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EXHIBIT 99.6
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT, dated as of October 27, 1997 (the
"Agreement"), is made by and between Selfcare, Inc., a Delaware corporation (the
"Company"), and Xxxxxxx Associates, L.P. and Westgate International, L.P.
(collectively, the "Initial Investor").
W I T N E S S E T H :
WHEREAS, in connection with the Securities Purchase Agreement dated as
of October 27, 1997 between the Initial Investor and the Company (the "Purchase
Agreement"), the Company has agreed, upon the terms and subject to the
conditions of said Purchase Agreement, to issue and sell to the Initial Investor
Ten Million U.S. Dollars face amount of Senior Subordinated Convertible Notes of
the Company (the "Notes"), together with Warrants to purchase additional shares
of common stock of the Company, par value $0.001 per share (the "Common Stock").
The shares of Common Stock into which the Notes are convertible, any shares of
Common Stock issuable pursuant to the Notes in lieu of cash interest and the
shares of Common Stock into which Warrants are exercisable are collectively
referred to herein as the "Common Shares." The term "Notes" as used herein shall
also mean any additional Notes issued pursuant hereto or pursuant to the
Purchase Agreement; the term "Warrants" as used herein shall also mean any
additional Warrants issued pursuant hereto or pursuant to the Purchase
Agreement.
WHEREAS, to induce the Initial Investor to execute and deliver the
Purchase Agreement, the Company has agreed to provide certain registration
rights under the Securities Act of 1933, as amended, and the rules and
regulations thereunder, or any similar successor statute (collectively, the
"1933 Act"), and applicable state securities laws with respect to the Common
Shares;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Company and the
Initial Investor hereby agree as follows:
1. Definitions. Capitalized terms used herein and not otherwise
defined herein shall have the respective meanings set forth in the Purchase
Agreement. As used in this Agreement, the following terms shall have the
following meanings:
(a) "Holders" are stockholders of the Company who, by virtue of
agreements with the Company, are entitled to include their securities in certain
Registration Statements filed by the Company.
(b) "Investors" means the Initial Investor and any transferee or
assignee of the Initial Investor who agrees to
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become bound by the provisions of this Agreement in accordance with Section 9
hereof.
(c) "Registrable Securities" means the Common Shares, together
with any shares of Common Stock or other securities which hereafter are issued
as a dividend or other distribution or in exchange for Common Shares and any
additional shares of Common Stock or other securities which hereafter are issued
due to anti-dilution adjustments with respect to the Common Shares, which are
required to be included in a Registration Statement pursuant to Section 2(a)
below.
(d) "Registration Period" means the period between the date of
this Agreement and the earlier of (i) the date on which all of the Registrable
Securities have been sold in transactions where the transferee is not subject to
resale registration restrictions or volume limitations imposed by the Securities
Act or any state securities law (or is subject to such restrictions or
limitations solely due to its status as an "affiliate" of the Company under the
Securities Act and the Rules promulgated thereunder), or (ii) the date on which
the Registrable Securities (in the reasonable opinion of Investors' counsel) may
thereafter be sold to the public without registration under Rule 144(k)
(assuming that the holder is not an "affiliate" of the Company).
(e) "Registration Statement" means a registration statement of
the Company filed with the Securities and Exchange Commission (the "SEC") under
the 1933 Act.
(f) The terms "register," "registered," and "registration" refer
to a registration effected by preparing and filing a Registration Statement in
compliance with the 1933 Act and applicable rules and regulations thereunder,
and the declaration or ordering of effectiveness of such Registration Statement
by the SEC.
2. Registration.
(a) Mandatory Registration. The Company will file a Registration
Statement with the SEC registering the Registrable Securities for resale within
one hundred (100) days of the closing of the purchase of the Notes (the "Closing
Date"). To the extent allowable under the 1933 Act, the Registration Statement
shall include the Common Shares and such indeterminate number of additional
shares of Common Stock as may become issuable in lieu of cash interest under any
of the Notes and as may become issuable upon conversion of the Notes and
exercise of the Warrants (i) to protect against dilution in accordance with the
terms of the Notes and the Warrants, or (ii) by reason of changes in the
conversion price of the Notes or the exercise price of the Warrants in
accordance with the terms thereof. The number of shares of Common Stock
initially included in such Registration Statement on account of the Investors
shall be no less than one and one half (1.5) times the number of Common Shares
that are issuable upon conversion of the Notes and
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exercise of the Warrants. The Company shall also have the right to register in
such Registration Statement (a) shares of Common Stock, if any, which the
Company presently has a contractual obligation to register for UBS'93
(approximately 438,750 shares), to the extent that the Company is contractually
obligated to register such shares in such Registration Statement, (b) additional
shares of Common Stock (approximately 31,250) which may be issued upon the
exercise of warrants issued by the Company on the date hereof to four
individuals at the request of Shoreline Pacific, and (c) shares of Common Stock,
if any, which the Company is hereafter involuntarily ordered, by a court of
competent jurisdiction, in a non-appealable court order, to include in such
Registration Statement (provided the Company has diligently attempted to prevent
the issuance of such court order) and has diligently prosecuted an appeal, if
permissible, of such court order. The Company shall use its best efforts to
cause such Registration Statement to be declared effective by the SEC as soon as
practicable after filing and in any event on or before the earlier of the
following two dates: (1) 187 days after the Company's registration statement
relating to the Series B Convertible Preferred Stock (the "Series B Registration
Statement"), the purchase of which closed on August 26, 1997, has been declared
effective by the SEC or (2) May 24, 1998. Such periods may be extended by the
number of days, not to exceed in the aggregate 90 days, that a permitted
"blackout" is in effect under the Series B Registration Statement (the earliest
date on which the Registration Statement is required to be declared effective
under this Section 2(a) is the "Required Effective Date"). Such best efforts
shall include, but not be limited to, promptly responding to all comments
received from the staff of the SEC. Should the Company receive notification from
the SEC that the Registration Statement will receive no action or no review from
the SEC, the Company shall cause such Registration Statement to become effective
within five (5) business days of such SEC notification; provided, however, that
in no event will the Company be required to cause such Registration Statement to
be declared effective prior to said 187 day period, as so permitted to be
extended for such "blackout" periods. Once declared effective by the SEC, the
Company shall cause such Registration Statement to remain effective throughout
the Registration Period.
