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EXHIBIT (c)(6)
EXECUTION COPY
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT is made as of this 14th day of June,
1999 by and among TA MergerCo, Inc., a Delaware corporation ("MergerCo" or the
"Company"), each of the Persons listed on the signature pages attached hereto,
and each of the other Persons who hereafter agree to become party to and bound
by this Agreement (collectively the "Stockholders").
WHEREAS, MergerCo has been formed for the purpose of merging (the
"Merger") with and into Physicians' Specialty Corp., a Delaware corporation
("Target") pursuant to the terms and subject to the conditions set forth in the
Agreement and Plan of Merger, dated as of the date hereof, by and among MergerCo
and Target, as amended from time to time (the "Merger Agreement").
WHEREAS, by virtue of the Merger, Target will become the successor to
all of the rights, interests, duties and obligations of MergerCo, including,
without limitation, those arising under this Agreement, and after the Merger,
Target shall be deemed to be a party to this Agreement and all references in
this Agreement to MergerCo or the "Company" shall be deemed to be references to
Target.
WHEREAS, the parties hereto desire to enter into this Agreement for the
purpose of establishing the registration rights of the Stockholders.
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements hereinafter set forth, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties hereto agree as follows:
1. CERTAIN DEFINITIONS. As used in this Agreement, the following
terms shall have the following respective meanings:
"COMMISSION" shall mean the United States Securities and
Exchange Commission, or any other federal agency at the time administering the
Securities Act and the Exchange Act.
"COMMON STOCK" shall mean the Company's Common Stock, par
value $.001 per share, and any capital stock of any class of the Company
hereafter authorized which is not limited to a fixed sum or percentage of par or
stated value in respect to the rights of the holders thereof to participate in
dividends or in the distribution of assets upon any liquidation, dissolution or
winding up of the Company.
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"COMMON STOCKHOLDER SHARES" shall mean Stockholder Shares
which are (i) Common Stock, (ii) warrants, options or other rights to subscribe
for or to acquire, directly or indirectly, Common Stock, whether or not then
exercisable or convertible, and (iii) stock or other securities which are
convertible into or exchangeable for, directly or indirectly, Common Stock,
whether or not then convertible or exchangeable (including, without limitation,
the Convertible Preferred Stock). As to any particular Common Stockholder
Shares, such shares shall cease to be Common Stockholder Shares when they have
been disposed of in a Public Sale or repurchased by the Company or any
Subsidiary. References in this Agreement to a majority of, or a certain
percentage of, the Common Stockholder Shares, shall be deemed to be references
to a majority of the Common Stock represented by the Common Stockholder Shares
or a certain percentage of the Common Stock represented by the Common
Stockholder Shares, calculated on a fully-diluted basis, as applicable.
"CONVERTIBLE PREFERRED STOCK" shall mean the Company's
Convertible Participating Preferred Stock, par value $.001 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 of the Commission thereunder, all as the same shall be in effect at
the time.
"INITIAL PUBLIC OFFERING" means the consummation of the
Company's first underwritten, firm commitment public offering pursuant to an
effective registration statement under the Securities Act, other than on Forms
S-4 or S-8 of their then equivalents, covering the offer and sale by the Company
of its equity securities, or such other event as a result of or following which
the Common Stock shall be publicly held.
"PERSON" shall mean an individual, a corporation, a
partnership, a joint venture, a trust, an unincorporated organization, a limited
liability company or partnership, a government and any agency or political
subdivision thereof.
"PRINCIPAL MANAGEMENT STOCKHOLDERS" shall mean all
Stockholders who are not TA Investors and who beneficially own at least 2.5% of
the outstanding Stockholder Shares (as reflected in the stock record books of
the Company) after the effective date of the Merger.
"PUBLIC SALE" shall mean any sale of Stockholder Shares to the
public pursuant to an offering registered under the Securities Act or to the
public through a broker, dealer or market maker pursuant to the provisions of
Rule 144 adopted under the Securities Act.
"QUALIFIED PUBLIC OFFERING" shall have the meaning set forth
in the Company's Amended and Restated Certificate of Incorporation (the
"Charter").
