Exhibit 10.6
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "AGREEMENT") dated as of June __,
2000, by and among COVALENT GROUP, INC, a Nevada corporation, with headquarters
located at One Glenhardie Corporate Center, 1275 Drummers Lane, Suite 100,
Wayne, Pennsylvania 19087 (the "COMPANY"), and the individuals or entities
identified on Exhibit A attached hereto (the "INVESTORS").
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WHEREAS:
A. Covalent Partners, LLC, a Delaware limited liability company
("COVALENT PARTNERS") executed certain promissory notes in the original
aggregate principal amount of $8,725,000, each dated January 20, 2000 (the
"PROMISSORY NOTES") in favor of the Investors, pursuant to which Covalent
Partners delivered as full payment of the Promissory Notes an aggregate of
3,158,333 shares (together with the 645,945 shares of Common Stock held by
Covalent Partners, the "SHARES") of the Company's common stock (the "COMMON
STOCK");
B. In connection with the above transaction, Covalent Partners and the
Investors entered into a certain Stockholder Agreement dated January 20, 2000
(the "STOCKHOLDER AGREEMENT") pursuant to which Covalent Partners agreed to
cause the Company to provide certain registration rights under the Securities
Act of 1933, as amended, and the rules and regulations thereunder as amended or
supplemented from time to time, or any successor thereto (the "1933 ACT"), and
applicable state securities laws, subject to the conditions contained herein;
C. Following the above transaction, Covalent Partners make additional
transfers in the aggregate amount of 1,211,158 Shares to certain of the
Investors;
D. The Company and the Investors are entering into this Agreement to set
forth the terms and conditions under which the Company will file and maintain
the effectiveness of a shelf registration statement for the Shares.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and intending to be legally bound,
the Company and the Investors hereby agree as follows:
1. DEFINITIONS. As used in this Agreement, the following terms shall have the
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following meanings unless the context shall otherwise require:
a. "REGISTER," "REGISTERED," and "REGISTRATION" refer to a
registration effected by preparing and filing a Registration Statement or
Statements in compliance with the 1933 Act and pursuant to Rule 415 under the
1933 Act or any successor rule providing for offering securities on a continuous
basis ("RULE 415"), and the declaration or ordering of effectiveness of such
Registration Statement by the United States Securities and Exchange Commission
(the "SEC").
b. "REGISTRABLE SECURITIES" means the Shares and any shares of capital
stock issued or issuable as a dividend on or in exchange for or otherwise with
respect to any of the foregoing.
c. "REGISTRATION PERIOD" means the period beginning on the date on
which the initial Registration Statement filed under this Agreement is declared
effective by the SEC and ending on the date which is the earlier of: (i) the
date on which all of the Registrable Securities have been sold pursuant to any
Registration Statement, whether filed pursuant to this Agreement or otherwise;
(ii) the first date on which public sale of all of the Registrable Securities
held by each Investor is permitted to be made in any period of 90 days pursuant
to Rule 144 or any other rule or regulation permitting public sale without
registration under the 1933 Act (in any case, as amended or supplemented, or any
successors thereto); or (iii) January 15, 2002.
d. "REGISTRATION STATEMENT" means a registration statement of the
Company under the 1933 Act.
2. REGISTRATION. The Company shall use its best efforts to effect the
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registration of all of the Registered Securities under the 1933 Act on a
Registration Statement on Form S-3, to obtain effectiveness of the Registration
Statement filed to effect such registration as soon as reasonably practicable
thereafter, and to continue to use such best efforts to maintain such
effectiveness for the Registration Period, subject to the provisions of Sections
4 and 5 hereof. Notwithstanding anything herein to the contrary, the Company
shall have no obligation to file a Registration Statement if it is ineligible to
use short form registration on Form S-3.