(b) Late Registration Payments. If the Registration Statement
required pursuant to Section 2(a) above has not been declared effective by the
Required Effective Date, the Company will make cash payments to the Investor as
partial compensation for the added liquidity risk of such delay (the "Late
Registration Payments"). The Late Registration Payments will be equal to two
percent (2%) of the purchase price for the Notes (plus accrued but unpaid
interest) for each month (pro rated for partial months) following the Required
Effective Date, continuing through the date the Registration Statement is
declared effective by the SEC. The Late Registration Payments will be paid to
the Initial Investor within five (5) business days following the earlier of: (i)
the end of each month following the Required Effective Date, or (ii) the
effective date of the Registration
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Statement. Nothing herein shall limit the Investor's right to pursue damages
(including without limitation lost trading or other profits of the Investor and
expenses and reasonable legal fees incurred by the Investor; excluding, however,
other consequential damages and punitive damages) (collectively, "Damages") for
the Company's failure to file a Registration Statement or to have it declared
effective by the SEC on or prior to the Required Effective Date in accordance
with the terms of this Agreement. The late payments may be made, at the option
of each Initial Investor, in cash or additional Notes with the face amount of
any additional Notes equal to the Late Registration Payment (and including the
related Warrants in the same proportion as in the initial purchase of the Notes
pursuant to the Purchase Agreement).
(c) Piggyback Registrations. If, at any time prior to the
expiration of the Registration Period, the Company decides to register any of
its securities for its own account or for the account of others (excluding
registrations relating to equity securities to be issued solely in connection
with an acquisition of any entity or business or in connection with stock option
or other employee benefit plans), the Company will promptly give the Investors
written notice thereof, and will use its best efforts to include in such
registration all or any part of the Registrable Securities so requested by such
Investors (excluding any Registrable Securities previously included in a
Registration Statement which is then currently effective). Each Investor's
request for registration must be given to the Company in writing within ten (10)
business days after receipt of the notice from the Company. If the registration
for which the Company gives notice is a public offering involving an
underwriting, the Company will so advise the Investors as part of the
above-described written notice. In such event, if the managing underwriter(s) of
the public offering impose a limitation on the number of shares of Common Stock
which may be included in the Registration Statement because, in such
underwriter(s)' judgment, such limitation would be necessary to effect an
orderly public distribution, then the Company will be obligated to include only
such limited portion, if any, of the Registrable Securities with respect to
which such Investors have requested inclusion hereunder. Any exclusion of
Registrable Securities shall be made pro-rata among all Holders of the Company's
securities seeking to include shares of Common Stock in proportion to the number
of shares of Common Stock sought to be included by such Holders; provided,
however, that the Company will not exclude any Registrable Securities unless the
Company has first excluded all outstanding securities the Holders of which are
not entitled by right to inclusion in such Registration Statement. No right to
registration of Registrable Securities under this Section 2(c) shall be
construed to limit in any way the registration required under Section 2(a)
above. The obligations of the Company under this Section 2(c) will expire upon
the earlier of: (i) the effectiveness of the Registration Statement filed
pursuant to Section 2(a) above, unless such Registration Statement is no longer
effective and neither clause (ii) nor (iii) hereof have been met; (ii) after the
Company has afforded the opportunity for
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the Investors to exercise registration rights under this Section 2(c) for two
separate registrations; provided, however, that any Investor who shall have had
any Registrable Securities excluded from any Registration Statement in
accordance with this Section 2(c) shall be entitled to include in one additional
Registration Statement (for each one that an Investor had Registerable
Securities so excluded) filed by the Company the Registrable Securities so
excluded; or (iii) when all of the Registrable Securities held by any Investor
may be sold by such Investor under Rule 144 under the 1933 Act without being
subject to any volume restrictions or limitations.
(d) Eligibility for Form S-3. The Company represents and
warrants that it meets the requirements for the use of Form S-3 for registration
of the resale by the Investors of the Registrable Securities, and the Company
shall use all best efforts to file all reports required to be filed by the
Company with the SEC in a timely manner so as to maintain such eligibility for
the use of Form S-3.
3. Additional Obligations of the Company. In connection with the
registration of the Registrable Securities, the Company shall have the following
additional obligations:
(a) Except as otherwise expressly provided in this Agreement,
the Company shall use its best efforts to keep the Registration Statement
effective pursuant to Rule 415 under the 1933 Act at all times during the
Registration Period after such Registration Statement is initially declared
effective.
(b) The Registration Statement (including any amendments or
supplements thereto and prospectuses contained therein) filed by the Company
shall not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein, or necessary to make the statements
therein, in light of the circumstances in which they were made, not misleading.