"REGISTRABLE SECURITIES" shall mean any shares of Common Stock
held by a Stockholder or subject to acquisition by a Stockholder upon conversion
of Common Stockholder Shares, as applicable, including any shares issued by way
of a stock dividend or stock split or in
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connection with a combination of shares, recapitalization, merger, consolidation
or other reorganization; provided, however, that if a TA Investor owns
Convertible Preferred Stock, the TA Investor may exercise its registration
rights hereunder by converting the shares to be sold publicly into Common Stock
as of the closing of the relevant offering and shall not be required to cause
such Convertible Preferred Stock to be converted to Common Stock until and
unless such closing occurs, it being understood that the Company shall at the
request of the relevant TA Investor effect the reconversion of Common Stock to
Convertible Preferred Stock if such a conversion occurs notwithstanding the
foregoing and a public offering does not close; and provided, further, that any
Common Stock that is sold in a registered sale pursuant to an effective
registration statement under the Securities Act or pursuant to Rule 144
thereunder, or that may be sold without restriction as to volume or otherwise
pursuant to Rule 144 under the Securities Act (as confirmed by an opinion of
counsel to the Company), shall not be deemed Registrable Securities.
"SECURITIES ACT" shall mean the Securities Act of 1933, as
amended, or any similar successor federal statute, and the rules and regulations
of the Commission thereunder, all as the same shall be in effect at the time.
"STOCKHOLDER SHARES" shall mean (i) any capital stock of the
Company purchased or otherwise acquired by any Stockholder, (ii) any warrants,
options or other rights to subscribe for or to acquire, directly or indirectly,
any capital stock of the Company, purchased or otherwise acquired by any
Stockholder, whether or not then exercisable or convertible, and (iii) any stock
or other securities which are convertible into or exchangeable for, directly or
indirectly, any capital stock of the Company, purchased or otherwise acquired by
any Stockholder, whether or not then convertible or exchangeable, (iv) any
securities or rights issued or issuable directly or indirectly with respect to
the securities and rights referred to in clauses (i), (ii) and (iii) above by
way of stock dividend or stock split or in connection with a combination of
shares, recapitalization, merger, consolidation or other reorganization. As to
any particular Stockholder Shares, such shares shall cease to be Stockholder
Shares when they have been disposed of in a Public Sale or repurchased by the
Company or any Subsidiary.
"SUBSIDIARY" OR "SUBSIDIARIES" means, with respect to any
Person, any corporation, limited liability company, partnership, association, or
other business entity of which (i) if a corporation, a majority of the total
voting power of shares of stock entitled (without regard to the occurrence of
any contingency) to vote in the election of directors, managers, or trustees
thereof is at the time owned or controlled, directly or indirectly, by such
Person or one or more of the other Subsidiaries of such Person or a combination
thereof, or (ii) if a limited liability company, partnership, association, or
other business entity, a majority of the partnership or other similar ownership
interest thereof is at the time owned or controlled, directly or indirectly, by
any Person or one or more Subsidiaries of such Person or entity or a combination
thereof. For purposes hereof, a Person or Persons shall be deemed to have a
majority ownership interest in a limited liability company, partnership,
association, or other business entity if such Person or Persons shall be
allocated a majority of limited liability company, partnership, association, or
other business entity gains or losses or shall be or control any managing
director or general partner of such limited liability company, partnership,
association, or other business entity.
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"TA INVESTORS" means the Stockholders identified as such on
the signature pages hereto and their Affiliates.
2. OPTIONAL REGISTRATIONS. If at any time or times after an
Initial Public Offering and for a period of six (6) years thereafter, the
Company shall seek to register any shares of its capital stock or securities
convertible into capital stock under the Securities Act (whether in connection
with a public offering of securities by the Company (a "primary offering"), a
public offering of securities by stockholders of the Company (a "secondary
offering"), or both (together an "underwritten public offering"), the Company
will promptly give written notice thereof to each Stockholder (including any
Permitted Transferee thereof as defined in that certain Stockholders Agreement,
dated as of the date hereof, by and among the parties hereto) holding
Registrable Securities (individually, a "Holder" and collectively, the
"Holders"). If within ten (10) days after receipt of such notice one or more
Holders request the inclusion of some or all of the Registrable Securities owned
by them in such registration, the Company will use its commercially reasonable
efforts to effect the registration under the Securities Act of all Registrable
Securities which such Holders may request in a writing delivered to the Company
within ten (10) days after their receipt of the notice given by the Company;
provided, however, that if the Company determines at any time not to pursue an
underwritten public offering of its securities, then it shall give prompt
written notice of such determination to each Holder requesting registration
hereunder, and the Company shall thereafter be relieved of its obligation to
register any Registrable Securities pursuant to this Section 2 until such time
as it shall again decide to pursue an underwritten public offering. In the case
of the registration of shares of capital stock by the Company in connection with
any underwritten public offering, if the underwriter(s) determines that
marketing factors require a limitation on the number of Registrable Securities
to be offered, the Company shall not be required to register Registrable
Securities of the Holders in excess of the amount, if any, of shares of which
the principal underwriter of such underwritten offering shall reasonably and in
good faith agree to include in such offering in excess of any amount to be
registered for the Company. If any limitation of the number of shares of
Registrable Securities to be registered by the Holders is required pursuant to
this Section 2, the number of shares that may be included in the registration on
behalf of the Holders shall be allocated among the Holders or the holders of any
other registration rights in proportion, as nearly as practicable, to the
respective holdings of Registrable Securities of all Holders requesting
registration. The provisions of this Section 2 will not apply to a registration
statement on Form S-8 or Form S-4 (or any successor forms) or a registration
effected solely to implement (i) an employee benefit plan, or (ii) a transaction
to which Rule 145 or any other similar rule of the Commission under the
Securities Act is applicable.
