Exhibit 7
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OPTICARE EYE HEALTH CENTERS, INC.
REGISTRATION RIGHTS AGREEMENT
October __, 1997
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TABLE OF CONTENTS
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SECTION 1......................................................................1
REGISTRATION RIGHTS............................................................1
1.1 CERTAIN DEFINITIONS................................................1
1.2 HOLDERS' REQUESTED REGISTRATION....................................3
1.3 COMPANY REGISTRATION...............................................5
1.4 FORM S-3 REGISTRATION..............................................6
1.5 EXPENSES OF REGISTRATION...........................................8
1.6 LOCK-UP............................................................8
1.7 REGISTRATION PROCEDURES............................................8
1.8 INDEMNIFICATION...................................................10
1.9 INFORMATION BY HOLDERS............................................12
1.10 RULE 144 REPORTING................................................12
1.11 TERMINATION OF REGISTRATION RIGHTS................................13
SECTION 2.....................................................................13
MISCELLANEOUS.................................................................13
2.1 GOVERNING LAW.....................................................13
2.2 SUCCESSORS AND ASSIGNS; ASSIGNMENT OF RIGHTS......................13
2.3 ENTIRE AGREEMENT; AMENDMENT; WAIVER...............................13
2.4 NOTICES, ETC......................................................14
2.5 DELAYS OR OMISSIONS...............................................14
2.6 RIGHTS; SEPARABILITY..............................................14
2.7 TITLES AND SUBTITLES..............................................14
2.8 COUNTERPARTS......................................................14
2.9 AGGREGATION OF STOCK..............................................14
2.10 THIRD PARTY BENEFICIARIES.........................................15
2.11 REMEDIES..........................................................15
SCHEDULE A....................................................................17
OPTICARE EYE HEALTH CENTERS, INC.
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "Agreement") is made and
entered into as of the ____ day of October, 1997, by and among OPTICARE EYE
HEALTH CENTERS, INC., a Connecticut corporation (the "Company"), OXFORD HEALTH
PLANS, INC., a Connecticut corporation ("Oxford"), NAZEM OPTICARE PARTNERS, LP,
a Delaware limited partnership (the "Partnership"), ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, an
individual ("▇▇▇▇▇▇▇"), ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, an individual ("▇▇▇▇▇"), and ANTHEM
HEALTH PLANS, INC., a Connecticut corporation doing business as Anthem Blue
Cross and Blue Shield of Connecticut and successor by merger to Blue Cross &
Blue Shield of Connecticut, Inc. (hereinafter "BCBS") ("BCBS", with BCBS,
Kaufman, Huang, the Partnership and Oxford being referred to collectively as the
"Investors").
WHEREAS, Oxford, the Partnership, ▇▇▇▇▇▇▇, ▇▇▇▇▇ and the Company are
parties to a Stock Purchase Agreement, dated as of the date hereof (the "Stock
Purchase Agreement"), pursuant to which their respective obligations to purchase
shares of the Company's Class A Convertible Preferred Stock, par value $.0l per
share (the "Class A Preferred Stock") are conditioned upon the execution and
delivery by the Company of this Agreement; and
WHEREAS, BCBS has heretofore exchanged certain of its shares of the
Company's previously outstanding Class B Common Stock, Class C Common Stock and
Class D Common Stock for shares of the Company's Class A Preferred Stock and
certain of its shares of the Company's previously outstanding Class C Common
Stock for shares of the Company's Class B Convertible Preferred Stock, par value
$.0l per share ("Class B Preferred Stock") on the understanding that the Company
would execute and deliver this Agreement.
NOW, THEREFORE, in consideration of the mutual promises and covenants
set forth herein, the parties hereto agree as follows:
SECTION 1
REGISTRATION RIGHTS
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1.1 CERTAIN DEFINITIONS. As used in this Agreement, the following
definitions shall apply:
"COMMISSION" shall mean the Securities and Exchange Commission or
any other federal agency at the time administering the Securities Act.
"COMMON STOCK" shall mean the Company's Common stock, par value
$.01 per share.
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934 as
amended, or any similar successor federal statute and the rules and regulations
promulgated thereunder, all as the same shall be in effect from time to time.
"HOLDER" shall mean any holder of outstanding Registrable
Securities.
"INVESTOR SHARES" shall mean and include (a) the shares of Class A
Preferred Stock issued to Oxford, the Partnership, ▇▇▇▇▇▇▇, and ▇▇▇▇▇ pursuant
to the Stock Purchase Agreement, (b) the shares of Class A Preferred Stock and
the shares of the Class B Preferred Stock issued to BCBS pursuant to the
exchange that is referred to in the Recitals hereto, (c) the shares of Class B
Preferred Stock issued to Oxford and BCBS upon the exercise of warrants issued
to Oxford and BCBS pursuant to a Warrant Agreement dated as of the date hereof,
among the Company, Oxford, BCBS and others, (d) the shares of Common Stock
issued upon conversion of such shares of Class A Preferred Stock or Class B
Preferred Stock, and (e) any securities issued or issuable, directly or
indirectly, in respect of such Class A Preferred Stock or Class B Preferred
Stock or such Common Stock upon any stock split, stock dividend recapitalization
or similar event.