The Company shall prepare and file with the SEC such amendments (including
post-effective amendments) and supplements to the Registration Statement and the
prospectus used in connection with the Registration Statement as may be
necessary to keep the Registration Statement effective at all times during the
Registration Period after such Registration Statement is initially declared
effective, and, at all times during such period, shall comply with the
provisions of the 1933 Act with respect to the disposition of all Registrable
Securities of the Company covered by the Registration Statement until such time
as all of such Registrable Securities have been disposed of. In the event the
number of shares of Common Stock included in a Registration Statement filed
pursuant to this Agreement (excluding piggyback registrations as provided for in
Section 2(c) above) is insufficient to cover all of such Registrable Securities,
the Company shall amend the Registration Statement and/or file a new
Registration Statement so as to cover all of the Registrable Securities as soon
as practicable, but in no event more than twenty (20) business days after the
Company first determines (or reasonably should have determined) the need
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therefor. The Company shall use its best efforts to cause such amendment and/or
new Registration Statement to become effective as soon as practicable following
the filing thereof. The Late Registration Payment provisions of Section 2(b)
above shall become applicable with respect to the effectiveness of such
amendment and/or new Registration Statement on the sixtieth (60th) day following
the date the Company first determines (or reasonably should have determined), or
is notified in writing of, the need for the amendment and/or new Registration
Statement.
(c) The Company shall furnish to each Investor whose Registrable
Securities are included in the Registration Statement (i) promptly after the
same is prepared and publicly distributed, filed with the SEC or received by the
Company, one copy of the Registration Statement and any amendment thereto; each
preliminary prospectus and final prospectus and each amendment or supplement
thereto; and, in the case of the Registration Statement required under Section
2(a) above, each letter written by or on behalf of the Company to the SEC and
each item of correspondence from the SEC, in each case relating to such
Registration Statement (other than any portion of any item thereof which
contains information for which the Company has sought confidential treatment);
and (ii) such number of copies of a prospectus, including a preliminary
prospectus, and all amendments and supplements thereto, and such other documents
as such Investor may reasonably request in order to facilitate the disposition
of the Registrable Securities owned by such Investor.
(d) The Company shall use its commercially reasonable efforts to
(i) register and qualify the Registrable Securities covered by the Registration
Statement under such other securities or blue sky laws of such jurisdictions as
the Investors reasonably request, (ii) prepare and file in those jurisdictions
such amendments (including post-effective amendments) and supplements to such
registrations as may be necessary to maintain the effectiveness thereof during
the Registration Period, (iii) take such other actions as may be necessary to
maintain such registrations and qualifications in effect at all times during the
Registration Period, and (iv) take all other actions reasonably necessary or
advisable to qualify the Registrable Securities for sale in such jurisdictions.
Notwithstanding the foregoing provision, the Company shall not be required in
connection therewith or as a condition thereto to (i) qualify to do business in
any jurisdiction where it would not otherwise be required to qualify but for
this Section 3(d), (ii) subject itself to general taxation in any such
jurisdiction, (iii) file a general consent to service of process in any such
jurisdiction, (iv) provide any non-customary undertakings that cause more than
nominal expense or burden to the Company, or (v) make any change in its charter
or bylaws, which in each case the Board of Directors of the Company determines
to be contrary to the best interests of the Company and its stockholders.
(e) In the event Investors who hold a majority in interest of
the Registrable Securities being offered in an offering select underwriters for
such offering, the Company shall
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enter into and perform its obligations under an underwriting agreement in usual
and customary form including, without limitation, customary indemnification and
contribution obligations, with the managing underwriter of such offering. Such
Investors shall use commercially reasonable efforts to consult with the Company
with respect to the selection of such underwriter. The Company shall have the
right to reasonably object to two (2) such underwriters proposed by the
Investors, provided the Company promptly so objects. No Investor shall be
obligated to participate in any such underwriting.
(f) As promptly as practicable after becoming aware of such
event, the Company shall notify each Investor who holds Registrable Securities
being sold pursuant to a Registration Statement of the happening of any event of
which the Company has knowledge as a result of which the prospectus included in
the 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, in light of the circumstances under
which they were made, not misleading (a "Suspension Event"). The Company shall
make such notification as promptly as practicable after the Company becomes
aware of such Suspension Event, shall promptly, but in all events within five
(5) business days, use its best efforts to prepare a supplement or amendment to
the Registration Statement to correct such untrue statement or omission, and
shall deliver a number of copies of such supplement or amendment to each
Investor as such Investor may reasonably request. Notwithstanding the foregoing
provision, the Company shall not be required to maintain the effectiveness of
the Registration Statement or to amend or supplement the Registration Statement
for a period (a "Delay Period") commencing on the happening of the Suspension
Event and expiring upon the earlier to occur of (i) the date on which such
material information is disclosed to the public or ceases to be material or,
(ii) the date on which the Company is able to comply with its disclosure
obligations and SEC requirements related thereto, or (iii) thirty (30) days
after the occurrence of the Suspension Event; provided, however, that there
shall not be more than two Delay Periods in any twelve (12) month period. In the
event that the aggregate number of days in all Delay Period(s) taken together
within a twelve-month period exceeds forty-five (45) days, or in the event that
there are more than two Delay Periods in any twelve-month period, regardless of
duration, the Company shall compensate the Investor for such delay by making
monthly cash payments, prorated on a daily basis, to such Investor of two
percent (2%) of the purchase price paid for the Registrable Shares still held by
such Investor at such time continuing through the date such Registration
Statement is declared effective by the SEC (the "Delay Compensation"). The Delay
Compensation will begin to accrue on the thirty-first (31st) day falling within
one or more Suspension Events in any twelve-month period, on the first day of
any Delay Period in excess of the first two Delay Periods in any twelve-month
period; and on the forty sixth day of all Delay Periods taken together in any
twelve-month period, and will be payable thirty days from each such date and
each thirty days thereafter until the Investor
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is notified that the Registration Statement becomes or is brought effective.
Payment of the Delay Compensation is not intended to be the Investor's exclusive
remedy; the Investor shall also be entitled to seek any Damages incurred.
