REGISTRATION RIGHTS AGREEMENT by and among TREAN INSURANCE GROUP, INC. and THE PERSONS LISTED ON SCHEDULE A HERETO
Exhibit 10.1
by and among
and
THE PERSONS LISTED ON SCHEDULE A HERETO
Dated as of [•], 2020
Table of Contents
Page
| Section 1. | Definitions | 1 |
| Section 2. | Registration Rights | 4 |
| (a) | Demand Registration | 4 |
| (b) | Priority on Demand Registrations | 4 |
| (c) | Restrictions on Demand Registrations | 5 |
| (d) | Selection of Underwriters | 5 |
| (e) | Effective Period of Demand Registrations | 5 |
| Section 3. | Piggyback Registrations | 6 |
| (a) | Right to Piggyback | 6 |
| (b) | Priority on Primary Registrations | 6 |
| (c) | Priority on Secondary Registrations | 6 |
| (d) | Selection of Underwriters | 7 |
| (e) | Other Jurisdictions | 7 |
| Section 4. | Shelf Registration | 7 |
| (a) | S-3 Registration | 7 |
| (b) | Block Trade | 8 |
| Section 5. | Lock-Up Agreements | 8 |
| Section 6. | Registration Procedures | 8 |
| Section 7. | Registration Expenses | 12 |
| Section 8. | Indemnification | 13 |
| (a) | Indemnification by the Company | 13 |
| (b) | Indemnification by the Holders | 14 |
| (c) | Notices of Claims, etc. | 14 |
| (d) | Contribution | 15 |
| (e) | No Exclusivity | 15 |
| Section 9. | Covenants Relating to Rule 144 | 16 |
| Section 10. | Limitation on Subsequent Registration Rights | 16 |
| Section 11. | Miscellaneous | 16 |
| (a) | Termination; Survival | 16 |
| (b) | Governing Law | 16 |
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| (c) | Consent to Jurisdiction; Venue; Waiver of Jury Trial | 16 |
| (d) | Entire Agreement | 17 |
| (e) | Amendments and Waivers | 17 |
| (f) | Successors and Assigns | 17 |
| (g) | Counterparts; Electronic Signature | 17 |
| (h) | Severability | 18 |
| (i) | Notices | 18 |
| (j) | Specific Performance | 19 |
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THIS REGISTRATION RIGHTS AGREEMENT, dated as of [•], 2020 (this “Agreement”), is by and among Trean Insurance Group, Inc., a Delaware
corporation (the “Company”), and the persons listed on Schedule A hereto (such persons, in their capacity as holders of Registrable Securities (as defined below), including any permitted transferees
hereunder, the “Holders” and each a “Holder”).
RECITALS
WHEREAS, pursuant to a Reorganization Agreement, dated as of the date hereof, by and among the Company, BIC Holdings LLC, a Delaware limited liability company (“BIC Holdings”), Trean Holdings LLC, a Delaware limited liability company (“Trean Holdings”), and certain other parties thereto (the “Reorganization
Agreement”), the Company has effected the following transactions (collectively, the “Reorganization Transactions”): (i) each of Trean Holdings and BIC Holdings contributed all of their respective assets
and liabilities to the Company, in exchange for shares of common stock, par value $0.01 per share, of the Company (the “Common Stock”), (ii) the Company acquired from ▇▇▇▇▇ ▇▇▇▇▇ Enterprises I, Inc., a Delaware
corporation, ▇▇▇▇▇ ▇▇▇▇▇ Enterprises II, Inc., a Delaware corporation and ▇▇▇▇▇ ▇▇▇▇▇ Enterprises III, Inc., a Delaware corporation their 55% equity interest in Compstar Holding Company LLC, a Delaware limited liability company (“Compstar”) in exchange for approximately 6.6 million shares of Common Stock, after which the Company contributed such 55% equity interest in Compstar to Trean Compstar Holdings LLC (“Trean
Compstar”), such that Trean Compstar now owns 100% of Compstar, and (iii) following the completion of the transfers by Trean Holdings and BIC Holdings, Trean Holdings and BIC Holdings will be dissolved and will distribute in-kind shares to the
current holders of each of Trean Holdings and BIC Holdings equity interests (the “Pre-IPO Unitholders”) (including with respect to the Trean Holdings and BIC Holdings Class C units held by ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, one
of the Company’s directors, that became fully vested in connection with the initial public offering of the Company’s Common Stock (the “IPO”));
WHEREAS, the shares of Common Stock issued to the Holders pursuant to the Reorganization Transactions are not registered under the Securities Act of 1933, as amended, and any
successor thereto, and any rules and regulations promulgated thereunder, all as the same shall be in effect from time to time (the “Securities Act”); and
WHEREAS, the board of directors of the Company (the “Board”) has determined that it is advisable and in the best interests of the Company and
its stockholders to take steps to enable the Company to effect an IPO, including providing the Holders registration rights.
NOW, THEREFORE, in consideration of the premises and of the mutual covenants and obligations hereinafter set forth, and for other good and valuable considerations, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:
Section 1. Definitions. As used in this
Agreement, the following terms shall have the following meanings:
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“Affiliate” shall mean a Person that directly, or indirectly through one or more intermediaries, controls or is controlled by, or is under common control with, the Person specified.