3. REQUIRED REGISTRATIONS.
(A) DEMAND REGISTRATION. On one occasion beginning at any time
after the Company's Initial Public Offering, or in the case of a Principal
Management Stockholder beginning after (i) a Qualified Public Offering; (ii) the
redemption for cash of all of the Redeemable Preferred Stock (as defined in the
Charter) then outstanding in accordance with the terms of the Charter and (iii)
the sale, transfer or other disposition of at least 50% of the Convertible
Preferred Stock held by the TA Investors as of the effective date of the ▇▇▇▇▇▇
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(▇▇▇▇▇▇▇ (▇), (▇▇) and (iii) collectively, the "Management Stockholders Demand
Right Trigger"), and within a period of six (6) years thereafter, a TA Investor
or the TA Investors, or a Principal Management Stockholder or the Principal
Management Stockholders (such TA Investors and Principal Management Stockholders
shall hereafter be sometimes referred to individually as a "Demand Holder," and
collectively as the "Demand Holders"), holding at least 50% of the Registrable
Securities held by the TA Investors or Principal Management Stockholders,
respectively, may require the Company to register under the Securities Act all
or a portion of the Registrable Securities held by such requesting Demand
Holder; provided, however, that the Company shall have no obligation to effect a
registration of its securities pursuant to this Section 3(a) unless the shares
to be included therein shall in the aggregate consist of at least 150,000
Registrable Securities (as adjusted for stock splits, stock dividends or other
similar events).
(B) FORM S-3. Commencing one (1) year after an Initial Public
Offering (or such shorter period as Form S-3 may otherwise permit), or in the
case of a Principal Management Stockholder one (1) year after the Management
Stockholders Demand Right Trigger, and for a period of six (6) years thereafter,
the Company shall use its commercially reasonable efforts to qualify and remain
qualified to register securities on Form S-3 (or any successor form) under the
Securities Act. Subject to the conditions set forth in Section 3(a) above, a TA
Investor or the TA Investors or a Principal Management Stockholder or the
Principal Management Stockholders holding at least 50% of the Registrable
Securities held by the TA Investors or Principal Management Stockholders,
respectively, may request not more than three (3) registrations on Form S-3 (or
any successor form) per year for the Registrable Securities held by such
requesting Demand Holder, including registrations for the sale of such
Registrable Securities on a delayed or continuous basis pursuant to Rule 415
under the Securities Act. Such requests shall be in writing and shall state the
number of shares of Registrable Securities to be disposed of and the intended
method of disposition of such shares by such Demand Holder.
(C) REGISTRATION REQUIREMENTS. Following a request pursuant to
Sections 3(a) or 3(b) above, the Company will notify all of the Holders who
would be entitled to notice of a proposed registration under Section 2 above and
any other holder of piggyback registration rights of its receipt of such request
from such Demand Holder. Upon the written request of any such Holder or other
holder of the Company's securities delivered to the Company within twenty (20)
days after receipt from the Company of such notification, the Company will
either (i) elect to make a primary offering, in which case the rights of such
Holders shall be as set forth in Section 2 above, or (ii) use its commercially
reasonable efforts to cause such of the Registrable Securities as may be
requested by any Holders and any other holders of piggyback registration rights
to be registered under the Securities Act in accordance with the terms of this
Section 3.