(g) The Company shall use its best efforts to prevent the
issuance of any stop order or other suspension of effectiveness of a
Registration Statement and, if such an order or other suspension is issued,
shall use its best efforts to obtain the withdrawal of such order or other
suspension at the earliest possible time and to notify each Investor who holds
Registrable Securities being sold (and in the event of an underwritten offering,
the managing underwriters) of the issuance of such order or other suspension and
the resolution thereof. For purposes of Section 3(f), a stop order or other
suspension referred to in this subparagraph (g) shall be an additional
"Suspension Event."
(h) The Company shall permit a single firm of counsel designated
by the Investors who hold a majority in interest of the Registrable Securities
being sold pursuant to such registration to review the Registration Statement
and all amendments and supplements thereto (as well as all requests for
acceleration or effectiveness thereof) a reasonable period of time (not to
exceed five (5) business days) prior to their filing with the SEC, and shall not
file any document in a form to which such counsel reasonably objects. Clean and
marked (showing changes from previous drafts) copies shall be so provided to
counsel for the Investors. Such review shall not be deemed approval of anything
contained therein.
(i) The Company shall make generally available to its security
Holders as soon as practical, but not later than ninety (90) days after the
close of the period covered thereby, an earnings statement (in a form complying
with the provisions of Rule 158 under the 0000 Xxx) covering a twelve-month
period beginning not later than the first day of the Company's fiscal quarter
following the effective date of the Registration Statement.
(j) At the request of any Investor who holds the Registrable
Securities being sold pursuant to such registration, the Company shall furnish
on the date that Registrable Securities are delivered to an underwriter for sale
in connection with the Registration Statement (i) a letter, dated such date,
from the Company's independent certified public accountants in form and
substance as is customarily given by independent certified public accountants to
underwriters in an underwritten public offering, addressed to the underwriters;
and (ii) an opinion, dated such date, from counsel representing the Company for
purposes of such Registration Statement, in form and substance as is customarily
given in an underwritten public offering, addressed to the underwriters and
Investors.
(k) The Company shall make available for inspection by any
Investor whose Registrable Securities are being sold pursuant
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to such registration, any underwriter participating in any disposition pursuant
to the Registration Statement, and one firm of attorneys, accountants or other
agent retained by all such Investors and one firm of attorneys, accountants or
other agent retained by all underwriters (collectively, the "Inspectors"), all
pertinent financial and other records, pertinent corporate documents and
properties of the Company (collectively, the "Records"), as shall be reasonably
necessary to enable each Inspector to exercise its due diligence responsibility,
and cause the Company's officers, directors and employees to supply all
information which any Inspector may reasonably request for purposes of such due
diligence; provided, however, that each Inspector shall hold in confidence and
shall not make any disclosure (except to an Investor who agrees to be bound by
such confidentiality agreement) of any Record or other information which the
Company determines in good faith to be confidential, and of which determination
the Inspectors are so notified in writing, unless (i) the disclosure of such
Records is necessary to avoid or correct a misstatement or omission in any
Registration Statement, (ii) the release of such Records is ordered pursuant to
a subpoena or other order from a court or government body of competent
jurisdiction or such release is reasonably necessary in connection with
litigation or other legal process, or (iii) the information in such Records has
been made generally available to the public other than by disclosure by an
Investor or its agent or such Inspector in violation of this or any other
agreement. The Company shall not be required to disclose any confidential
information in such Records to any Inspector until and unless such Inspector
shall have entered into confidentiality agreements (in form and substance
satisfactory to the Company) with the Company with respect thereto,
substantially covering the matters set forth in the form of this Section 3(k).
Each Investor agrees that it shall, upon learning that disclosure of such
Records is sought in or by a court or governmental body of competent
jurisdiction or through other means, give prompt notice to the Company and allow
the Company, at the Company's expense, to undertake appropriate action to
prevent disclosure of, or to obtain a protective order for, the Records deemed
confidential. Nothing herein shall be deemed to limit the Investor's ability to
sell Registrable Securities in a manner which is otherwise consistent with
applicable laws and regulations.
(l) The Company shall hold in confidence and shall not make any
disclosure of information concerning an Investor provided to the Company
pursuant hereto unless (i) disclosure of such information is necessary to comply
with federal or state securities laws, (ii) the disclosure of such information
is necessary to avoid or correct a misstatement or omission in any Registration
Statement, (iii) the release of such information is ordered pursuant to a
subpoena or other order from a court or governmental body of competent
jurisdiction, or such release is reasonably necessary in connection with
litigation or other legal process, or (iv) such information has been made
generally available to the public other than by disclosure in violation of this
agreement. The Company agrees that it shall, upon learning
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that disclosure of such information concerning an Investor is sought in or by a
court or governmental body of competent jurisdiction or through other means,
give prompt notice to such Investor and allow such Investor, at its expense, to
undertake appropriate action to prevent disclosure of, or to obtain a protective
order for, such information.
(m) The Company shall use its best efforts either to (i) cause
all the Registrable Securities covered by the Registration Statement to be
listed on AMEX or another national securities exchange and on each additional
national securities exchange on which similar securities issued by the Company
are then listed, if any, if the listing of such Registrable Securities is then
permitted under the rules of such exchange, or (ii) secure designation of all
the Registrable Securities covered by the Registration Statement as a National
Association of Securities Dealers Automated Quotations System ("Nasdaq")
"national market system security" within the meaning of Rule 11Aa2-1 of the SEC
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and
the quotation of the Registrable Securities on the Nasdaq National Market System
or, if, despite the Company's best efforts to satisfy the preceding clause (i)
or (ii), the Company is unsuccessful in satisfying the preceding clause (i) or
(ii), to secure listing on a national securities exchange or Nasdaq
authorization and quotation for such Registrable Securities and, without
limiting the generality of the foregoing, to arrange for at least two market
makers to register with the National Association of Securities Dealers, Inc.
("NASD") as such with respect to such Registrable Securities.