For purposes of this definition, “control” (including the terms “controlling,” “controlled by” and “under common control with”) shall mean the possession, direct or indirect, of the power to direct or cause the direction of the management and policies
of a person, whether through the ownership of voting securities, by contract, or otherwise.
“Agreement” has the meaning set forth in the Preamble.
“Board” has the meaning set forth in the Recitals.
“BIC Holdings” has the meaning set forth in the Preamble.
“Business Day” shall mean any day other than a Saturday, Sunday or other day on which commercial banks in New York, New York are authorized or required by law or executive order to
close.
“Common Stock” has the meaning set forth in the Recitals.
“Company” has the meaning set forth in the Preamble.
“Demand Registration” shall have the meaning set forth in Section 2(a).
“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended (or any corresponding provision of succeeding law), and the rules and regulations
thereunder.
“Holders” has the meaning set forth in the Preamble.
“Initiating Holders” shall have the meaning set forth in Section 2(a).
“IPO” has the meaning set forth in the Recitals.
“Permitted Offerings” shall have the meaning set forth in Section 3(a).
“Person” shall mean any natural person, corporation, limited partnership, general partnership, limited liability company, joint stock company, joint venture, association, company,
estate, trust, bank trust company, land trust, business trust, or other organization, whether or not a legal entity, custodian, trustee-executor, administrator, nominee or entity in a representative capacity and any government or agency or political
subdivision thereof.
“Piggyback Registration” shall have the meaning set forth in Section 3(a).
“Preliminary Prospectus” means any preliminary Prospectus (as defined below) or preliminary Prospectus supplement that may be included in any Registration Statement (as defined
below).
“Principal Holders” shall mean AHP-BHC LLC, a Delaware limited liability company, AHP-TH LLC, a Delaware limited liability company, ACP-BHC LLC, a Delaware limited liability company,
and ACP TH LLC, a Delaware limited liability company, collectively, together with their respective permitted transferees.
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“Prospectus” shall mean the prospectus included in any Registration Statement (including, without limitation, a prospectus that discloses information previously omitted from a
prospectus filed as part of an effective Registration Statement in reliance upon Rule 430A under the Securities Act), as amended or supplemented by any prospectus supplement or any issuer free writing prospectus (as defined in Rule 433 under the
Securities Act), with respect to the terms of the offering of any portion of the Registrable Securities covered by such Registration Statement, and all other amendments and supplements to the Prospectus, including post-effective amendments, and all
material incorporated by reference or deemed to be incorporated by reference in such prospectus.
“Public Offering” shall mean a public offering and sale of equity securities for cash pursuant to an effective registration statement under the Securities Act.
“Registrable Securities” shall mean any Shares held or beneficially owned as of the date hereof by the Holders, including any securities acquired as a result of any reclassification,
recapitalization, stock split or combination, exchange, readjustment or similar transaction of such Shares or securities, or any stock dividend or stock distribution in respect of such Shares or securities; provided, however, such
securities shall cease to be Registrable Securities on the earliest to occur of (i) a Registration Statement with respect to the sale of such Registrable Securities shall have become effective under the Securities Act and such Registrable Securities
shall have been disposed of in accordance with such Registration Statement; (ii) such Registrable Securities shall have been sold in accordance with Rule 144; or (iii) such Registrable Securities have ceased to be outstanding.
“Registration Expenses” has the meaning set forth in Section 7(a).
“Registration Statement” shall mean any registration statement (including any Demand Registration or S-3 Registration) of the Company under the Securities Act which permits the
Public Offering of any of the Registrable Securities pursuant to the provisions of this Agreement, including the Prospectus, amendments and supplements to such registration statement, including post-effective amendments, all exhibits and all material
incorporated by reference or deemed to be incorporated by reference in such registration statement.
“Reorganization Agreement” has the meaning set forth in the Preamble.
“Reorganization Transactions” has the meaning set forth in the Preamble.
“Rule 144” shall mean Rule 144 under the Securities Act, as such Rule may be amended from time to time, or any similar rule or regulation hereafter adopted by
the SEC.
“S-3 Registration” shall have the meaning set forth in Section 4(a).
“SEC” means the United States Securities and Exchange Commission.
“Securities Act” has the meaning set forth in the Recitals.
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“Shares” means the shares of Common Stock owned by the Holders as described in the Recitals and any securities issued in respect thereof, or in substitution therefor, in connection
with any stock split, dividend, distribution or combination, or any reclassification, recapitalization, merger, consolidation, exchange, readjustment or other similar transaction.
“Shelf Period” shall have the meaning set forth in Section 4(a).
“Substantial Marketing Efforts” means marketing that involves in-person road shows with prospective investors over multiple days.
“Trean Compstar” has the meaning set forth in the Recitals.
“Trean Holdings” has the meaning set forth in the Preamble.
“Underwritten Block Trade” shall have the meaning set forth in Section 4(b).
“Withdrawn Demand Registration” shall have the meaning set forth in Section 2(e).
Section 2. Registration Rights.
