EXHIBIT 4.4
GOHEALTH.MD, INC.
STOCK OPTION AGREEMENT
THIS STOCK OPTION AGREEMENT (this "Agreement") is made and entered into as
of this 7th day of May, 1999, by and between GOHEALTH.MD, INC., a Delaware
corporation (the "Company"), and Millennium Consulting, Inc. ("Optionee").
Background
The Company desires to grant Optionee an option to purchase shares of
common stock of the Company.
NOW, THEREFORE, in consideration of the premises and the covenants
contained herein, and other good and valuable consideration, including the
consideration set forth in the Consulting Agreement, the receipt and adequacy of
which is hereby acknowledged, and intending to be legally bound, it is agreed as
follows:
3. Non-Qualified Stock Options to Purchase Shares.
(a) Number of Option Shares and Exercise Price. The Company
hereby grants to the Optionee non-qualified stock options (the "Options"), to
purchase the following number of shares of the Company's common stock, par value
$0.001 per share (the "Option Shares"):
(i) 30,000 shares of common stock with an exercise price
of $.50 per share.
(b) Exercise Period. The Options shall be exercisable, in
whole or in part, at any time and from time to time during the period commencing
on the date hereof, and ending on May 7, 2006 (the "Exercise Period").
2. Manner of Exercise and Terms of Payment.
The Options may be exercised in whole or in part, subject to
the limitations set forth in this Agreement, upon delivery to the Company of
timely written notice of exercise, accompanied by full payment of the Option
Price for the Option Shares with respect to which the Options are exercised. The
exercise price may be paid by delivering a certified check or wire transfer of
immediately available funds to the order of the Company for the entire exercise
price. The person entitled to the shares so purchased shall be treated for all
purposes as the holder of such shares as of the close of business on the date of
exercise and certificates for the shares of stock so purchased shall be
delivered to the person so entitled within a reasonable time, not exceeding
thirty (30) days, after such exercise. Unless this Option has expired, a new
Option of like tenor and for such number of shares as the holder of this Option
shall direct,
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representing in the aggregate the right to purchase a number of shares with
respect to which this Option shall not have been exercised, shall also be issued
to the holder of this Option within such time.
3. Rights as Stockholder. Optionee or a permitted transferee of the Options
shall have no rights as a stockholder of the Company with respect to any shares
of common stock subject to such Options prior to his exercise of the Options.
4. Adjustment of Purchase Price and Number of Shares. The number and kind
of securities purchasable upon the exercise of this Option and the exercise
price shall be subject to adjustment from time to time, as provided in Schedule
A attached hereto.
5. Investment Representation.
(a) Optionee represents and warrants to the Company that
Optionee is acquiring these Options and the Option Shares for Optionee's own
account for the purpose of investment and not with a view toward resale or other
distribution thereof in violation of the 1933 Act. Optionee acknowledges that
the effect of the representations and warranties is that the economic risk of
the investment in the Options and Option Shares must be borne by the Optionee
for an indefinite period of time. This representation and warranty shall be
deemed to be a continuing representation and warranty and shall be in full force
and effect upon such exercise of the Options granted hereby.
(b) Prior to such time as the Option Shares have been
registered under the 1933 Act, the Company shall place a legend on each
certificate for the Option Shares issued pursuant hereto, or any certificate
issued in exchange therefore, stating that such securities are not registered
under the 1933 Act and state securities laws and setting forth or referring to
the restriction on transferability and sale thereof imposed by the 1933 Act or
any applicable state securities law, and that the holder thereof agrees to be
bound by such restrictive legend.
6. Exercisability. The Options shall be exercisable only by Optionee during
his lifetime or by his assigns, heirs, executors or administrators, as the case
may be. Any assignment hereof shall be in compliance with applicable securities
laws. The Options granted hereunder and the registration rights may be assigned
together only, but may not be separately assigned.
7. Piggyback Registrations.
(a) Right to Piggyback. At any time after the first to occur
of the date (i) a registration statement covering the Initial Public Offering of
the Company's securities shall become effective or (ii) upon the Company
becoming a reporting company under Section 12 of the Securities Act of 1934, as
amended whenever the Company proposes to register any of its securities under
the 1933 Act (other than a registration on Form S-4 or S-8 or such replacement
form), and the registration form to be used may be used for the registration of
Registrable Securities (a "Piggyback Registration"), the Company will give
prompt written notice to the Optionee and will include in such Piggyback
Registration, subject to the allocation provisions below, all Registrable
Securities of Optionee with respect to which the Company has received written
requests for inclusion within fifteen (15) days after the Company's mailing of
such notice.