(D) LIMITATIONS ON REGISTRATION OBLIGATIONS. The Company shall
not be obligated to effect more than one (1) registration statement pursuant to
Section 3(a) or more than three (3) registration statements per year pursuant to
Section 3(b) for each of the TA Investors and Principal Management Stockholders
as a group. The Company shall not be obligated to effect any registration on
Form S-3 pursuant to Section 3(b) if Form S-3 is not available for such offering
by the Holders; provided, however, that in this event the Company shall be
obligated to effect
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such registration on either Form S-1 or S-2, and such registration shall not be
counted as a registration pursuant to Section 3(a) for purposes of the
limitations set forth in Section 3(a) or in the first sentence of this Section
3(d). The Company may postpone the filing or the effectiveness of any
registration statement pursuant to Sections 3(a) or 3(b) for a reasonable period
of time, provided that such postponements shall not exceed one hundred twenty
(120) days in the aggregate during any twelve (12) month period, if (i) the
Company has been advised by legal counsel that such filing or effectiveness
would require disclosure of a material financing, acquisition or other corporate
transaction, and the Board of Directors of the Company determines in good faith
that such disclosure is not in the best interests of the Company and its
stockholders or the Company would be required to include in such registration
statement financial statements and/or other information concerning the business
of any other party to such financing, acquisition or other corporate transaction
that is not yet then available or (ii) the Board of Directors determines in good
faith that there is a valid business purpose or reason for delaying filing or
effectiveness.
4. FURTHER OBLIGATIONS OF THE COMPANY. Whenever the Company is
required hereunder to register any Registrable Securities, it agrees that it
shall also do the following:
(A) Pay all expenses of such registrations and offerings
(exclusive of underwriting discounts and commissions) and the reasonable fees
and expenses of not more than one independent counsel for the Holders reasonably
satisfactory to the TA Investors in connection with any registrations pursuant
to Section 2 or reasonably satisfactory to the requesting Demand Holder in
connection with any registration pursuant to Section 3;
(B) Use its commercially reasonable efforts (with due regard
to management of the ongoing business of the Company and the allocation of
managerial resources) diligently to prepare and file with the SEC a registration
statement and such amendments and supplements to said registration statement and
the prospectus used in connection therewith as may be necessary to keep said
registration statement effective for at least 120 days or until the Holder or
Holders have completed the distribution described in the registration statement
relating thereto, or until there are no longer any Registrable Securities issued
and outstanding, whichever first occurs, and to comply in all material respects
with the provisions of the Securities Act with respect to the sale of securities
covered by said registration statement for the period necessary to complete the
proposed public offering;
(C) Furnish to each selling Holder such copies of each
preliminary and final prospectus and such other documents as such Holder may
reasonably request to facilitate the public offering of its Registrable
Securities;
(D) Enter into any reasonable underwriting agreement required
by the proposed underwriter (which underwriter shall be selected by the Company
and shall be reasonably satisfactory to the selling Demand Holders in connection
with any registration requested pursuant to Section 3), if any, in such form and
containing such terms as are customary; provided, however, that no Holder shall
be required to make any representations or warranties other than (i) with
respect to its title to the Registrable Securities; (ii) with respect to any
written information
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provided by such Holder to the Company and (iii) representations and warranties
of selling stockholders customarily contained in agreements of this type, and if
the underwriter requires that representations or warranties be made and that
indemnification be provided, the Company shall make all such representations and
warranties and provide all such indemnities, including, without limitation, in
respect of the Company's business, operations and financial information and the
disclosures relating thereto in the prospectus, customarily contained in
agreements of this type;
(E) Use its commercially reasonable efforts (with due regard
to management of the ongoing business of the Company and the allocation of
managerial resources) to register or qualify the securities covered by said
registration statement under the securities or "blue sky" laws of such
jurisdictions as any selling Holder may reasonably request, provided that the
Company shall not be required to register or qualify the securities in any
jurisdictions which require it to qualify to do business therein;
(F) Immediately notify each selling Holder, at any time when a
prospectus relating to his Registrable Securities is required to be delivered
under the Securities Act, of the happening of any event as a result of which
such prospectus contains an untrue statement of a material fact or omits any
material fact 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 selling Holder, prepare a supplement or amendment to such prospectus so
that, as thereafter delivered to the purchasers of such Registrable Securities,
such prospectus will not contain any untrue statement of a material fact or omit
to state any material fact necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading;
(G) Use its commercially reasonable efforts to cause all such
Registrable Securities to be listed on each securities exchange or quotation
system on which similar securities issued by the Company are then listed or
quoted;
(H) Use its commercially reasonable efforts to comply with the
securities laws of the United States and other applicable jurisdictions and all
applicable rules and regulations of the SEC and comparable governmental agencies
in other applicable jurisdictions and make generally available to its Holders,
in each case as soon as practicable, an earnings statement of the Company which
will satisfy the provisions of Section 11(a) of the Securities Act;
(I) In the event of an underwritten public offering, use its
commercially reasonable efforts to obtain and furnish to each selling Holder,
immediately prior to the effectiveness of the registration statement and at the
time of delivery of any Registrable Securities sold pursuant thereto, a cold
comfort letter from the Company's independent public accountants in customary
form and covering such matters of the type customarily covered by cold comfort
letters delivered in connection with underwritten public offerings; and
(J) Otherwise cooperate with the underwriter or underwriters,
the Commission and other regulatory agencies and take all actions and execute
and deliver or cause to be executed
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and delivered all documents reasonably necessary to effect the registration of
any Registrable Securities under this Agreement.