(a) Demand Registration. Subject to Section 2(c), at any time or from time to time following one hundred and eighty (180) days
after the effective date of the Company’s IPO, any Principal Holder may request at any time (at which time, such requesting Principal Holders shall be referred to as the “Initiating Holders”) in writing and
require that the Company register under the Securities Act all or part of its Registrable Securities (a “Demand Registration”). Promptly after its receipt of any such request for Demand Registration, the Company
shall give written notice of such request to all other Holders holding Registrable Securities and shall, subject to the provisions of Section 2(c) hereof, include in such registration all such Registrable Securities with respect to which the Company
has received written requests for inclusion therein within fifteen (15) days after the receipt of the Company’s written notice.
(b) Priority on Demand Registrations. Subject to the provisions of this Section 2, the Company shall not include in any Demand
Registration any securities other than Registrable Securities without: (i) the written consent of the Holders representing at least a majority of the Registrable Securities to be included in such registration and (ii) if such Demand Registration is an
underwritten offering, the consent of the managing underwriter(s). If the managing underwriter(s) in any requested Demand Registration advise(s) the Company and the Initiating Holders of the Registrable Securities proposed to be registered in writing
that in its or their opinion the number of Registrable Securities proposed to be included in any such registration exceeds the largest number of securities that can be expected to be sold in such offering and/or that the number of Registrable
Securities proposed to be included in any such registration would have an adverse effect on the offering, including the price per share at which the Company’s equity securities can be sold in such offering, the Company shall include in such
registration only the number of Registrable Securities that in the opinion of such managing underwriter(s) can be sold without adversely affecting the offering; provided, however, that the number of Registrable Securities to be sold in
such underwriting shall not be reduced unless all other securities are first entirely excluded from the underwriting. If the number of Registrable Securities that can be sold is less than the number of Registrable Securities proposed to be registered,
the number of Registrable Securities to be so sold shall be allocated pro rata among the Holders of Registrable Securities that desire to participate in such registration on the basis of the amount of Registrable Securities beneficially owned by such
Holders.
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(c) Restrictions on Demand Registrations. The Company shall not be obligated to effect any Demand Registration within three (3)
months after the effective date of a previous S-3 Registration or a previous registration under which the Holders had piggyback registration rights pursuant to Section 3 hereof wherein the Holders were permitted to register, and actually sold, at least
50% of the Registrable Securities requested to be included therein by such Holders. The Company may postpone or withdraw for up to one hundred twenty (120) days the confidential submission, filing or the effectiveness of (or suspend the use of) a
Registration Statement for a Demand Registration if (A) based on the reasonable judgment of the disinterested members of the Board, such postponement or withdrawal is necessary in order to avoid premature disclosure of a matter the Board has determined
would not be in the best interest of the Company to be disclosed at such time or (B) the Company is pursuing a material financing, material acquisition or other material corporate transaction; provided that if the Company exercises its right to
withdraw the filing or the effectiveness of a Registration Statement for a Demand Registration then the Initiating Holders may withdraw its or their request for such Demand (and such Demand shall not count against such Initiating Holders). The Company
shall provide written notices to the relevant Initiating Holders requesting such Demand Registration of (x) any postponement or withdrawal of the filing or effectiveness of (or suspension of the use of) a Registration Statement pursuant to this Section
2(c), (y) the Company’s decision to refile or seek effectiveness of such Registration Statement following such withdrawal or postponement (or suspension) and (z) the effectiveness of such Registration Statement. The restrictions set forth in this
Section 2(c) shall apply regardless of the form of the Registration Statement containing Registrable Securities and for the avoidance of doubt shall apply to S-3 Registrations. Notwithstanding anything to the contrary herein, the Company shall have no
obligation to register, file any Registration Statement or take any other action during any underwriter lock-up period applicable to the Company’s Public Offering to the extent any such action would result in a violation of such lock-up agreement of
the Company.
(d) Selection of Underwriters. If any Registrable Securities covered by a Demand Registration are to be sold in an underwritten offering, the managing underwriter(s) to administer the offering shall be selected by
the Initiating Holders representing a majority of the Registrable Securities participating in such offering, subject to the approval of the Company, which approval shall not be unreasonably withheld or delayed.
(e) Effective Period of Demand Registrations. If any Initiating Holder(s) request(s) a Demand Registration pursuant to Section 2(a) above, such Demand Registration shall not be deemed to have been effected
unless the Registration Statement filed pursuant to such Demand Registration has been effective for a period equal to ninety (90) days from the date on which such Registration Statement became effective (or if such Demand Registration is not effective
during any period within such ninety (90) days, such ninety (90)-day period shall be extended by the number of days during such period when such Registration Statement is not effective), or such shorter period which shall terminate when all of the
Registrable Securities covered by such Demand Registration have been sold pursuant to such Demand Registration or otherwise disposed of by such Initiating Holders. If the Company shall withdraw any Demand Registration pursuant to Section 2(c) (a “Withdrawn Demand Registration”), the Initiating Holders of the Registrable Securities remaining unsold and originally covered by such Withdrawn Demand Registration shall be entitled to a replacement Demand
Registration which (subject to the provisions of this Section 2) the Company shall use its reasonable best efforts to keep effective for a period commencing on the effective date of such Demand Registration and ending on the earlier to occur of the
date (i) which is ninety (90) days from the effective date of such Demand Registration and (ii) on which all of the Registrable Securities covered by such Demand Registration have been sold or otherwise disposed of such Initiating Holders. Each such
additional Demand Registration otherwise shall be subject to all of the provisions of this Agreement.
