction where it would not otherwise be required to so qualify,
(ii) file any general consent to service of process in any such
jurisdiction or (iii) subject itself to taxation in any such
jurisdiction if it is not so subject;
(e) in the case of a Shelf Registration, notify each
Holder of Registrable Securities, counsel for such Holders and counsel
for the Initial Purchasers promptly
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and, if requested by any such Holder or counsel, confirm such advice in
writing (i) when a Registration Statement has become effective and when
any post-effective amendment thereto has been filed and becomes
effective, (ii) of any request by the SEC or any state securities
authority for amendments and supplements to a Registration Statement
and Prospectus or for additional information after the Registration
Statement has become effective, (iii) of the issuance by the SEC or any
state securities authority of any stop order suspending the
effectiveness of a Registration Statement or the initiation of any
proceedings for that purpose, (iv) if, between the effective date of a
Registration Statement and the closing of any sale of Registrable
Securities covered thereby, the representations and warranties of the
Company or any Guarantor contained in any underwriting agreement,
securities sales agreement or other similar agreement, if any, relating
to an offering of such Registrable Securities cease to be true and
correct in all material respects or if the Company or any Guarantor
receives any notification with respect to the suspension of the
qualification of the Registrable Securities for sale in any
jurisdiction or the initiation of any proceeding for such purpose, (v)
of the happening of any event during the period a Shelf Registration
Statement is effective that makes any statement made in such
Registration Statement or the related Prospectus untrue in any material
respect or that requires the making of any changes in such Registration
Statement or Prospectus in order to make the statements therein not
misleading and (vi) of any determination by the Company or any
Guarantor that a post-effective amendment to a Registration Statement
would be appropriate;
(f) use their commercially reasonable efforts to obtain
the withdrawal of any order suspending the effectiveness of a
Registration Statement at the earliest possible moment and provide
prompt notice to each Holder of the withdrawal of any such order;
(g) in the case of a Shelf Registration, furnish to each
Holder of Registrable Securities, without charge, at least one
conformed copy of each Registration Statement and any post-effective
amendment thereto (without any documents incorporated therein by
reference or exhibits thereto, unless requested);
(h) in the case of a Shelf Registration, cooperate with
the selling Holders of Registrable Securities to facilitate the timely
preparation and delivery of certificates representing Registrable
Securities to be sold and not bearing any restrictive legends and
enable such Registrable Securities to be issued in such denominations
and registered in such names (consistent with the provisions of the
Indenture) as the selling Holders may reasonably request at least two
Business Days prior to the closing of any sale of Registrable
Securities;
(i) in the case of a Shelf Registration, upon the
occurrence of any event contemplated by Section 3(e)(v) hereof, use
their commercially reasonable efforts to prepare and file with the SEC
a supplement or post-effective amendment to a Registration
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Statement or the related Prospectus or any document incorporated
therein by reference or file any other required document so that, as
thereafter delivered to purchasers of the Registrable Securities, such
Prospectus will not contain any untrue statement of a material fact or
omit to state a material fact necessary to make the statements therein,
in the light of the circumstances under which they were made, not
misleading; and the Company and the Guarantors shall notify the Holders
of Registrable Securities to suspend use of the Prospectus as promptly
as practicable after the occurrence of such an event, and such Holders
hereby agree to suspend use of the Prospectus until the Company and the
Guarantors have amended or supplemented the Prospectus to correct such
misstatement or omission;
(j) a reasonable time prior to the filing of any
Registration Statement, any Prospectus, any amendment to a Registration
Statement or amendment or supplement to a Prospectus or of any document
that is to be incorporated by reference into a Registration Statement
or a Prospectus after initial filing of a Registration Statement,
provide copies of such document to the Initial Purchasers and their
counsel (and, in the case of a Shelf Registration Statement, to the
Holders of Registrable Securities and their counsel) and make such of
the representatives of the Company and the Guarantors as shall be
reasonably requested by the Initial Purchasers or their counsel (and,
in the case of a Shelf Registration Statement, the Holders of
Registrable Securities or their counsel) available for discussion of
such document; and the Company and the Guarantors shall not, at any
time after initial filing of a Registration Statement, file any
Prospectus, any amendment of or supplement to a Registration Statement
or a Prospectus, or any document that is to be incorporated by
reference into a Registration Statement or a Prospectus, of which the
Initial Purchasers and their counsel (and, in the case of a Shelf
Registration Statement, the Holders of Registrable Securities and their
counsel) shall not have previously been advised and furnished a copy or
to which the Initial Purchasers or their counsel (and, in the case of a