"IPO" shall mean a firm commitment underwritten public offering
pursuant to an effective registration statement under the Securities Act
covering the offer and sale of Common Stock for the account of the Company.
The terms "REGISTER", "REGISTERED" and "REGISTRATION" refer to a
registration effected by preparing and filing a registration statement in
compliance with the Securities Act (and any post-effective amendments filed or
required to be filed), and the declaration or ordering of the effectiveness of
such registration statement.
"REGISTRABLE SECURITIES" shall mean the Common Stock that is
acquired by the Investors upon conversion of shares of Class A Preferred Stock
or Class B Preferred Stock that are Investor Shares; PROVIDED, HOWEVER, that
Registrable Securities shall not include any shares of Common Stock that have
previously been registered or sold to the public or any Investor Shares that
have been sold in a private transaction in which the transferor's rights under
this Agreement are not assigned.
"REGISTRATION EXPENSES" shall mean all expenses incurred by the
Company in complying with Sections 1.2, 1.3 and 1.4 including, without
limitation, all registration, qualification and filing fees, printing expenses,
escrow fees, fees and disbursements of counsel for the Company and for the
Holders, blue sky fees and expenses, and the expense of any special audits
incident to or required by any such registration (but excluding the compensation
of regular employees of the Company, which shall be paid in any event by the
Company). Registration Expenses shall not include Selling Expenses or other
compensation paid to underwriters or other agents or brokers to effect the sale
or the fees and disbursements of more than one counsel for the Investors.
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"RULE 144" shall mean Rule 144 promulgated under the Securities
Act, or any similar successor rule, as the same shall be in effect from time to
time.
"RULE 145" shall mean Rule 145 promulgated under the Securities
Act, or any similar successor rule, as the same shall be in effect from time to
time.
"RULE 415" shall mean Rule 415 promulgated under the Securities
Act, or any similar successor rule, as the same shall be in effect from time to
time.
"SECURITIES ACT" shall mean the Securities Act of 1933, as
amended, or any similar federal statute and the rules and regulations of the
Commission thereunder, as shall be in effect at the time.
"SELLING EXPENSES" shall mean all underwriting discounts, selling
commissions, and stock transfer taxes applicable to the sale of Registrable
Securities.
"STOCKHOLDERS' AGREEMENT" shall mean the Amended and Restated
Stockholders' Agreement dated as of the date hereof, among the Company, the
Investors and others.
1.2 HOLDERS' REQUESTED REGISTRATION.
(a) REQUEST FOR REGISTRATION. In case, at any time after the
earlier of (i) the third anniversary of the Closing under (and as defined in)
the Stock Purchase Agreement and (ii) the closing of an IPO, the Company shall
receive a written request from any Holders (the "Initiating Holders") that the
Company effect any underwritten registration, qualification, or compliance with
respect to Registrable Securities held by such Initiating Holders, then the
Company shall:
(i) promptly give written notice of the proposed
registration, qualification, or compliance to all other Holders; and
(ii) as soon as practicable, use its best efforts to effect
such registration, qualification, or compliance (including, without limitation,
the execution of an undertaking to file post-effective amendments, appropriate
qualification under applicable blue sky or other state securities laws, and
appropriate compliance with applicable regulations issued under the Securities
Act and any other governmental requirements or regulations) as may be so
requested and as would permit or facilitate the sale and distribution of all or
such portion of such Registrable Securities as are specified in such request,
together with all or such portion of the Registrable Securities of any Holders
joining in such request as are specified in a written request received by the
Company within 20 days after the date the Company mails such written notice.
Provided, however, that the Company shall not be obligated to take any
action to effect any such registration, qualification, or compliance pursuant to
this Section 1.2:
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(A) In any jurisdiction in which the Company would be
required to execute a general consent to service of process in effecting such
registration, qualification, or compliance unless the Company is already subject
to service in such jurisdiction and except as may be required by the Securities
Act; or
(B) During the period starting with the date sixty (60)
days prior to the Company's estimated date of filing of, and ending on the date
one hundred eighty (180) days immediately following the effective date of any
registration statement pertaining to securities of the Company (other than a
registration of securities in a Rule 145 transaction or with respect to an
employee benefit plan); PROVIDED, HOWEVER, that the Company is actively
employing in good faith all reasonable efforts to cause such registration
statement to become effective.
(C) If the anticipated aggregate gross offering price to
the public of the Registrable Securities proposed to be sold by the Initiating
Holders will not aggregate at least $5,000,000; or
(D) If the Company has, within the twelve-month period
preceding the date of such request, already effected a registration for any
Holders pursuant to this Section 1.2.; or
(E) If the Company has already effected two
registrations for any Holders pursuant to this Section 1.2, excluding any
registration made pursuant to this Section 1.2 that does not, by reason of a
limitation of the number of Registrable Securities to be underwritten made as
contemplated by Section 1.2(b), result in an aggregate gross offering price to
the public of Registrable Securities of $5,000,000 or more.