(b) Piggyback Expenses. In all Piggyback Registrations, the
Company will pay all of the Registration Expenses.
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(c) Priority on Registrations. If a Piggyback Registration is
initiated as an underwritten primary or secondary registration on behalf of the
Company or holders of the Company's securities, and the managing underwriters
advise the Company in writing that in their reasonable opinion the number of
securities requested to be included in such registration exceeds the number that
can be sold in such offering, at a price reasonably related to fair value, the
Company may limit the number of Registrable Securities included in such
registration.
(d) Selection of Underwriters. If any Piggyback Registration
is underwritten, the selection of investment banker(s) and manager(s) and the
other decisions regarding the underwriting arrangements for the offering will be
made by the Company.
(e) Continuing Obligations. The Company's agreements with
respect to the registration of the Option Shares in this Section 8 shall
continue in effect regardless of the exercise and surrender of the Option.
8. Registration Procedures.
Whenever the Optionee has requested that any Registrable
Securities be registered pursuant to Section 7 of this Agreement, the Company
will, as expeditiously as possible:
(a) prepare and file with the Securities and Exchange
Commission a registration statement with respect to such Registrable Securities
and use its best reasonable efforts to cause such registration statement to
become effective as promptly as practical;
(b) prepare and file with the Securities and Exchange
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 for a period of not less than 90 days;
(c) furnish to each Selling Holder such reasonable number of
copies of such registration statement, each amendment and supplement thereto and
the prospectus included in such registration statement (including each
preliminary prospectus and any term sheet associated therewith), and such other
documents as such Optionee may reasonably request in order to facilitate the
disposition of the Registrable Securities owned by each seller;
(d) use its best reasonable efforts to register or qualify
such Registrable Securities under such other securities or blue sky laws of such
states as the managing underwriter(s) may reasonably request, or if the offering
is not underwritten in New York, New Jersey and Pennsylvania.
(e) notify each Selling Holder at any time when a prospectus
relating thereto is required to be delivered under the 1933 Act within the
period that the Company is required to keep the registration statement effective
of the happening of any event as a result of which the prospectus included in
such registration statement, together with any associated term sheet, contains
an untrue statement of a material fact or omits and fact necessary to make the
statement therein not misleading, and, at the request of any such seller, the
Company will 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 an untrue statement of a material fact or omit to
state any fact necessary to make the statement therein not misleading;
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(f) cause all such Registrable Securities to be listed or
included on each national securities exchange, if any, or on the NASDAQ Stock
Market, on which the other outstanding shares of Common Stock of the Company are
then listed;
(g) provide a transfer agent and registrar for all such
Registrable Securities not later than the effective date of such registration
statement;
(h) enter into such customary agreements (including an
underwriting agreement in customary form) and take such other customary actions
as may be reasonably necessary to expedite or facilitate the disposition of such
Registrable Securities;
(i) obtain a "comfort" letter addressed to the Company from
its independent public accountants in customary form and covering such matters
of the type customarily covered by "comfort" letters; and
(j) make available for inspection by the Optionee, any
underwriter participating in any disposition pursuant to such registration
statement, and any attorney, accountant or other agent retained by any such
seller, or any underwriter, all financial and other records, pertinent corporate
documents and properties of the Company, and cause the Company's officers,
directors and employees to supply all information reasonably requested by any
such seller or any such underwriter, attorney, accountant or agent in connection
with such registration statement.
9. Indemnification.
(a) The Company hereby indemnifies, to the extent permitted by
law, each Holder and their respective officers, directors, employees and agents,
if any, and each person who controls any of them within the meaning of the 1933
Act (each, an "indemnified Party") against all losses, claims, damages,
liabilities and expenses arising out of or resulting from any untrue or alleged
untrue statement of material fact contained in any registration statement,
prospectus or preliminary prospectus or associated term sheet or any omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading in light of the
circumstances in which made except insofar as the same are caused by or
contained in any information furnished in writing to the Company by such
Indemnified Party expressly for use therein or by any Indemnified Party's
failure to deliver a copy of the registration statement or prospectus or any
amendments or supplements thereto after the Company has furnished such
Indemnified Party with a sufficient number of copies of the same. In connection
with an underwritten offering, the Company will indemnify the underwriters,
their officers and directors, and each person who controls such underwriters
(within the meaning of the ▇▇▇▇ ▇▇▇) to the same extent as provided above with
respect to the indemnification of any Indemnified Party.