Shelf Registration Statement, the Holders or their counsel) shall
object;
(k) obtain a CUSIP number for all Exchange Securities or
Registrable Securities, as the case may be, not later than the
effective date of a Registration Statement;
(l) cause the Indenture to be qualified under the Trust
Indenture Act in connection with the registration of the Exchange
Securities or Registrable Securities, as the case may be; cooperate
with the Trustee and the Holders to effect such changes to the
Indenture as may be required for the Indenture to be so qualified in
accordance with the terms of the Trust Indenture Act; and execute, and
use their commercially reasonable efforts to cause the Trustee to
execute, all documents as may be required to effect such changes and
all other forms and documents required to be filed with the SEC to
enable the Indenture to be so qualified in a timely manner;
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(m) in the case of a Shelf Registration, make available
for inspection by a representative of the Holders of the Registrable
Securities (an "Inspector"), any Underwriter participating in any
disposition pursuant to such Shelf Registration Statement, and
attorneys and accountants designated by the Holders, at reasonable
times and in a reasonable manner, all pertinent financial and other
records, documents and properties of the Company and the Guarantors,
and cause the respective officers, directors and employees of the
Company and the Guarantors to supply all information reasonably
requested by any such Inspector, Underwriter, attorney or accountant in
connection with a Shelf Registration Statement; provided that if any
such information is identified by the Company or any Guarantor as being
confidential or proprietary, each Person receiving such information
shall take such actions as are reasonably necessary to protect the
confidentiality of such information to the extent such action is
otherwise not inconsistent with, an impairment of or in derogation of
the rights and interests of any Inspector, Holder or Underwriter);
(n) in the case of a Shelf Registration, use their
commercially reasonable efforts to cause all Registrable Securities to
be listed on any securities exchange or any automated quotation system
on which similar securities issued or guaranteed by the Company or any
Guarantor are then listed if requested by the Majority Holders, to the
extent such Registrable Securities satisfy applicable listing
requirements;
(o) if reasonably requested by any Holder of Registrable
Securities covered by a Registration Statement, promptly incorporate in
a Prospectus supplement or post-effective amendment such information
with respect to such Holder as such Holder reasonably requests to be
included therein and make all required filings of such Prospectus
supplement or such post-effective amendment as soon as the Company has
received notification of the matters to be incorporated in such filing;
and
(p) in the case of a Shelf Registration, enter into such
customary agreements and take all such other actions in connection
therewith (including those requested by the Holders of a majority in
principal amount of the Registrable Securities being sold) in order to
expedite or facilitate the disposition of such Registrable Securities
including, but not limited to, an Underwritten Offering and in such
connection, (i) to the extent possible, make such representations and
warranties to the Holders and any Underwriters of such Registrable
Securities with respect to the business of the Company and its
subsidiaries, the Registration Statement, Prospectus and documents
incorporated by reference or deemed incorporated by reference, if any,
in each case, in form, substance and scope as are customarily made by
issuers to underwriters in underwritten offerings and confirm the same
if and when requested, (ii) obtain opinions of counsel to the Company
and the Guarantors (which counsel and opinions, in form, scope and
substance, shall be reasonably satisfactory to the Holders and such
Underwriters and their respective counsel) addressed to each selling
Holder and Underwriter of Registrable Securities, covering the matters
customarily covered in opinions re-
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quested in underwritten offerings, (iii) obtain "comfort" letters from
the independent certified public accountants of the Company and the
Guarantors (and, if necessary, any other certified public accountant of
any subsidiary of the Company or any Guarantor, or of any business
acquired by the Company or any Guarantor for which financial statements
and financial data are or are required to be included in the
Registration Statement) addressed to each selling Holder and
Underwriter of Registrable Securities, such letters to be in customary
form and covering matters of the type customarily covered in "comfort"
letters in connection with underwritten offerings and (iv) deliver such
documents and certificates as may be reasonably requested by the
Holders of a majority in principal amount of the Registrable Securities
being sold or the Underwriters, and which are customarily delivered in
underwritten offerings, to evidence the continued validity of the
representations and warranties of the Company and the Guarantors made
pursuant to clause (i) above and to evidence compliance with any
customary conditions contained in an underwriting agreement.
In the case of a Shelf Registration Statement, the Company may
require each Holder of Registrable Securities to furnish to the Company such
information regarding such Holder and the proposed disposition by such Holder of
such Registrable Securities as the Company and the Guarantors may from time to
time reasonably request in writing.