Subject to the foregoing clauses (A), (B), (C), (D) and (E), the
Company shall file a registration statement covering the Registrable Securities
so requested to be registered (and, in the Company's discretion, also covering
shares that the Company itself then desires to sell) as soon as practicable, and
in any event within 120 days, in the case of an initial public offering
requested pursuant to this Section 1.2, and 60 days in all other cases, after
receipt of the request or request of the Initiating Holders; PROVIDED, HOWEVER,
that the Company may defer filing such a registration statement for a period of
six months if it believes that a deferral would be in the best interests of its
shareholders.
(b) UNDERWRITING. The right of any Holder to registration pursuant
to this Section 1.2 shall be conditioned upon such Holder's participation in
such underwriting and the inclusion of such Holder's Registrable Securities in
the underwriting to the extent requested (unless otherwise mutually agreed by a
majority in interest of the Initiating Holders intending to participate in such
registration and such Holder with respect to such participation and inclusion)
to the extent provided herein.
The Company shall (together with all Holders selling Registrable
Securities) enter into an underwriting agreement in customary form with the
managing underwriter selected for such underwriting by a majority in interest of
the Initiating Holders (which underwriter is reasonably
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acceptable to the Company). Notwithstanding any other provision of this Section
1.2, if the managing underwriter advises the Initiating Holders in writing that
marketing factors require a limitation of the number of shares to be
underwritten, then the Company shall so advise all Holders and the number of
shares of Registrable Securities and other securities that may be included in
the registration and underwriting shall be allocated among the Company and all
Holders as follows: First, to the Company so as to permit the Company to include
shares that the Company desires to sell, up to, but not in excess of the greater
of (A) 50% of the total number of shares which may be included or (B) the amount
by which the total number of shares which may be included exceeds the number of
shares which all Holders have requested to be included; and second to the
participating Holders of Registrable Securities pro rata, in proportion to the
respective amounts of Registrable Securities held by such Holders of Registrable
Securities at the time of the filing of the Registration Statement, up to, but
not in excess of, the remaining number of shares which may be included. No
Registrable Securities or other securities excluded from the underwriting by
reason of the underwriter's marketing limitation shall be included in such
registration. To facilitate the allocation of shares in accordance with the
above provisions, the Company or the underwriters may round the number of shares
allocated to any Holder or other holder to the nearest 100 shares.
If any Holder or other holder disapproves of the terms of the
underwriting, such person may elect to withdraw therefrom by written notice to
the Company, the managing underwriter and the Initiating Holders. The
Registrable Securities so withdrawn shall also be withdrawn from registration,
and such Registrable Securities shall not be transferred in a public
distribution prior to 180 days after the effective date of such registration, or
such other shorter period of time as the underwriters may require. If by the
withdrawal of such Registrable Securities, a greater number of Registrable
Securities held by other Holders may be included in such registration (up to the
maximum of any limitation imposed by the underwriters), then the Company shall
use its best efforts to offer to all Holders who have included Registrable
Securities in the registration the right to include additional Registrable
Securities in the same proportion and manner used in determining the effect of
the underwriter limitation in this Section 1.2(b).
1.3 COMPANY REGISTRATION.
(a) NOTICE OF REGISTRATION. If at any time or from time to time,
the Company shall determine to register in an underwritten offering any of its
securities, either for its own account or the account of a security holder or
holders, other than (i) a registration relating solely to employee benefit
plans, or (ii) a registration relating solely to a Rule 145 transaction, or a
registration on any registration form that does not permit secondary sales, the
Company shall:
(i) promptly give to each Holder written notice thereof; and
(ii) include in such registration (and any related
qualification under blue sky laws or other compliance), and in any underwriting
involved therein, all the
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Registrable Securities specified in a written request by each Holder received by
the Company within 20 days after the Company mails such written notice, subject
to the provisions below.
(b) UNDERWRITING. The right of any Holder to registration pursuant
to this Section 1.3 shall be conditioned upon the participation by such Holder
in such underwriting and the inclusion of Registrable Securities of such Holder
in the underwriting to the extent provided herein. Those parties proposing to
distribute their securities through such underwritings shall (together with the
Company and the other holders distributing their securities through such
underwriting) enter into an underwriting agreement in customary form with the
managing underwriter selected for such underwriting by the Company.