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Section 3. Piggyback Registrations.
(a) Right to Piggyback. At any time or from time to time following the date of this Agreement, whenever the
Company proposes to register any equity securities under the Securities Act (other than a Registration Statement (i) relating to shares issuable upon exercise of employee share options or in connection with any employee benefit, equity incentive or
similar plan of the Company or (ii) in connection with any merger, consolidation, business combination, scheme of arrangement or amalgamation by the Company or any Affiliate of the Company or the acquisition by the Company or any such Affiliate of the
shares or the assets of any other Person or other registration statement on Form S-4 (clauses (i) and (ii) are referred to as “Permitted Offerings”)) for purposes of a Public Offering of such shares for its own
account, and the registration form to be used may be used for any registration of Registrable Securities (a “Piggyback Registration”), the Company shall give prompt written notice to all Holders of its intention
to effect such a registration and, subject to Section 3(b) and Section 3(c) hereof, shall include in such registration all Registrable Securities with respect to which the Company has received written requests for inclusion therein within fifteen (15)
days after the receipt of the Company’s written notice; provided that any participation in such Public Offering shall be on terms not less favorable, taken as a whole, than the Company’s participation therein. The Company may postpone or
withdraw the filing or the effectiveness of a Piggyback Registration at any time in its discretion.
(b) Priority on Primary Registrations. If a Piggyback Registration is an underwritten primary registration on behalf
of the Company, and the managing underwriter(s) advise(s) the Company in writing that in its or their opinion the number of securities requested to be included in such registration exceeds the largest number that can be sold in such offering and/or
that the number of Registrable Securities proposed to be included in any such registration would have an adverse effect on the offering, including the price per share at which the Company’s equity securities can be sold in such offering, the Company
shall include in such registration (i) first, the securities the Company proposes to sell, (ii) second, the Registrable Securities requested to be included therein by the Holders, pro rata among the Holders of such Registrable Securities on the basis
of the number of Registrable Securities requested to be registered by such Holders and (iii) third, other securities requested to be included in such registration pro rata among the holders of such securities on the basis of the number of shares
requested to be registered by such holders or as such holders may otherwise agree in writing.
(c) Priority on Secondary Registrations. If a Piggyback Registration is an underwritten secondary registration on
behalf of a holder of the Company’s securities other than Registrable Securities, and the managing underwriter(s) advise(s) the Company in writing that in its or their opinion the number of securities requested to be included in such registration
exceeds the largest number that can be sold in such offering and/or that the number of Registrable Securities proposed to be included in any such registration would have an adverse effect on the offering, including the price per share at which the
Company’s equity securities can be sold in such offering, the Company shall include in such registration (i) first, the securities requested to be included therein by the holders requesting such registration, together with the Registrable Securities
requested to be included therein by the Holders, pro rata among (A) the holders of securities requesting such registration and (B) the Holders of such Registrable Securities, in each case, on the basis of the number of Registrable Securities requested
to be registered by such Holders or holders of securities, as applicable, (ii) second, securities the Company proposes to sell and (iii) third, other securities requested to be included in such registration pro rata among the holders of such securities
on the basis of the number of shares requested to be registered by such holders or as such holders may otherwise agree in writing.
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(d) Selection of Underwriters. If any Piggyback Registration is a primary underwritten offering, the Company shall
have the right to select the managing underwriter(s) to administer any such offering.
(e) Other Jurisdictions. If the Company at any time proposes to effect a Public Offering in a jurisdiction other
than the United States of any of its shares or any options, warrants or other rights to acquire, or securities convertible into or exchangeable for, its shares (other than a Public Offering relating to a Permitted Offering), the Company and the Holders
will have the rights and be subject to the obligations agreed in this Section 3 to the extent and where applicable.
Section 4. Shelf Registration.
(a) S-3 Registration. At any time that the Company is eligible to use Form S‑3, a Principal Holder may request (by
written notice to the Company stating the number of Registrable Securities proposed to be sold and the intended method of disposition) that the Company file a registration statement on Form S-3 (an “S-3 Registration”)
for a Public Offering of all or any portion of such Holder’s Registrable Securities, or that the Company take all steps necessary to include such Registrable Securities in a Form S-3 that the Company has previously filed under Rule 415 under the
Securities Act. The Company shall use its reasonable best efforts to keep any S-3 Registration continuously effective under the Securities Act until the date as of which all Registrable Securities have been sold pursuant to such S-3 Registration or
another Registration Statement filed under the Securities Act (such period of effectiveness, the “Shelf Period”). The Company shall not be deemed to have used its reasonable best efforts to keep any S-3
Registration effective during the Shelf Period if the Company voluntarily takes any action or omits to take any action that would result in Holders not being able to offer and sell any Registrable Securities pursuant to such S-3 Registration during the
Shelf Period, unless such action or omission is (x) permitted pursuant to Section 2(c) or (y) required by applicable law, rule or regulation. Whenever the Company is required pursuant to this Section 4 to effect the registration of Registrable
Securities, each of the procedures and requirements of Section 2 (including but not limited to the requirement that the Company notify all Holders from whom notice has not been received and provide them with the opportunity to participate in the
offering and the postponement, withdrawal and suspension provisions) shall apply to such registration. If at the time of such request the Company is a WKSI, such S-3 Registration shall, upon the approval of the Board, cover an unspecified number of
Common Stock to be sold by the Company and the Holders. The Company will use its reasonable best efforts to qualify for Form S-3 registration or a similar short-form registration. Notwithstanding the foregoing, the Company shall have no obligation to
effect any underwritten offering pursuant to this Section 4 involving Substantial Marketing Efforts if, based on the current market prices, the number of Registrable Securities requested to be included in such offering by the Holders would not yield
gross proceeds to the selling Holders of at least $25 million.