In the case of a Shelf Registration Statement, each Holder of
Registrable Securities agrees that, upon receipt of any notice from the Company
and the Guarantors of the happening of any event of the kind described in
Section 3(e)(iii) or 3(e)(v) hereof, such Holder will forthwith discontinue
disposition of Registrable Securities pursuant to a Registration Statement until
such Holder's receipt of the copies of the supplemented or amended Prospectus
contemplated by Section 3(i) hereof and, if so directed by the Company and the
Guarantors, such Holder will deliver to the Company and the Guarantors all
copies in its possession, other than permanent file copies then in such Holder's
possession, of the Prospectus covering such Registrable Securities that is
current at the time of receipt of such notice.
If the Company and the Guarantors shall give any such notice
to suspend the disposition of Registrable Securities pursuant to a Registration
Statement, the Company and the Guarantors shall extend the period during which
the Registration Statement shall be maintained effective pursuant to this
Agreement by the number of days during the period from and including the date of
the giving of such notice to and including the date when the Holders shall have
received copies of the supplemented or amended Prospectus necessary to resume
such dispositions. The Company and the Guarantors may give any such notice only
twice during any 365-day period and any such suspensions shall not exceed 30
days for each suspension and there shall not be more than two suspensions in
effect during any 365-day period.
The Holders of Registrable Securities covered by a Shelf
Registration Statement who desire to do so may sell such Registrable Securities
in an Underwritten Offering. In any such Underwritten Offering, the investment
banker or investment bankers and manager or
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managers (the "Underwriters") that will administer the offering will be selected
by the Majority Holders of the Registrable Securities included in such offering.
4. Participation of Broker-Dealers in Exchange Offer.
(a) (a) The Staff of the SEC has taken the position that any broker-dealer that
receives Exchange Securities for its own account in the Exchange Offer in
exchange for Securities that were acquired by such broker-dealer as a result of
market-making or other trading activities (a "Participating Broker-Dealer") may
be deemed to be an "underwriter" within the meaning of the Securities Act and
must deliver a prospectus meeting the requirements of the Securities Act in
connection with any resale of such Exchange Securities.
The Company and the Guarantors understand that it is the
Staff's position that if the Prospectus contained in the Exchange Offer
Registration Statement includes a plan of distribution containing a statement to
the above effect and the means by which Participating Broker-Dealers may resell
the Exchange Securities, without naming the Participating Broker-Dealers or
specifying the amount of Exchange Securities owned by them, such Prospectus may
be delivered by Participating Broker-Dealers to satisfy their prospectus
delivery obligation under the Securities Act in connection with resales of
Exchange Securities for their own accounts, so long as the Prospectus otherwise
meets the requirements of the Securities Act.
(b) In light of the above, and notwithstanding the other
provisions of this Agreement, the Company and the Guarantors agree to amend or
supplement the Prospectus contained in the Exchange Offer Registration
Statement, as would otherwise be contemplated by Section 3(i), for a period of
up to 180 days after the last Exchange Date (as such period may be extended
pursuant to the penultimate paragraph of Section 3 of this Agreement), if
requested by the Initial Purchasers or by one or more Participating
Broker-Dealers, in order to expedite or facilitate the disposition of any
Exchange Securities by Participating Broker-Dealers consistent with the
positions of the Staff recited in Section 4(a) above. The Company and the
Guarantors further agree that Participating Broker-Dealers shall be authorized
to deliver such Prospectus during such period in connection with the resales
contemplated by this Section 4.
(c) The Initial Purchasers shall have no liability to the
Company, any Guarantor or any Holder with respect to any request that they may
make pursuant to Section 4(b) above.
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5. Indemnification and Contribution. (a) (a) The Company
and the Guarantors, jointly and severally, agree to indemnify and hold harmless
each Initial Purchaser and each Holder, their respective affiliates, directors
and officers and each Person, if any, who controls any Initial Purchaser or any
Holder within the meaning of Section 15 of the Securities Act or Section 20 of
the Exchange Act, from and against any and all losses, claims, damages and
liabilities (including, without limitation, reasonable legal fees and other
expenses incurred in connection with any suit, action or proceeding or any claim
asserted, as such fees and expenses are incurred), joint or several, that arise
out of, or are based upon, any untrue statement or alleged untrue statement of a
material fact contained in any Registration Statement or any Prospectus or any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading, except
insofar as such losses, claims, damages or liabilities arise out of, or are
based upon, any untrue statement or omission or alleged untrue statement or
omission made in reliance upon and in conformity with any information relating
to any Initial Purchaser or any Holder furnished to the Company in writing
through X.X. Xxxxxx Securities Inc. or any selling Holder expressly for use
therein. In connection with any Underwritten Offering permitted by Section 3,
the Company and the Guarantors, jointly and severally, will also indemnify the
Underwriters, if any, selling brokers, dealers and similar securities industry
professionals participating in the distribution, their respective affiliates and
each Person who controls such Persons (within the meaning of the Securities Act
and the Exchange Act) to the same extent as provided above with respect to the
indemnification of the Holders, if requested in connection with any Registration
Statement.