Notwithstanding any other provisions of this Section 1.3, if the managing
underwriter determines that marketing factors require a limitation of the number
of shares to be underwritten or a limitation on the number of Registrable
Securities or other securities to be underwritten, the managing underwriter may
limit the Registrable Securities or other securities to be included in such
registration. The Company shall so advise all Holders and the other holders
distributing their securities through such underwriting, and the number of
shares of Registrable Securities and other securities that may be included in
the registration and underwriting shall be allocated among the Company, the
Holders and the other holders as follows: First, to the Company so as to permit
the Company to include all shares that the Company desires to sell; second, to
the participating Holders of Registrable Securities pro rata, in proportion to
the respective amounts of Registrable Securities held by such participating
Holders of Registrable Securities at the time of the filing of the registration
statement; and third, to all other participating holders pro rata, in proportion
to the respective amounts of securities entitled to inclusion in such
registration held by all such other participating holders. To facilitate the
allocation of shares in accordance with the above provisions, the Company or the
underwriter may round the number of shares allocated to any Holder or other
holder to the nearest 100 shares. If any Holder or other holder disapproves of
the terms of any such underwriting, he may elect to withdraw therefrom by
written notice to the Company and the managing underwriter. Any securities
excluded or withdrawn from such underwriting shall be withdrawn from such
registration, and shall not be transferred in a public distribution prior to 180
days after the effective date of the registration statement relating thereto, or
such other shorter period of time as the underwriters may require.
(c) RIGHT TO TERMINATE REGISTRATION. The Company shall have
the right to terminate or withdraw any registration initiated by it under this
Section 1.3 prior to the effectiveness of such registration whether or not any
Holder has elected to include securities in such registration.
1.4 FORM S-3 REGISTRATION. After its IPO, the Company shall use its
best efforts to qualify for registration on Form S-3. After the Company has
qualified for the use of Form S-3, in addition to the rights contained in the
foregoing provisions of this Section 1, any Investors owning Registrable
Securities which constitute at least 15% of the outstanding Common Stock of the
Company (determined on an as-converted basis) shall have the right to request
registration on Form S-3 (all such requests shall be in writing and shall state
the number of shares of Registrable Securities to be disposed of and the
intended methods of disposition of such shares by such Holder or Holders);
PROVIDED, HOWEVER, that Investors owning Registrable Securities which constitute
less than 15% of the outstanding Common Stock of the Company
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(determined on an as-converted basis) shall have the right to request
registration on Form S-3 if the anticipated aggregate gross offering price to
the public exceeds $500,000; AND PROVIDED, FURTHER, that no request will be
honored with respect to proposed S-3 offerings which do not have an anticipated
aggregate offering price to the public of at least $500,000. In case the Company
shall receive from an Initiating Holder or Holders a written request that the
Company effect a registration on Form S-3 and any related state securities
qualification or blue sky compliance with respect to such an amount of the
Registrable Securities owned by such Initiating Holder or Holders, the Company
shall:
(a) promptly give written notice of the proposed registration, and
any related qualification or compliance, to all other Holders; and
(b) as soon as practicable, use its best efforts to effect such
registration and all such qualifications and compliances as may be so requested
and as would permit or facilitate the sale and distribution of all or such
portion of such Holder's or Holders' Registrable Securities as are specified in
such request, together with all or such portion of the Registrable Securities of
any other Holder or Holders joining in such request as are specified in a
written request given within 20 days after receipt of such written notice from
the Company; PROVIDED, HOWEVER, that the Company shall not be obligated to
effect any such registration, qualification, or compliance pursuant to this
Section 1.4: (1) if Form S-3 is not available for such offering by Holder(s);
(2) if the Company has, within the twelve-month period preceding the date of
such request, already effected two registrations on Form S-3 for any Holders
pursuant to this Section 1.4; or (3) in any jurisdiction in which the Company
would be required to execute a general consent to service of process in
effecting such registration, qualification or compliance unless the Company is
already subject to service in such jurisdiction and except as may be required by
the Securities Act.
Subject to the foregoing, the Company shall effect such registration.
qualification, or compliance (including, without limitation, the execution of an
undertaking to file post-effective amendments, appropriate qualification under
applicable blue sky or other state securities laws and appropriate compliance
with applicable regulations issued under the Securities Act and any other
governmental requirements or regulations) covering the Registrable Securities
and other securities so requested to be registered as soon as practicable after
receipt of the request or requests of the Holder or other Holders. Registrations
effected pursuant to this Section 1.4 shall not be counted as demands for
registration or registrations effected pursuant to Sections 1.2 or 1.3.
If the registration to be effected pursuant to this Section 1.4 is to
be an underwritten public offering, it shall be managed by an underwriter or
underwriters acceptable to the Company and selected by a majority in interest of
the Holders requesting registration. In such event, the right of any Holder to
registration pursuant to this Section 1.4 shall be conditioned upon the
participation by such Holder in such underwriting and the inclusion of the
Registrable Securities of such Holder in the underwriting to the extent provided
herein. If the managing underwriter so selected determines that marketing
factors require a limitation of the number of shares to be underwritten, the
managing underwriter may limit the Registrable Securities held by such Holders
to be included in such registration. The Company shall so advise such
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Holders, and the number of shares of Registrable Securities that may be included
in the registration shall be allocated among the Holders of Registrable
Securities and other holders as follows: First, to the participating Holders of
Registrable Securities pro rata in proportion to the respective amounts of
Registrable Securities held by each of such participating Holders of Registrable
Securities at the time of filing of the registration statement; and second, to
all other holders pro rata in proportion to the respective amounts of
securities, if any, entitled to inclusion in such registration held by all such
other participating holders. Any Registrable Securities or other securities that
are so excluded from the underwriting shall be excluded from the registration.