3. REGISTRATION PROCEDURES. In connection with the registration of the
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Registrable Securities, pursuant to Section 2, the Company shall:
a. prepare and file with the SEC a Registration Statement with respect
to the Registrable Securities, as expeditiously as is reasonably practicable,
and thereafter use its best efforts to cause such Registration Statement to
become effective as soon as reasonably practicable after such filing, and keep
the Registration Statement effective pursuant to Rule 415 until the expiration
of the Registration Period, which Registration Statement (including any
amendments or supplements thereto and prospectuses contained therein) shall not
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein, or necessary to make the statement therein not
misleading;
b. prepare and file with the SEC such amendments (including
post-effective amendments) and supplements to the Registration Statement and the
prospectus used in connection with the Registration Statement as may be
necessary to keep the Registration Statement effective at all times during the
Registration Period, and, during such period, comply with the Company's
obligations under the provisions of the 1933 Act with respect to the disposition
of all Registrable Securities of the Company covered by the Registration
Statement until such time as all of such Registrable Securities have been
disposed of in accordance with the intended methods of disposition by the seller
or sellers thereof as set forth in the Registration Statement;
c. furnish to each Investor (i) promptly after the same is prepared
and publicly distributed, filed with the SEC, or received by the Company, one
copy of the Registration Statement and any amendment thereto, and each
preliminary prospectus and prospectus and each amendment or supplement thereto
(ii) such number of copies of a prospectus, including a preliminary prospectus,
and all amendments and supplements thereto and such other documents in the
Company's possession as the Investors may reasonably request in order to
facilitate the disposition of the Registrable Securities owned by the Investors.
The Company will immediately notify each Investor by facsimile of the
effectiveness of the Registration Statement or any post-effective amendment. The
Company will use its best efforts to respond to any and all comments received
from the SEC, with a view towards causing the Registration Statement or any
amendment thereto to be declared effective by the SEC as soon as practicable and
shall file an acceleration request as soon as practicable following the
resolution or clearance of all SEC comments or, if applicable, following
notification by the SEC that any such Registration Statement or any amendment
thereto will not be subject to review;
d. use commercially reasonable efforts to register or qualify the
Registrable Securities covered by the Registration Statement under such other
securities or "blue sky" laws of such jurisdictions in the United States, to
the extent required pursuant to such laws, and as the Investors who hold an
interest in the Registrable Securities being offered reasonably request, and to
maintain such registration or qualification during the Registration Period,
provided, however, that the Company shall not for any purpose be required in
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connection therewith or as a condition thereto to (i) qualify to do business in
any jurisdiction where it would not otherwise be required to qualify but for
this Section 3(d), (ii) subject itself to general taxation in any such
jurisdiction, (iii) file a general consent to service of process in any such
jurisdiction, (iv) provide any undertakings that cause the Company undue expense
or burden, or (v) make any change in its charter or bylaws, which in each case
the Board of Directors of the Company determines to be contrary to the best
interests of the Company and its stockholders;
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e. as promptly as practicable after receipt of a notice from an
Investor pursuant to Section 5(d), but in no event later than the Notice Period
(as defined herein), notify the Investors of the happening of any event, of
which the Company has knowledge, as a result of which the prospectus included in
the Registration Statement, as then in effect, includes an untrue statement of a
material fact or omission to state a material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under
which such statements were made, not misleading, and use its best efforts
promptly to prepare a supplement or amendment to the Registration Statement to
correct such untrue statement or omission, and deliver such number of copies of
such supplement or amendment to the Investors as the Investors may reasonably
request;
f. use its best efforts to prevent the issuance of any stop order or
other suspension of effectiveness of a Registration Statement, and, if such an
order is issued, to obtain the withdrawal of such order at the earliest possible
moment and to notify the Investors of the issuance of such order and the
resolution thereof;
g. make generally available to its security holders as soon as
practical, but not later than ninety (90) days after the close of the period
covered thereby, an earnings statement (in form complying with the provisions of
Rule 158 under the 1933 Act) covering a twelve-month period beginning not later
than the first day of the Company's fiscal quarter next following the effective
date of the Registration Statement;
h. provide a transfer agent and registrar, which may be a single
entity, for the Registrable Securities not later than the effective date of the
Registration Statement;
i. use its best efforts to list the Registrable Securities covered by
the Registration Statement with the securities exchange, or to cause such
Registrable Securities to be designated and quoted or approved for designation
or quotation as a national market system security on the inter-dealer quotation
system, on which the Common Stock is then listed or designated;
j. cooperate with the Investors to facilitate the timely preparation
and delivery of certificates representing Registrable Securities to be offered
pursuant to such Registration Statement and enable such certificates to be in
such denominations or amounts, as the case may be, as the Investors may
reasonably request and registered in such names as the Investors may reasonably
request upon delivery of documentation evidencing any such transfers reasonably
requested by the Company, including, but not limited to, opinions of counsel
related to such transfers; and
k. At the request of the holders of a majority-in-interest of the
Registrable Securities, the Company shall prepare and file with the SEC such
amendments (including post-effective amendments) and supplements to a
Registration Statement and the prospectus used in connection with the
Registration Statement as may be necessary in order to change the plan of
distribution set forth in such Registration Statement.