5. INDEMNIFICATION; CONTRIBUTION.
(A) Incident to any registration statement referred to in this
Agreement, the Company will indemnify and hold harmless each underwriter, each
Holder who offers or sells any such Registrable Securities in connection with
such registration statement (including its partners (including partners of
partners and stockholders of any such partners), and directors, officers,
employees and agents of any of them (a "Selling Holder"), and each person who
controls any of them within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act (a "Controlling Person")), from and against any
and all losses, claims, damages, expenses and liabilities, joint or several
(including any investigation, reasonable attorney's fees and other expenses
incurred in connection with, and any amount paid in settlement of, any action,
suit or proceeding or any claim asserted, as the same are incurred), to which
they, or any of them, may become subject under the Securities Act, the Exchange
Act or other federal or state statutory law or regulation, at common law or
otherwise, insofar as such losses, claims, damages or liabilities arise out of
or are based on (x) any untrue statement or alleged untrue statement of a
material fact contained in such registration statement (including any related
preliminary or definitive prospectus, or any amendment or supplement to such
registration statement or prospectus), (y) any omission or alleged omission to
state in such document a material fact required to be stated in it, in light of
the circumstances under which it was made, or necessary to make the statements
in it not misleading, or (z) any violation by the Company of the Securities Act,
any state securities or "blue sky" laws or any rule or regulation thereunder in
connection with such registration; provided, however, that the Company will not
be liable to the extent that such loss, claim, damage, expense or liability
arises from and is based on an untrue statement or omission or alleged untrue
statement or omission made in reliance on and in conformity with information
furnished in writing to the Company by such underwriter, Selling Holder or
Controlling Person expressly for use in such registration statement. With
respect to an untrue statement or omission or alleged untrue statement or
omission made in reliance upon the information furnished in writing to the
Company by such Selling Holder expressly for use in such registration statement,
such Selling Holder will indemnify and hold harmless each underwriter, the
Company (including its directors, officers, employees and agents), each other
Holder (including its partners (including partners of partners and stockholders
of such partners) and directors, officers, employees and agents of any of them,
and each person who controls any of them within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act), from and against any and all
losses, claims, damages, expenses and liabilities, joint or several, to which
they, or any of them, may become subject under the Securities Act, the Exchange
Act or other federal or state statutory law or regulation, at common law or
otherwise to the same extent provided in the immediately preceding sentence. The
Company shall not be obligated hereunder to indemnify any Holder for any amount
paid in settlement of any such loss, claim, damage, liability or action if such
settlement is effected without the consent of the Company (which consent shall
not be unreasonably withheld). In no event, however, shall the liability of a
Selling Holder for indemnification under this Section 5 exceed the lesser of (x)
that proportion of the total of such
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losses, claims, damages or liabilities indemnified against equal to the
proportion of the total securities sold under such registration statement which
is being sold by such Selling Holder or (y) the proceeds received by such
Selling Holder from its sale of Registrable Securities under such registration
statement.