As used throughout this Section the term "Form S-3" shall be deemed to include
any equivalent successor form for registration pursuant to the Act.
1.5 EXPENSES OF REGISTRATION. All Registration Expenses shall be borne
by the Company; PROVIDED, HOWEVER, that in connection with any registration of
securities, the Company shall only be responsible for the fees and disbursements
of one counsel for the Holders (selected by Holders of at least 51% of the
Registrable Securities participating in the offering). All Selling Expenses
relating to securities so registered shall be borne by the holders of such
securities pro rata on the basis of the number of shares of securities so
registered on their behalf.
1.6 LOCK-UP. Each of the Holders hereby agrees not to offer, sell,
make any short sale of, loan, grant any option for the purchase of, or otherwise
dispose of any of the Company's Common Stock held of record or beneficially
owned by such person (other than those included in the registration) which at
the time of the effective date of such registration statement may be sold or
otherwise transferred in reliance upon Rule 144 during the period of time (not
to exceed 180 days) determined by the Board of Directors of the Company upon
advice of its managing underwriter, from and after the effective date of the
registration statement for the Company's IPO; provided that the obligations of
the Holders under this Section 1.6 shall not apply unless each officer and
director of the Company and each holder of five percent (5%) of the Company's
voting securities then outstanding, in each case, who are not signatories to
this Agreement, are bound by similar restrictions. Such restriction shall not
apply to shares registered in such offering. In order to enforce this provision,
the Company may impose stop-transfer instructions with respect to such shares
until the end of such period. The obligations described in this Section 1.6
shall not apply to a registration relating solely to employee benefit plans on
Form S-1 or Form S-8 or similar forms that may be promulgated in the future or
to a registration relating solely to a Rule 145 transaction on Form S-4 or
similar forms that may be promulgated in the future.
1.7 REGISTRATION PROCEDURES. If and whenever the Company is required
by the provisions of this Section 1 to use its best efforts to effect promptly
the registration of Registrable Securities the Company shall use its best
efforts to:
(a) Prepare and file with the Commission a registration statement
with respect to such Registrable Securities and use its best efforts to cause
such registration statement to become and remain effective as provided herein.
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(b) Prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in connection
therewith as may be necessary to keep such registration statement effective and
current and to comply with the provisions of the Securities Act with respect to
the sale of or other disposition of all Registrable Securities covered by such
registration statement, including such amendments and supplements as may be
necessary to reflect the intended method of disposition of the prospective
seller or sellers of such Registrable Securities but for no longer than one
hundred eighty (180) days subsequent to the effective date of such registration
in the case of a registration statement on Form S-1 (or any similar form of
registration statement required to set forth substantially identical
information); PROVIDED, HOWEVER, that (i) such period shall be extended for a
period of time equal to the period the underwriter recommends that all the
Holders refrain from selling the securities included in such registration due to
marketing conditions or other conditions which adversely affect the offer and
sale of such securities; and (ii) in the case of any registration of Registrable
Securities on Form S-3 which is intended to be offered on a continuous or
delayed basis, such period shall be extended, if necessary, to keep the
registration statement effective until all such Registrable Securities are sold,
provided that Rule 415 permits an offering on a continuous or delayed basis, and
provided further that applicable rules under the Securities Act governing the
obligation to file a post-effective amendment permit, in lieu of filing a
post-effective amendment that (I) includes any prospectus required by Section
10(a)(3) of the Securities Act or (II) reflects facts or events representing a
material or fundamental change in the information set forth in the registration
statement, the incorporation by reference of information required to be included
in (I) and (II) above to be contained in periodic reports filed pursuant to
Section 13 or 15(d) of the Exchange Act in the registration statement.
(c) Furnish to each prospective seller of Registrable Securities
such number of copies of a prospectus, including a preliminary prospectus, in
conformity with the requirements of the Securities Act, and such other
documents, as such seller may reasonably request in order to facilitate the
public sale or other disposition of the Registrable Securities of such seller.
(d) Notify each seller of Registrable Securities covered by such
registration statement at any time when a prospectus relating thereto is
required to be delivered under the Securities Act of the happening of any event
as a result of which the prospectus included in such registration statement, as
then in effect, includes an untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading or incomplete in the light of the
circumstances then existing, and at the request of any such seller, prepare and
furnish to such seller a reasonable number of copies of a supplement to or an
amendment of such prospectus as may be necessary so that, as thereafter
delivered to the purchasers of such shares, such prospectus shall not include 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 not misleading or
incomplete in the light of the circumstances then existing.
(e) Cause all such Registrable Securities registered pursuant to
such registration statement hereunder to be listed on each securities exchange
or approved for
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quotation on any inter-dealer quotation system on which similar securities
issued by the Company are then listed or quoted.
