-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, AAA6BQJmmzyNqXZ/qNc+jFNKuExCC97SVaExgS+hXfYcXaSaJ34Rza1LgOzng5HR NcxoYVWvtWFgtmSV0HPLaA== 0000927016-03-001751.txt : 20030409 0000927016-03-001751.hdr.sgml : 20030409 20030409171555 ACCESSION NUMBER: 0000927016-03-001751 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 8 FILED AS OF DATE: 20030409 GROUP MEMBERS: FH & CO. III, L.P. GROUP MEMBERS: HARRY J. HEALER, JR. GROUP MEMBERS: KEVIN J. DOUGHERTY GROUP MEMBERS: RICHARD A. FARRELL GROUP MEMBERS: WILLIAM C. MILLS, III SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: OCCUPATIONAL HEALTH & REHABILITATION INC CENTRAL INDEX KEY: 0000887757 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-HEALTH SERVICES [8000] IRS NUMBER: 133464527 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-43061 FILM NUMBER: 03644440 BUSINESS ADDRESS: STREET 1: 175 DERBY STREET STREET 2: SUITE 36 CITY: HINGHAM STATE: MA ZIP: 02043-5048 BUSINESS PHONE: 7817415175 MAIL ADDRESS: STREET 1: 175 DERBY STREET STREET 2: SUITE 36 CITY: HINGHAM STATE: MA ZIP: 02043-5048 FORMER COMPANY: FORMER CONFORMED NAME: TELOR OPHTHALMIC PHARMACEUTICALS INC DATE OF NAME CHANGE: 19940218 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: VENTURE CAPITAL FUND OF NEW ENGLAND III LP CENTRAL INDEX KEY: 0000886709 IRS NUMBER: 043147075 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 160 FEDERAL ST 23RD FLR CITY: BOSTON STATE: MA ZIP: 02110 BUSINESS PHONE: 6174394646 MAIL ADDRESS: STREET 1: 160 FEDERAL ST 23RD FLR CITY: BOSTON STATE: MA ZIP: 02110 SC 13D/A 1 dsc13da.txt SCHEDULE 13D AMENDMENT NO 2 ------------------------------- OMB APPROVAL ------------------------------- OMB Number: 3235-0145 Expires: December 31, 2005 Estimated average burden hours per response....... 14.90 ------------------------------- UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ____________ SCHEDULE 13D (Amendment No. 2) * Occupational Health + Rehabilitation Inc - -------------------------------------------------------------------------------- (Name of Issuer) Common Stock, $0.001 par value - -------------------------------------------------------------------------------- (Title of Class of Securities) 674617105 - -------------------------------------------------------------------------------- (CUSIP Number) Kevin J. Dougherty (781) 431-8400 c/o The Venture Capital Fund of New England III, L.P. 30 Washington Street Wellesley Hills, MA 02481 (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) March 24, 2003 - -------------------------------------------------------------------------------- (Date of Event which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition which is the subject of this Schedule 13D, and is filing this schedule because of (S)(S)240, Rule 13d-1(e), 240.13d-1(f) or 240.13D-1(g), check the following box.[_] Note: Schedules filed in paper format shall include a signed original and five copies of this schedule, including all exhibits. See (S)240.13d-7 for other parties to whom copies are to be sent. ___________ * The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). - ------------------------------- CUSIP No. 674617105 13D -------------------- - ------------------------------- - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (ENTITIES ONLY) The Venture Capital Fund of New England III, L.P. IRSN: 04-3147075 - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a)[_] (b)[X] - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS (SEE INSTRUCTIONS) OO - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [_] - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware Limited Partnership - -------------------------------------------------------------------------------- 7 SOLE VOTING POWER NUMBER OF -0- shares ------------------------------------------------------ SHARES 8 SHARED VOTING POWER BENEFICIALLY 191,319 shares OWNED BY ------------------------------------------------------ EACH 9 SOLE DISPOSITIVE POWER REPORTING PERSON -0- shares ------------------------------------------------------ WITH 10 SHARED DISPOSITIVE POWER 191,319 shares - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 191,319 shares - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) [_] - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 6.2% - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS) PN - -------------------------------------------------------------------------------- - ------------------------------- CUSIP No. 674617105 13D -------------------- - ------------------------------- - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (ENTITIES ONLY) FH& Co. III, L.P. IRSN: 04-3147078 - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a)[_] (b)[X] - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS (SEE INSTRUCTIONS) OO - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [_] - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware Limited Partnership - -------------------------------------------------------------------------------- 7 SOLE VOTING POWER NUMBER OF -0- shares ------------------------------------------------------ SHARES 8 SHARED VOTING POWER BENEFICIALLY 191,319 shares OWNED BY ------------------------------------------------------ EACH 9 SOLE DISPOSITIVE POWER REPORTING PERSON -0- shares ------------------------------------------------------ WITH 10 SHARED DISPOSITIVE POWER 191,319 shares - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 191,319 shares - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) [_] - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 6.2% - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS) PN - -------------------------------------------------------------------------------- - ------------------------------- CUSIP No. 674617105 13D -------------------- - ------------------------------- - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (ENTITIES ONLY) Richard A. Farrell - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a)[_] (b)[X] - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS (SEE INSTRUCTIONS) AF - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [_] - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION USA - -------------------------------------------------------------------------------- 7 SOLE VOTING POWER NUMBER OF -0- shares ------------------------------------------------------ SHARES 8 SHARED VOTING POWER BENEFICIALLY 191,319 shares OWNED BY ------------------------------------------------------ EACH 9 SOLE DISPOSITIVE POWER REPORTING PERSON -0- shares ------------------------------------------------------ WITH 10 SHARED DISPOSITIVE POWER 191,319 shares - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 191,319 shares - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) [_] - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 6.2% - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON * IN - -------------------------------------------------------------------------------- - ------------------------------- CUSIP No. 674617105 13D -------------------- - ------------------------------- - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (ENTITIES ONLY) Harry J. Healer, Jr. - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a)[_] (b)[X] - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS (SEE INSTRUCTIONS) AF - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [_] - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION USA - -------------------------------------------------------------------------------- 7 SOLE VOTING POWER NUMBER OF -0- shares ------------------------------------------------------ SHARES 8 SHARED VOTING POWER BENEFICIALLY 191,319 shares OWNED BY ------------------------------------------------------ EACH 9 SOLE DISPOSITIVE POWER REPORTING PERSON -0- shares ------------------------------------------------------ WITH 10 SHARED DISPOSITIVE POWER 191,319 shares - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 191,319 shares - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) [_] - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 6.2% - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS) IN - -------------------------------------------------------------------------------- - ------------------------------- CUSIP No. 674617105 13D -------------------- - ------------------------------- - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (ENTITIES ONLY) Kevin J. Dougherty - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a)[_] (b)[X] - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS (SEE INSTRUCTIONS) AF - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [_] - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION USA - -------------------------------------------------------------------------------- 7 SOLE VOTING POWER NUMBER OF 18,500 shares ------------------------------------------------------ SHARES 8 SHARED VOTING POWER BENEFICIALLY 191,319 shares OWNED BY ------------------------------------------------------ EACH 9 SOLE DISPOSITIVE POWER REPORTING PERSON 28,500 shares ------------------------------------------------------ WITH 10 SHARED DISPOSITIVE POWER 191,319 shares - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 209,819 shares - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) [_] - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 6.8% - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS) IN - -------------------------------------------------------------------------------- - ------------------------------- CUSIP No. 674617105 13D -------------------- - ------------------------------- - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (ENTITIES ONLY) William C. Mills, III - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a)[_] (b)[X] - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS (SEE INSTRUCTIONS) AF - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [_] - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION USA - -------------------------------------------------------------------------------- 7 SOLE VOTING POWER NUMBER OF -0- shares ------------------------------------------------------ SHARES 8 SHARED VOTING POWER BENEFICIALLY 191,319 shares OWNED BY ------------------------------------------------------ EACH 9 SOLE DISPOSITIVE POWER REPORTING PERSON -0- shares ------------------------------------------------------ WITH 10 SHARED DISPOSITIVE POWER 191,319 shares - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 191,319 shares - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) [_] - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 6.2% - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON * IN - -------------------------------------------------------------------------------- Item 1. Security and Issuer: This statement relates to the common stock, $0.001 par value per share, of Occupational Health + Rehabilitation Inc, a Delaware corporation (the "Issuer"). The address of the Issuer's principal executive offices is 175 Derby Street, Suite 36, Hingham, MA 02043. Item 2. Identity and Background: This statement is being filed by (i) The Venture Capital Fund of New England III, L.P. ("the Fund"), (ii) FH& Co. III, L.P. (the "GPLP"), (iii) Richard A. Farrell ("Farrell"), a general partner of the GPLP, (iv) Harry J. Healer, Jr. ("Healer"), a general partner of the GPLP, (v) Kevin J. Dougherty ("Dougherty"), a general partner of the GPLP, and (vi) William C. Mills , III ("Mills"), a general partner of the GPLP. The Fund, the GPLP, Farrell, Healer, Dougherty and Mills are sometimes referred to collectively herein as the "Reporting Persons." The address of the principal business and principal office of the Fund, the GPLP, Farrell and Healer is 30 Washington Street, Wellesley Hills, MA 02482. The address of the principal business and principal office of Mills is c/o Advent International Corporation, 75 State Street, Boston, MA 02109. The state of organization for the Fund and the GPLP is Delaware. Each of Farrell, Healer, Dougherty and Mills is a citizen of the United States of America. The principal business of the Fund is venture capital investing. The principal business of the GPLP is to act as the sole general partner of the Fund. The principal occupations of Farrell, Healer and Dougherty are their activities on behalf of the Fund. The principal occupations of Mills are his activities on behalf of the Fund and his activities as a Partner at Advent International Corporation, a global private equity firm. During the five years prior to the date hereof, none of the Reporting Persons has been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or has been a party to a civil proceeding ending in a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws, or finding a violation with respect to such laws. Item 3. Source and Amount of Funds or Other Consideration: On March 24, 2003, the Issuer repurchased its outstanding shares of Series A Convertible Preferred Stock including the accrued dividends thereon for cash, promissory notes and Common Stock. The cash paid by the Issuer was equal to $6.00 per share for 25% of the outstanding shares of Series A Convertible Preferred Stock and paid $3.00 per share for the accrued dividends. The Issuer repurchased 25% of the outstanding shares of the Series A Convertible Preferred Stock and repaid the accrued dividends thereon by issuing promissory notes for the aggregate principal amount of $2,699,740.35. The Issuer issued two shares of Common Stock for each outstanding share of Series A Convertible Preferred Stock at a price of $3.00 per share of Common Stock and 50% of the accrued dividends on the outstanding shares of Series A Convertible Preferred Stock repurchased with Common Stock were repaid by issuing shares of Common Stock at a price of $3.00 per share. Pursuant to this transaction, the Fund acquired 75,683 shares of the Issuer's Common Stock, $127,047.21 in cash, and notes in an aggregate principal amount of $127,047.21. No part of the purchase price was or will be represented by funds or other consideration borrowed or otherwise obtained for the purpose of acquiring, holding, trading or voting such securities. Item 4. Purpose of Transaction: The Fund acquired the Issuer's securities for investment purposes. Depending on market conditions, their continuing evaluation of the business and prospects of the Issuer and other factors, the Fund and may dispose of or acquire additional securities of the Issuer. Except as otherwise described herein or as expressly stated below, none of the Reporting Persons has any present plans which relate to or would result in: (a) The acquisition by any person of additional securities of the Issuer, or the disposition of securities of the Issuer; (b) An extraordinary corporate transaction, such as a merger, reorganization or liquidation, involving the Issuer or any of its subsidiaries; (c) A sale or transfer of a material amount of assets of the Issuer or of any of its subsidiaries; (d) Any change in the present board of directors or management of the Issuer, including any plans or proposals to change the number or term of directors or to fill any existing vacancies on the board; (e) Any material change in the present capitalization or dividend policy of the Issuer; (f) Any other material change in the Issuer's business or corporate structure; (g) Changes in the Issuer's charter, bylaws or instruments corresponding thereto or other actions which may impede the acquisition of control of the Issuer by any person; (h) Causing a class of securities of the Issuer to be delisted from a national securities exchange or to cease to be authorized to be quoted in an inter-dealer quotation system of a registered national securities association; (i) A class of equity securities of the Issuer becoming eligible for termination of registration pursuant to Section 12(g)(4) of the Securities Exchange Act of 1934; or (j) Any action similar to any of those enumerated above. Exception. Pursuant to the terms of a certain Amended and Restated Registration Rights Agreement dated March 24, 2003 (the "Registration Rights Agreement," attached hereto as Exhibit 99.2) by and among the Issuer, the Fund and the other Investors listed therein, the Fund is granted, subject to certain restrictions and limitations, certain required and incidental registration rights with respect to the Restricted Shares (as defined below). Item 5. Interest in the Securities of the Issuer: (a) The Fund is the record owner of 191,319 shares of the Common Stock (the "Fund Common Shares"). As the sole general partner of the Fund, the GPLP may be deemed to own beneficially the Fund Common Shares. As the individual general partners of the GPLP, each of Farrell, Healer, Dougherty and Mills may be deemed to own beneficially the Fund Common Shares. Additionally, by virtue of the Amended and Restated Stockholders' Agreement (attached hereto as Exhibit 99.3), each of the Reporting Persons may be deemed to share voting power with respect to each share of the Issuer's stock subject to the agreement. Consequently, the Reporting Persons may be deemed to beneficially own the Fund Common Shares. The GPLP, Farrell, Healer, Dougherty and Mills each disclaim beneficial ownership of the Fund Common Shares except with respect to their pecuniary interest therein, if any. Dougherty is the beneficial owner of 18,500 option shares of the Issuer exercisable within 60 days of the date of this Schedule 13D/A. Each of the Reporting Persons, except Dougherty, may be deemed to own beneficially 6.2% of the Issuer's Common Stock, which percentage is calculated based upon (i) 1,479,864 shares of the Issuer's common stock reported as outstanding by the Issuer in its Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2002, and (ii) the number of shares of the Issuer's Common Stock issued in connection with the Repurchase of the Series A Preferred Stock in the transaction that is the subject of this Schedule 13D/A. Dougherty may be deemed to own beneficially 6.8% of the Issuer's Common Stock, which percentage is calculated based upon (i) 1,479,864 shares of the Issuer's common stock reported as outstanding by the Issuer in its Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2002, (ii) the number of shares of the Issuer's Common Stock issued in connection with the Repurchase of the Series A Preferred Stock in the transaction that is the subject of this Schedule 13D/A; and (iii) 18,500 option shares of the Issuer exercisable within 60 days of the filing of this Schedule 13D/A held by Dougherty.