(B) If the indemnification provided for in Section 5(a) above
for any reason is held by a court of competent jurisdiction to be unavailable to
an indemnified party in respect of any losses, claims, damages, expenses or
liabilities referred to therein, then each indemnifying party under this Section
5, in lieu of indemnifying such indemnified party thereunder, shall contribute
to the amount paid or payable by such indemnified party as a result of such
losses, claims, damages, expenses or liabilities (x) in such proportion as is
appropriate to reflect the relative benefits received by the Company, the other
Selling Holders and the underwriters from the offering of the Registrable
Securities or (y) if the allocation provided by clause (x) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (x) above but also the relative
fault of the Company, the other Selling Holders and the underwriters in
connection with the statements or omissions which resulted in such losses,
claims, damages, expenses or liabilities, as well as any other relevant
equitable considerations. The relative benefits received by the Company, the
Selling Holders and the underwriters shall be deemed to be in the same
respective proportions that the net proceeds from the offering (before deducting
expenses) received by the Company and the Selling Holders and the underwriting
discount received by the underwriters, in each case as set forth in the table on
the cover page of the applicable prospectus, bear to the aggregate public
offering price of the Registrable Securities. The relative fault of the Company,
the Selling Holders and the underwriters shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information supplied by the Company, the Selling Holders or the underwriters and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission.
The Company, the Selling Holders, and the underwriters agree that it
would not be just and equitable if contribution pursuant to this Section 5(b)
were determined by pro rata or per capita allocation or by any other method of
allocation which does not take account the equitable considerations referred to
in the immediately preceding paragraph. In no event, however, shall a Selling
Holder be required to contribute any amount under this Section 5(b) in excess of
the lesser of (x) that proportion of the total of such losses, claims, damages
or liabilities indemnified against equal to the proportion of the total
Registrable Securities sold under such registration statement which are being
sold by such Selling Holder or (y) the proceeds received by such Selling Holder
from its sale of Registrable Securities under such registration statement. No
person found guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribution from any
person who was not found guilty of such fraudulent misrepresentation.
(C) The amount paid by an indemnifying party or payable to an
indemnified party as a result of the losses, claims, damages and liabilities
referred to in this Section 5 shall be
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deemed to include, subject to the limitations set forth above, any reasonable
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim, payable as
the same are incurred. The indemnification and contribution provided for in this
Section 5 will remain in full force and effect regardless of any investigation
made by or on behalf of the indemnified parties or any officer, director,
employee, agent or controlling person of the indemnified parties.
(D) NOTICE; DEFENSE OF CLAIMS. Promptly after receipt by an
indemnified party of notice of any claim, liability or expense to which the
indemnification obligations set forth in this Section 5 would apply, the
indemnified party shall give notice thereof in writing to the indemnifying
party, but the omission to so notify the indemnifying party promptly will not
relieve the indemnifying party from any liability except to the extent that the
indemnifying party shall have been prejudiced as a result of the failure or
delay in giving such notice. Such notice shall state the information then
available regarding the amount and nature of such claim, liability or expense
and shall specify the provision or provisions of this Agreement under which the
liability or obligation is asserted. If within twenty (20) days after receiving
such notice the indemnifying party gives written notice to the indemnified party
stating that (x) it would be liable under the provisions hereof for indemnity in
the amount of such claim if such claim were successful and (y) that it disputes
and intends to defend against such claim, liability or expense at its own cost
and expense, then counsel for the defense shall be selected by the indemnifying
party (subject to the consent of the indemnified party, which consent shall not
be unreasonably withheld) and the indemnified party shall not be required to
make any payment with respect to such claim, liability or expense as long as the
indemnifying party is conducting a good faith and diligent defense at its own
expense; provided, however, that the assumption of defense of any such matters
by the indemnifying party shall relate solely to the claim, liability or expense
that is subject or potentially subject to indemnification. The indemnifying
party shall have the right, with the consent of the indemnified party, which
consent shall not be unreasonably withheld, to settle all indemnifiable matters
related to claims by third parties which are susceptible to being settled
provided its obligation to indemnify the indemnifying party therefor will be
fully satisfied. The indemnifying party shall keep the indemnified party
apprised of the status of the claim, liability or expense and any resulting
suit, proceeding or enforcement action, shall furnish the indemnified party with
all documents and information that the indemnified party shall reasonably
request and shall consult with the indemnified party prior to acting on major
matters, including settlement discussions. Notwithstanding anything herein
stated to the contrary, the indemnified party shall at all times have the right
to fully participate in such defense at its own expense directly or through
counsel; provided, however, if the named parties to the action or proceeding
include both the indemnifying party and the indemnified party and representation
of both parties by the same counsel would be inappropriate under applicable
standards of professional conduct, the reasonable expense of one (1) separate
counsel for the indemnified party shall be paid by the indemnifying party. If no
such notice of intent to dispute and defend is given by the indemnifying party,
or if such diligent good faith defense is not being or ceases to be conducted,
the indemnified party shall, at the expense of the indemnifying party, undertake
the defense of (with counsel selected by the indemnified party), and shall have
the right to compromise or settle (exercising reasonable business judgment),
such claim, liability or expense. If such claim, liability or expense is one
that by its nature cannot
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be defended solely by the indemnifying party, then the indemnified party shall
make available all information and assistance that the indemnifying party may
reasonably request and shall cooperate with the indemnifying party in such
defense.