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(b) Block Trade. (ii) If
a Principal Holder wishes to engage in an underwritten block trade or bought deal off of an S-3 Registration (an “Underwritten Block Trade”), then notwithstanding the time periods set forth in Section 4(a), such
Principal Holders will notify the Company of the Underwritten Block Trade not less than five (5) Business Days prior to the day such offering is first anticipated to commence.
Section 5. Lock-Up Agreements. In connection with each
underwritten offering, the Company and each Holder, if requested, agree to be bound by the underwriting agreement’s lock-up restrictions (which must apply in like manner to all Holders); provided that in no event shall any lock-up restriction
exceed a period of ninety (90) days from the date of the final Prospectus for any such Public Offering. The Company shall cause its executive officers and directors (and managers, if applicable) and shall use commercially reasonable efforts to cause
other holders of Common Stock who beneficially own (within the meaning of Rules 13d-3 and 13d-5 under the Exchange Act as in effect on the date of this Agreement) any of the Common Stock participating in such offering, to enter into lock-up agreements
that contain restrictions that are no less restrictive than the restrictions contained in the lock-up agreements executed by the Holders.
Section 6. Registration Procedures.
(i) prepare and file with or submit to the SEC a Registration Statement with respect to such Registrable Securities as soon as practicable, but in any event within
sixty (60) days of written request from a Holder or Holders, and use its reasonable best efforts to cause such Registration Statement to become effective as soon as practicable thereafter; and before filing a Registration Statement or Prospectus or any
amendments or supplements thereto, furnish to the Holders of Registrable Securities covered by such Registration Statement and the underwriter or underwriters, if any, copies of all such documents proposed to be filed, including documents incorporated
by reference in the Prospectus and, if reasonably requested by such Holders, the exhibits incorporated by reference, and such Holders shall have the reasonable opportunity to object to any information pertaining to such Holders that is contained
therein and the Company will make the corrections reasonably requested by such Holders with respect to such information prior to filing any Registration Statement or Prospectus;
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(ii) prepare and file with or submit to the SEC such amendments and supplements to such Registration Statement and the Prospectus used in connection therewith as may
be necessary to keep such Registration Statement effective for a period of not less than ninety (90) days (or three hundred (300) days in the case of a shelf S-3 Registration Statement), in the case of a Demand Registration, or such shorter period as
is necessary to complete the distribution of the securities covered by such Registration Statement and comply with the provisions of the Securities Act with respect to the disposition of all securities covered by such Registration Statement during such
period in accordance with the intended methods of disposition by the sellers thereof set forth in such Registration Statement;
(iii) furnish the number of copies of such Registration Statement and the Prospectus included in such Registration Statement (including each preliminary Prospectus and
each amendment and supplement thereto) as reasonably required by each seller of Registrable Securities under such Registration Statement, and such other documents as each seller may reasonably request in writing in order to facilitate the disposition
of Registrable Securities owned by each seller; provided, however, that the Company shall have no obligation to furnish copies of a final prospectus if the conditions of Rule 172(c) under the Securities Act are satisfied by the Company;
(iv) use its reasonable best efforts to register or qualify such Registrable Securities under such other securities or “blue sky” laws of such jurisdictions as any
seller reasonably requests in writing and do any and all other acts and things that may be reasonably necessary or advisable to enable such seller to consummate the disposition in such jurisdictions of the Registrable Securities owned by such seller; provided
that the Company will not be required to (A) qualify generally to do business in any jurisdiction where it would not otherwise be required to qualify but for this clause (iv), (B) subject itself to taxation in any such jurisdiction or (C) consent to
general service of process in any such jurisdiction;
(v) promptly notify each seller of Registrable Securities, at any time when a Prospectus relating thereto is required to be delivered under the Securities Act, of
the occurrence of any event as a result of which the Prospectus included in such Registration Statement contains 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, and, at the request of any such seller, to prepare a supplement to such Prospectus so that, as thereafter delivered to the purchasers of such Registrable Securities,
such Prospectus shall not contain an 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 under which they were made, not
misleading;
(vi) in the case of an underwritten offering, enter into such customary agreements (including underwriting agreements in customary form and containing customary
indemnification provisions in favor of the underwriters) and take all such other actions as the Holders of the Registrable Securities being sold or the underwriters reasonably request in order to expedite or facilitate the disposition of such
Registrable Securities (including making members of senior management of the Company reasonably available to participate in, and cause them to reasonably cooperate with the underwriters in connection with, “roadshow” and other customary marketing
activities) and cause to be delivered to the underwriters and the sellers, if any, opinions of counsel to the Company in customary form, covering such matters as are customarily covered by opinions for an underwritten offering as the underwriters may
reasonably request and addressed to the underwriters and the sellers;
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(vii) make
available for inspection by a seller of Registrable Securities pursuant to a Registration Statement hereunder, any underwriter participating in any disposition pursuant to such Registration Statement, and any attorney, accountant or other agent
retained on behalf of such seller or underwriter, all material financial and other records, material corporate documents and material properties of the Company, and cause the Company’s officers, directors, employees and independent accountants to
supply all information reasonably requested by any such seller representative, underwriter, attorney, accountant or agent in connection with such Registration Statement;