(b) In connection with any registration statement in which a
Selling Holder is participating, each such Holder will furnish to the Company in
a timely manner in writing such information as is reasonably requested by the
Company for use in any such registration statement or prospectus and will
indemnify, to the extent permitted by law, the Company, its directors and
officers and each person who controls the Company (within the meaning of the
▇▇▇▇ ▇▇▇) against any losses, claims, damages, liabilities and expenses
resulting from any untrue or alleged untrue statement of material fact or any
omission or alleged omission of a material fact required to be stated in the
registration statement or prospectus or any
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amendment thereof or supplement thereto or necessary to make the statements
therein not misleading, but only to the extent that such untrue statement or
omission is contained in information so furnished in writing by such Holder
specifically for use in preparing the registration statement. Notwithstanding
the foregoing, the liability of a Selling Holder under this Section 9(b) shall
be limited to an amount equal to the net proceeds actually received by the
Selling Holder from the sale of Registrable Securities covered by the
registration statement.
(c) Any person entitled to indemnification hereunder will (i)
give prompt notice to the indemnifying party of any claim with respect to which
it seeks indemnification and (ii) unless in such indemnifying party's counsel
reasonable judgment a conflict of interest between such indemnified and
indemnifying parties may exist with respect to such claim, permit such
indemnifying party to assume the defense of such claim with counsel reasonably
satisfactory to the indemnified party. Any failure to give prompt notice shall
deprive a party of its right to indemnification hereunder only to the extent
that such failure shall have adversely affected the indemnifying party. If the
defense of any claim is assumed, the indemnifying party will not be subject to
any liability for any settlement made without its consent (but such consent will
not be unreasonably withheld). An indemnifying party who is not entitled, or
elects not, to assume the defense of a claim will not be obligated to pay the
fees and expenses or more than one counsel for all parties indemnified by such
indemnifying party with respect to such claim, unless in the reasonable
judgement of any indemnified party's counsel a conflict of interest exists
between such indemnified party and any other of such indemnifying parties with
respect to such claim.
10. Participation in Underwritten Registrations.
The Optionee may not participate in any underwritten registration
hereunder unless he (i) agrees to sell his securities on the basis provided in
any underwriting arrangements approved by the persons entitled hereunder to
approve such arrangements under Section 7(e), and (ii) completes and executes
all questionnaires, powers of attorney, indemnities, underwriting agreements and
other documents required under the terms of such underwriting arrangements.
11. Definitions.
(a) The term "Additional Shares of Capital Stock" shall mean
all shares of Capital Stock issued by the Company, except those shares of Common
Stock of the Company issuable upon the exercise of this Option or any other
shares of Common Stock issued to the Optionee.
(b) The term "Capital Stock" shall mean the Company's common
stock, and any other stock of any class, whether now or hereafter authorized,
which has the right to participate in the distribution of earnings and assets of
the Company without limit as to amount or percentage.
(c) The term "Initial Public Offering" means the first public
offering under the 1933 Act of any of the Company's equity securities.
(d) The term "Registrable Securities" means (i) the Common
Stock issuable upon the exercise of the Options and (ii) any securities issued
or to be issued with respect to the securities referred to above by way of a
stock dividend or stock split or in connection with a combination of shares,
recapitalization, merger, consolidation or other reorganization. As to any
particular Registrable Securities,
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such securities will cease to be Registrable Securities when they have been
effectively registered under the 1933 Act and disposed of in accordance with the
registration statement covering them.
(e) The term "Registration Expenses" means all expenses
incident to the Company's performance of or compliance with this Agreement,
including without limitation all registration and filing fees, fees and expenses
of compliance with securities or blue sky laws (in such states reasonably
determined by the Company), printing expenses, messenger and delivery expenses,
expenses and fees for listing the securities to be registered on exchanges or
electronic quotation systems on which similar securities issued by the Company
are then listed, and fees and disbursements of counsel for the Company (but not
Optionee's counsel) and of all independent certified public accountants,
underwriters (other than Underwriting Commissions) and other persons retained by
the Company.