4. LIMITATIONS ON REGISTRATION RIGHTS; HOLDBACK. Notwithstanding anything
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to the contrary contained in this Agreement:
a. The Company may delay the filing, suspend the effectiveness of a
Registration Statement under Section 2(a) or require the Investors to suspend
sales or other dispositions of Registrable Securities under an effective
Registration Statement, (i) if in the Company's Board of Directors' judgment,
the sale of Registrable Securities pursuant thereto would interfere with or be
detrimental to a planned offering, by the Company of any of the Company's
securities, (ii) if in the Company's Board of Directors' judgment, the sale of
Registrable Securities thereunder would have a material adverse effect on the
business, prospects, operations, results of operations, assets, liabilities, or
condition (financial or otherwise) of the Company; or (iii) at any time when the
Company is engaged in discussions concerning any merger, financing, business
combination, sale of the Company or any similar transaction or when the Company
would be required to disclose in such Registration Statement material
information that it would not otherwise be required to disclose in its filings
with the SEC pursuant to the Securities Exchange Act of 1934, and the rules and
regulations thereunder as amended or supplemented from time to time, or any
successor thereto (the "1934 ACT") and that it has not then disclosed in such
filings with the SEC (an "ALLOWED DELAY"). In the event of an Allowed Delay, the
Company shall following the receipt of a notice pursuant to Section 5(d), (x)
notify
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the Investors (a "DELAY NOTICE") of the existence (but not the substance) of
circumstances giving rise to an Allowed Delay and (y) advise the Investors in
writing that no sale shall occur under the Registration Statement. Upon
expiration of aNotice Period during which conditions causing an Allowed Delay
existed, the Investors may submit an additional notice pursuant to Section 5(d),
subject to compliance with this Section 4(a). The Company shall prepare a
supplement or amendment when necessary pursuant to Section 3(e).
b. If during any period when a Registration Statement covering
Registrable Securities filed pursuant to Section 2(a) is effective, the Company
proposes to file a Registration Statement on Forms S-1 or S-4 (or any of their
respective successor forms), then the Company shall have the right to terminate
the effectiveness of the Registration Statement covering such Registrable
Securities for a period of not more than ninety (90) days. During such ninety
(90) day period the Company shall use reasonable efforts to prepare and file a
Registration Statement covering the shares of Common Stock sought to be
registered by the Company and the Registrable Securities for which such
Registration Statement was filed pursuant to Section 2(a). In any such event,
the Investors shall include such Registrable Securities in the Company
Registration Statement.
c. If the Company shall at any time register any of its securities
under the 1933 Act, for offer or sale to the public, then the Investors shall
not make any short sale of, grant an option for the sale, assignment, transfer,
pledge, hypothecation, gift or other disposition of any Registrable Securities
(other than for the public sale of those Registrable Securities included in and
sold pursuant to such registration) without the prior written consent of the
Company for such period as may be designated by the Company, or, if the
registration shall be, in whole or in part, an underwritten offering, the
managing underwriter, in writing to the Investors; provided that (i) no such
period shall begin more than ten (10) days prior to the effectiveness of the
registration statement pursuant to which such public offer or sale will be made
and shall not last more than ninety (90) days after the effective date of such
registration statement or such longer period requested by such managing
underwriter and (ii) all executive officers and directors of the Company agree
to comparable restrictions with respect to such offering.