NUMBER OF SHARES ----------------------------------------------- (b) Reporting Person (i) (ii) (iii) (iv) ----------------- ------- ------- ------- ------- The Venture Capital Fund of New England III, L.P. 0 191,319 0 191,319 FH & Co. III, L.P. 0 191,319 0 191,319 Richard A. Farrell 0 191,319 0 191,319 Harry J. Healer, Jr. 0 191,319 0 191,319 Kevin J. Dougherty 18,500 191,319 18,500 191,319 William C. Mills, III 0 191,319 0 191,319
(i) Sole power to vote or direct the vote (ii) Shared power to vote or to direct the vote (iii) Sole power to dispose or to direct the disposition of (iv) Shared power to dispose or to direct the disposition of (c) Except as set forth above, none of the Reporting Persons has effected any transaction in the Shares during the last 60 days. (d) No other person is known to have the right to receive or the power to direct the receipt of dividends from, or any proceeds from the sale of, the Shares beneficially owned by any of the Reporting Persons. (e) Not applicable. Item 6. Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer: Pursuant to the terms of the Repurchase Agreement (attached hereto as Exhibit 99.4), the Fund acquired 75,683 shares of the Issuer's Common Stock. Pursuant to the terms of the Registration Rights Agreement (attached hereto as Exhibit 99.2), the Fund is granted, subject to certain restrictions and limitations, certain required and incidental registration rights with respect to the Fund Common Shares. Item 7. Material to be Filed as Exhibits: Exhibit 99.1 - Agreement regarding filing of joint Schedule 13D (filed herewith). Exhibit 99.2 - Execution Copy of the Registration Rights Agreement dated as of March 24, 2003 by and among Occupational Health + Rehabilitation Inc, The Venture Capital Fund of New England III, L.P. and other Investors therein (filed herewith). Exhibit 99.3 - Execution Copy of the Amended and Restated Stockholders Agreement dated as of March 24, 2003 by and among Occupational Health + Rehabilitation Inc, the Venture Capital Fund of New England III, L.P. and other Investors and Holders therein (filed herewith). Exhibit 99.4 Execution Copy of the Series A Convertible Preferred Stock Repurchase Agreement dated as of March 24, 2003 by and among Occupational Health + Rehabilitation Inc, The Venture Capital Fund of new England III, L.P. and the other Sellers therein (filed herewith). Exhibit 99.5 Power of Attorney for Richard A. Farrell (filed herewith). Exhibit 99.6 Power of Attorney for Harry J. Healer, Jr. (filed herewith). Exhibit 99.7 Power of Attorney for William C. Mills, III (filed herewith). SCHEDULE 13D Signature After reasonable inquiry and to the best of its knowledge and belief, each of the undersigned certifies that the information set forth in this statement is true, complete and correct. Dated: April 9, 2003 THE VENTURE CAPITAL FUND OF NEW ENGLAND III, L.P. By: FH & Co. III, L.P., its Sole General Partner By: /s/ Kevin J. Dougherty ------------------------------------- Kevin J. Dougherty, General Partner FH & Co. III, L.P. By: /s/ Kevin J. Dougherty ------------------------------------- Kevin J. Dougherty, General Partner * ----------------------------------------- Richard A. Farrell * ----------------------------------------- Harry J. Healer, Jr. * ----------------------------------------- William C. Mills, III /s/ Kevin J. Dougherty ----------------------------------------- Kevin J. Dougherty *By: /s/ Kevin J. Dougherty ------------------------------------ Kevin J. Dougherty, Attorney-in-Fact EX-99.1 3 dex991.txt AGREEMENT REGARDING FILING OF JOINT SCHEDULE 13D EXHIBIT 99.1 AGREEMENT Pursuant to Rule 13d-1(k)(1) under the Securities Exchange Act of 1934, the undersigned persons hereby agree to file with the Securities and Exchange Commission the Statement on Schedule 13D (the "Statement") to which this Agreement is attached as an exhibit, and agree that such Statement, as so filed, is filed on behalf of each of them. In WITNESS WHEREOF, the undersigned have executed this Agreement. The Venture Capital Fund of New England III, L.P. By: FH & Co. III, L.P., its sole general partner /s/ Kevin J. Dougherty ----------------------------------- Kevin J. Dougherty, General Partner FH & Co. III, L.P. /s/ Kevin J. Dougherty --------------------------------- Kevin J. Dougherty, General Partner Richard A. Farrell * --------------------------------- Richard A. Farrell Harry J. Healer, Jr. * --------------------------------- Harry J. Healer, Jr. William C. Mills, III * --------------------------------- William C. Mills, III Kevin J. Dougherty /s/ Kevin Dougherty --------------------------------- Name: Kevin J. Dougherty *By: /s/ Kevin J. Dougherty ------------------------------------ Kevin J. Dougherty, Attorney-in-Fact EX-99.2 4 dex992.txt EXECUTION COPY OF THE REGISTRATION RIGHTS AGREEMENT EXHIBIT 99.2 EXECUTION COPY AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT This Amended and Restated Registration Rights Agreement (the "Agreement"), dated as of March 24, 2003 is by and among Occupational Health + Rehabilitation Inc (the "Company"), and the parties listed under the heading of Investors on Schedule A attached hereto (the "Investors"). WHEREAS, the Investors and the Company entered into a Series A Convertible Preferred Stock Purchase Agreement dated as of November 6, 1996 (the "Series A Purchase Agreement") pursuant to which the Company issued to the Investors 1,416,667 shares of Series A Convertible Preferred Stock, par value $.001 per share, of the Company (the "Series A Preferred Shares"); and WHEREAS, the Company agreed to grant to the Investors, as an inducement to enter into the Series A Purchase Agreement, certain rights with respect to the Series A Preferred Shares as set forth in a Registration Rights Agreement dated as of November 6, 1996 (the "Prior Agreement"); WHEREAS, the Investors and the Company are, on the date hereof, entering into a Series A Convertible Stock Repurchase Agreement (the "Repurchase Agreement") pursuant to which the Company shall repurchase the Series A Preferred Shares held by the Investors in exchange for consideration that includes shares of the Company's Common Stock, par value $.001 per share; WHEREAS, the Investors and the Company have agreed that it is in the best interest of the Company to amend and restate the Prior Agreement to provide for certain rights with respect to the shares of Common Stock issued pursuant to the Repurchase Agreement; and WHEREAS, pursuant to Section 13(d) of the Prior Agreement, amendments to the Prior Agreement may be made with the written consent of the Company and the holders of a majority of the aggregate number of outstanding shares of Restricted Stock (as defined therein) held of record by the Holders (as defined therein) or their permitted successors and assigns. NOW, THEREFORE, in consideration of the premises set forth herein, the parties hereto hereby agree as follows: 1. Certain Definitions. As used in this Agreement, the following terms shall have the following respective meanings: "Commission" shall mean the Securities and Exchange Commission, or any other federal agency at the time administering the Securities Act. - 2 - "Common Stock" shall mean the Common Stock, $.001 par value, of the Company, as constituted as of the date of this Agreement. "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended, or any similar federal statute, and the rules and regulations of the Commission thereunder, all as the same shall be in effect at the time. "Holder" shall mean the person who is the then record owner of Restricted Stock. "Registrable Shares" shall mean the shares of Restricted Stock. "Registration Expenses" shall mean the expenses so described in Section 8. "Restricted Stock" shall mean the shares of Common Stock issued to the Investors pursuant to the Repurchase Agreement, and any shares of capital stock received in respect thereof, excluding shares which have been (a) registered under the Securities Act pursuant to an effective registration statement filed thereunder and disposed of in accordance with the registration statement covering them or (b) publicly sold pursuant to Rule 144 under the Securities Act. "Securities Act" shall mean the Securities Act of 1933, as amended, or any similar federal statute, and the rules and regulations of the Commission thereunder, all as the same shall be in effect at the time. 2. Restrictive Legend. Each certificate representing the Restricted Stock shall bear a legend stating in substance: THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR APPLICABLE STATE SECURITIES LAWS. THESE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO DISTRIBUTION OR RESALE, AND MAY NOT BE SOLD, MORTGAGED, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED [FOR NON U.S. PERSONS ADD: IN THE UNITED STATES OR TO U.S. PERSONS] WITHOUT AN EFFECTIVE REGISTRATION STATEMENT FOR SUCH SECURITIES UNDER THE SECURITIES ACT OF 1933 AND APPLICABLE STATE SECURITIES LAWS, OR THE AVAILABILITY OF AN EXEMPTION FROM THE REGISTRATION PROVISIONS OF THE SECURITIES ACT OF 1933 AND APPLICABLE STATE SECURITIES LAWS. A certificate shall not be required to bear such legend if, in the opinion of counsel satisfactory to the Company, the securities represented thereby may be publicly sold without registration under the Securities Act. - 3 - 3. Notice of Proposed Transfer. Prior to any proposed transfer of any Restricted Stock (other than under the circumstances described in Section 4, 5 or 6), the Holder thereof shall give written notice to the Company of its intention to effect such transfer. Each such notice shall describe the manner of the proposed transfer and, if requested by the Company, shall be accompanied by an opinion of counsel satisfactory to the Company to the effect that the proposed transfer may be effected without registration under the Securities Act, whereupon the Holder of such stock shall be entitled to transfer such stock in accordance with the terms of its notice; provided, however, that no such opinion of counsel shall be required for a distribution by a partnership to its partners or a limited liability company to its members of such stock in respect of such interest. Each certificate for shares of Restricted Stock transferred as above provided shall bear the legend set forth in Section 2, except that such certificate shall not bear such legend if (i) such transfer is in accordance with the provisions of Rule 144 (or any other rule permitting public sale without registration under the Securities Act) or (ii) the opinion of counsel referred to above is to the further effect that the transferee and any subsequent transferee (other than an affiliate of the Company) would be entitled to transfer such securities in a public sale without registration under the Securities Act. The restrictions provided for in this Section 3 shall not apply to securities which are not required to bear the legend prescribed by Section 2 in accordance with the provisions of that Section. 4. Required Registration. (a) The Holders of Registrable Shares constituting at least 51% of the total shares of Registrable Shares then outstanding may request the Company to register under the Securities Act all or any portion of the Registrable Shares held by such requesting Holder or Holders for sale in the manner specified in such notice, provided that the Registrable Shares for which registration has been requested shall constitute at least 25% of the total Registrable Shares originally issued pursuant to the Repurchase Agreement if such Holder or Holders shall request the registration of less than all Registrable Shares then held by such Holder or Holders. Notwithstanding anything to the contrary contained herein, no request may be made under this Section 4 within 180 days after the effective date of a registration statement filed by the Company covering a firm commitment underwritten public offering in which the Holders of Registrable Shares shall have been entitled to join pursuant to Section 5 or 6 and in which there shall have been effectively registered all Registrable Shares to which registration shall have been requested. (b) Following receipt of any notice under this Section 4, the Company shall immediately notify all Holders of Registrable Shares from whom notice has not been received and shall use its reasonable best efforts to register under the Securities Act, for public sale in accordance with the method of disposition specified in such notice from requesting Holders, the number of Registrable Shares specified in such notice (and in all notices received by the Company from other Holders within 30 days after the giving of such notice by the Company). If such method of disposition shall be an underwritten public offering, the Holders of a majority of the Registrable Shares to be sold in such offering may designate the managing underwriter of - 4 - such offering, subject to the approval of the Company, which approval shall not be unreasonably withheld or delayed. The Company shall be obligated to register Registrable Shares pursuant to this Section 4 on two occasions only, provided, however, that such obligation shall be deemed satisfied only when a registration statement, which covers all Registrable Shares specified in notices received as aforesaid and with respect to which the request for registration has not been withdrawn and provides for sale of such shares in accordance with the method of disposition specified by the requesting Holders, shall have become effective and, if such method of disposition is a firm commitment underwritten public offering, all such shares shall have been sold pursuant thereto. (c) The Company shall be entitled to include in any registration statement referred to in this Section 4, for sale in accordance with the method of disposition specified by the requesting Holders, shares of Common Stock to be sold by the Company for its own account, except as and to the extent that, in the opinion of the managing underwriter (if such method of disposition shall be an underwritten public offering), such inclusion would adversely affect the marketing of the Registrable Shares to be sold. Except for registration statements on Form S-4, S-8 or any successor thereto, the Company will not file with the Commission any other registration statement with respect to its Common Stock, whether for its own account or that of other stockholders, from the date of receipt of a notice from requesting Holders pursuant to this Section 4 (the "Demand Holders") until the first to occur of (i) withdrawal of such registration statement or (ii) the effectiveness of such registration statement unless such registration statement relates to a firm commitment underwritten public offering, then the completion of the period of distribution of the registration contemplated thereby; provided, however, that following receipt of any notice under this Section 4, the Company shall immediately notify all holders of the Company's Common Stock who have contractual rights to demand registrations pursuant to the terms of any other registration rights agreement to which the Company is a party. Upon the written request of such demand rights holders constituting the requisite percentages of shares to initiate a demand under such other registration rights agreement specifying the number of shares to be registered, which request shall be deemed to be an exercise of a demand right under the terms of the registration rights agreement to which they are parties, such demand rights holders shall be deemed to be Demand Holders and the shares requested to be registered by such Demand Holders shall be deemed to be Registrable Shares, in each case, for purposes of Section 4(d), provided that such written request is received by the Company within 30 days of the giving of notice by the Company. (d) If, in the opinion of the managing underwriter, the inclusion in a registration statement to be filed under this Section of any shares other than the Registrable Shares requested to be registered under this Section by Demand Holders would adversely affect the marketing of such shares, then, in such event (a) such other shares may be included in such registration only if all of the Registrable Shares requested to be registered by Demand Holders hereunder are included, and (b) such other shares shall be subject to the provisions of Section 5 and the first sentence of Section 4(c) as to priority of inclusion. If, in the opinion of the managing underwriter, the inclusion of the Registrable Shares requested to be registered under this Section by Demand Holders would adversely affect the marketing of such Registrable Shares, Registrable Shares to be sold by the Demand Holders shall be excluded in such manner - 5 - that the Registrable Shares to be excluded shall first be the Registrable Shares of Demand Holders who are not affiliates (as defined in Rule 144 of the Securities Act) of the Company (the "Affiliate Holders") and whose Registrable Shares are then saleable under Rule 144(e) or Rule 144(k) under the Securities Act and then pro rata among them, and if further reduction is necessary, shall next be pro rata among the remaining Registrable Shares of the Demand Holders who are Affiliate Holders or whose Registrable Shares are not then saleable under Rule 144(e) or Rule 144(k), provided, however, that, notwithstanding anything in this Agreement to the contrary, in respect of the first underwritten public offering following the date of this Agreement, no reduction shall reduce the number of shares which may be sold by requesting Holders to less than 25% of the shares to be sold in such offering. 