(b) Each Holder agrees, severally and not jointly, to
indemnify and hold harmless the Company, the Guarantors, the Initial Purchasers
and the other selling Holders, their respective affiliates, the directors of the
Company and the Guarantors, each officer of the Company and the Guarantors who
signed the Registration Statement and each Person, if any, who controls the
Company, the Guarantors, any Initial Purchaser and any other selling Holder
within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act to the same extent as the indemnity set forth in paragraph (a)
above, but only with respect to any losses, claims, damages or liabilities that
arise out of, or are based upon, any untrue statement or omission or alleged
untrue statement or omission made in reliance upon and in conformity with any
information relating to such Holder furnished to the Company in writing by such
Holder expressly for use in any Registration Statement and any Prospectus.
(c) If any suit, action, proceeding (including any
governmental or regulatory investigation), claim or demand shall be brought or
asserted against any Person in respect of which indemnification may be sought
pursuant to either paragraph (a) or (b) above, such Person (the "Indemnified
Person") shall promptly notify the Person against whom such indemnification may
be sought (the "Indemnifying Person") in writing; provided that the failure to
notify the Indemnifying Person shall not relieve it from any liability that it
may have under this Section 5 except to the extent that it has been materially
prejudiced (through the forfeiture of substantive rights or defenses) by such
failure; and provided, further, that the failure to notify the Indemnifying
Person shall not relieve it from any liability that it may have to an
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Indemnified Person otherwise than under this Section 5. If any such proceeding
shall be brought or asserted against an Indemnified Person and it shall have
notified the Indemnifying Person thereof, the Indemnifying Person shall retain
counsel reasonably satisfactory to the Indemnified Person to represent the
Indemnified Person and any others entitled to indemnification pursuant to this
Section 5 that the Indemnifying Person may designate in such proceeding and
shall pay the reasonable fees and expenses of such counsel related to such
proceeding, as incurred. In any such proceeding, any Indemnified Person shall
have the right to retain its own counsel, but the fees and expenses of such
counsel shall be at the expense of such Indemnified Person unless (i) the
Indemnifying Person and the Indemnified Person shall have mutually agreed to the
contrary; (ii) the Indemnifying Person has failed within a reasonable time to
retain counsel reasonably satisfactory to the Indemnified Person; (iii) the
Indemnified Person shall have reasonably concluded that there may be legal
defenses available to it that are different from or in addition to those
available to the Indemnifying Person; or (iv) the named parties in any such
proceeding (including any impleaded parties) include both the Indemnifying
Person and the Indemnified Person and representation of both parties by the same
counsel would be inappropriate due to actual or potential differing interests
between them. It is understood and agreed that the Indemnifying Person shall
not, unless there exists a conflict among Indemnified Persons, in connection
with any proceeding or related proceeding in the same jurisdiction, be liable
for the fees and expenses of more than one separate firm (in addition to any
local counsel) for all Indemnified Persons, and that all such fees and expenses
shall be reimbursed as they are incurred. Any such separate firm (x) for any
Initial Purchaser, its affiliates, directors and officers and any control
Persons of such Initial Purchaser shall be designated in writing by X.X. Xxxxxx
Securities Inc., (y) for any Holder, its affiliates, directors and officers and
any control Persons of such Holder shall be designated in writing by the
Majority Holders and (z) in all other cases shall be designated in writing by
the Company. The Indemnifying Person shall not be liable for any settlement of
any proceeding effected without its written consent, but if settled with such
consent or if there be a final judgment for the plaintiff, the Indemnifying
Person agrees to indemnify each Indemnified Person from and against any loss or
liability by reason of such settlement or judgment. Notwithstanding the
foregoing sentence, if at any time an Indemnified Person shall have requested
that an Indemnifying Person reimburse the Indemnified Person for fees and
expenses of counsel as contemplated by this paragraph, the Indemnifying Person
shall be liable for any settlement of any proceeding effected without its
written consent if (i) such settlement is entered into more than 30 days after
receipt by the Indemnifying Person of such request and (ii) the Indemnifying
Person shall not have reimbursed the Indemnified Person in accordance with such
request prior to the date of such settlement. No Indemnifying Person shall,
without the written consent of the Indemnified Person, effect any settlement of
any pending or threatened proceeding in respect of which any Indemnified Person
is or could have been a party and indemnification could have been sought
hereunder by such Indemnified Person, unless such settlement (A) includes an
unconditional release of such Indemnified Person, in form and substance
reasonably satisfactory to such Indemnified Person, from all liability on claims
that are the subject matter of such proceeding and (B) does
15
not include any statement as to or any admission of fault, culpability or a
failure to act by or on behalf of any Indemnified Person.