(E) PROSPECTUS DELIVERY. The foregoing indemnity agreements of
the Company and Selling Holders are subject to the condition that, insofar as
they relate to any misstatement or omission in a preliminary prospectus that was
eliminated or remedied in the amended prospectus on file with the SEC at the
time the registration statement in question becomes effective or the amended
prospectus filed with the SEC pursuant to Rule 424(b) (the "Final Prospectus"),
such indemnity agreement shall not inure to the benefit of any person if a copy
of the Final Prospectus was furnished to the indemnified party and was not
furnished to the person asserting the loss, liability, claim or damage at or
prior to the time such action is required by the Securities Act.
6. RULE 144 AND RULE 144A REQUIREMENTS. In the event that the
Company becomes subject to Section 13 or Section 15(d) of the Exchange Act, the
Company shall use its best efforts to take all action as may be required as a
condition to the availability of Rule 144 or Rule 144A under the Securities Act
(or any successor or similar exemptive rules hereafter in effect). The Company
shall furnish to any Holder, within 15 days of a written request, a written
statement executed by the Company as to the steps it has taken to comply with
the current public information requirement of Rule 144 or Rule 144A or such
successor rules.
7. "MARKET STAND-OFF" AGREEMENT. In connection with any
underwritten public offering by the Company, the Stockholders, if requested in
good faith by the Company and the managing underwriter of the Company's
securities, shall agree not to sell or otherwise transfer or dispose of any
securities of the Company held by them (except for any securities sold pursuant
to such registration statement) for a period following the effective date of the
applicable registration statement; provided, however that in no event shall such
period exceed 180 days; and provided further that such agreement shall not be
required unless all officers and directors and two percent (2%) or greater
stockholders of the Company and all other persons with registration rights enter
into similar agreements. In order to enforce the foregoing, the Company may
impose stop-transfer instructions with respect to the Registrable Securities of
each Stockholder (and the shares of securities of every other person subject to
the foregoing restriction) until the end of such period.
8. WAIVER; AMENDMENTS. For purposes of this Agreement and all
agreements executed pursuant hereto, no course of dealing between or among any
of the parties hereto and no delay on the part of any party hereto in exercising
any rights hereunder or thereunder shall operate as a waiver of the rights
hereof and thereof. This Agreement may not be amended or modified or any
provision hereof waived without the written consent of the Company and the
holders of not less than a majority of the outstanding Common Stockholder
Shares; provided, however, that any party may waive any provision hereof
intended for its benefit by written consent; and provided further, however, that
any amendment that would adversely effect any Stockholder that is not a TA
Investor shall require the consent of Principal Management
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Stockholders holding a majority of the Stockholder Shares held by the Principal
Management Stockholders.
9. MISCELLANEOUS.
(A) SEVERABILITY. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be invalid,
illegal or unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability shall not affect
any other provision or any other jurisdiction, but this Agreement shall be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision had never been contained herein.
(B) ENTIRE AGREEMENT. Except as otherwise expressly set forth
herein, this document embodies the complete agreement and understanding among
the parties hereto with respect to the subject matter hereof and supersedes and
preempts any prior understandings, agreements or representations by or among the
parties, written or oral, which may have related to the subject matter hereof in
any way.
(C) SUCCESSORS AND ASSIGNS. Except as otherwise expressly
provided herein, this Agreement shall bind and inure to the benefit of and be
enforceable by the Company and its successors and assigns and the Stockholders
and any subsequent holders of Stockholder Shares and the respective successors
and assigns of each of them.
(D) COUNTERPARTS. This Agreement may be executed in separate
counterparts each of which shall be an original and all of which taken together
shall constitute one and the same agreement.
(E) REMEDIES. The parties hereto shall be entitled to enforce
their rights under this Agreement specifically to recover damages by reason of
any breach of any provision of this Agreement and to exercise all other rights
existing in their favor. The parties hereto agree and acknowledge that money
damages may not be an adequate remedy for any breach of the provisions of this
Agreement and that any party hereto may in its sole discretion apply to any
court of law or equity of competent jurisdiction for specific performance and/or
injunctive relief (without posting a bond or other security) in order to enforce
or prevent any violation of the provisions of this Agreement.