5. Incidental Registration. If the Company at any time (other than pursuant to Section 4 or Section 6) proposes to register any of its securities under the Securities Act for sale to the public, whether for its own account or for the account of other securityholders or both (except with respect to registration statements on Forms S-4, S-8 or another form not available for registering the Restricted Stock for sale to the public), each such time the Company will give written notice to all Holders of outstanding Restricted Stock of its intention to do so. Upon the written request of any such Holder received by the Company within 30 days of the giving of any such notice by the Company to register any of such Holder's Restricted Stock (which request shall state the intended method of disposition thereof), the Company will use its reasonable best efforts to cause the Restricted Stock as to which registration shall have been so requested to be included in the securities to be covered by the registration statement proposed to be filed by the Company, all to the extent requisite to permit the sale or other disposition by the Holder (in accordance with such Holder's written request) of such Restricted Stock so registered. In the event that any registration pursuant to this Section 5 shall be, in whole or in part, an underwritten public offering of Common Stock, the number of shares of Restricted Stock to be included in such an underwriting may be reduced if and to the extent that the managing underwriter shall be of the opinion that such inclusion would adversely affect the marketing of the securities to be sold by the Company or the requesting party therein or that such reduction is otherwise advisable, provided, however, that after any shares to be sold by holders that do not have contractual rights to have shares included in such registration have been excluded, shares to be sold by the Holders shall be excluded in such manner that the shares to be excluded shall first be the shares of selling Holders and other requesting holders who, in each case, are not Affiliate Holders and whose shares are then saleable under Rule 144(e) or Rule 144(k) under the Securities Act and then pro rata among them, and if further reduction is necessary, shall next be pro rata among the remaining shares of the selling Holders and other requesting holders who are Affiliate Holders or whose shares are not then saleable under Rule 144(e) or Rule 144(k), unless such registration is pursuant to the exercise of a demand right of another securityholder, in which event such securityholder shall be entitled to include all shares it desires to have so included before any shares of Restricted Stock or shares of any other holder are included therein and provided, however, that, notwithstanding anything in this Agreement to the contrary, in respect of the first underwritten public offering following the date of this Agreement, no reduction shall reduce the number of shares which may be sold by requesting Holders to less than 25% of the shares to be sold in such offering. - 6 - 6. Registration on Form S-3. If (i) a Holder or Holders of Registrable Shares request that the Company file a registration statement on Form S-3 or any successor thereto for a public offering of all or any portion of the Registrable Shares held by such requesting Holder or Holders, the reasonably anticipated aggregate price to the public of at least $500,000, and (ii) the Company is a registrant entitled to use Form S-3 or any successor thereto to register such shares, then the Company shall use its reasonable best efforts to register under the Securities Act on Form S-3 or any successor thereto, for public sale in accordance with the method of disposition specified in such notice, the number of Registrable Shares specified in such notice. Whenever the Company is required by this Section 6 to use its reasonable best efforts to effect the registration of Registrable Shares, each of the procedures and requirements of Section 4 (including but not limited to the requirement that the Company notify all Holders of Registrable Shares from whom notice has not been received and provide them with the opportunity to participate in the offering) shall apply to such registration, provided, however, that there shall be up to five (5) registrations on Form S-3 which may be requested and obtained under this Section 6, and the Company shall not be obligated to register Registrable Shares pursuant to this Section 6 on more than one occasion per twelve (12) month period, and provided, further, however, that the requirements contained in the first sentence of Section 4(a) shall not apply to any registration on Form S-3 which may be requested and obtained under this Section 6. 7. Registration Procedures. If and whenever the Company is required by the provisions of Section 4, 5 or 6 to use its reasonable best efforts to effect the registration of any shares of Restricted Stock under the Securities Act, the Company will, as expeditiously as possible: (a) prepare and file with the Commission a registration statement (which, in the case of an underwritten public offering pursuant to Section 4, shall be on Form S-1 or other form of general applicability satisfactory to the managing underwriter selected as therein provided) with respect to such securities and use its reasonable best efforts to cause such registration statement to become and remain effective for the period of the distribution contemplated thereby (determined as hereinafter provided); (b) prepare and file with the Commission such amendments and supplements to such registration statement and the prospectus used in connection therewith as may be necessary to keep such registration statement effective for the period specified in paragraph (a) above and comply with the provisions of the Securities Act with respect to the disposition of all Restricted Stock covered by such registration statement in accordance with the sellers' intended method of disposition set forth in such registration statement for such period; (c) furnish to each seller of Restricted Stock and to each underwriter such number of copies of the registration statement and the prospectus included therein (including - 7 - each preliminary prospectus) as such persons reasonably may request in order to facilitate the public sale or other disposition of the Restricted Stock covered by such registration statement; (d) use its reasonable best efforts to register or qualify the Restricted Stock covered by such registration statement under the securities or "blue sky" laws of such jurisdictions as the sellers of Restricted Stock or, in the case of an underwritten public offering, the managing underwriter reasonably shall request, provided, however, that the Company shall not for any such purpose be required to qualify generally to transact business as a foreign corporation in any jurisdiction where it is not so qualified or to consent to general service of process in any such jurisdiction; (e) use its reasonable best efforts to list the Restricted Stock covered by such registration statement with any securities exchange on which the Common Stock is then listed; (f) immediately notify each seller of Restricted Stock and each underwriter under such registration statement, at any time when a prospectus relating thereto is required to be delivered under the Securities Act, of the happening of any event of which the Company has knowledge as a result of which the prospectus contained in such registration statement, as then in effect, includes an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances then existing, and promptly prepare and furnish to such seller a reasonable number of copies of a prospectus supplemented or amended so that, as thereafter delivered to the purchasers of such Restricted Stock, such prospectus shall not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances then existing; (g) if the offering is underwritten and at the request of any seller of Restricted Stock as provided herein, use its reasonable best efforts to furnish on the date that Restricted Stock is delivered to the underwriters for sale pursuant to such registration: (i) an opinion dated such date of counsel representing the Company for the purposes of such registration, addressed to the underwriters and to such seller, stating that such registration statement has become effective under the Securities Act and that (A) to the knowledge of such counsel, no stop order suspending the effectiveness thereof has been issued and no proceedings for that purpose have been instituted or are pending or threatened under the Securities Act, (B) the registration statement, the related prospectus and each amendment or supplement thereof comply as to form in all material respects with the requirements of the Securities Act (except that such counsel need not express any opinion as to financial statements, schedules and other financial or statistical information contained therein) and (C) to such other effects as reasonably may be requested by counsel for the underwriters or by such seller or its counsel; and (ii) a letter dated such date from the independent public accountants retained by the Company, addressed to the underwriters and to such seller, stating that they are independent public accountants within the meaning of the Securities Act and that, in the opinion of such accountants, the financial statements of the Company included in the registration statement or the prospectus, or any amendment or supplement thereof, comply as to form in all material respects with the applicable accounting requirements of the Securities Act, and such letter shall additionally cover such other financial - 8 - matters (including information as to the period ending no more than five business days prior to the date of such letter) with respect to such registration as such underwriters reasonably may request; (h) make available for inspection by each seller of Restricted Stock, any underwriter participating in any distribution pursuant to such registration statement, and any attorney, accountant or other agent retained by such seller or 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, underwriter, attorney, accountant or agent in connection with such registration statement; (i) cooperate with the selling holders of Restricted Stock and the managing underwriters, if any, to facilitate the timely preparation and delivery of certificates representing Restricted Stock to be sold, such certificates to be in such denominations and registered in such names as such holders or the managing underwriters may request at least two business days prior to any sale of Restricted Stock; and (j) permit any holder of Restricted Stock which holder, in the sole and exclusive judgment, exercised in good faith, of such holder, might be deemed to be a controlling person of the Company, to participate in good faith in the preparation of such registration or comparable statement and to require the insertion therein of material, furnished to the Company in writing, which in the reasonable judgment of such holder and its counsel should be included. For purposes of Section 7(a) and 7(b) and of Section 4(c), the period of distribution of Restricted Stock included therein shall be deemed to extend until the first to occur of (i) each underwriter's completion of the distribution of all securities purchased by it, and (ii) either (A) two years, if the Company is qualified to file a registration statement on Form S-3 or any successor thereto, or (B) 120 days if the Company is not qualified to file a registration statement on Form S-3 or any successor thereto. In connection with each registration hereunder, the sellers of Restricted Stock will furnish to the Company in writing such information with respect to themselves and the proposed distribution by them as reasonably shall be necessary in order to assure compliance with federal and applicable state securities laws. In connection with each registration pursuant to Section 4, 5 or 6 covering an underwritten public offering, the Company and each seller agree to enter into a written agreement with the managing underwriter selected in the manner herein provided in such form and containing such provisions as are customary in the securities business for such an arrangement between such underwriter and companies of the Company's size and investment stature. No Holder of shares of Restricted Stock included in a registration statement shall (until further notice) effect sales thereof after receipt of telegraphic or written notice from the Company to suspend sales to permit the Company to correct or update a registration statement or prospectus; but the obligations of the Company with respect to maintaining any registration - 9 - statement current and effective shall be extended by a period of days equal to the period such suspension is in effect unless (i) such extension would result in the Company's inability to use the financial statements in the registration statement as initially filed and (ii) such correction or update did not result from the Company's acts or failures to act. At the end of the period during which the Company is obligated to keep the registration statement current and effective as described above (and any extensions thereof required by the preceding sentence), the Holders of shares of Restricted Stock included in the registration statement shall discontinue sales of shares pursuant to such registration statement upon receipt of notice from the Company of its intention to remove from registration the shares covered by such registration statement which remain unsold, and such Holders shall notify the Company of the number of shares registered which remain unsold immediately upon receipt of such notice from the Company. 8. Expenses. All expenses incurred by the Company in complying with Sections 4, 5 and 6, including, without limitation, all registration and filing fees, printing expenses, fees and disbursements of counsel and independent public accountants for the Company, fees and expenses (including counsel fees) incurred in connection with complying with state securities or "blue sky" laws, fees of the National Association of Securities Dealers, Inc., transfer taxes, fees of transfer agents and registrars, costs of insurance, and fees and disbursements of one counsel for the sellers of Restricted Stock, but excluding any Selling Expenses, are called "Registration Expenses." All underwriting discounts and selling commissions applicable to the sale of Restricted Stock are called "Selling Expenses." The Company will pay all Registration Expenses in connection with each registration statement under Sections 4, 5 or 6. All Selling Expenses in connection with each registration statement under Sections 4, 5 or 6 shall be borne by the participating sellers in proportion to the number of shares sold by each, or by such participating sellers other than the Company (except to the extent the Company shall be a seller) as they may agree. 