(d) If the indemnification provided for in paragraphs (a)
and (b) above is unavailable to an Indemnified Person or insufficient in respect
of any losses, claims, damages or liabilities referred to therein, then each
Indemnifying Person under such paragraph, in lieu of indemnifying such
Indemnified Person thereunder, shall contribute to the amount paid or payable by
such Indemnified Person as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company and the Guarantors from the offering of the
Securities and the Exchange Securities, on the one hand, and by the Holders from
receiving Securities or Exchange Securities registered under the Securities Act,
on the other hand, or (ii) if the allocation provided by clause (i) is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) but also the relative fault
of the Company and the Guarantors on the one hand and the Holders on the other
in connection with the statements or omissions that resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative fault of the Company and the Guarantors on the one
hand and the Holders on the other 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 Company and the Guarantors or by the Holders and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.
(e) The Company, the Guarantors and the Holders agree
that it would not be just and equitable if contribution pursuant to this Section
5 were determined by pro rata allocation (even if the Holders were treated as
one entity for such purpose) or by any other method of allocation that does not
take account of the equitable considerations referred to in paragraph (d) above.
The amount paid or payable by an Indemnified Person as a result of the losses,
claims, damages and liabilities referred to in paragraph (d) above shall be
deemed to include, subject to the limitations set forth above, any reasonable
legal or other expenses actually incurred by such Indemnified Person in
connection with any such action or claim. Notwithstanding the provisions of this
Section 5, in no event shall a Holder be required to contribute any amount in
excess of the amount by which the total price at which the Securities or
Exchange Securities sold by such Holder 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. 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.
(f) The remedies provided for in this Section 5 are not
exclusive and shall not limit any rights or remedies that may otherwise be
available to any Indemnified Person at law or in equity.
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(g) The indemnity and contribution provisions contained
in this Section 5 shall remain operative and in full force and effect regardless
of (i) any termination of this Agreement, (ii) any investigation made by or on
behalf of the Initial Purchasers or any Holder, their respective affiliates or
any Person controlling any Initial Purchaser or any Holder, or by or on behalf
of the Company or the Guarantors, their respective affiliates or the officers or
directors of or any Person controlling the Company or the Guarantors, (iii)
acceptance of any of the Exchange Securities and (iv) any sale of Registrable
Securities pursuant to a Shelf Registration Statement.
6. General.
(a) No Inconsistent Agreements. The Company and the
Guarantors represent, warrant and agree that (i) the rights granted to the
Holders hereunder do not in any way conflict with and are not inconsistent with
the rights granted to the holders of any other outstanding securities issued or
guaranteed by the Company or any Guarantor under any other agreement and (ii)
neither the Company nor any Guarantor has entered into, or on or after the date
of this Agreement will enter into, any agreement that is inconsistent with the
rights granted to the Holders of Registrable Securities in this Agreement or
otherwise conflicts with the provisions hereof.
(b) Amendments and Waivers. The provisions of this
Agreement, including the provisions of this sentence, may not be amended,
modified or supplemented, and waivers or consents to departures from the
provisions hereof may not be given unless the Company and the Guarantors have
obtained the written consent of Holders of at least a majority in aggregate
principal amount of the outstanding Registrable Securities affected by such
amendment, modification, supplement, waiver or consent; provided that no
amendment, modification, supplement, waiver or consent to any departure from the
provisions of Section 5 hereof shall be effective as against any Holder of
Registrable Securities unless consented to in writing by such Holder. Any
amendments, modifications, supplements, waivers or consents pursuant to this
Section 6(b) shall be by a writing executed by each of the parties hereto.