(F) NOTICES. Any notice provided for in this Agreement shall
be in writing and shall be either (i) personally delivered, (ii) sent by
registered or certified mail (return receipt requested and postage prepaid),
(iii) sent by reputable overnight courier service (charges prepaid), or (iv)
sent by facsimile, in each case, to the Company at the address set forth below
and to any other recipient at the address indicated on the Notices Schedule
attached hereto, or if such recipient is not listed on the Notices Schedule
attached hereto, at the address indicated by the Company's records. Any Person
may change its address for purposes of this Agreement by
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providing prior notice of such change to the other parties hereto in accordance
with this Section. Notices will be deemed to have been given hereunder (i) when
delivered personally, (ii) three days after being mailed, (iii) one day after
deposit with a reputable overnight courier service, or (iv) in the cases of
notices sent by facsimile, when receipt is acknowledged. The Company's address
is:
Physicians' Specialty Group
The Pavilion at Lake ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇
President and Chairman
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
The TA Investors' address is:
▇/▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇.▇. ▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
▇▇▇▇▇▇▇, Procter & ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ III, P.C.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(G) GOVERNING LAW. All questions concerning the construction,
validity and interpretation of this Agreement shall be governed by and construed
in accordance with the internal laws of the State of Delaware, without giving
effect to any choice of law or other conflict of law provision or rule (whether
of the State of Delaware or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the State of Delaware.
(H) DISPUTE RESOLUTION. All disputes, claims, or controversies
arising out of or relating to this Agreement or the negotiation, validity or
performance hereof that are not resolved by mutual agreement shall be resolved
solely and exclusively by binding arbitration to be conducted before
JAMS/Endispute, Inc. or its successor. The arbitration shall be held in
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Boston, Massachusetts before a single arbitrator, acceptable to the holders of a
majority of the Common Stockholder Shares, and shall be conducted in accordance
with the rules and regulations promulgated by JAMS/Endispute, Inc. unless
specifically modified herein.
Whenever a party shall decide to initiate arbitration proceedings it
shall first give written notice of its intent to do so to all other parties
hereto. The parties covenant and agree that during the sixty (60) day period
following such notice, they shall make good faith efforts to resolve the dispute
without arbitration; provided, that if such dispute cannot be resolved within
such sixty (60) day period, then the arbitration shall commence upon termination
of such sixty (60) day period.
(I) BUSINESS DAYS. If any time period for giving notice or
taking action hereunder expires on a day which is a Saturday, Sunday or legal
holiday in the state in which the Company's chief executive office is located,
the time period shall automatically be extended to the business day immediately
following such Saturday, Sunday or legal holiday.
(J) CONSTRUCTION. Whenever the context requires, each term
stated in either the singular or the plural shall include the singular and the
plural, and pronouns stated in either the masculine, the feminine or the neuter
gender shall include the masculine, feminine and neuter. All references to
Sections and Paragraphs refer to sections and paragraphs of this Agreement. The
use of the word "including" in this Agreement shall be by way of example rather
than limitation.
(K) DESCRIPTIVE HEADINGS. The descriptive headings of this
Agreement are inserted for convenience only and do not constitute a part of this
Agreement.
(L) TERMINATION. This Agreement becomes effective upon the
Effective Time of the Merger (as defined in the Merger Agreement) and shall
terminate and be of no further force and effect upon the termination of the
Merger Agreement pursuant to Section 9.1 thereof.
[SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF, the parties hereto have caused this Registration
Rights Agreement to be duly executed as of the date first set forth above.
COMPANY:
TA MERGERCO, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: President and Chief Executive Officer
TA INVESTORS:
TA/ADVENT VIII, L.P.
By: TA Associates VIII LLC, its General Partner
By: TA Associates, Inc., its General Partner
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Managing Director
TA/ATLANTIC AND PACIFIC IV, L.P.
By: TA Associates AP IV, L.P. its General
Partner
By: TA Associates, Inc., its General Partner
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Managing Director
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TA INVESTORS, LLC
By: TA Associates, Inc., its Manager
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Managing Director
TA EXECUTIVES FUND, LLC
By: TA Associates, Inc., its Manager
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Managing Director
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[STOCKHOLDER SIGNATURE PAGES OMITTED]
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NOTICE SCHEDULE