(n) The Company shall provide a transfer agent and registrar,
which may be a single entity, for the Registrable Securities not later than the
effective date of the Registration Statement.
(o) The Company shall cooperate with the Investors who hold
Registrable Securities being sold and the managing underwriter or underwriters,
if any, to facilitate the timely preparation and delivery of certificates (not
bearing any restrictive legends) representing Registrable Securities to be sold
pursuant to the Registration Statement and enable such certificates to be in
such denominations or amounts as the case may be, and registered in such names
as the managing underwriter or underwriters, if any, or the Investors may
reasonably request; and, within three (3) trading days after a Registration
Statement which includes Registrable Securities is ordered effective by the SEC,
the Company shall deliver, and shall cause legal counsel selected by the Company
to deliver, to the transfer agent for the Registrable Securities (with copies to
the Investors whose Registrable Securities are included in such Registration
Statement) instructions to the transfer agent to issue new stock certificates
without a legend and an opinion of Company's counsel that the Common Shares have
been registered.
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(p) The Company shall take all other reasonable actions
necessary to expedite and facilitate disposition by the Investor of the
Registrable Securities pursuant to the Registration Statement.
4. Obligations of the Investors. In connection with the registration
of the Registrable Securities, the Investors shall have the following
obligations:
(a) It shall be a condition precedent to the obligations of the
Company to take any action pursuant to this Agreement with respect to each
Investor that such Investor shall, upon request of the Company, furnish to the
Company such information regarding itself, the number of Registrable Securities
held by it and the intended method of disposition of the Registrable Securities
held by it as shall be required by rules of the SEC to effect the registration
of the Registrable Securities. The information so provided by the Investor shall
be included without material alteration in the Registration Statement and shall
not be modified without such Investor's written consent, which consent shall be
deemed to be given, if not objected to, in connection with and upon completion
of the review contemplated by Section 3(h) hereof. At least twelve (12) business
days prior to the first anticipated filing date of the Registration Statement,
the Company shall notify each Investor of the information the Company requires
from each such Investor (the "Requested Information") if such Investor elects to
have any of such Investor's Registrable Securities included in the Registration
Statement. If within seven (7) business days of such notice the Company has not
received the Requested Information from an Investor (a "Non-Responsive
Investor"), then the Company may file the Registration Statement without
including Registrable Securities of such Non-Responsive Investor.
(b) Each Investor, by such Investor's acceptance of the
Registrable Securities, agrees to cooperate with the Company as required to
comply with applicable securities laws and as reasonably requested by the
Company in connection with the preparation and filing of the Registration
Statement hereunder, unless such Investor has notified the Company in writing of
such Investor's election to exclude all of such Investor's Registrable
Securities from the Registration Statement.
(c) In the event Investors holding a majority in interest of the
Registrable Securities being registered determine to engage (subject to Section
3(e) above) the services of an underwriter, each Investor agrees to enter into
and perform such Investor's obligations under an underwriting agreement, in
usual and customary form, including, without limitation, customary
indemnification and contribution obligations, with the managing underwriter of
such offering and take such other actions as are reasonably required in order to
expedite or facilitate the disposition of the Registrable Securities, unless
such Investor has notified the Company in writing of such Investor's election to
exclude all of such Investor's Registrable Securities from the
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applicable Registration Statement. No Investor shall be obligated to participate
in any such underwriting.
(d) Each Investor agrees that, upon receipt of any notice from
the Company of the happening of any event of the kind described in Section 3(f)
or 3(g), such Investor will immediately discontinue disposition of Registrable
Securities pursuant to the Registration Statement covering such Registrable
Securities until such Investor's receipt of the copies of the supplemented or
amended prospectus contemplated by Section 3(f) or 3(g) and, if so directed by
the Company, such Investor shall deliver to the Company (at the expense of the
Company) or destroy (and deliver to the Company a certificate of destruction)
all copies in such Investor's possession, of the prospectus covering such
Registrable Securities current at the time of receipt of such notice.
(e) No Investor may participate in any underwritten registration
hereunder unless such Investor (i) agrees to sell such Investor's Registrable
Securities on the basis provided in any underwriting arrangements approved by
the Investors entitled hereunder to approve such arrangements, (ii) completes
and executes all questionnaires, powers of attorney, indemnities, underwriting
agreements and other documents reasonably required under the terms of such
underwriting arrangements, and (iii) agrees to pay its pro rata share of all
underwriting discounts and commissions applicable with respect to its
Registrable Securities.
5. Expenses of Registration. All expenses, other than underwriting
discounts and commissions, incurred in connection with registrations, filings or
qualifications pursuant to Sections 2 and 3, including, without limitation, all
registration, listing and qualifications fees, printers and accounting fees, the
fees and disbursements of counsel for the Company and counsel for the
underwriter, and the reasonable fees and disbursements of one counsel selected
by the Initial Investors pursuant to Section 3(e) hereof, shall be borne by the
Company.