(c) Notices. All notices and other communications
provided for or permitted hereunder shall be made in writing by hand-delivery,
registered first-class mail, telex, telecopier, or any courier guaranteeing
overnight delivery (i) if to a Holder, at the most current address given by such
Holder to the Company by means of a notice given in accordance with the
provisions of this Section 6(c), which address initially is, with respect to the
Initial Purchasers, the address set forth in the Purchase Agreement; (ii) if to
the Company and the Guarantors, initially at the Company's address set forth in
the Purchase Agreement and thereafter at such other address, notice of which is
given in accordance with the provisions of this Section 6(c); and (iii) to such
other persons at their respective addresses as provided in the Purchase
Agreement and thereafter at such other address, notice of which is given in
accordance with the provisions of this Section 6(c). All such notices and
communications shall be deemed to have been duly given at the time delivered by
hand, if personally delivered; five
17
Business Days after being deposited in the mail, postage prepaid, if mailed;
when answered back, if telexed; when receipt is acknowledged, if telecopied; and
on the next Business Day if timely delivered to an air courier guaranteeing
overnight delivery. Copies of all such notices, demands or other communications
shall be concurrently delivered by the Person giving the same to the Trustee, at
the address specified in the Indenture.
(d) Successors and Assigns. This Agreement shall inure to
the benefit of and be binding upon the successors, assigns and transferees of
each of the parties, including, without limitation and without the need for an
express assignment, subsequent Holders; provided that nothing herein shall be
deemed to permit any assignment, transfer or other disposition of Registrable
Securities in violation of the terms of the Purchase Agreement or the Indenture.
If any transferee of any Holder shall acquire Registrable Securities in any
manner, whether by operation of law or otherwise, such Registrable Securities
shall be held subject to all the terms of this Agreement, and by taking and
holding such Registrable Securities such Person shall be conclusively deemed to
have agreed to be bound by and to perform all of the terms and provisions of
this Agreement and such Person shall be entitled to receive the benefits hereof.
The Initial Purchasers (in their capacity as Initial Purchasers) shall have no
liability or obligation to the Company or the Guarantors with respect to any
failure by a Holder to comply with, or any breach by any Holder of, any of the
obligations of such Holder under this Agreement.
(e) Purchases and Sales of Securities. The Company and
the Guarantors shall not, and shall use their commercially reasonable efforts to
cause their affiliates (as defined in Rule 405 under the Securities Act) not to,
purchase and then resell or otherwise transfer any Registrable Securities.
(f) Third Party Beneficiaries. Each Holder shall be a
third party beneficiary to the agreements made hereunder between the Company and
the Guarantors, on the one hand, and the Initial Purchasers, on the other hand,
and shall have the right to enforce such agreements directly to the extent it
deems such enforcement necessary or advisable to protect its rights or the
rights of other Holders hereunder.
(g) Counterparts. This Agreement may be executed in any
number of counterparts and by the parties hereto in separate counterparts, each
of which when so executed shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement.
(h) Headings. The headings in this Agreement are for
convenience of reference only, are not a part of this Agreement and shall not
limit or otherwise affect the meaning hereof.
(i) Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of New York without
regard to principles of conflicts of law.
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(j) Miscellaneous. This Agreement together with the
Purchase Agreement contains the entire agreement between the parties relating to
the subject matter hereof and supersedes all oral statements and prior writings
with respect thereto. If any term, provision, covenant or restriction contained
in this Agreement is held by a court of competent jurisdiction to be invalid,
void or unenforceable or against public policy, the remainder of the terms,
provisions, covenants and restrictions contained herein shall remain in full
force and effect and shall in no way be affected, impaired or invalidated. The
Company, the Guarantors and the Initial Purchasers shall endeavor in good faith
negotiations to replace the invalid, void or unenforceable provisions with valid
provisions the economic effect of which comes as close as possible to that of
the invalid, void or unenforceable provisions.
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IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
TEAM HEALTH, INC.
By: /s/ Xxxxxx Xxxxxxxxxx
------------------------------------
Name: Xxxxxx Xxxxxxxxxx
Title: Executive Vice President -
Finance and Administration
[GUARANTORS]
By: /s/ Xxxxxx Xxxxxxxxxx
------------------------------------
Name: Xxxxxx Xxxxxxxxxx
Title: Vice President
Confirmed and accepted as of the date first above written:
X.X. XXXXXX SECURITIES INC.
For itself and on behalf of the
several Initial Purchasers
By /s/ Xxxxxxx X. Xxxx
----------------------------------
Name: Xxxxxxx X. Xxxx
Title: MD
20