(f) Provide a transfer agent and registrar for all Registrable
Securities registered pursuant to such registration statement and a CUSIP number
of all such Registrable Securities not later than the effective date of such
registration.
(g) Otherwise use its best efforts to comply with all applicable
rules and regulations of the Commission, and make available to its security
holders, as soon as reasonably practicable, an earnings statement covering the
period of at least twelve months, but not more than eighteen months, beginning
with the first month after the effective date of the Registration Statement,
which earnings statement shall satisfy the provisions of Section 11(a) of the
Securities Act.
(h) In connection with any underwritten offering pursuant to a
registration statement filed pursuant to Section 1.2 or 1.3 hereof, will enter
into an underwriting agreement reasonably necessary to effect the offer and sale
of Common Stock, provided such underwriting agreement contains customary
underwriting provisions and provided further that if the underwriter so requests
the underwriting agreement will contain customary contribution provisions.
(i) Prevent any seller of Registrable Securities from effecting
sales of shares covered by any registration statement after receipt of
telegraphic or written notice from the Company to suspend sales to permit the
Company to correct or update a registration statement or prospectus.
1.8 INDEMNIFICATION. In the event any Registrable Securities are
included in a registration statement under this Section 1:
(a) The Company will indemnify each Holder, each of its officers,
directors, shareholders and partners, and each person controlling such Holder
within the meaning of Section 15 of the Securities Act, and each underwriter, if
any, and each person who controls any underwriter within the meaning of Section
15 of the Securities Act, against all expenses, claims, losses, damages or
liabilities (or actions in respect thereof), including any of the foregoing
incurred in settlement of any litigation, commenced or threatened, arising out
of or based on any untrue statement (or alleged untrue statement) of a material
fact contained, on the effective date thereof, in any registration statement,
any prospectus contained therein, or any amendment or supplement thereto, or
based on any omission (or alleged omission) to state therein a material fact
required to be stated therein or necessary to make the statements therein (in
the case of a prospectus, in the light of the circumstances under which they
were made) not misleading, or any violation by the Company of any rule or
regulation promulgated under the Securities Act applicable to the Company in
connection with any such registration, qualification or compliance, and the
Company will reimburse each such Holder, each of its officers, directors,
shareholders and partners and each person controlling such Holder, each such
underwriter and each person who controls any such underwriter, for any legal and
any other expenses reasonably incurred in connection with investigating,
preparing or defending any such
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claim, loss, damage, liability or action, provided that the Company will not be
liable in any such case to the extent that any such claim, loss, damage,
liability or expense arises out of or is based on any untrue statement or
omission or alleged untrue statement or omission, made in reliance upon and in
conformity with written information furnished to the Company by an instrument
duly executed by such Holder or underwriter and stated to be specifically for
use therein. If the Holders are represented by counsel other than counsel for
the Company, the Company shall not be obligated under this Section 1.8 to
reimburse legal fees and expenses of more than one separate counsel for the
Holders unless any Holder(s) shall have reasonably concluded that there may be
one or more legal defenses available to it which are different from or
additional to those available to the other Holders.
(b) Each Holder, severally and not jointly, will, if Registrable
Securities held by such Holder are included in the securities as to which such
registration, qualification or compliance is being effected, indemnify the
Company, each of its directors and officers and its legal counsel and
independent accountants, each underwriter, if any, of the Company's securities
covered by such a registration statement, each person who controls the Company
or such underwriter within the meaning of Section 15 of the Securities Act,
against all claims, losses, damages and liabilities (or actions in respect
thereof), including any of the foregoing incurred in settlement of any
litigation commenced or threatened, arising out of or based on any untrue
statement (or alleged untrue statement) of a material fact contained, on the
effective date thereof, in any such registration statement, and, prospectus
contained therein, or any omission (or alleged omission) to state therein a
material fact required to be stated therein or necessary to make the statements
therein (in the case of a prospectus, in the light of the circumstances under
which they were made) not misleading, and will reimburse the Company, and such
directors, officers, persons, underwriters or control persons for any legal or
any other expenses reasonably incurred in connection with investigating or
defending any such claim, loss, damage, liability or action, in each case to the
extent, but only to the extent, that such untrue statement (or alleged untrue
statement) or omission (or alleged omission) is made in such registration
statement or prospectus in reliance upon and in conformity with written
information furnished to the Company by an instrument duly executed by such
Holder and stated to be specifically for use therein.