(f) The term "Underwriting Commissions" means all underwriting
discounts or commissions relating to the sale of securities of the Company.
12. Rule 144 Reporting. With a view to making available to the Holders
the benefits of certain rules and regulations of the U.S. Securities and
Exchange Commission (the "SEC") which may permit the sale of the Options or the
shares underlying the Options to the public without registration, at any time
after the first to occur of the date (i) a registration statement under the
Securities Act covering the Initial Public Offering of the Company's securities
shall become effective, or (ii) upon the Company becoming a reporting company
under Section 12 of the Securities Exchange Act of 1934, as amended, the Company
agrees to: (a) make and keep public information available, as those terms are
understood and defined in Rule 144 under the 1933 Act; (b) file with the SEC in
a timely manner all reports and other documents required of the Company under
the 1993 Act and the Securities Exchange Act of 1934, as amended; and (c)
furnish to Optionee upon its written request a written statement by the Company
as to its compliance with the public information requirements of Rule 144 and a
copy of the most recent annual or quarterly report of the Company.
13. Miscellaneous.
(a) Termination of Other Agreements. This Agreement sets forth
the entire understanding of the parties hereto with respect to the rights to the
registration of capital stock of the Company and supercedes all prior
arrangements or understandings among the parties regarding such matters.
(b) Notices. Any notices required hereunder shall be deemed to
be given upon the earlier of the date when received at, or (i) the third
business day after the date when sent by certified or registered mail, (ii) the
next business day after the date sent by guaranteed overnight courier, or (iii)
the date sent by telecopier or delivered by hand, in each case, to the addresses
set forth below:
If to the Company: GoHealth.MD, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: President
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If to the Optionee: Millennium Consulting, Inc.
▇.▇. ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
or to such other addresses as the parties may specify in writing.
(c) Amendments and Waivers. The provisions of this Agreement
may be amended or terminated unless in a writing signed by the Optionee and the
Company.
(d) Binding Effect. This Agreement will bind and inure to the
benefit of the respective successors (including any successor resulting from a
merger or similar reorganization), assigns, heirs, and personal representatives
of the parties hereto.
(e) Governing Law. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the State of New Jersey.
(f) Counterparts. This Agreement may be executed in any number
of counterparts, each of which shall be considered to be an original instrument
and to be effective as of the date first written above. Each such copy shall be
deemed an original, and it shall not be necessary in making proof of this
Agreement to produce or account for more than one such counterpart.
(g) Interpretation. Unless the context of this Agreement
clearly requires otherwise, (a) references to the plural include the singular,
the singular the plural, the part the whole, (b) references to one gender
include all genders, (c) "or" has the inclusive meaning frequently identified
with the phrase "and/or" and (d) "including" has the inclusive meaning
frequently identified with the phrase "but not limited to." The section and
other headings contained in this Agreement are for reference purposes only and
shall not control or affect the construction of the Agreement or the
interpretation thereof in any respect.
IN WITNESS WHEREOF, the undersigned have executed, or have caused this
Agreement to be executed, as of the day and year first above written.
GOHEALTH.MD, INC. OPTIONEE
MILLENNIUM CONSULTING, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ /s/ Millennium Consulting, Inc.