5. OBLIGATIONS OF THE INVESTORS. In connection with the registration of
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the Registrable Securities, the Investors shall:
a. furnish to the Company a Questionnaire for Selling Stockholders in
the form attached to this Agreement as Exhibit B and such other information
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regarding itself, the Registrable Securities held by it and the intended method
of disposition of the Registrable Securities held by it as shall be reasonably
required to effect the registration of such Registrable Securities and shall
execute such documents in connection with such registration as the Company may
reasonably request;
b. cooperate with the Company as reasonably requested by the Company
in connection with the preparation and filing of the Registration Statement
hereunder;
c. upon receipt of a Delay Notice from the Company , immediately
discontinue any actions in connection with the disposition of Registrable
Securities pursuant to the Registration Statement covering such Registrable
Securities until, , the Investors' receipt of the copies of the supplemented or
amended prospectus contemplated by Section 3(e) or, written notification by the
Company of the resolution of the event and authority to continue the disposition
of Registrable Securities pursuant to the Registration Statement, and, if so
directed by the Company, deliver to the Company (at the expense of the Company)
or destroy (and deliver to the Company a certificate of destruction) all copies
in the Investors' possession, of the prospectus covering such Registrable
Securities current at the time of receipt of the Delay Notice;
d. notify the Company of its desire to sell Registrable Securities
pursuant to the Registration Statement filed under this Agreement at least three
(3) business days prior to any intended sale of such Registrable Securities
pursuant to such Registration Statement (the "Notice Period");
e. upon receipt of any Delay Notice, immediately discontinue
disposition of Registrable Securities until the expiration of the Notice Period
or any extension thereof pursuant to a subsequent Delay Notice;
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f. sell, transfer and otherwise dispose of the Registrable Securities
only pursuant to transactions described in the plan of distribution section of
the Registration Statement; and
g. comply with all applicable laws and regulations in connection with
any sale, transfer or other disposition of Registrable Securities.
6. EXPENSES OF REGISTRATION. All reasonable expenses, other than
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underwriting fees, discounts and commissions (which shall be borne by the
Investors), incurred in connection with registrations, filings or qualifications
pursuant to the Company's obligations under Section 2 and 3 including, without
limitation, all registration, listing and qualifications fees, printers and the
Company's accounting fees, and the fees and disbursements of counsel for the
Company, shall be borne by the Company.
7. INDEMNIFICATION. In the event any Registrable Securities are included
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in a Registration Statement under this Agreement:
a. To the extent permitted by law, the Company will indemnify, hold
harmless and defend the Investors, each of the Investors' directors, officers,
partners, employees, agents and each person who controls the Investors within
the meaning of the 1933 Act or the 1934 Act, if any, (each, an "INVESTOR
INDEMNIFIED PERSON"), against any losses, claims, damages, liabilities or
expenses (collectively, together with actions, proceedings or inquiries by any
regulatory or self-regulatory organization, whether commenced or threatened, in
respect thereof, "CLAIMS") to which any of them may become subject insofar as
such Claims are caused by: (i) any untrue statement or alleged untrue statement
of a material fact in a Registration Statement or the omission or alleged
omission to state therein a material fact required to be stated or necessary to
make the statements therein not misleading, (ii) any untrue statement or alleged
untrue statement of a material fact contained in any preliminary prospectus if
used prior to the effective date of such Registration Statement, or contained in
the final prospectus (as amended or supplemented, if the Company files any
amendment thereof or supplement thereto with the SEC) or the omission or alleged
omission to state therein any material fact necessary to make the statements
made therein, in light of the circumstances under which the statements therein
were made, not misleading, or (iii) any violation or alleged violation by the
Company of the 1933 Act, the 1934 Act, any other law, including, without
limitation, any state securities law, or any rule or regulation thereunder