(viii) use its reasonable best efforts to cause all such Registrable Securities to be listed or quoted on each securities exchange or automated interdealer quotation
system on which securities of the same class issued by the Company are then listed or quoted;
(ix) provide
a transfer agent and registrar for all such Registrable Securities not later than the effective date of such Registration Statement;
(x) if
requested, cause to be delivered, immediately prior to the effectiveness of the Registration Statement (and, in the case of an underwritten offering, at the time of delivery of any Registrable Securities sold pursuant thereto), letters from the
Company’s independent certified public accountants (and the independent certified public accountants for any other acquired company or business whose financial statements are required to be included in such Registration Statement in accordance with the
applicable requirements of Regulation S-X) addressed to the underwriters stating that such accountants are independent public accountants or an independent registered public accounting firm within the meaning of the Securities Act and the applicable
rules and regulations adopted by the SEC thereunder and, to the extent applicable, the PCAOB, and otherwise in customary form and covering such financial and accounting matters as are customarily covered by letters of the independent certified public
accountants delivered in connection with primary or secondary underwritten offerings, as the case may be;
(xi) make generally available to Holders a consolidated earnings statement (which need not be audited) for the twelve (12) months beginning after the effective date of a Registration Statement
as soon as reasonably practicable after the end of such period, which earnings statement shall satisfy the requirements of an earnings statement under Section 11(a) of the Securities Act;
(xii) promptly notify each seller of Registrable Securities and the underwriter or underwriters, if any:
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(a) when the Registration Statement, any pre-effective amendment, the Prospectus or any Prospectus supplement or post-effective amendment to the Registration
Statement has been filed and, with respect to the Registration Statement or any post-effective amendment, when the same has become effective;
(b) of any written request by the SEC for amendments or supplements to the Registration Statement or Prospectus;
(c) of the notification to the Company by the SEC of its initiation of any proceeding with respect to the issuance by the SEC of any stop order suspending the
effectiveness of the Registration Statement; and
(d) of the receipt by the Company of any notification with respect to the suspension of the qualification of any Registrable Securities for sale under the applicable
securities or “blue sky” laws of any jurisdiction; and
(xiii) use its reasonable best efforts to obtain as soon as practicable the lifting of any stop order that might be issued suspending the effectiveness of such
Registration Statement.
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Section 7. Registration Expenses.
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Section 8. Indemnification.
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(b) Indemnification by the Holders. Each Holder agrees to indemnify and hold harmless (in the same manner and to the
same extent as set forth in Section 8(a)) the Company, each member of the Board, each officer, employee and agent of the Company and each other person, if any, who controls any of the foregoing within the meaning of the Securities Act or the Exchange
Act, with respect to any untrue statement or alleged untrue statement of a material fact in or omission or alleged omission to state a material fact from such Registration Statement, any Prospectus contained therein, or any amendment or supplement
thereto, to the extent, but only to the extent, that such untrue statement or alleged untrue statement or omission or alleged omission was made in reliance upon and in conformity with written information about such Holder furnished to the Company by
such Holder specifically for inclusion in such Registration Statement, Prospectus, amendment or supplement and has not been corrected in a subsequent Registration Statement, any Prospectus contained therein, or any amendment or supplement thereto prior
to or concurrently with the sale of the Registrable Securities to the person asserting the claim; provided, however, that Holder shall not be liable for any amounts in excess of the net proceeds received by such Holder from sales of
Registrable Securities pursuant to the registration statement to which the claims relate, and provided, further, that the obligations of the Holders shall be several and not joint and several. Such indemnity shall remain in full force
and effect regardless of any investigation made by or on behalf of the Company or any indemnified party and shall survive the transfer of such securities by the Company.
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The indemnification provided for under this Agreement shall remain in full force and effect regardless of any investigation made by or on behalf of the indemnified party and shall survive the transfer of
securities.
(d) Contribution. If the foregoing indemnity is held by a governmental authority of competent jurisdiction to be
unavailable to the Company or any Holder, or is insufficient to hold harmless an indemnified party, then the indemnifying party shall contribute to the amount paid or payable by the indemnified party as a result of the loss, claim, damage or expense in
such proportion as is appropriate to reflect the relative fault of the indemnifying party and the indemnified party, and the relative benefits received by the indemnifying party and the indemnified party, as well as any other relevant equitable
considerations. No indemnified party guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any indemnifying party who was not guilty of such fraudulent
misrepresentation. In connection with any registration statement filed with the SEC by the Company, the relative fault of the indemnifying party on the one hand and of the indemnified person 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 indemnifying party or by the indemnified party, and by such party’s relative
intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. Notwithstanding the provisions of this Section 8, no Holder shall be required to contribute an amount greater than the net proceeds received by
such Holder from sales of Registrable Securities pursuant to the Registration Statement to which the claims relate (after taking into account the amount of damages which such Holder has otherwise been required to pay by reason of any and all untrue or
alleged untrue statements of material fact or omissions or alleged omissions of material fact made in any Registration Statement or Prospectus or any amendment thereof or supplement thereto related to such sale of Registrable Securities).