(c) Each party entitled to indemnification under this Section 1.8
(the "Indemnified Party") shall give notice to the party required to provide
indemnification (the "Indemnifying Party") promptly after such Indemnified Party
has actual knowledge of any claim as to which indemnity may be sought, and shall
permit the Indemnifying Party to assume the defense of any such claim or any
litigation resulting therefrom, provided that counsel for the Indemnifying
Party, who shall conduct the defense of such claim or litigation, shall be
approved by the Indemnified Party (whose approval shall not unreasonably be
withheld), and the Indemnified Party may participate in such defense at such
party's expense, and provided further that the failure of any Indemnified Party
to give notice as provided herein shall not relieve the Indemnifying Party of
its obligations under this Section 1 to the extent such failure is not
prejudicial. No Indemnifying Party, in the defense of any such claim or
litigation, shall, except with the consent of each Indemnified Party, consent to
entry of any judgment or enter into any settlement which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
Indemnified Party of a release from all liability in respect to such
11
claim or litigation. Notwithstanding anything to the contrary contained in this
Section 1.8(c), the Indemnified Party shall have the right to employ its own
counsel in any action, claim, litigation, proceeding or investigation. and the
fees and expenses thereof shall be borne by the Indemnified Party, unless the
Indemnified Party shall have reasonably concluded that there may be one or more
legal defenses available to it which are different from or additional to those
available to the Indemnifying Party, in which case the Indemnifying Party shall
bear all of such Indemnified Party's legal and other fees and expenses which
arise in defense thereof. In such event, the Indemnifying Party shall not have
the right to direct the defense of such action, claim, litigation, proceeding or
investigation on behalf of the Indemnified Party.
(d) If the indemnification provided for in this Section 1.8 is
held by a court of competent jurisdiction to be unavailable to an Indemnified
Party with respect to any loss, liability, claim, damage or expense referred to
herein, then the Indemnifying Party, in lieu of Indemnifying the Indemnified
Party, shall contribute to the amount paid or payable by such Indemnified Party
with respect to such loss, liability, claim, damage or expense in the proportion
that is appropriate to reflect the relative fault of the Indemnifying Party and
the Indemnified Party in connection with the statements or omissions that
resulted in such loss, liability, claim, damage or expense, as well as any other
relevant equitable considerations. The relative fault of the Indemnifying Party
and the Indemnified Party shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of material fact or the
omission (or alleged omission) to state a material fact relates to information
supplied by the Indemnifying Party or by the Indemnified Party, and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission.
1.9 INFORMATION BY HOLDERS. The Holder or Holders of Registrable
Securities included in any registration shall furnish to the Company such
information regarding such Holder or Holders and the distribution proposed by
such Holder or Holders as the Company may request in writing and as shall be
required in connection with any registration, qualification or compliance
referred to in this Section 1.
1.10 RULE 144 REPORTING. With a view to making available the benefits
of certain rules and regulations of the Commission which may at any time permit
the sale of the Registrable Securities to the public without registration, after
such time as a public market exists for the Common Stock of the Company, the
Company shall use its best efforts to:
(a) Make and keep public information available, as those terms are
understood and defined in Rule 144, beginning 90 days after (i) the effective
date of the first registration statement filed by the Company for an offering of
its securities to the general public, (ii) the Company registers a class of
securities under Section 4 of the Exchange Act, or (iii) the Company issues an
offering circular meeting the requirements of Regulation A under the Securities
Act;
(b) File with the Commission in a timely manner all reports and
other documents required of the Company under the Securities Act and the
Exchange Act (at any time after it has become subject to such reporting
requirements);
12
(c) Furnish to any Holder promptly upon request, a written
statement as to its compliance with the reporting requirements of Rule 144 (at
any time after 90 days after the effective date of the first registration
statement filed by the Company for an offering of its securities to the general
public), and of the Securities Act and the Exchange Act (at any time after it
has become subject to such reporting requirements), a copy of the most recent
annual or quarterly report of the Company, and such other reports and documents
of the Company and other information in the possession of or reasonably
obtainable by the Company as a Holder may reasonably request in availing itself
of any rule or regulation of the Commission allowing a Holder to sell any such
securities without registration.
1.11 TERMINATION OF REGISTRATION RIGHTS. The rights of each Holder
under this Section 1 shall terminate at such time after the Company's initial
IPO as such Holder's Registrable Securities may be sold immediately without
registration during any 90-day period in reliance upon Rule 144; PROVIDED,
HOWEVER, that this Section 1.11 shall not apply to any Holder who owns more than
one percent (1%) of the Company's outstanding Common Stock (determined on an
as-converted basis) until such time thereafter as the Holder owns less than one
percent (1%) of the outstanding Common Stock of the Company (determined as
aforesaid).
SECTION 2
MISCELLANEOUS
-------------
2.1 GOVERNING LAW. This Agreement shall be governed in all respects by
the laws of the State of Connecticut, as applied to agreements among Connecticut
residents entered into and to be performed entirely within Connecticut.