relating to the offer or sale of the Registrable Securities arising solely from
actions taken by the Company (the matters in the foregoing clauses (i) through
(iii) being, collectively, "VIOLATIONS"). Subject to the restrictions set forth
in Section 7(c) with respect to the number of legal counsel, the Company shall
reimburse the Investor Indemnified Person, promptly as such expenses are
incurred and are due and payable, for any reasonable legal fees or other
reasonable expenses incurred by them in connection with investigating or
defending any such Claim. Notwithstanding anything to the contrary contained
herein, the indemnification agreement contained in this Section 7(a): (x) shall
not apply to a Claim to the extent it is caused by a Violation which is based
upon or arises out of information furnished in writing to the Company by any
Investor Indemnified Person or agent for such Investor Indemnified Person
expressly for use in connection with the preparation of the Registration
Statement or any such amendment thereof or supplement thereto; (y) shall not
apply to amounts paid in settlement of any Claim if such settlement is effected
without the prior written consent of the Company, which consent shall not be
unreasonably withheld; and (z) with respect to any preliminary prospectus or
prospectus, shall not inure to the benefit of any Investor Indemnified Person if
the untrue statement or omission of material fact contained therein was
corrected on a timely basis in the final prospectus or a corrected prospectus,
as then amended or supplemented, such final or corrected prospectus was timely
made available by the Company pursuant to Section 3(c) hereof, and the Investor
Indemnified Person was promptly advised in writing not to use the incorrect
prospectus prior to the use giving rise to a Violation and such Investor
Indemnified Person, notwithstanding such advice, used it. Such indemnity shall
remain in full force and effect regardless of any investigation made by or on
behalf of the Investor Indemnified Person and shall survive the transfer of the
Registrable Securities by the Investors.
b. In connection with any Registration Statement in which the
Investors are participating, each Investor severally and not jointly will
indemnify, hold harmless and defend, to the same extent and in the same manner
set forth in Section 7(a), the Company, each of its directors, officers,
employees, agents and each person who controls the Company within the meaning of
the 1933 Act or the 1934 Act, any underwriter and any other stockholder selling
securities pursuant to the Registration Statement or any of its directors or
officers or any person
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who controls such stockholder or underwriter within the meaning of the 1933 Act
or the 1934 Act (collectively, a "COMPANY INDEMNIFIED PERSON"), against any
Claim to which any of them may become subject, under the 1933 Act, the 1934 Act
or otherwise, insofar as such Claim is caused by any Violation, in each case to
the extent (and only to the extent) that such Violation is based upon or arises
out of written information furnished to the Company by such Investor or agent
for such Investor expressly for use in connection with such Registration
Statement; and subject to Section 7(c) such Investor will reimburse any legal or
other expenses (promptly as such expenses are incurred and are due and payable)
reasonably incurred by them in connection with investigating or defending any
such Claim; provided, however, that the indemnity agreement contained in
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this Section 7(b) shall not apply to amounts paid in settlement of any
Claim if such settlement is effected without the prior written consent
of such Investor, which consent shall not be unreasonably withheld;
provided, further, however, that such Investor shall be liable under
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this Agreement (including this Section 7(b) and Section 8) for only that amount
as does not exceed the net proceeds (i.e., after deduction of selling
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commissions and discounts) to such Investor as a result of the sale of
Registrable Securities pursuant to such Registration Statement. Such indemnity
shall remain in full force and effect regardless of any investigation made by or
on behalf of such Company Indemnified Person. Notwithstanding anything to the
contrary contained herein, the indemnification agreement contained in this
Section 7(b) with respect to any preliminary prospectus shall not inure to the
benefit of any Indemnified Person if the untrue statement or omission of
material fact contained in the preliminary prospectus was corrected on a timely
basis in the prospectus, as then amended or supplemented.