(e) No Exclusivity. The remedies provided for in this Section 8 are not exclusive and shall not limit any rights or
remedies which may be available to any indemnified party at law or in equity or pursuant to any other agreement.
Section 9. Covenants Relating to Rule 144. The Company shall use reasonable best efforts to file any reports required to be filed by it under the Securities Act and the Exchange Act and to take such
further action as any Holder may reasonably request to enable Holders to sell Registrable Securities without registration under the Securities Act from time to time within the limitation of the exemptions provided by Rule 144. The Company shall, in
connection with any request by Holder in connection with a sale, transfer or other disposition by any Holder of any Registrable Securities pursuant to Rule 144 either currently or prospectively with unspecified timing, promptly cause (and in no event
longer than five (5) Business Days after such request) the removal of any restrictive legend or similar restriction on the Registrable Securities, and, in the case of book-entry shares, make or cause to be made appropriate notifications on the books of
the Company’s transfer agent for such number of shares and registered in such names as the Holders may reasonably request and to provide a customary opinion of counsel and instruction letter required by the Company’s transfer agent.
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Section 10. Limitation on Subsequent Registration Rights. From and after the date of this Agreement, the Company shall not, without the prior written consent of the Principal Holders, enter into any agreement with any holder
or prospective holder of any securities of the Company giving such holder or prospective holder any registration rights the terms of which are equivalent to or more favorable than the registration rights granted to the Principal Holders hereunder, or
which would reduce the amount of Registrable Securities the holders can include in any Registration Statement filed pursuant to Section 2 hereof, unless such rights are subordinate to those of the holders of Registrable Securities.
Section 11. Miscellaneous.
(a) Termination; Survival. The rights of each Holder under this Agreement shall terminate upon the date that all
of the Registrable Securities held by such Holder cease to be Registrable Securities. Notwithstanding the foregoing, the obligations of the parties under Sections 8, 9 and this Section 11 shall survive the termination of this Agreement.
(b) Governing Law. This Agreement and any claim, controversy or dispute arising under or related to this Agreement,
whether in law or in equity, whether in contract or in tort, by statute or otherwise, shall be governed and construed in accordance with the laws of the State of New York without giving effect to the principles of conflicts of law thereof or of any
other jurisdiction that would result in the application of another law.
(c) Consent to Jurisdiction; Venue; Waiver of Jury
Trial. All actions arising out of or relating to this Agreement shall be heard and determined exclusively in any New York state or federal court sitting in the Borough of Manhattan in The City of New York. The parties hereto hereby (a) submit to
the exclusive jurisdiction of any state or federal court sitting in the Borough of Manhattan of The City of New York for the purpose of any action arising out of or relating to this Agreement brought by any party hereto, and (b) irrevocably waive, and
agree not to assert by way of motion, defense, or otherwise, in any such action, any claim that it is not subject personally to the jurisdiction of the above-named courts, that its property is exempt or immune of from attachment or execution, that the
action is brought in an inconvenient forum, that the venue of the action is improper, or that this Agreement or the transactions contemplated hereby may not be enforced in or by any of the above-named courts. TO THE EXTENT NOT PROHIBITED BY APPLICABLE
LAW WHICH CANNOT BE WAIVED, EACH PARTY HERETO HEREBY WAIVES AND COVENANTS THAT IT WILL NOT ASSERT (WHETHER AS PLAINTIFF, DEFENDANT OR OTHERWISE) ANY RIGHT TO TRIAL BY JURY IN ANY FORUM IN RESPECT OF ANY ISSUE OR ACTION, CLAIM, CAUSE OF ACTION OR SUIT
(IN CONTRACT, TORT OR OTHERWISE), INQUIRY, PROCEEDING OR INVESTIGATION ARISING OUT OF OR BASED UPON THIS AGREEMENT OR THE SUBJECT MATTER HEREOF OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE TRANSACTIONS CONTEMPLATED HEREBY, IN EACH CASE
WHETHER NOW EXISTING OR HEREAFTER ARISING. EACH PARTY HERETO ACKNOWLEDGES THAT IT HAS BEEN INFORMED BY THE OTHER PARTIES HERETO THAT THIS SECTION 11(C) CONSTITUTES A MATERIAL INDUCEMENT UPON WHICH THEY ARE RELYING AND WILL RELY IN ENTERING INTO THIS
AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY. ANY PARTY HERETO MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION 11(C) WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF EACH SUCH PARTY TO THE WAIVER OF ITS RIGHT TO TRIAL BY JURY.