9. Indemnification and Contribution. (a) In the event of a registration of any of the Restricted Stock under the Securities Act pursuant to Sections 4, 5 or 6, the Company will indemnify and hold harmless each seller of such Restricted Stock thereunder, its officers and directors, each underwriter of such Restricted Stock thereunder and each other person, if any, who controls such seller or underwriter within the meaning of the Securities Act, against any losses, claims, damages or liabilities, joint or several, to which such seller, officer, director, underwriter or controlling person may become subject under the Securities Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon (i) any untrue statement or alleged untrue statement of any material fact contained in any registration statement under which such Restricted Stock was registered under the Securities Act pursuant to Sections 4, 5 or 6, any preliminary prospectus or final prospectus contained therein, or any - 10 - amendment or supplement thereof, (ii) any blue sky application or other document executed by the Company specifically for that purpose or based upon written information furnished by the Company filed in any state or other jurisdiction in order to qualify any or all of the Restricted Stock under the securities laws thereof (any such application, document or information herein called a "Blue Sky Application"), (iii) the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, (iv) any violation by the Company or its agents of any rule or regulation promulgated under the Securities Act applicable to the Company or its agents and relating to action or inaction required of the Company in connection with such registration, or (v) any failure to register or qualify the Restricted Stock in any state where the Company or its agents has affirmatively undertaken or agreed in writing that the Company (the undertaking of any underwriter chosen by the Company being attributed to the Company) will undertake such registration or qualification on the seller's behalf (provided that in such instance the Company shall not be so liable if it has undertaken its best efforts to so register or qualify the Restricted Stock) and will reimburse each such seller, and such officer and director, each such underwriter and each such controlling person for any legal or other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage, liability or action, provided, however, that the Company will not be liable in any such case if and to the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission so made in conformity with information furnished by any such seller, any such underwriter or any such controlling person in writing specifically for use in such registration statement or prospectus, and except that the foregoing indemnity agreement is subject to the condition that, insofar as it relates to any such untrue statement or alleged untrue statement or omission or alleged omission made in the preliminary prospectus but eliminated or remedied in the amended prospectus on file with the Commission at the time the registration statement becomes effective or in the amended prospectus filed with the Commission pursuant to Rule 424(b) or in the prospectus subject to completion and term sheet under Rule 434 of the Securities Act, which together meet the requirements of Section 10(a) of the Securities Act (the "Final Prospectus"), such indemnity agreement shall not inure to the benefit of any such seller, any such underwriter or any such controlling person, if such seller, underwriter or controlling person was obligated under law to provide a copy of the Final Prospectus to the person or entity asserting the loss, liability, claim or damage and failed to do so after sufficient copies of the Final Prospectus were delivered by the Company to such seller, underwriter or controlling person in sufficient time to deliver the Final Prospectus within the period required by the Securities Act; provided, further, that this indemnity shall not be deemed to relieve any underwriter of any of its due diligence obligations. (b) To the extent permitted by law, in the event of a registration of any of the Restricted Stock under the Securities Act pursuant to Section 4, 5 or 6, each seller of such Restricted Stock thereunder, severally and not jointly, will indemnify and hold harmless the Company, each person, if any, who controls the Company within the meaning of the Securities Act, each officer of the Company who signs the registration statement, each director of the Company, each underwriter and each person who controls any underwriter within the meaning of the Securities Act, against all losses, claims, damages or liabilities, joint or several, to which the Company or such officer, director, underwriter or controlling person may become subject under - 11 - the Securities Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of any material fact contained in any registration statement under which such Restricted Stock was registered under the Securities Act pursuant to Section 4, 5 or 6, any preliminary prospectus or final prospectus contained therein, or any amendment or supplement thereof, or arise out of or are based upon the 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 the light of the circumstances in which they were made, and will reimburse the Company and each such officer, director, underwriter or controlling person for any legal or other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage, liability or action, provided, however, that such seller will be liable hereunder in any such case if and only to the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission so made in reliance upon and in conformity with information pertaining to such seller furnished in writing to the Company by such seller specifically for use in such registration statement or prospectus, and provided, further, that the foregoing indemnity agreement is subject to the condition that, insofar as it relates to any such untrue statement or alleged untrue statement or omission or alleged omission made in the preliminary prospectus but eliminated or remedied in the amended prospectus on file with the Commission at the time the registration statement becomes effective or in the Final Prospectus, such indemnity agreement shall not inure to the benefit of the Company, any controlling person or any underwriter, if the Company, underwriter or controlling person was obligated under law to provide a copy of the Final Prospectus to the person or entity asserting the loss, liability, claim or damage and failed to do so within the period required by the Securities Act; provided, further, that this indemnity shall not be deemed to relieve any underwriter of any of its due diligence obligations; and provided, further, that in no event shall any indemnity by a seller under this Section 9(b) exceed the gross proceeds from the offering received by such seller. (c) Promptly after receipt by an indemnified party hereunder of notice of the commencement of any action, such indemnified party shall, if a claim in respect thereof is to be made against the indemnifying party hereunder, notify the indemnifying party in writing thereof, but the omission so to notify the indemnifying party shall not relieve it from any liability which it may have to such indemnified party other than under this Section 9 and shall only relieve it from any liability which it may have to such indemnified party under this Section 9 if and to the extent the indemnifying party is prejudiced by such omission. In case any such action shall be brought against any indemnified party and it shall notify the indemnifying party of the commencement thereof, the indemnifying party shall be entitled to participate in and, to the extent it shall wish, to assume and undertake the defense thereof with counsel satisfactory to such indemnified party, and, after notice from the indemnifying party to such indemnified party of its election so to assume and undertake the defense thereof, the indemnifying party shall not be liable to such indemnified party under this Section 9 for any legal expenses subsequently incurred by such indemnified party in connection with the defense thereof other than reasonable costs of investigation and of liaison with counsel so selected, provided, however, that, if the defendants in any such action include both the indemnified party and the indemnifying party and counsel to the indemnified party shall have reasonably concluded that there are reasonable defenses available to the indemnified party which are different from or additional to those available to the - 12 - indemnifying party or if the interests of the indemnified party reasonably may be deemed to conflict with the interests of the indemnifying party, the indemnified party shall have the right to select a separate counsel and to assume such legal defenses and otherwise to participate in the defense of such action, with the expenses and fees of such separate counsel and other expenses related to such participation to be reimbursed by the indemnifying party as incurred. No indemnifying party, in the defense of any such claim or litigation, shall, except with the consent of each indemnified party, consent to entry of any judgment or enter into any settlement which does not include as an unconditional term thereof the giving by the claimant or plaintiff to such indemnified party of a release from all liability in respect to such claim or litigation. (d) In order to provide for just and equitable contribution to joint liability under the Securities Act in any case in which either (i) any Holder of Restricted Stock exercising rights under this Agreement, or any controlling person of any such Holder, makes a claim for Indemnification pursuant to this Section 9 but it is judicially determined (by the entry of a final judgment or decree by a court of competent jurisdiction and the expiration of time to appeal or the denial of the last right of appeal) that such indemnification may not be enforced in such case notwithstanding the fact that this Section 9 provides for indemnification in such case, or (ii) contribution under the Securities Act may be required on the part of any such selling Holder or any such controlling person in circumstances for which indemnification is provided under this Section 9; then, and in each such case, the Company and such Holder will contribute to the aggregate losses, claims, damages or liabilities to which they may be subject (after contribution from others) in such proportion so that such Holder is responsible for the portion represented by the percentage that the public offering price of its Restricted Stock offered by the registration statement bears to the public offering price of all securities offered by such registration statement, and the Company is responsible for the remaining portion; provided, however, that, in any such case, (A) no such Holder will be required to contribute any amount in excess of the public offering price of all such Restricted Stock offered by it pursuant to such registration statement; and (B) no person or entity guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) will be entitled to contribution from any person or entity who was not guilty of such fraudulent misrepresentation. 10. Changes in Common Stock. If, and as often as, there is any change in the Common Stock by way of a stock split, stock dividend, combination or reclassification, or through a merger, consolidation, reorganization or recapitalization, or by any other means, appropriate adjustment shall be made in the provisions hereof so that the rights and privileges granted hereby shall continue with respect to the Common Stock as so changed. 11. Rule 144 Reporting. With a view to making available the benefits of certain rules and regulations of the Commission which may at any time permit the sale of the Restricted Stock to the public without registration, the Company agrees to: (a) make and keep public information available, as those terms are understood and defined in Rule 144 under the Securities Act; - 13 - (b) use its reasonable best efforts to file with the Commission in a timely manner all reports and other documents required of the Company under the Securities Act and the Exchange Act; and (c) furnish to each Holder of Restricted Stock forthwith upon request a written statement by the Company as to its compliance with the reporting requirements of such Rule 144 and of the Securities Act and the Exchange Act, a copy of the most recent annual or quarterly report of the Company, and such other reports and documents so filed by the Company as such Holder may reasonably request in availing itself of any rule or regulation of the Commission allowing such Holder to sell any Restricted Stock without registration. The Company shall not be required to effect a registration pursuant to Section 4, 5 or 6 hereof for any Holder desiring to participate in such registration who (a) may then dispose of all of its shares of Restricted Stock pursuant to Rule 144 within the three-month period following such proposed registration; and (b) holds less than 1% of the outstanding capital stock of the Company (on a common stock-equivalent basis) at the time of such registration. 12. Representations and Warranties of the Company. The Company represents and warrants to the Investors as follows: (a) The execution, delivery and performance of this Agreement by the Company have been duly authorized by all requisite corporate action and will not violate any provision of law, any order of any court or other agency of government, the Charter or By-laws of the Company or any provision of any indenture, agreement or other instrument to which it or any or its properties or assets is bound, conflict with, result in a breach of or constitute (with due notice or lapse of time or both) a default under any such indenture, agreement or other instrument or result in the creation or imposition of any lien, charge or encumbrance of any nature whatsoever upon any of the properties or assets of the Company. (b) This Agreement has been duly executed and delivered by the Company and constitutes the legal, valid and binding obligation of the Company, enforceable in accordance with its terms (subject, as to enforcement of remedies, to applicable bankruptcy, reorganization, insolvency, moratorium and similar laws affecting the rights of creditors generally), except to the extent the indemnification provisions herein may be deemed not enforceable. (c) The Company has not granted any registration rights, and no such registration rights exist, that conflict with the registrations rights set forth herein or contemplated hereby. All registration rights agreements relating to the capital stock of the Company permit, or have been amended to permit, the transactions and rights set forth herein and contemplated hereby. 13. Miscellaneous. (a) All covenants and agreements contained in this Agreement by or on behalf of any of the parties hereto shall bind and inure to the benefit of the respective successors and - 14 - assigns of the parties hereto (including without limitation transferees of any of the shares of Restricted Stock), whether so expressed or not, provided, however, that registration rights conferred herein on the Holders of shares of Restricted Stock shall only inure to the benefit of a transferee of shares of Restricted Stock if such transferee, in the Company's reasonable judgment, is not a competitor of the Company, and (i) there is transferred to such transferee at least 20% of the total shares of Restricted Stock originally issued to the direct or indirect transferor of such transferee by the Company or (ii) such transfer is made in connection with the distribution by a Holder to such Holders beneficial owners (including, without limitation, to partners of a general or limited partnership, shareholders of a corporation, members of a limited liability company, and beneficiaries of a trust) of securities of the Holder or to the partners or employees of the Holder, provided that at the Company's request, one person shall be designated by such transferees as their agent for purposes of their rights hereunder and the provision of a notice by the Company to such agent in accordance with the provisions hereof shall be deemed compliance with such provisions for all such beneficial owners, partners and employees, and following such request by the Company, the Company shall have no obligation under said provisions with respect to such transferees until it shall have been notified of the name and address of such agent. (b) Each Holder agrees that it will provide notice to the Company of any transfer or assignment of its rights or interests hereunder. Any failure by the Company to fulfill a covenant or obligation hereunder which is the direct result of a failure by a Holder to provide such notice shall not be deemed to be a breach of any covenant or obligation hereunder. Nothing in this Agreement shall be construed to create any rights or obligations except among the parties hereto and their respective and permitted successors and assigns, and no person or entity shall be regarded as a third-party beneficiary of this Agreement. Except as provided in Section 13(a) above, all notices, requests, consents and other communications hereunder shall be in writing, shall be addressed to the receiving party's address set forth below or to such other address as a party may designate by notice hereunder, and shall be either (i) delivered by hand, (ii) sent by overnight courier, with a receipt obtained or (iii) sent by registered or certified mail, return receipt requested, postage prepaid. If to the Company: Occupational Health + Rehabilitation Inc 175 Derby Street, Suite 36 Hingham, MA 02043-5048 Attn: Chief Executive Officer If to an Investor: To such Investor at the address of such Investor set forth in Schedule A attached hereto All notices, requests, consents and other communications hereunder shall be deemed to have been given (i) if by hand, at the time of the delivery thereof to the receiving party at the address of such party set forth above, (ii) if sent by overnight courier, on the next business day - 15 - following the day such notice is delivered to the courier service, or (iii) if sent by registered or certified mail, on the 5th business day following the day such mailing is made. (c) This Agreement shall be governed and construed in accordance with the law of the Commonwealth of Massachusetts, without giving effect to the conflict of laws principles thereof. (d) This Agreement may be amended or modified, and any provision hereof may be waived in whole or in part, but only by the written consent of the Company and the holders of a majority of the aggregate number of outstanding shares of Restricted Stock held of record by the Holders or their permitted successors and assigns. This Agreement may be terminated by written agreement of the Company and the holders of at least a majority of the aggregate number of outstanding shares of Restricted Stock held of record by the Holders or their permitted successors and assigns. (e) This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. (f) Except as otherwise expressly provided herein, the obligations of the Company to register shares of Restricted Stock under Section 4, 5 or 6 as provided herein shall terminate on March 24, 2007. (g) If requested by the underwriter or underwriters for an underwritten public offering of securities of the Company which offering is by the Company, each Holder of Restricted Stock who is a party to this Agreement (including, without limitation, a successor or permitted assignee of a party) shall agree not to sell, make any short sale of, loan, grant any option for the purchase of, or otherwise dispose of any shares of Restricted Stock or any other shares of Common Stock (other than shares being registered in such offering), without the consent of such underwriter or underwriters, for a period of not more than 90 days following the effective date of the registration statement relating to such offering (unless in any event such underwriter or underwriters shall, based on then current market conditions, agree to a shorter period), provided, with respect to each such offering, that all persons entitled to registration rights in such offering who are not parties to this Agreement, all other persons selling shares of Common Stock in such offering and all executive officers of the Company shall also have agreed to be bound by provisions pertaining to the sale of their shares of Common Stock following such offering which provisions are substantially similar to the provisions binding upon the Holders of Restricted Stock obligated under this Agreement with respect to the sale of their shares following such offering. (h) The Company shall be permitted to require any Holders requesting registration under Section 4, 5 or 6 to delay any request for registration or to cease sales under any effective registration statement if the Company is then contemplating a transaction that could reasonably be expected to be adversely affected or the Company would be required to make - 16 - public disclosure of information, the disclosure of which at such time could reasonably be expected to cause a material adverse effect upon the Company's business. In addition, if at the time of any request to register Registrable Shares pursuant to Section 4 or Section 6 hereof, the Company is engaged or has fixed plans to engage within ninety (90) days of the time of the request in a registered public offering as to which such Holders may include Registrable Shares pursuant to Section 5 hereof, then the Company may at its option direct that such request be delayed. (i) If any provision of this Agreement shall be held to be illegal, invalid or unenforceable, such illegality, invalidity or unenforceability shall attach only to such provision and shall not in any manner affect or render illegal, invalid or unenforceable any other provision of this Agreement, and this Agreement shall be carried out as if any such illegal, invalid or unenforceable provision were not contained herein. In the event that any court of competent jurisdiction shall determine that any provision, or any portion thereof, contained in this Agreement shall be unreasonable or unenforceable in any respect, then such provision shall be deemed limited to the extent that such court deems it reasonable and enforceable, and as so limited shall remain in full force and effect. (j) The headings and captions of the various subdivisions of this Agreement are for convenience of reference only and shall in no way modify, or affect the meaning or construction of any of the terms or provisions hereof. 