6. Indemnification. In the event any Registrable Securities are
included in a Registration Statement under this Agreement:
(a) To the extent permitted by law, the Company will indemnify
and hold harmless each Investor who holds such Registrable Securities, the
directors, if any, of such Investor, the officers, if any, of such Investor, the
partners, if any, of such Investor, each person, if any, who controls any
Investor within the meaning of the 1933 Act or the Exchange Act, any underwriter
(as defined in the 0000 Xxx) for the Investors, the directors, if any, of such
underwriter and the officers, if any, of such underwriter, and each person, if
any, who controls any such underwriter within the meaning of the 1933 Act or the
Exchange Act (each, an "Indemnified Person"), against any losses, claims,
damages, expenses or liabilities (joint or several)
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13
(collectively "Claims") to which any of them become subject under the 1933 Act,
the Exchange Act or otherwise, insofar as such Claims (or actions or
proceedings, whether commenced or threatened, in respect thereof) arise out of
or are based upon any of the following statements, omissions or violations in
the Registration Statement, or any post-effective amendment thereof, or any
prospectus included therein: (i) any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement or any
post-effective amendment thereof or 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, (ii) any untrue statement or alleged untrue
statement of a material fact contained in any preliminary prospectus if used
prior to the effective date of such Registration Statement, or contained in the
final prospectus (as amended or supplemented, if the Company files any amendment
thereof or supplement thereto with the SEC) or the omission or alleged omission
to state therein any material fact necessary to make the statements made
therein, in light of the circumstances under which the statements therein were
made, not misleading, or (iii) any violation or alleged violation by the Company
of the 1933 Act, the Exchange Act or any state securities law or any rule or
regulation promulgated thereunder (the matters in the foregoing clauses (i)
through (iii) being, collectively, "Violations"). Subject to the restrictions
set forth in Section 6(c) with respect to the number of legal counsel, the
Company shall reimburse the Investors and each such underwriter or controlling
person, promptly as such expenses are incurred and are due and payable, for any
legal fees or other reasonable expenses incurred by them in connection with
investigating or defending any such Claim. Notwithstanding anything to the
contrary contained herein, the indemnification agreement contained in this
Section 6(a): (A) shall not apply to a Claim arising out of or based upon a
Violation which occurs in reliance upon and in conformity with information
furnished in writing to the Company by any Indemnified Person or underwriter for
such Indemnified Person expressly for use in connection with the preparation of
the Registration Statement or any such amendment thereof or supplement thereto,
if such prospectus was timely made available by the Company pursuant to Section
3(c) hereof; (B) with respect to any preliminary prospectus shall not inure to
the benefit of any such person from whom the person asserting any such Claim
purchased the Registrable Securities that are the subject thereof (or to the
benefit of any person controlling such person) if the untrue statement or
omission of material fact contained in the preliminary prospectus was corrected
in the prospectus, as then amended or supplemented, if a prospectus was timely
made available by the Company pursuant to Section 3(c) hereof; and (C) shall not
apply to amounts paid in settlement of any Claim if such settlement is effected
without the prior written consent of the Company, which consent shall not be
unreasonably withheld. Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of the Indemnified Persons
and shall survive the transfer of the Registrable Securities by the Investors
pursuant to Section 9.
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14
(b) In connection with any Registration Statement in which an
Investor is participating, each such Investor, severally and not jointly, agrees
to indemnify and hold harmless, to the same extent and in the same manner set
forth in Section 6(a), the Company, each of its directors, each of its officers
who signs the Registration Statement, each person, if any, who controls the
Company within the meaning of the 1933 Act or the Exchange Act, any underwriter
and any other stockholder selling securities pursuant to the Registration
Statement or any of its directors or officers or any person who controls such
stockholder or underwriter within the meaning of the 1933 Act or the Exchange
Act (collectively and together with an Indemnified Person, an "Indemnified
Party"), against any Claim to which any of them may become subject, under the
1933 Act, the Exchange Act or otherwise, insofar as such Claim arises out of or
is based upon any Violation, in each case to the extent (and only to the extent)
that such Violation occurs in reliance upon and in conformity with written
information furnished to the Company by such Investor expressly for use in
connection with such Registration Statement, and such Investor will promptly
reimburse any legal or other expenses reasonably incurred by them in connection
with investigating or defending any such Claim; provided, however, that the
indemnity agreement contained in this Section 6(b) shall not apply to amounts
paid in settlement of any Claim if such settlement is effected without the prior
written consent of such Investor, which consent shall not be unreasonably
withheld; provided further, however, that the Investor shall be liable under
this Section 6(b) for only that amount of a Claim as does not exceed the net
proceeds to such Investor as a result of the sale of Registrable Securities
pursuant to such Registration Statement. Such indemnity shall remain in full
force and effect regardless of any investigation made by or on behalf of such
Indemnified Party and shall survive the transfer of the Registrable Securities
by the Investors pursuant to Section 9. Notwithstanding anything to the contrary
contained herein, the indemnification agreement contained in this Section 6(b)
with respect to any preliminary prospectus shall not inure to the benefit of any
Indemnified Party if the untrue statement or omission of material fact contained
in the preliminary prospectus was corrected on a timely basis in the prospectus,
as then amended or supplemented unless such corrected prospectus was timely
provided to the Investor and was not thereafter delivered as required by law on
a timely basis by the Investor or by an underwriter selected by such Investor.
(c) Promptly after receipt by an Indemnified Person or
Indemnified Party under this Section 6 of notice of the commencement of any
action (including any governmental action), such Indemnified Person or
Indemnified Party shall, if a Claim in respect thereof is to be made against any
indemnifying party under this Section 6, deliver to the indemnifying party a
written notice of the commencement thereof and this indemnifying party shall
have the right to participate in, and, to the extent the indemnifying party so
desires, jointly with any other indemnifying party similarly noticed, to assume
control of the defense thereof with counsel mutually satisfactory to the
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15
indemnifying parties; provided, however, that an Indemnified Person or
Indemnified Party shall have the right to retain its own counsel, with the fees
and expenses to be paid by the indemnifying party, if, in the reasonable opinion
of counsel retained by the indemnifying party, the representation by such
counsel of the Indemnified Person or Indemnified Party and the indemnifying
party would be inappropriate due to actual or potential differing interests
between such Indemnified Person or Indemnified Party and other party represented
by such counsel in such proceeding. The Company shall pay for only one separate
legal counsel for the Investors; such legal counsel shall be selected by the
Investors holding a majority in interest of the Registrable Securities. The
failure to deliver written notice to the indemnifying party within a reasonable
period of time following the commencement of any such action shall not relieve
such indemnifying party of any liability to the Indemnified Person or
Indemnified Party under this Section 6, except to the extent that the
indemnifying party is prejudiced in its ability to defend such action. The
indemnification required by this Section 6 shall be made by periodic payments of
the amount thereof during the course of the investigation or defense, as such
expense, loss, damage or liability is incurred and is due and payable.