----------------------------- -------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Chief Executive Officer
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SCHEDULE A
Adjustment of Purchase Price and Number of Shares
1. Adjustment. The number and kind of securities purchasable
upon the exercise of this Option and the Exercise Price shall be subject to
adjustment from time to time upon the happening of certain events as follows:
(a) Reclassification, Consolidation or Merger. At any
time while this Option remains outstanding and unexpired, in case of (i) any
reclassification or change of outstanding securities issuable upon exercise of
this Option (other than a change in par value, or from par value to no par value
per share, or from no par value per share to par value or as a result of a
subdivision or combination of outstanding securities issuable upon the exercise
of this Option), (ii) any consolidation or merger of the Company with or into
another corporation (other than a merger with another corporation in which the
Company is a continuing corporation and which does not result in any
reclassification or change, other than a change in par value, or from par value
to no par value per share, or from no par value per share to par value, or as a
result of a subdivision or combination of outstanding securities issuable upon
the exercise of this Option), or (iii) any sale or transfer to another
corporation of the property of the Company as an entirety or substantially as an
entirety, the Company, or such successor or purchasing corporation, as the case
may be, shall without payment of any additional consideration therefor, execute
a new Option providing that the holder of this Option shall have the right to
exercise such new Option (upon terms not less favorable to the holder than those
then applicable to this Option) and to receive upon such exercise, in lieu of
each share of Common Stock theretofore issuable upon exercise of this Option,
the kind and amount of shares of stock, other securities, money or property
receivable upon such reclassification, change, consolidation, merger, sale or
transfer. Such new Option shall provide for adjustments which shall be as nearly
equivalent as may be practicable to the adjustments provided for in this Section
1 of Schedule A. The provisions of this subsection 1(a) shall similarly apply to
successive reclassifications, changes, consolidations, mergers, sales and
transfers.
(b) Subdivision or Combination of Shares. If the
Company at any time while this Option remains outstanding and unexpired, shall
subdivide or combine its Capital Stock, the Exercise Price shall be
proportionately reduced, in case of subdivision of such shares, as of the
effective date of such subdivision, or, if the Company shall take a record of
holders of its Capital Stock for the purpose of so subdividing, as of such
record date, whichever is earlier, or shall be proportionately increased, in the
case of combination of such shares, as of the effective date of such
combination, or, if the Company shall take a record of holders of its Capital
Stock for the purpose of so combining, as of such record date, whichever is
earlier.
(c) Stock Dividends. If the Company at any time while
this Option is outstanding and unexpired shall pay a dividend in shares of, or
make other distribution of shares of, its Capital Stock, then the Exercise Price
shall be adjusted, as of the date the Company shall take a record of the holders
of its Capital Stock for the purpose of receiving such dividend or other
distribution (or if no such record is taken, as at the date of such payment or
other distribution), to that price determined by multiplying the exercise price
in effect immediately prior to such payment or other distribution by a fraction
(a) the numerator of which shall be the total number of shares of Capital Stock
outstanding immediately prior to such dividend or distribution, and (b) the
denominator of which shall be the total number of shares of Capital Stock
outstanding immediately after such dividend or distribution. The provisions of
this
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subsection 1(c) shall not apply under any of the circumstances for which an
adjustment is provided in subsection 1(a) or 1(b).
(d) Liquidating Dividends, Etc. If the Company at any
time while this Option is outstanding and unexpired makes a distribution of its
assets to the holders of its Capital Stock as a dividend in liquidation or by
way of return of capital or other than as a dividend payable out of earnings or
surplus legally available for dividends under applicable law or any distribution
to such holders made in respect of the sale of all or substantially all of the
Company's assets (other than under the circumstances provided for in the
foregoing subsections (a) through (c)), the holder of this Option shall be
entitled to receive upon the exercise hereof, in addition to the shares of
Common Stock receivable upon such exercise, and without payment of any
consideration other than the exercise price, an amount in cash equal to the
value of such distribution per share of Common Stock multiplied by the number of
shares of Common Stock which, on the record date for such distribution, are
issuable upon exercise of this Option (with no further adjustment being made
following any event which causes a subsequent adjustment in the number of shares
of Common Stock issuable upon the exercise hereof), and an appropriate provision
therefor should be made a part of any such distribution. The value of a
distribution which is paid in other than cash shall be determined in good faith
by the Board of Directors.
2. Notice of Adjustments. Whenever any of the exercise price
or the number of shares of Common Stock purchasable under the terms of this
Option at that exercise price shall be adjusted pursuant to Section 1 hereof,
the Company shall promptly make a certificate signed by its President or a Vice
President and by its Treasurer or Assistant Treasurer or its Secretary or
Assistant Secretary, setting forth in reasonable detail the event requiring the
adjustment, the amount of the adjustment, the method by which such adjustment
was calculated (including a description of the basis on which the Company's
Board of Directors made any determination hereunder), and the exercise price and
number of shares of Common Stock purchasable at that exercise price after giving
effect to such adjustment, and shall promptly cause copies of such certificate
to be mailed (by first class and postage prepaid ) to the registered holder of
this Option.
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