c. Promptly after receipt by an Investor Indemnified Person or a
Company Indemnified Person (as applicable, an "INDEMNIFIED PERSON") under this
Section 7 of notice of the commencement of any action (including any
governmental action), such Indemnified Person shall, if a Claim in respect
thereof is to be made against any indemnifying person under this Section 7,
deliver to the indemnifying person a written notice of the commencement thereof,
and the indemnifying person shall have the right to participate in, and, to the
extent the indemnifying person so desires, jointly with any other indemnifying
person similarly noticed, to assume control of the defense thereof with counsel
mutually satisfactory to the indemnifying person and the Indemnified Person;
provided, however, that an Indemnified Person shall have the right to retain its
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own counsel with the fees and expenses to be paid by the indemnifying person,
if, in the reasonable opinion of counsel retained by the indemnifying person,
the representation by such counsel of the Indemnified Person and the
indemnifying person would be inappropriate due to actual or likely differing
interests between such Indemnified Person and any other person represented by
such counsel in such proceeding. The indemnifying person shall pay for only one
separate legal counsel for the Indemnified Persons, and such legal counsel shall
be selected by the persons and entities identified on Schedule A attached to
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this Agreement holding a majority-in-interest of the Registrable Securities
included in the Registration Statement to which the Claim relates, if the
Investors are entitled to indemnification hereunder, or the Company, if the
Company is entitled to indemnification hereunder, as applicable. The failure to
deliver written notice to the indemnifying person within a reasonable time of
the commencement of any such action shall not relieve such indemnifying person
of any liability to the Indemnified Person under this Section 7, except to the
extent that the indemnifying person is actually prejudiced in its ability to
defend such action. The indemnification required by this Section 7 shall be made
by periodic payments of the amount thereof during the course of the
investigation or defense, as such expense, loss, damage or liability is incurred
and is due and payable.
8. CONTRIBUTION. To the extent any indemnification by an indemnifying
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person is prohibited or limited by law, the indemnifying person agrees to make
the maximum contribution with respect to any amounts for which it would
otherwise be liable under Section 7 to the fullest extent permitted by law;
provided, however, that (i) no contribution shall be made under circumstances
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where the maker would not have been liable for indemnification under the fault
standards set forth in Section 7, (ii) no seller of Registrable Securities
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the 1933 Act) shall be entitled to contribution from any seller of Registrable
Securities who was not guilty of such fraudulent misrepresentation, and (iii)
contribution (together with any indemnification or other obligations under this
Agreement) by any seller of Registrable Securities shall be limited in amount to
the net amount of proceeds received by such seller from the sale of such
Registrable Securities and provided, further, that such contribution shall be
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made in such proportion as is appropriate to reflect the relative fault of the
Company on the one hand, and the Investor on the other, in connection with the
statements or omissions which resulted in such claims.
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9. REPORTS UNDER THE 1934 ACT. With a view to making available to the
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Investors the benefits of Rule 144 promulgated under the 1933 Act or any other
similar rule or regulation of the SEC that may at any time permit the Investors
to sell restricted securities of the Company to the public without registration
("RULE 144"), the Company shall use its commercially reasonable efforts to:
a. make and keep public information available, as those terms are
understood and defined in Rule 144;
b. file with the SEC in a timely manner all reports and other
documents required of the Company under the 1934 Act so long as the Company
remains subject to such requirements and the filing of such reports and other
documents is required for the applicable provisions of Rule 144; and
c. furnish to each Investor so long as such Investor owns Registrable
Securities, promptly upon request, (i) a written statement by the Company that
it has complied with the reporting requirements of Rule 144, the 1933 Act and
the 1934 Act, (ii) a copy of the most recent annual or quarterly report of the
Company and (iii) such other information as may be reasonably requested to
permit the Investors to sell such securities pursuant to Rule 144 without
registration.
10. AMENDMENT OF REGISTRATION RIGHTS. Provisions of this Agreement may
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be amended and the observance thereof may be waived (either generally or in a
particular instance and either retroactively or prospectively), only with
written consent of the Company and the Investors holding a majority of the
Shares. Any amendment or waiver effected in accordance with this Section 10
shall be binding upon the Investors and the Company.
11. MISCELLANEOUS.
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a. Notices required or permitted to be given hereunder shall be in
writing and shall be deemed to be sufficiently given when personally delivered
(by hand, by courier, by facsimile transmission or other means) or sent by
certified mail, return receipt requested, properly addressed and with proper
postage pre-paid,
if to the Company:
Covalent Group, Inc.