2.2 SUCCESSORS AND ASSIGNS; ASSIGNMENT OF RIGHTS. Subject to the terms
and conditions of the rights and benefits of an Investor hereunder may be
assigned to a transferee or assignee in connection with transfer or assignment
of any Registrable Securities owned by such Investor (A) to any person or entity
which is a majority-owned subsidiary of such Investor, or controls, is
controlled by or under common control with such Investor, (B) to any other
person or entity provided that (a) such transfer may otherwise be effected in
accordance with applicable securities laws, (b) such transferee or assignee
acquires at least one percent (1%) of the shares of Registrable Securities, (c)
such transfer otherwise complies with this Agreement, and (d) such assignee or
transferee executes a written instrument agreeing to be bound by the terms and
provisions of this Agreement, (C) to a constituent partner of an Investor or the
estate of such a constituent partner or to a liquidating trust for the benefit
of such partners, (D) to a successor trustee of an Investor in its capacity as
trustee and (E) to any ancestor, descendant or spouse of an Investor or to
trusts or other entities for the sole benefit thereof or of the Investor. Any
such transfer or assignment permitted hereby shall inure to the benefit of, and
be binding upon, the successors, assigns, heirs, executors and administrators of
the parties hereto.
2.3 ENTIRE AGREEMENT; AMENDMENT; WAIVER. This Agreement constitutes the
full and entire understanding and agreement between the parties with regard to
the subjects hereof. Neither this Agreement nor any term hereof may be amended,
waived, discharged or
13
terminated, except by a written instrument signed by the Company and the holders
of at least fifty-one percent (51%) of the outstanding Registrable Securities
and any such amendment, waiver, discharge or termination shall be binding upon
all the parties hereto, but in no event shall the obligation of any Party hereto
be materially increased, except upon the written consent of such party.
2.4 NOTICES, ETC. All notices and other communications required or
permitted hereunder shall be in writing and shall be mailed by United States
first-class mail, postage prepaid, sent by facsimile or delivered personally by
hand or nationally recognized courier addressed (a) if to an Investor, as
indicated on the list of Investors attached hereto as Schedule A, or at such
other address as such Investor or permitted assignee shall have furnished to the
Company in writing and (b) if to the Company, at such address or facsimile
number as the Company shall have furnished to each Investor in writing, with a
copy (which shall not constitute notice) to ▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, ▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇ III,
Esq., telecopier no. (▇▇▇) ▇▇▇-▇▇▇▇. All such notices and other written
communications shall be effective on the date of mailing, facsimile transfer or
delivery.
2.5 DELAYS OR OMISSIONS. No delay or omission to exercise any right,
power or remedy accruing to any Investors upon any breach or default of the
Company under this Agreement shall impair any such right, power or remedy of
such Investor nor shall it be construed to be a waiver of any such breach or
default, or an acquiescence therein, or of or in any similar breach or default
or be deemed a waiver of any other breach or default theretofore or thereafter
occurring. Any waiver, permit, consent or approval of any kind or character on
the part of any Investor of any breach or default under this Agreement or any
waiver on the part of any Investor of any provisions or conditions of this
Agreement must be made in writing and shall be effective only to the extent
specifically set forth in such writing. All remedies, either under this
Agreement or by law or otherwise afforded to any Investor, shall be cumulative
and not alternative.
2.6 RIGHTS; SEPARABILITY. Unless otherwise expressly provided herein,
the rights of an Investor hereunder are several rights, not rights jointly held
with any of the other Investors. In case any provision of the Agreement shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
2.7 TITLES AND SUBTITLES. The titles of the paragraphs and
subparagraphs of this Agreement are for convenience of reference only and are
not to be considered in construing or interpreting this Agreement.
2.8 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
2.9 AGGREGATION OF STOCK. All shares of Registrable Securities held
or acquired by affiliated entities or persons shall be aggregated together for
the purpose of determining the availability, of any rights under this Agreement.
14
2.10 THIRD PARTY BENEFICIARIES. The covenants and agreements set forth
herein are for the sole and exclusive benefit of the parties hereto and their
respective successors and assigns and such covenants and agreements shall not be
construed as conferring, and are not intended to confer, any rights or benefits
upon any other persons.
2.11 REMEDIES. The parties to this Agreement acknowledge and agree
that a breach of any of the covenants of the Company or the Investors set forth
in this Agreement may not be compensable by payment of money damages and,
therefore, that the covenants of the foregoing, parties set forth in this
Agreement may be enforced in equity by a decree requiring specific performance.
Such remedies shall be cumulative and non-exclusive and shall be in addition to
any other rights and remedies the parties may have under this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Registration
Rights Agreement effective as of the day and year first above written.
COMPANY:
OPTICARE EYE HEALTH CENTERS, INC.
By:
---------------------------------------
Name:
Title:
INVESTORS:
OXFORD HEALTH PLANS, INC.
By:
---------------------------------------
Name:
Title:
ANTHEM HEALTH PLANS, INC.
By:
---------------------------------------
Name:
Title:
15
NAZEM OPTICARE PARTNERS, LP
By ▇▇▇▇ ▇▇▇▇▇ LLC, General Partner
By:
---------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇
Title: Managing Member
------------------------------------------
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
16
SCHEDULE A
----------
SCHEDULE OF INVESTORS
Name and Address of Investors
-----------------------------
Anthem Blue Cross and Blue Shield of Connecticut
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, Esq.
Oxford Health Plans, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇, Esq.
Nazem OptiCare Partners, LP
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇ ▇▇▇▇ ▇▇▇▇ ▇▇.
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq.
▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
17