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(d) Entire Agreement. This Agreement (including the documents and the instruments referred to herein),
constitutes the entire agreement among the parties hereto with respect to the subject matter hereof and supersedes any and all prior discussions, negotiations, proposals, undertakings, understandings, and agreements (including any draft agreements)
with respect thereto, whether written or oral, none of which shall be used as evidence of the parties’ intent.
(e) Amendments and Waivers. No amendment of any provision of this Agreement shall be valid and binding unless it is
in writing and signed by each of the parties hereto. No waiver of any right or remedy hereunder, to the extent legally allowed, shall be valid unless the same shall be in writing and signed by the party making such waiver. No waiver by any party of
any breach or violation of, default under, or inaccuracy in any representation, warranty, covenant, or agreement hereunder, whether intentional or not, shall be deemed to extend to any prior or subsequent breach, violation, default of, or inaccuracy
in, any such representation, warranty, covenant, or agreement hereunder or affect in any way any rights arising by virtue of any prior or subsequent such occurrence. No delay or omission on the part of any party in exercising any right, power, or
remedy under this Agreement shall operate as a waiver thereof. Notwithstanding the foregoing, no amendments may be made to this Agreement that adversely affect any Holder in a manner different than any other Holder without such adversely affected
Holder’s prior written consent.
(f) Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties hereto and
to their respective successors and permitted assignee. A “permitted assignee” means any Affiliate of any Holder who executes and delivers to the Company a joinder to this Agreement providing that such assignee shall be bound by and shall fully comply
with the terms of this Agreement as a “Holder”. Any successor or permitted assignee of any Holder shall be deemed a Holder for all purposes of this Agreement to the extent such successor or permitted assignee owns Registrable Securities. No Holder may
assign its rights hereunder to any Person except to any permitted assignee.
(g) Counterparts; Electronic Signature. This Agreement may be executed and delivered in one or more counterparts,
all of which shall be considered one and the same agreement and shall become effective when one or more counterparts have been signed by each of the parties and delivered to the other parties, it being understood that all parties need not sign the same
counterpart. This Agreement may be executed by facsimile or .pdf signature by any party and such signature shall be deemed binding for all purposes hereof without delivery of an original signature being thereafter required.
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(h) Severability. Any term or provision of this Agreement that is illegal, invalid or unenforceable in any
jurisdiction shall, as to that jurisdiction, be ineffective to the extent of such illegality, invalidity or unenforceability without rendering illegal, invalid or unenforceable the remaining terms and provisions of this Agreement or affecting the
legality, validity or enforceability of any of the terms or provisions of this Agreement in any other jurisdiction. In the event that any provision hereof would, under applicable law, be illegal, invalid or unenforceable in any respect, each party
hereto intends that such provision shall be reformed and construed by modifying or limiting it so as to be valid and enforceable to the maximum extent compatible with, and possible under, applicable laws and to otherwise give effect to the intent of
the parties hereto.
(i) Notices. All notices and other communications hereunder shall be in writing and shall be deemed duly delivered
(i) four (4) Business Days after being sent by registered or certified mail, return receipt requested, postage prepaid, (ii) one (1) Business Day after being sent for next Business Day delivery, fees prepaid, via a reputable nationwide overnight
courier service or (iii) on the date of confirmation of receipt (or, the first Business Day following such receipt if the date of such receipt is not a Business Day) of transmission by email, in each case to the intended recipient as set forth below:
If to a Holder, to the address indicated for such Holder in Schedule A hereto with a copy (which shall not constitute notice) to:
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Altaris Capital Partners, LLC | |
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If to the Company, as follows:
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President and Chief Executive Officer |
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with a copy (which shall not constitute notice) to:
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Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP | |
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Any party may, from time to time, by written notice to the other parties, designate a different notice details, which shall be substituted for the one specified above for such party.
(j) Specific Performance.
The parties agree that irreparable damage may occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. Accordingly, the parties shall be entitled to seek an
injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement, in addition to any other remedy to which they are entitled at law or in equity.
[Signature Pages Follow]
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IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed as of the date first written above.
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[Signature Page to Registration Rights Agreement]
HOLDERS:
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AHP-BHC LLC | ||
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Altaris Health Partners, III L.P., its sole member | |
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AHP-TH LLC | ||
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ACP-BHC LLC | ||
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Altaris Constellation GP, L.P., its sole member | |
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ACP-TH LLC | ||
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[Signature Page to Registration Rights Agreement]
Schedule A
Notice Details of the Holders
If to any Holder:
| AHP-BHC LLC | ||
| AHP-TH LLC | ||
| ACP-BHC LLC | ||
| ACP TH LLC | ||
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c/o Altaris Capital Partners LLC | |
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Attention: | ▇▇▇▇▇▇ ▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇▇ |
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Email: | [•] |
| ▇▇▇▇▇ ▇▇▇▇▇ Enterprises I, Inc. | ||
| ▇▇▇▇▇ ▇▇▇▇▇ Enterprises II, Inc. | ||
| ▇▇▇▇▇ ▇▇▇▇▇ Enterprises III, Inc. | ||
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c/o [▇▇▇▇▇ ▇▇▇▇▇] | |
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c/o [▇▇▇▇▇▇ ▇. ▇’▇▇▇▇▇] | |
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Facsimile: | [•] |
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[•] | |
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Facsimile: | [•] |
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