14. Entire Agreement. This Agreement embodies the entire agreement and understanding among the parties hereto with respect to the subject matter hereof and supersedes all prior oral or written agreements and understandings related to the subject matter hereof, including without limitation the Prior Agreement. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] - 17 - IN WITNESS WHEREOF, the undersigned have executed this Amended and Restated Registration Rights Agreement as a sealed instrument as of the day and year first written above. THE COMPANY: INVESTORS: OCCUPATIONAL HEALTH + CAHILL, WARNOCK STRATEGIC REHABILITATION INC PARTNERS FUND, L.P. By: Cahill, Warnock Strategic Partners, L.P. By: /s/ Keith G. Frey By: /s/ Donald W. Hughes -------------------------- ------------------------------------------ Title: CFO Title: General Partner STRATEGIC ASSOCIATES, L.P. By: Cahill, Warnock Strategic Partners, L.P. By: /s/ Donald W. Hughes ------------------------------------------ Title: General Partner AXA U.S. GROWTH FUND LLC By: /s/ Thomas J. McKinley ------------------------------------------ Title: Managing Member PANTHEON GLOBAL PCC LIMITED By: /s/ Sarita Keen ------------------------------------------ Title: Alternate Director DOUBLE BLACK DIAMOND II, LLC By: /s/ Thomas J. McKinley ------------------------------------------ Title: Managing Member - 18 - /s/ Thomas J. McKinley ---------------------------------------------- Vincent Worms, signed by Thomas J. McKinley pursuant to a power of attorney THE VENTURE CAPITAL FUND OF NEW ENGLAND III, L.P. By: FH & Co. III, L.P., Its General Partner By: /s/ Kevin J. Dougherty ------------------------------------------ Title: General Partner BANCBOSTON VENTURES, INC. By: /s/ John McCormick ------------------------------------------ Title: Vice President VENROCK ASSOCIATES VENROCK ASSOCIATES II, L.P. By: /s/ Anthony B. Envin ------------------------------------------ Title: General Partner ASSET MANAGEMENT ASSOCIATES, 1989, L.P. By: AMC Partners 89, L.P., General Partner By: /s/ Craig Taylor ------------------------------------------ Title: General Partner SCHEDULE A INVESTORS Cahill, Warnock Strategic Partners Fund, L.P. One South Street Suite 2150 Baltimore, Maryland 21202 Attn: Mr. Donald W. Hughes with copy to: Edward L. Cahill HLM Management 222 Berkley Street Boston, MA 02116 Strategic Associates, L.P. One South Street Suite 2150 Baltimore, Maryland 21202 Attn: Mr. Donald W. Hughes with copy to: Edward L. Cahill HLM Management 222 Berkley Street Boston, MA 02116 AXA U.S. Growth Fund LLC c/o Partech International 50 California Street Suite 3200 San Francisco, CA 94111 Attn: Mr. Thomas G. McKinley Pantheon Global PCC Limited Pantheon Ventures, Inc. Transamerica Center 600 Montgomery Street 23rd Floor San Francisco, CA 94111 Attn: Jay Pierrepont Double Black Diamond II, LLC c/o Partech International 50 California Street Suite 3200 San Francisco, CA 94111 Attn: Mr. Thomas G. McKinley Vincent Worms 50 California Street Suite 3200 San Francisco, CA 94111 Asset Management Associates, 1989, L.P. Alloy Ventures 480 Cowper Street, 2nd Floor Palo Alto, CA 94301 Attn: Mr. Craig C. Taylor Venrock Associates Room 5508, 30 Rockefeller Plaza New York, NY 10112 Attn: Mr. Anthony Evnin Venrock Associates II, L.P. Room 5508, 30 Rockefeller Plaza New York, NY 10112 Attn: Mr. Anthony Evnin The Venture Capital Fund of New England, III, L.P. 30 Washington Street Wellesley Hills, MA 02481-1905 Attn: Mr. Kevin J. Dougherty BancBoston Ventures, Inc. BancBoston Capital Mail Stop: MA DE 10210A 175 Federal Street, 10th Floor Boston, MA 02110 Attn: Mr. John B. McCormick EX-99.3 5 dex993.txt EXECUTION COPY OF THE AMENDED AND RESTATED STOCKHOLDERS AGREEMENT EXHIBIT 99.3 EXECUTION COPY AMENDED AND RESTATED STOCKHOLDERS' AGREEMENT AMENDED AND RESTATED STOCKHOLDERS' AGREEMENT (this "Agreement") made this 24th day of March, 2003, by and among (i) Occupational Health + Rehabilitation Inc, a Delaware corporation (the "Company"), (ii) the individuals and entities listed under the heading "Holders" on Schedule I attached hereto, and (iii) those persons whose names are set forth under the heading "Investors" on Schedule I hereto (the "Investors"). WHEREAS, the Investors acquired an aggregate of 1,416,667 shares of Series A Convertible Preferred Stock, par value $.001 per share, of the Company (the "Series A Preferred Stock") pursuant to a certain Series A Convertible Preferred Stock Purchase Agreement dated as of November 6, 1996, by and among the Investors and the Company (the "Purchase Agreement"); WHEREAS, in connection with the sale of the Series A Preferred Stock, the Company entered into a Stockholders' Agreement dated as of November 6, 1996 with the Holders and the Investors (the "Prior Agreement"); WHEREAS, the Investors and the Company are, on the date hereof, entering into a Series A Convertible Stock Repurchase Agreement (the "Repurchase Agreement") pursuant to which the Company shall repurchase the Series A Preferred Stock held by the Investors in exchange for consideration that includes shares of the Company's Common Stock, par value $.001 per share; WHEREAS, the Investors, the Holders and the Company have agreed that it is in the best interest of the Company to amend and restate the Prior Agreement to grant certain rights to the Investors with respect to the composition of the Board of Directors; and WHEREAS, pursuant to Section 7 of the Prior Agreement, amendments to the Prior Agreement may be made with the written consent of the Company, Investors holding a majority of the Series A Preferred Stock and Holders holding a majority of the Common Stock subject to the Prior Agreement. NOW, THEREFORE, in consideration of the mutual covenants herein contained and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Company, the Holders and the Investors agree as follows: 1. Board of Directors. (a) Election of Directors. Each of the parties hereto agrees to vote all of the Stock (as hereinafter defined) of the Company now owned or hereafter acquired by such party (and attend, in person or by proxy, all meetings of stockholders called for the purpose of electing directors), and the Company agrees to take all actions (including, but not limited to the nomination of specified persons) to cause and maintain the election to the Board of Directors of the Company, - 2 - to the extent permitted pursuant to the Company's Restated Certificate of Incorporation, as amended, as set forth below: (i) the Chief Executive Officer of the Company, who initially is John C. Garbarino; (ii) a person designated by the Chief Executive Officer of the Company, who shall initially be Angus M. Duthie; (iii) a person designated by those persons designated as OH+R Principal Stockholders on Schedule II hereto by a majority in interest of Stock held by them, who shall initially be Kevin J. Dougherty; (iv) two persons designated by Cahill, Warnock Strategic Partners Fund, L.P. and Strategic Associates, L.P., one of whom shall initially be Edward L. Cahill and the other of whom shall initially be Donald W. Hughes (the "Cahill Directors"), and (v) two persons who shall be unaffiliated with the management of the Company and mutually agreeable to all of the other directors, one of whom shall initially be Frank H. Leone and the other of whom shall initially be Steven W. Garfinkle. Each of the parties further covenants and agrees to vote, to the extent possible, all shares of Stock of the Company now owned or hereafter acquired by such party so that the Company's Board of Directors shall consist of no more than seven (7) members. For the purposes of this Agreement, "Stock" shall mean and include all shares of Common Stock, and all other securities of the Company which may be exchangeable for or issued in exchange for or in respect of shares of Common Stock (whether by way of stock split, stock dividend, combination, reclassification, reorganization or any other means). In the absence of any designation from the persons or groups so designating directors as specified above, the director previously designated by them and then serving shall be reelected if still eligible to serve as provided herein. No party hereto shall vote to remove any member of the Board of Directors designated in accordance with the aforesaid procedure unless the persons or groups so designating directors as specified above so vote, and, if such persons or groups so vote then the non-designating party or parties shall likewise so vote. Any vacancy on the Board of Directors created by the resignation, removal, incapacity or death of any person designated under this Section 1 shall be filled by another person designated in a manner so as to preserve the constituency of the Board as provided above. If any party to this Agreement shall fail to vote such party's Stock as provided in this Agreement, without further action by such party, the President of the Company shall be, and hereby is, irrevocably constituted the attorney-in-fact and proxy of such party for the purpose of - 3 - voting the shares of such Stock and shall vote the same in accordance with the terms of this Agreement and is hereby authorized to revoke any proxy providing for any other vote of such shares with respect to the election of directors. (b) Committees of the Board of Directors. The membership of each committee of the Board of Directors shall at all times include one of the Cahill Directors. 2. Termination. This Agreement, and the respective rights and obligations of the parties hereto, shall terminate upon the earliest to occur of the following: (i) the date on which the Investors no longer hold either the Promissory Notes issued to the Investors pursuant to the Repurchase Agreement or at least fifty percent (50%) of the shares of Common Stock issued to the Investors pursuant to the Repurchase Agreement; (ii) a firm commitment underwritten public offering of shares of Common Stock; (iii) the sale of the Company, whether by merger, sale, or transfer of more than eighty percent (80%) of its capital stock, or sale of substantially all of its assets; or (iv) the date on which the Company's Common Stock is listed on a securities exchange or the Nasdaq Stock Market if termination of this Agreement is required to be so listed. 3. Notices. All notices, requests, demands and other communications provided for hereunder shall be in writing (including electronic communication) and delivered personally, or by overnight courier, or by facsimile or other electronic means or sent by certified or registered United States mail, postage prepaid, return receipt requested and addressed as follows: If to any Investor: at such Investor's address for notice as set forth in the register maintained by the Company, or, as to each of the foregoing, at the addresses set forth on Schedule I hereto or at such other address as shall be designated by such Person in a written notice to the other parties complying as to delivery with the terms of this Section, with a copy to Barbara M. Johnson, Esq., Testa, Hurwitz & Thibeault, LLP, High Street Tower, 125 High Street, Boston, Massachusetts 02110. If to the Company: at 175 Derby Street, Suite 36, Hingham, Massachusetts 02043, or at such other address as shall be designated by the Company in a written notice to the other parties complying as to delivery with the terms of this Section, with a copy to Donna L. Brooks, Esq., Shipman & Goodwin LLP, One American Row, Hartford, CT 06103. All such notices, requests, demands and other communications shall be effective three days after deposited in the mails or upon receipt when delivered electronically, by facsimile, by hand or by overnight courier, respectively, addressed as aforesaid, unless otherwise provided herein. 4. Specific Performance. The rights of the parties under this Agreement are unique and, accordingly, the parties shall, in addition to such other remedies as may be available to any of them at law or in equity, have the right to enforce their rights hereunder by actions for specific performance to the extent permitted by law. - 4 - 5. Entire Agreement. This Agreement constitutes the entire agreement among the parties with respect to the subject matter hereof and supersedes all prior agreements and understandings between them or any of them as to such subject matter, including, without limitation, the Prior Agreement. 6. Waivers and Further Agreements. Any of the provisions of this Agreement may be waived with the consent of the Investors holding a majority in interest of the issued and outstanding shares of Common Stock issued to the Investors pursuant to the Repurchase Agreement by an instrument in writing. Any waiver by any party of a breach of any provision of this Agreement shall not operate or be construed as a waiver of any subsequent breach of that provision or of any other provision hereof. Each of the parties hereto agrees to execute all such further instruments and documents and to take all such further action as any other party may reasonably require in order to effectuate the terms and purposes of this Agreement. Notwithstanding the foregoing, no waiver approved in accordance herewith shall be effective if and to the extent that such waiver grants to any one or more Investors any rights more favorable than any rights granted to all other Investors or otherwise treats any one or more Investors differently than all other Investors. 7. Amendments. Except as otherwise expressly provided herein, this Agreement may not be amended except by an instrument in writing executed by (i) the Company, (ii) Investors holding a majority in interest of the issued and outstanding shares of Common Stock issued to the Investors pursuant to the Repurchase Agreement, and (iii) Holders holding a majority of the shares of Common Stock subject to this Agreement. Notwithstanding the foregoing, no such amendment shall be effective if and to the extent that such amendment creates any additional affirmative obligations to be complied with by any or all of the Investors. 8. Assignment; Successors and Assigns. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective heirs, executors, legal representatives, successors and permitted transferees. 9. Severability. In case any one or more of the provisions contained in this Agreement shall for any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision of this Agreement, and such invalid, illegal and unenforceable provision shall be reformed and construed so that it will be valid, legal, and enforceable to the maximum extent permitted by law. 10. Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 11. Section Headings. The headings contained in this Agreement are for reference purposes only and shall not in any way affect the meaning or interpretation of this Agreement. 12. Governing Law. This Agreement shall be construed and enforced in accordance with and governed by the General Corporation Law of the State of Delaware as to matters within - 5 - the scope thereof, and as to all other matters shall be governed by and construed in accordance with the internal laws of the Commonwealth of Massachusetts. 13. Legend. The certificates representing the shares of Common Stock issued to the Investors pursuant to the Repurchase Agreement shall bear a legend substantially in the following form: "The shares represented by this certificate are subject to the terms and conditions of an Amended and Restated Stockholders' Agreement dated as of March 24, 2003, a copy of which will be furnished to any interested party upon written request without charge." [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] - 6 - IN WITNESS WHEREOF, the parties hereto have executed this Stockholders' Agreement as a sealed instrument as of the day and date first above written. INVESTORS: THE COMPANY: CAHILL, WARNOCK STRATEGIC OCCUPATIONAL HEALTH + PARTNERS FUND, L.P. REHABILITATION INC By: Cahill, Warnock Strategic Partners, L.P. By: /s/ Donald W. Hughes By: /s/ Keith G. Frey ----------------------------------------------- ----------------------------------------------- Title: General Partner Title: CFO AXA U.S. GROWTH FUND LLC HOLDERS: STRATEGIC ASSOCIATES, L.P. By: /s/ Thomas J. McKinley ----------------------------------------------- By: Cahill, Warnock Strategic Partners, L.P. Title: Managing Member By: /s/ Donald W. Hughes ----------------------------------------------- PANTHEON GLOBAL PCC LIMITED Title: General Partner By: /s/ Sarita Keen *THE VENTURE CAPITAL FUND OF ----------------------------------------------- NEW ENGLAND III, L.P. Title: Alternate Director By: FH & Co. III, L.P., Its General Partner DOUBLE BLACK DIAMOND II LLC By: /s/ Kevin J. Dougherty ----------------------------------------------- Title: General Partner By: /s/ Thomas J. McKinley ----------------------------------------------- Title: Managing Member *BANCBOSTON VENTURES, INC. /s/ Thomas J. McKinley - -------------------------------------------------- By: /s/ John McCormick Vincent Worms, signed by Thomas J. ----------------------------------------------- McKinley pursuant to a power of attorney Title: Vice President /s/ John C. Garbarino -------------------------------------------------- John C. Garbarino /s/ Lynne M. Rosen -------------------------------------------------- Lynne M. Rosen