One Glenhardie Corporate Center
1275 Drummers Lane
Suite 100
Wayne, PA 19087
Attention: Chief Financial Officer
Telecopy: (610) 975-9556
with a copy to:
Pepper Hamilton LLP
Suite 400
1235 Westlakes Drive
Berwyn, PA 19312
Attention: Jeffrey P. Libson, Esquire
Telecopy: (610) 640-7835
if to the Investors:
To the address set forth on the signature
page of this Agreement.
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or at such other address as each such party furnishes to the Company by notice
given in accordance with this Section 11(b), and shall be effective, when
personally delivered, upon receipt, when by overnight courier, or the business
day after delivery or drop off with such courier, and, when so sent by certified
mail, four (4) days after deposit with the United States Postal Service.
b. Failure of any party to exercise any right or remedy under this
Agreement or otherwise, or delay by a party in exercising such right or remedy,
shall not operate as a waiver thereof.
c. This Agreement shall be enforced, governed by and construed in
accordance with the laws of the Commonwealth of Pennsylvania applicable to
agreements made and to be performed entirely within Pennsylvania. In the event
that any provision of this Agreement is invalid or unenforceable under any
applicable statute or rule of law, then such provision shall be deemed
inoperative to the extent that it may conflict therewith and shall be deemed
modified to conform with such statute or rule of law. Any provision hereof which
may prove invalid or unenforceable under any law shall not affect the validity
or enforceability of any other provision hereof. The parties hereto hereby
submit to the exclusive jurisdiction of the United States Federal Courts located
in the Eastern District of Pennsylvania with respect to any dispute arising
under this Agreement or the transactions contemplated hereby.
d. This Agreement constitutes the entire agreement among the parties
hereto with respect to the subject matter hereof. There are no restrictions,
promises, warranties or undertakings, other than those set forth or referred to
herein and therein. This Agreement supersedes all prior agreements and
understandings among the parties hereto with respect to the subject matter
hereof.
e. This Agreement shall inure to the benefit of and be binding upon
the successors and assigns of each of the parties hereto; provided that the
Investors shall not have the right to assign their rights under this Agreement.
f. The headings in this Agreement are for convenience of reference
only and shall not limit or otherwise affect the meaning hereof.
g. This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original but all of which shall constitute one and the
same agreement. This Agreement, once executed by a party, may be delivered to
the other party hereto by facsimile transmission of a copy of this Agreement
bearing the signature of the party so delivering this Agreement.
h. Each party shall do and perform, or cause to be done and performed,
all such further acts and things, and shall execute and deliver all such other
agreements, certificates, instruments and documents, as the other party may
reasonably request in order to carry out the intent and accomplish the purposes
of this Agreement and the consummation of the transactions contemplated hereby.
i. In the event that any provision to this Agreement is invalid or
unenforceable under any applicable statute or rule of law, then such provision
shall be deemed inoperative to the extent that it may conflict therewith and
shall be deemed modified to conform with such statute or rule of law. Any
provision hereof which may prove invalid or unenforceable under any law shall
not affect the validity or enforceability of any other provision hereof.
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IN WITNESS WHEREOF, the Company and the Investors have caused this
Agreement to be duly executed as of the date first above written.
COVALENT GROUP, INC.
By:
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Name:
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Title:
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[NAME]
By:
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Name:
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Title:
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EXHIBIT A
List of Investors
INVESTOR NUMBER OF SHARES TO BE REGISTERED
Houston Ventures, Inc. 500,000
Hassan Nemazee 500,000
Dr. Richard D. Propper 704,000
Bedford Oak Partners, L.P. 671,642
Covalent Partners, LLC 1,486,587
Acorn Technology Fund 600,000
Berkshire International Finance, Inc. 200,000
S&F Consulting, Inc. 150,000
Montpellier International LDC. 134,328
Maxwell H. Gluck Foundation 111,940
Emerald International 39,179
U.S. Equity Portfolio, LP 27,985
United Congregation Mesorah 22,388
Interim Advantage Fund, LLC 18,657
Contra VC, LLC 18,656
Thomas Hodapp 500,000
Michael Chermak 550,163
Ashish Vibhakar 33,333
Gerry Beemiller 50,000
David Smith 46,642