7. Contribution. If the indemnification provided for in Section 6
herein is unavailable to the Indemnified Parties in respect of any losses,
claims, damages or liabilities referred to herein (other than by reason of the
exceptions provided therein), then each such Indemnifying Party, in lieu of
indemnifying such Indemnified Party, shall contribute to the amount paid or
payable by such Indemnified Party as a result of such losses, claims, damages or
liabilities as between the Company on the one hand and any Investor on the
other, in such proportion as is appropriate to reflect the relative fault of the
Company and of such Investor in connection with the statements or omissions
which resulted in such losses, claims, damages or liabilities, as well as any
other relevant equitable considerations. The relative fault of the Company on
the one hand and of any Investor on the other shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates
to information supplied by the Company or by such Investor.
In no event shall the obligation of any Indemnifying Party to
contribute under this Section 7 exceed the amount that such Indemnifying Party
would have been obligated to pay by way of indemnification if the
indemnification provided for under Section 6(a) or 6(b) hereof had been
available under the circumstances.
The Company and the Investors agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro rata
allocation (even if the Investors or the underwriters were treated as one entity
for such purpose) or by any other method of allocation which does not take
account of the equitable considerations referred to in the immediately preceding
paragraphs. The amount paid or payable by an
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16
Indemnified Party as a result of the losses, claims, damages and liabilities
referred to in the immediately preceding paragraphs shall be deemed to include,
subject to the limitations set forth above, any legal or other expenses
reasonably incurred by such Indemnified Party in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
section, no Investor or underwriter shall be required to contribute any amount
in excess of the amount by which (i) in the case of any Investor, the net
proceeds received by such Investor from the sale of Registrable Securities or
(ii) in the case of an underwriter, the total price at which the Registrable
Securities purchased by it and distributed to the public were offered to the
public exceeds, in any such case, the amount of any damages that such Investor
or underwriter 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.
8. With a view to making available to the Investors the benefits of
Rule 144 promulgated under the Securities Act or any other similar rule or
regulation of the SEC that may at any time permit the Investors to sell
securities of the Company to the public without registration ("Rule 144"), the
Company agrees (until such time as all Registrable Securities may be sold by the
Investor pursuant to Rule 144(k)) to:
(a) File with the SEC in a timely manner and make and keep
available all reports and other documents required of the Company under the
Exchange Act so long as the Company remains subject to such requirements and the
filing and availability of such reports and other documents is required for the
applicable provisions of Rule 144; and
(b) Furnish to each Investor so long as such Investor holds
Registrable Securities, promptly upon request, (i) a written statement by the
Company that it has complied with the reporting requirements of Rule 144 and the
Exchange Act, (ii) a copy of the most recent annual or quarterly report of the
Company and such other reports and documents so filed by the Company, and (iii)
such other information as may be reasonably requested to permit the Investors to
sell such securities pursuant to Rule 144 without registration.
9. Assignment of Registration Rights. The rights to have the Company
register Registrable Securities pursuant to this Agreement shall be
automatically assigned with respect to the transferred Registrable Securities or
Notes or Warrants by the Investors to transferees or assignees of all or any
portion of such securities only if (i) the Investor agrees in writing with the
transferee or assignee to assign such rights and a copy of such agreement is
furnished to the Company within a reasonable time after such assignment, (ii)
the Company is, within a reasonable period of time after such transfer or
assignment, furnished with written notice of the name and address of such
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17
transferee or assignee and the securities with respect to which such
registration rights are being transferred or assigned, (iii) following such
transfer or assignment the further public disposition of such securities by the
transferee or assignee is conditioned, restricted or limited under the 1933 Act
or applicable state securities laws, (iv) at or before the time the Company
received the written notice contemplated by clause (ii) of this sentence, the
transferee or assignee agrees in writing with the Company to be bound by all of
the relevant provisions contained herein, (v) such transfer shall have been made
in all material respects in accordance with the applicable requirements of the
Purchase Agreement, and (vi) such transferee shall be an "accredited investor"
as that term is defined in Rule 501 of Regulation D promulgated under the 1933
Act.
10. Amendment of Registration Rights. Provisions of this Agreement may
be amended and the observance thereof may be waived (either generally or in a
particular instance and either retroactively or prospectively) only with the
written consent of the Company and each Investor in the case of an amendment,
and in the case of a waiver, with the written consent of the party charged with
the enforcement of any such provision. Any amendment or waiver effected in
accordance with this Section 10 shall be binding upon each Investor and the
Company.
11. Third Party Beneficiary. The parties acknowledge and agree that
Shoreline Pacific Institutional Finance, the Institutional Division of Financial
West Group ("Shoreline"), shall be deemed a third party beneficiary of the
Company's agreements and representations set forth in this Agreement and to
indemnification by the Company for any damages resulting to Shoreline from any
actual or threatened breach thereof by the Company, both in Shoreline's personal
capacity and, should Shoreline so elect, and provided that Shoreline has
obtained the prior written consent of the Investor, on behalf of the Investor.
12. Miscellaneous.
(a) Conflicting Instructions. A person or entity is deemed to be
a holder of Registrable Securities whenever such person or entity owns of record
such Registrable Securities. If the Company receives conflicting instructions,
notices or elections from two or more persons or entities with respect to the
same Registrable Securities, the Company shall act upon the basis of
instructions, notice or election received from the registered owner of such
Registrable Securities.