- 7 - *VENROCK ASSOCIATES *VENROCK ASSOCIATES II, L.P. By: /s/ Anthony B. Envin ----------------------------------------------- Title: General Partner *ASSET MANAGEMENT ASSOCIATES, 1989, L.P. By: AMC Partners 89, L.P., General Partner By: /s/ Craig Taylor ----------------------------------------------- Title: General Partner *In their capacities as Holders and Investors hereunder
SCHEDULE I OCCUPATIONAL HEALTH + REHABILITATION INC HOLDERS The Venture Capital Fund of New England III, L.P. BancBoston Ventures, Inc. John C. Garbarino Lynne M. Rosen Venrock Associates Venrock Associates II, L.P. Asset Management Associates, 1989, L.P. INVESTORS Cahill, Warnock Strategic Partners Fund, L.P. One South Street Suite 2150 Baltimore, Maryland 21202 Attn: Mr. Donald W. Hughes with copy to: Edward L. Cahill HLM Management 222 Berkley Street Boston, MA 02116 Strategic Associates, L.P. One South Street Suite 2150 Baltimore, Maryland 21202 Attn: Mr. Donald W. Hughes with copy to: Edward L. Cahill HLM Management 222 Berkley Street Boston, MA 02116 AXA U.S. Growth Fund LLC c/o Partech International 50 California Street Suite 3200 San Francisco, CA 94111 Attn: Mr. Thomas G. McKinley Pantheon Global PCC Limited Pantheon Ventures, Inc. Transamerica Center 600 Montgomery Street 23rd Floor San Francisco, CA 94111 Attn: Jay Pierrepont Double Black Diamond II, LLC c/o Partech International 50 California Street Suite 3200 San Francisco, CA 94111 Attn: Mr. Thomas G. McKinley Vincent Worms 50 California Street Suite 3200 San Francisco, CA 94111 Asset Management Associates, 1989, L.P. Alloy Ventures 480 Cowper Street, 2nd Floor Palo Alto, CA 94301 Attn: Mr. Craig C. Taylor Venrock Associates Room 5508 30 Rockefeller Plaza New York, New York 10112 Attn: Mr. Anthony Evnin Venrock Associates II, L.P. Room 5508 30 Rockefeller Plaza New York, New York 10112 Attn: Mr. Anthony Evnin The Venture Capital Fund of New England, III, L.P. 30 Washington Street Wellesley Hills, MA 02481-2175 Attn: Mr. Kevin J. Dougherty BancBoston Ventures, Inc. BancBoston Capital Mail Stop: MA DE 10210A 175 Federal Street, 10th Floor Boston, MA 02110 Attn: Mr. John B. McCormick SCHEDULE II OCCUPATIONAL HEALTH + REHABILITATION INC OH+R Principal Stockholders The Venture Capital Fund of New England III, L.P. BancBoston Ventures, Inc. EX-99.4 6 dex994.txt EXECUTION COPY OF THE SERIES A CONVERTIBLE PREFERRED STOCK REPURCHASE AGREEMENT EXHIBIT 99.4 EXECUTION COPY SERIES A CONVERTIBLE PREFERRED STOCK REPURCHASE AGREEMENT Between OCCUPATIONAL HEALTH + REHABILITATION INC and THE SERIES A CONVERTIBLE PREFERRED STOCKHOLDERS NAMED ON SCHEDULE I Dated as of March 24, 2003 TABLE OF CONTENTS 1. Authorization; Purchase of Series A Preferred............................................................... 1 1.1 Authorization.......................................................................................... 1 1.2 Repurchase of Series A Preferred at the Closing........................................................ 1 2. Closing; Delivery........................................................................................... 1 2.1 The Closing............................................................................................ 1 2.2 Delivery............................................................................................... 2 3. Representations and Warranties of the Company............................................................... 2 3.1 Organization and Corporate Power; No Violations........................................................ 2 3.2 Authorization.......................................................................................... 3 3.3 Capitalization......................................................................................... 4 3.4 Contracts and Commitments.............................................................................. 5 3.5 Financial Statements................................................................................... 5 3.6 Events Subsequent to the Date of the Balance Sheet..................................................... 6 3.7 Litigation; Compliance with Law........................................................................ 6 3.8 Loans and Advances..................................................................................... 7 3.9 Assumptions, Guaranties, Etc. of Indebtedness of Other Persons......................................... 7 3.10 Significant Customers and Suppliers.................................................................... 7 3.11 Governmental Approvals................................................................................. 7 3.12 Certain Agreements of Officers......................................................................... 8 3.13 No Insolvency.......................................................................................... 8 3.14 ERISA.................................................................................................. 8 3.15 Transactions with Affiliates........................................................................... 9 3.16 Securities Act of 1933................................................................................. 9 3.17 Registration Rights.................................................................................... 9 3.18 Insurance........................................................................................... 9 3.19 Books and Records................................................................................... 9 3.20 Title to Assets........................................................................................10 3.21 Burdensome Restrictions................................................................................10 3.22 Computer Programs......................................................................................10 3.23 Intellectual Property Rights...........................................................................11 3.24 Taxes..................................................................................................11 3.25 Disclosure.............................................................................................11 3.26 Additional Information.................................................................................12 4. Covenants...................................................................................................12 5. Representations and Warranties of the Sellers...............................................................14 6. Conditions to the Obligations of the Sellers................................................................15 6.1 Accuracy of Representations and Warranties.............................................................15 6.2 Performance............................................................................................15 6.3 Documents; Corporate Approvals.........................................................................15 6.4 Payment of Costs.......................................................................................16 6.5 Board of Directors.....................................................................................16 6.6 Sellers' Participation.................................................................................16 6.7 Consents, Waivers, Etc.................................................................................16
i 7. Conditions to the Obligations of the Company................................................................17 7.1 Accuracy of Representations and Warranties.............................................................17 7.2 Performance............................................................................................17 7.3 Approvals..............................................................................................17 7.4 Stockholders' Agreement, Registration Rights Agreement and Subordination Agreement.....................17 7.5 Sellers' Participation.................................................................................17 8. Successors and Assigns......................................................................................17 9. Survival of Representations and Warranties..................................................................17 10. Costs, Expenses and Taxes................................................................................18 11. Notices..................................................................................................18 12. Brokers..................................................................................................19 13. Entire Agreement.........................................................................................19 14. Amendments and Waivers...................................................................................19 15. Counterparts.............................................................................................19 16. Captions.................................................................................................19 17. Severability.............................................................................................19 18. Waiver of Preemptive Rights..............................................................................19 19. Governing Law............................................................................................20
SCHEDULES: Schedule I Schedule of Sellers EXHIBITS: Exhibit A Form of Promissory Note Exhibit B Disclosure Schedule Exhibit C Opinion of Shipman & Goodwin LLP Exhibit D Amended and Restated Stockholders' Agreement Exhibit E Amended and Restated Registration Rights Agreement Exhibit F Subordination Agreement ii SERIES A CONVERTIBLE PREFERRED STOCK REPURCHASE AGREEMENT This Series A Convertible Preferred Stock Repurchase Agreement (the "Agreement") dated as of March 24, 2003 is between Occupational Health + Rehabilitation Inc, a Delaware corporation (the "Company"), and the several holders of Series A Convertible Preferred Stock, par value $.001 per share (the "Series A Preferred") named in the attached Schedule I (each individually, a "Seller" and collectively, the "Sellers"). In consideration of the mutual promises and covenants contained in this Agreement, and intending to be legally bound by the terms and conditions of this Agreement, the parties hereto hereby agree as follows: 1. Authorization; Purchase of Series A Preferred. 1.1 Authorization. (a) Common Stock. The Company has duly authorized the issuance of up to 1,608,247 shares of its previously authorized but unissued shares of Common Stock, par value $.001 per share (the "Repurchase Stock") to the Sellers. (b) The Notes. The Company has duly authorized the issuance of the Company's Promissory Notes in the original aggregate principal amount of up to $2,699,740.35 (collectively, the "Notes" and individually, a "Note") to the Sellers. Each Note will be substantially in the form set forth in Exhibit A hereto. 1.2 Repurchase of Series A Preferred at the Closing. Upon the terms and subject to the conditions hereof, at the Closing each Seller agrees, severally but not jointly, to sell to the Company all of its shares of Series A Preferred as set forth opposite such Seller's name on the attached Schedule I under the heading "Series A Preferred Shares", and the Company agrees to repurchase all such shares of Series A Preferred. The aggregate purchase price of the Series A Preferred being repurchased by the Company from each Seller at the Closing is set forth opposite such Seller's name on the attached Schedule I and includes: (i) that number of shares of Repurchase Stock set forth opposite such Seller's name on the attached Schedule I under the heading "Shares of Repurchase Stock"; (ii) a Note in the principal amount set forth opposite such Seller's name on the attached Schedule I under the heading "Notes"; and (iii) the dollar amount set forth opposite such Seller's name on the attached Schedule I under the heading "Cash". 2. Closing; Delivery. 2.1 The Closing. The closing of the repurchase of the Series A Preferred pursuant to this Agreement shall take place by mail and/or facsimile at the offices of Testa, Hurwitz & Thibeault, LLP, 125 High Street, Boston, Massachusetts 02110 on March 24, 2003, or at such other time, date, and place as are mutually agreeable to the Company and the Sellers (the "Closing"). The date of the Closing is hereinafter referred to as the "Closing Date." 2.2 Delivery. At the Closing, upon the terms and subject to the conditions hereof, each Seller shall deliver to the Company the certificates evidencing the shares of Series A Preferred to be sold by each Seller at the Closing accompanied by executed stock powers and, in payment therefor, the Company shall deliver to each Seller the certificates evidencing the number of shares of Repurchase Stock to be issued to such Seller at the Closing or issue on the Closing Date irrevocable instructions to the Company's transfer agent to deliver such stock certificates as soon as practicable after the Closing, a Note evidencing the aggregate principal amount set forth opposite the Seller's name on Schedule I under the heading "Notes," and the dollar amounts to be paid to such Seller at the Closing. The Company shall make payment of all dollar amounts to be paid at the Closing to each Seller by wire transfer in immediately available funds. 3. Representations and Warranties of the Company. For purposes of this Section 3, unless otherwise specified, the term Company shall include the Company and each of its Subsidiaries. Except as disclosed in the Disclosure Schedule attached hereto as Exhibit B (the "Disclosure Schedule"), the Company hereby represents and warrants to the Sellers as follows: 3.1 Organization and Corporate Power; No Violations. (a) The Company is a corporation duly organized, validly existing and in corporate good standing under the laws of the State of Delaware and is qualified to do business as a foreign corporation in each jurisdiction in which such qualification is required, except where the failure to be so qualified would not have either individually or in the aggregate, a material adverse effect on the business, operations, affairs or condition (financial or otherwise), assets, liabilities or contractual rights of the Company (a "Material Adverse Effect"). The Company has all required corporate power and authority to own its property, to carry on its business as presently conducted or contemplated, to enter into and perform this Agreement, the Amended and Restated Stockholders' Agreement (the "Stockholders' Agreement"), the Amended and Restated Registration Rights Agreement (the "Registration Rights Agreement"), the Subordination Agreement (the "Subordination Agreement"), the Notes and the other agreements, documents and instruments contemplated hereby or executed in connection herewith (collectively with this Agreement, the "Transaction Documents"), and generally to carry out the transactions contemplated hereby or executed in connection herewith. The copies of the Restated Certificate of Incorporation and Certificate of Designations (collectively, the "Restated Charter") and By-laws of the Company, as amended to date, which have been furnished to the Sellers by the Company, are correct and complete at the date hereof. (b) The Company is in compliance with the terms and provisions of this Agreement and of its Restated Charter and Bylaws, and with all mortgages, indentures, leases, agreements and other instruments, if any, by which it is bound or to which it or any of its respective properties or assets are subject. The Company is in compliance with all judgments, decrees, governmental orders, statutes, rules or regulations by which it is bound or to which any of its properties or assets are subject. Neither the execution and delivery of this Agreement or the other Transaction Documents, or the issuance of the Repurchase Stock or Notes, nor the consummation of any transaction contemplated by this Agreement or the Transaction Documents, has 2 constituted or resulted in or will constitute or result in a default or violation of any term or provision of any of the foregoing documents, instruments, judgments, agreements, decrees, orders, statutes, rules and regulations. (c) Section 3.1(c) of the Disclosure Schedule contains a list of all subsidiaries of the Company and its equity interest therein. Except for such subsidiaries, the Company does not (i) own of record or beneficially, directly or indirectly, (A) any shares of capital stock or securities convertible into capital stock of any other corporation or (B) any participating interest in any partnership, joint venture or other non-corporate business enterprise or (C) any assets comprising the business or obligations of any other corporation, partnership, joint venture or other non-corporate business enterprise, or (ii) control, directly or indirectly, any other entity. Each of the Company's corporate subsidiaries and limited liability company subsidiaries is a corporation or limited liability company duly incorporated or organized, as the case may be, validly existing and in good standing under the laws of its respective jurisdiction of incorporation or organization, as the case may be, and is duly licensed or qualified to transact business as a foreign corporation or limited liability company, as the case may be, and is in good standing in each jurisdiction in which the nature of the business transacted by it or the character of the properties owned or leased by it requires such licensing or qualification, except where the failure to be so qualified would not have a Material Adverse Effect. Each of the subsidiaries referenced above has the corporate power or entity power, as the case may be, and authority to own and hold its properties and to carry on its business as now conducted and as proposed to be conducted. All of the outstanding shares of capital stock or equity interests, as the case may be, of each of the subsidiaries are owned beneficially and of record by the Company, one of its other wholly-owned subsidiaries, or any combination of the Company and/or one or more of its other wholly-owned subsidiaries, in each case free and clear of any liens, charges, restrictions, claims or encumbrances of any nature whatsoever; and there are no outstanding subscriptions, warrants, options, convertible securities, or other rights (contingent or other) pursuant to which any of the subsidiaries is or may become obligated to issue any shares of its capital stock or equity interests, as the case may be, to any person other than the Company or one of the other subsidiaries. 3.2 Authorization. The Transaction Documents are valid and binding obligations of the Company, enforceable in accordance with their respective terms. The execution, delivery and performance of the Transaction Documents have been duly authorized by all necessary corporate or other action of the Company. The issuance and delivery of the Repurchase Stock, the Notes and the cash in accordance with this Agreement has been duly authorized and reserved for issuance, as the case may be, by all necessary corporate action on the part of the Company. The Repurchase Stock, when issued and delivered against the shares of Series A Preferred therefor in accordance with the provisions of this Agreement, will be duly authorized and validly issued, fully paid and non-assessable, is not subject to preemptive rights or other preferential rights in any present or future stockholders of the Company, will not be subject to any lien, and will not conflict with any provision of any agreement or instrument to which the Company is a party or by which it or its property is bound. The Notes, when issued 3 and delivered against the shares of Series A Preferred therefor in accordance with the provisions of this Agreement, will be duly authorized and validly issued, and will not conflict with any provision of any agreement or instrument to which the Company is a party or by which it or its property is bound. No consent, approval or authorization of, or designation, declaration or filing with, any governmental authority or any other person or entity is required in connection with the execution, delivery and performance of the Transaction Documents, or the issuance and delivery of the Repurchase Stock and Notes in accordance with the terms of this Agreement or the consummation of any other transaction contemplated hereby or by the other Transaction Documents other than (i) filings pursuant to federal and state securities laws (all of which filings have been made by the Company, other than those which are required to be made after the Closing and which will be duly made on a timely basis) in connection with the issuance of the Repurchase Stock and (ii) with respect to the Registration Rights Agreement, the registration of the shares covered thereby with the Commission and filings pursuant to state securities laws. 3.3 Capitalization. The authorized capital stock of the Company consists of (i) 5,000,000 shares of Preferred Stock, par value $.001 per share (the "Preferred Stock"), of which 1,666,667 shares have been designated Series A Preferred, and (ii) 10,000,000 shares of Common Stock. Immediately prior to the Closing, 1,479,864 shares of Common Stock will be validly issued and outstanding, fully paid and nonassessable with no personal liability attaching to the ownership thereof and 1,416,667 shares of Series A Preferred will be validly issued and outstanding, fully paid and nonassessable with no personal liability attaching to the ownership thereof. All the outstanding shares of capital stock of the Company have been duly authorized, and are validly issued, fully paid and non-assessable. The designations, powers, preferences, rights, qualifications, limitations and restrictions in respect of each class and series of authorized capital stock of the Company are as set forth in the Restated Charter and all such designations, powers, preferences, rights, qualifications, limitations and restrictions are valid, binding and enforceable and in accordance with all applicable laws. Except as set forth in the attached Disclosure Schedule, (i) no subscription, warrant, option, convertible security, or other right (contingent or other) to purchase or otherwise acquire equity securities of the Company is authorized or outstanding and (ii) there is no commitment by the Company to issue shares, subscriptions, warrants, options, convertible securities, or other such rights or to distribute to holders of any of its equity securities any evidence of indebtedness or asset. Except as provided for in the Restated Charter or as set forth in the attached Disclosure Schedule, the Company has no obligation (contingent or other) to purchase, redeem or otherwise acquire any of its equity securities or any interest therein or to pay any dividend or make any other distribution in respect thereof. Except for the Stockholders' Agreement, there are no voting trusts or agreements, stockholders' agreements, pledge agreements, buy-sell agreements, rights of first refusal, preemptive rights or proxies relating to any securities of the Company or any of its subsidiaries (whether or not the Company or any of its subsidiaries is a party thereto). All of the outstanding securities of the Company were issued in compliance with all applicable federal and state securities laws and no stockholder has a right of rescission with respect thereto. 3.4 Contracts and Commitments. Except as set forth on the Disclosure Schedule or as filed as an exhibit to the Company's periodic reports filed pursuant to the Securities Exchange Act of 1934, as amended (the "Exchange Act"), the Company (i) is not a party to any oral or written contract, obligation, instrument, corporate restriction or commitment 4 which involves a potential commitment in excess of $150,000 or which is otherwise material and not entered into in the ordinary course of business, and (ii) does not have any oral or written employment or consulting contracts; stock redemption or purchase agreements; registration rights agreements; non-competition agreements; financing agreements; licenses; contracts regarding intellectual property; agreements with officers, directors, employees or shareholders of the Company or persons or organizations related to or affiliated with any such persons (except for agreements between the Company and the Series A Preferred); leases; or agreements relating to product development. The Company and, to the Company's knowledge, each other party thereto have in all material respects performed all the actions required to be performed by them to date, have received no notice of default and are not in default under any lease, agreement or contract now in effect to which the Company is a party or by which it or its property may be bound. The Company has no present expectation or intention of not fully performing all its respective material obligations under each such lease, contract or other agreement, and the Company has no knowledge of any material breach or anticipated breach by the other party to any contract or commitment to which the Company is a party. 3.5 Financial Statements. The Company has furnished to the Sellers the unaudited consolidated balance sheet of the Company and its subsidiaries as of September 30, 2002 (the "Balance Sheet") and the related unaudited consolidated statements of income, stockholders' equity and cash flows of the Company and its subsidiaries for the nine-months ended September 30, 2002, All such financial statements have been prepared in accordance with United States generally accepted accounting principles consistently applied (except that such unaudited financial statements do not contain all of the required footnotes and interim statements do not contain year-end adjustments), or where different from generally accepted accounting principles, SEC requirements, and fairly present the consolidated financial position of the Company and its subsidiaries as of September 30, 2002 and December 31, 2001, respectively, and the consolidated results of operations, cash flows and stockholders' equity of the Company and its subsidiaries for the nine months ended September 30, 2002 and the year ended December 31, 2001, respectively. Since the date of the Balance Sheet, (i) there has been no change in the business, assets, liabilities or condition (financial or otherwise) of the Company and its subsidiaries (on a consolidated basis) from that reflected in the Balance Sheet except for changes in the ordinary course of business which in the aggregate have not been materially adverse and (ii) none of the business, prospects, financial condition, operations, property or affairs of the Company and its subsidiaries (on a consolidated basis) has been materially adversely affected by any occurrence or development, individually or in the aggregate, whether or not insured against. The Company does not have any material liability, contingent or otherwise, not adequately reflected in or reserved against in the aforesaid financial statements or in the notes thereto. 3.6 Events Subsequent to the Date of the Balance Sheet. Since the date of the Balance Sheet, the Company has not (i) issued any stock, bond or other corporate security, (ii) borrowed any amount or incurred or become subject to any liability (absolute, accrued or contingent), except current liabilities incurred and liabilities under contracts entered into in the ordinary course of business, (iii) discharged or satisfied any lien or encumbrance or incurred or paid any obligation or liability (absolute, accrued or contingent) other than current liabilities 5 shown on the Balance Sheet and current liabilities incurred since the date of the Balance Sheet in the ordinary course of business, (iv) declared or made any payment or distribution to stockholders or purchased or redeemed any share of its capital stock or other security, (v) mortgaged, pledged, encumbered or subjected to lien any of its assets, tangible or intangible, other than liens of current real property taxes not yet due and payable, (vi) sold, assigned or transferred any of its tangible assets except in the ordinary course of business, or cancelled any debt or claim, (vii) sold, assigned, transferred or granted any exclusive license with respect to any patent, trademark, trade name, service mark, copyright, trade secret or other intangible asset, (viii) suffered any loss of property or waived any right of substantial value whether or not in the ordinary course of business, (ix) made any change in officer compensation except in the ordinary course of business and consistent with past practice, (x) made any material change in the manner of business or operations of the Company, (xi) entered into any transaction except in the ordinary course of business or as otherwise contemplated hereby or (xii) entered into any commitment (contingent or otherwise) to do any of the foregoing. 3.7 Litigation; Compliance with Law. There is no (i) action, suit, claim, proceeding or investigation pending or, to the best of the Company's knowledge, threatened against or affecting the Company, any of its respective properties or assets, or against an officer, employee or holder of more than 5% of the capital stock of the Company relating to the business of the Company, at law or in equity, or before or by any federal, state, municipal or other governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign (including, without limitation, an action which directly or indirectly challenges the validity of this Agreement, or any action taken or to be taken pursuant hereto or pursuant to any Transaction Document), (ii) arbitration proceeding relating to the Company pending under collective bargaining agreements or otherwise or (iii) governmental inquiry pending or, to the best of the Company's knowledge, threatened against or affecting the Company (including without limitation any inquiry as to the qualification of the Company to hold or receive any license or permit), in each case, which would be required to be disclosed in the Company's periodic reports under the Exchange Act and, to the best of the Company's knowledge, there is no basis for any of the foregoing. The Company has not received any opinion or memorandum or legal advice from legal counsel to the effect that it is exposed, from a legal standpoint, to any liability or disadvantage which may be material to its business, prospects, financial condition, operations, property or affairs. The Company is not in default with respect to any order, writ, injunction or decree of any court or of any federal, state, municipal or other governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign. There is no action or suit by the Company pending, or threatened or contemplated against others. The Company has complied in all material respects with all laws, rules, regulations and orders applicable to its business, operations, properties, assets, products and services, the Company has all necessary permits, licenses and other authorizations required to conduct its business as conducted and as proposed to be conducted, and the Company has been operating its business pursuant to and in compliance with the terms of all such permits, licenses and other authorizations. There is no existing law, rule, regulation or order, and the Company after due inquiry is not aware of any proposed law, rule, regulation or order, whether federal, state, county or local, which would prohibit or restrict the Company from, or otherwise materially adversely affect the Company in, conducting its business in any jurisdiction in which it is now conducting 6 business or in which it proposes to conduct business. The foregoing includes, without limitation, actions pending or, to the knowledge of the Company, threatened (or any basis therefor) involving the prior employment of any of the Company's officers or employees or their use in connection with the Company's business of any information or techniques allegedly proprietary to any of their former employers. 3.8 Loans and Advances. The Company does not have any outstanding loans or advances to any person and is not obligated to make any such loans or advances, except, in each case, for advances to employees of the Company in respect of reimbursable business expenses anticipated to be incurred by them in connection with their performance of services for the Company. 3.9 Assumptions, Guaranties, Etc. of Indebtedness of Other Persons. The Company has not assumed, guaranteed, endorsed or otherwise become directly or contingently liable on any indebtedness of any other person (including, without limitation, liability by way of agreement, contingent or otherwise, to purchase, to provide funds for payment, to supply funds to or otherwise invest in the debtor, or otherwise to assure the creditor against loss), except for guaranties by endorsement of negotiable instruments for deposit or collection in the ordinary course of business. 