(b) Notices. Any notices required or permitted to be given under
the terms of this Agreement shall be sent by certified or registered mail (with
return receipt requested) or delivered personally or by courier (including a
nationally recognized overnight delivery service) or by facsimile transmission.
Any notice so given shall be deemed effective upon receipt if delivered
personally, by U.S. Mail, by courier or by facsimile transmission, in each case
addressed to a party at the
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18
following address or such other address as each such party furnishes to the
other in accordance with this Section 12(b):
If to the Company:
Selfcare, Inc.
000 Xxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: Xxx Xxxxxxxxx
Facsimile: (000) 000-0000
With copy to:
Xxxxxxx, Procter & Xxxx XXX
Xxxxxxxx Xxxxx
Xxxxxx, XX 00000
Telecopy: (000) 000-0000
Attention: Xxxxxxx X. Xxxx, P.C. &
Xxxxxx Xxxxxxxxxx, III, P.C.
If to either Investor:
c/o Stonington Management Corporation
000 Xxxxx Xxxxxx, 00xx Xx.
Xxx Xxxx, XX 00000
Attention: Xxxxx Xxxxx
Facsimile: (000) 000-0000
with a copy to:
Kleinberg, Kaplan, Xxxxx & Xxxxx, P.C.
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxxxx, Esq.
Facsimile: (000) 000-0000
In each case with a copy to:
Shoreline Pacific Institutional Finance
0 Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxx, XX 00000
Attention: General Counsel
Facsimile: (000) 000-0000
(c) Waiver. Failure of any party to exercise any right or remedy
under this Agreement or otherwise, or delay by a party in exercising such right
or remedy, shall not operate as a waiver thereof.
(d) Governing Law. This Agreement shall be enforced, governed by
and construed in accordance with the laws of the State of Delaware, without
giving effect to rules governing the conflict of laws, and any disputes arising
hereunder will be adjudicated in federal or state court situated therein or in
the State of New York. Each party hereto consents to such venue in Delaware and
New York and to the personal and subject matter
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19
jurisdiction of said courts and, to the extent permitted by applicable law,
agrees to waive any objection as to such jurisdiction or venue, and agrees not
to assert any defense based on lack of jurisdiction or venue.
(e) Severability. In the event that any provision of this
Agreement is invalid or unenforceable under any applicable statute or rule of
law, then such provision shall be deemed inoperative to the extent that it may
conflict therewith and shall be deemed modified to conform with such statute or
rule of law. Any provision hereof which may prove invalid or unenforceable under
any law shall not affect the validity or enforceability of any other provision
hereof.
(f) Entire Agreement. This Agreement and the Purchase Agreement
(including all schedules and exhibits thereto) constitute the entire agreement
among the parties hereto with respect to the subject matter hereof. There are no
restrictions, promises, warranties or undertakings, other than those set forth
or referred to herein or therein. This Agreement supersedes all prior agreements
and understandings among the parties hereto with respect to the subject matter
hereof. Nothing in this Agreement is intended to reduce the Company's
obligations or reduce the Investor's rights under the Purchase Agreement.
(g) Successors and Assigns. Subject to the requirements of
Section 9 hereof, this Agreement shall inure to the benefit of and be binding
upon the successors and assigns of each of the parties hereto.
(h) Use of Pronouns. All pronouns and any variations thereof
refer to the masculine, feminine or neuter, singular or plural, as the context
may require.
(i) Headings. The headings and subheadings in the Agreement are
for convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(j) Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original but all of which shall
constitute one and the same agreement. This Agreement, once executed by a party,
may be delivered to the other party hereto by facsimile transmission, and
facsimile signatures shall be binding on the parties hereto.
(k) Further Acts. Each party shall do and perform, or cause to
be done and performed, all such further acts and things, and shall execute and
deliver all such other agreements, certificates, instruments and documents, as
the other party may reasonably request in order to carry out the intent and
accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.
(l) Remedies. No provision of this Agreement providing for any
remedy to the Company or an Investor, respectively, shall limit any remedy which
would otherwise be
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20
available to such party at law or in equity. Nothing in this Agreement shall
limit any rights the Company or an Investor, respectively, may have with respect
to any applicable federal or state securities laws with respect to the
investment contemplated hereby. The Company and each Investor acknowledges that
a breach by it of its respective obligations hereunder will cause irreparable
harm to each Investor, in the case of the Company, and the Company, in the case
of an Investor. Accordingly, the Company and each Investor acknowledge that the
remedy at law for a breach of its obligations under this Agreement will be
inadequate and agrees, in the event of a breach or threatened breach by the
Company or an Investor, as the case may be, of the provisions of this Agreement,
that an Investor or the Company, as the case may be, shall be entitled, in
addition to all other available remedies, to an injunction restraining any
breach and requiring immediate compliance, without the necessity of showing
economic loss and without any bond or other security being required.
(m) Consents. All consents and other determinations to be made
by the Investors pursuant to this Agreement shall be made by Investors holding a
majority of the Registrable Securities, determined as if all Warrants and Notes
then outstanding had been exercised or converted for Registrable Securities.
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21
IN WITNESS WHEREOF, the parties have caused this Registration Rights
Agreement to be duly executed as of the date first above written.
COMPANY:
SELFCARE, INC.
By: /s/ Xxx Xxxxxxxxx
---------------------------
Name: Xxx Xxxxxxxxx
Title: President and CEO
INITIAL INVESTORS:
XXXXXXX ASSOCIATES, L.P.
By: /s/ Xxxx Xxxxx
---------------------------
Name:
Title:
WESTGATE INTERNATIONAL, L.P.
By: Martley International, Inc.
Attorney-in-fact
By: /s/ Xxxx Xxxxx
---------------------------
Name:
Title:
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