3.10 Significant Customers and Suppliers. No customer or supplier which was significant to the Company during the period covered by the financial statements referred to in Section 3.5 or which has been significant to the Company thereafter, has terminated, materially reduced or threatened to terminate or materially reduce its purchases from or provision of products or services to the Company, as the case may be. 3.11 Governmental Approvals. Subject to the accuracy of the representations and warranties of the Sellers set forth in Section 4, no registration or filing with, or consent or approval of or other action by, any federal, state or other governmental agency or instrumentality is or will be necessary for the valid execution, delivery and performance by the Company of this Agreement and the other Transaction Documents, the issuance and delivery of the Repurchase Stock, the issuance and delivery of the Notes, or for the performance by the Company of its obligations hereunder and under the other Transaction Documents other than (i) filings pursuant to federal and state securities laws (all of which filings have been made by the Company, other than those which are required to be made after the Closing and which will be duly made on a timely basis) in connection with the issuance of the Repurchase Stock and (ii) with respect to the Registration Rights Agreement, the registration of the shares covered thereby with the Commission and filings pursuant to state securities laws. 3.12 Certain Agreements of Officers. (a) The Company is not a party to or obligated in connection with its business with respect to (i) any contracts with officers, agents, consultants or advisers or (ii) collective bargaining agreements or contracts with any labor union or other 7 representative of employees or any employee benefits provided for by any such agreement. (b) To the knowledge of the Company, no officer of the Company is in violation of any term of any employment contract, patent disclosure agreement, proprietary information agreement, noncompetition agreement, or any other contract or agreement or any restrictive covenant relating to the right of any such officer to be employed by the Company because of the nature of the business conducted or to be conducted by the Company or relating to the use of trade secrets or proprietary information of others, and the continued employment of the Company's officers does not subject the Company or any Seller to any liability to third parties. (c) To the knowledge of the Company, no officer of the Company has expressed any present intention of terminating his employment with the Company. 3.13 No Insolvency. No insolvency proceeding of any character, including, without limitation, bankruptcy, receivership, reorganization, composition or arrangement with creditors, voluntary or involuntary, affecting the Company or any of its assets or properties, is pending or, to the knowledge of the Company, threatened. The Company has not taken any action in contemplation of, or that would constitute the basis for, the institution of any such insolvency proceedings. 3.14 ERISA. Each "Employee Benefit Plan" (within the meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended ("ERISA")) and each benefit arrangement including any plan, contract, arrangement or policy providing for severance benefits, insurance coverage, workers' compensation, disability benefits, vacation benefits, retirement benefits or for deferred compensation, profit-sharing, bonuses, stock options, stock appreciation rights or other forms of incentive compensation or post-retirement insurance, compensation or benefits has been maintained in substantial compliance with its terms and with the applicable requirements prescribed by any and all statutes, orders, rules and regulations, including but not limited to ERISA and the Code. Each Employee Benefit Plan which is intended to be qualified under Section 401(a) of the Code is so qualified and has been so qualified during the period from its adoption to date. Neither the Company nor any entity that would be considered to be under common control with the Company under Section 414 of the Code maintains or has ever maintained or contributed to any "multiemployer plan" as defined in Section 3(37) of ERISA or any Employee Benefit Plan subject to Title IV of ERISA. 3.15 Transactions with Affiliates. Except as contemplated hereby, there are no loans, leases, royalty agreements or other continuing transactions between the Company and (a) any officer, employee or director of the Company, or (b) any Person owning 5% or more of any class of capital stock of the Company, or (c) any member of the immediate family of such officer, employee, director or stockholder, or (d) any corporation or other entity controlled by such officer, employee, director or stockholder or a member of the immediate family of such officer, employee, director or stockholder. 8 3.16 Securities Act of 1933. The Company has complied and will comply with all applicable federal and state securities laws in connection with the offer, issuance and delivery of the Repurchase Stock and Notes. Neither the Company nor anyone acting on its behalf has or will sell, offer to sell, solicit offers to buy, issue or deliver the Repurchase Stock or Notes, or solicit offers with respect thereto from, or enter into any preliminary conversations or negotiations relating thereto with, any Person, so as to bring the issuance and delivery of Repurchase Stock or Notes under the registration provisions of the Securities Act and applicable state securities laws. 3.17 Registration Rights. Except for the rights granted to the Sellers pursuant to the Registration Rights Agreement, no Person has demand or other rights to cause the Company to file any registration statement under the Securities Act relating to any securities of the Company or any right to participate in any such registration statement. 3.18 Insurance. The Company has in full force and effect fire, general casualty, and liability insurance covering its properties and business, in such amounts, and against such losses and risks, as are generally maintained for comparable businesses and properties. 3.19 Books and Records. The books of account, ledgers, order books, records and documents of the Company accurately and completely reflect all material information relating to the business of the Company, the location and collection of its assets, and the nature of all transactions giving rise to the obligations or accounts receivable of the Company. 3.20 Title to Assets. The Company has good and marketable title in fee to such of its fixed assets, if any, as are real property, and good and marketable title to all of its other assets and properties, free of any mortgages, pledges, charges, liens, security interests or other encumbrances of any kind. The Company enjoys peaceful and undisturbed possession under all leases under which it is operating, and all said leases are valid and subsisting and in full force and effect. 3.21 Burdensome Restrictions. The Company is not obligated under any contract or agreement or subject to any charter or other corporate restriction which materially and adversely affects or in the future may reasonably be expected to materially adversely affect its financial condition, results of operations, assets, liabilities or business. 3.22 Computer Programs. (a) Set forth in the Disclosure Schedule is a list and brief description of the computer programs (other than off-the-shelf computer programs) owned, licensed or otherwise used by the Company that are material in the continued operation of its business as currently conducted or proposed to be conducted (such computer programs being referred to herein as the "Company Software"), identifying with respect to each such Computer Program whether it is owned, licensed or otherwise used by the Company. The Disclosure Schedule identifies all material agreements relating to the Company 9 Software (the "Software Contracts") and further classifies each such Software Contract under one of the following categories: (A) license to use third party software; (B) development contract, work-for-hire agreement, or consulting agreement; (C) distributor, dealer or value added reseller agreement; (D) license or sublicense to a third party (including agreements with end-users); (E) maintenance, support or enhancement agreement; or (F) other. (b) The computer programs included in the Company Software are (i) owned by the Company, (ii) currently in the public domain or otherwise available to the Company without the approval or consent of any third party, or (iii) licensed or otherwise used by the Company pursuant to the terms of valid, binding written agreements. (c) The Company Software owned, designed or developed by the Company or any of its employees, consultants or agents conforms in all material respects to the technical specifications for the design, performance, operation, test, support and maintenance of the Software, and all other documentation relating to such technical specifications. No portion of the Company Software sold or licensed by the Company directly or indirectly to end users contained, on the date of shipment by the Company, no portion of the Company Software currently for sale or license directly or indirectly to end users contains, and, to the knowledge of the Company, no portion of any other Company Software contains any software routines or hardware components designed to permit unauthorized access; to disable or erase software, hardware or data; or to perform any other such actions. (d) All personnel, including employees, agents, consultants, and contractors, who have contributed to or participated in the conception and development of any of the Company Software either (i) have been party to a "work-for-hire" arrangement or agreement with the Company, whether in accordance with applicable federal and state law, domestic or foreign, or otherwise, that has accorded the Company full, effective, exclusive and original ownership of all tangible and intangible property thereby arising, or (ii) have executed appropriate instruments of assignment in favor of the Company as assignee that have conveyed to the Company full, effective and exclusive ownership of all tangible and intangible property thereby arising. 3.23 Intellectual Property Rights. The Company owns or possesses or otherwise has the legally enforceable perpetual right to use, and has the right to bring actions for infringement of, all intellectual property rights necessary or required for the conduct of its business as currently conducted or proposed to be conducted, including all intellectual property rights pertaining to the Company Software. 3.24 Taxes. The Company has filed all tax returns, federal, state, county and local, domestic and foreign, required to be filed by it, and the Company has paid all taxes shown to be due by such returns as well as all other taxes, assessments and governmental charges which have become due or payable, including without limitation all taxes which the Company is 10 obligated to withhold from amounts owing to employees, creditors and third parties. The Company has established adequate reserves for all taxes accrued but not yet payable to the extent required by generally accepted accounting principles. All material tax elections of any type which the Company has made as of the date hereof are set forth in the audited financial statements referred to in Section 3.5. No deficiency assessment with respect to the Company's federal, state, county or local taxes, domestic and foreign, is pending or, to the knowledge of the Company, threatened. No proposed adjustment of the Company's federal, state, county, local taxes, domestic and foreign, is pending or, to the knowledge of the Company, threatened. There is no tax lien (other than for current taxes not yet due and payable), whether imposed by any federal, state, county or local taxing authority, domestic or foreign, outstanding against the assets, properties or business of the Company. Neither the Company nor any of its present or former stockholders has ever filed an election pursuant to Section 1362 of the Internal Revenue Code of 1986 (the "Code"), that the Company be taxed as an S corporation. 3.25 Disclosure. Neither this Agreement (including any Schedule or Exhibit to this Agreement) nor the Transaction Documents or any other agreement, statement, document, certificate or other items prepared or supplied by the Company with respect to the transactions contemplated hereby or thereby contains an untrue statement of a material fact or omits a material fact necessary to make the statements contained herein or therein not misleading. There is no fact which the Company has not disclosed to the Sellers and their counsel in writing and of which the Company is aware which could have a Material Adverse Effect. 3.26 Additional Information. The Company has filed in a timely manner all documents that the Company was required to file under the Exchange Act during the 12 months preceding the date of this Agreement. The following documents complied in all material respects with the requirements of the Exchange Act as of their respective filing dates, and the information contained therein was true and correct in all material respects as of the date of such documents, and each of the following documents as of the date thereof did not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading: (a) The Company's Annual Report on Form 10-K for the year ended December 31, 2001; (b) The Company's Quarterly Reports on Form 10-Q for the quarters ended March 31, 2002, June 30, 2002 and September 30, 2002; and (c) all other documents, if any, filed by the Company with the Securities and Exchange Commission (the "Commission") since the filing of the Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2002 pursuant to the reporting requirements of the Exchange Act. 4. Covenants. The Company, together with its subsidiaries, covenants and agrees with each of the Sellers that: 11 (a) The affirmative vote of both of the directors designated by Cahill, Warnock Strategic Partners Fund, L.P. and Strategic Associates L.P. pursuant to the terms of the Stockholders' Agreement shall be required to (i) amend or modify the terms of the Restated Charter; and (ii) issue any series of preferred stock, or other securities of the Company, which has preference or priority over the Common Stock as to the right to receive either dividends or amounts distributable upon liquidation, dissolution, or winding up of the Company. (b) The membership of each committee of the Company's Board of Directors shall include one of the directors designated by Cahill, Warnock Strategic Partners Fund, L.P. and Strategic Associates L.P. (c) The next annual meeting of the stockholders of the Company shall include a vote to approve an amendment to the Restated Charter to eliminate the terms of the Series A Preferred. (d) The Company shall maintain and cause each of its subsidiaries (if any) to maintain, their respective corporate or legal existence, rights and franchises in full force and effect. (e) The Company shall maintain and cause each of its subsidiaries (if any) to maintain as to their respective properties and business, with financially sound and reputable insurers, insurance against such casualties and contingencies and of such types and in such amounts as is customary for companies similarly situated, which insurance shall be deemed by the Company to be sufficient. (f) Neither the Company nor any of its subsidiaries shall become a party to any agreement which by its terms restricts the Company's performance of this Agreement, the other Transaction Documents or the Restated Charter. (g) Except for transactions contemplated by this Agreement or as otherwise approved by the Board of Directors, neither the Company nor any of its subsidiaries shall enter into any transaction with any director, officer, employee or holder of more than 5% of the outstanding capital stock of any class or series of capital stock of the Company or any of its subsidiaries, member of the family of any such person, or any corporation, partnership, trust or other entity in which any such person, or member of the family of any such person, is a director, officer, trustee, partner or holder of more than 5% of the outstanding capital stock thereof, except for transactions on customary terms related to such person's employment. (h) The Company shall promptly reimburse in full all directors of the Company who are not employees of the Company for all of his or her reasonable out-of-pocket expenses incurred in attending each meeting of the Board of Directors of the Company or any Committee thereof. (i) The Company shall use its best efforts to ensure that meetings of its Board of Directors are held at least four times each year and at least once each quarter. 12 (j) The Company shall comply, and cause each subsidiary to comply, with all applicable laws, rules, regulations and orders, noncompliance with which could materially adversely affect its business or condition, financial or otherwise. (k) The Company shall keep, and cause each subsidiary to keep, adequate records and books of account, in which complete entries will be made in accordance with generally accepted accounting principles consistently applied, reflecting all financial transactions of the Company and such subsidiary, and in which, for each fiscal year, all proper reserves for depreciation, depletion, obsolescence, amortization, taxes, bad debts and other purposes in connection with its business shall be made. (l) The transactions contemplated by this Agreement are intended to qualify as a reorganization within the meaning of Section 368(a) of the Code, and the Company shall not take any action inconsistent with such treatment. 5. Representations and Warranties of the Sellers. Each Seller, severally and not jointly, represents and warrants to the Company as follows: (a) Each Seller has good title to such Seller's shares of Series A Preferred, free and clear of all liens, security interests and adverse interests in favor of any person or entity. (b) (i) It will acquire the Repurchase Stock and the Note to be acquired by it for its own account and that the Repurchase Stock and the Note are being and will be acquired by it for the purpose of investment and not with a view to distribution or resale thereof; (ii) it is an "accredited investor" within the meaning of Rule 501 of Regulation D promulgated under the Securities Act and was not organized for the specific purpose of acquiring the Repurchase Stock or Note; (iii) it has taken no action which would give rise to any claim by any other person for any brokerage commissions, finders' fees or the like relating to this Agreement or the transactions contemplated hereby; (iv) it has sufficient knowledge and experience in investing in companies similar to the Company in terms of the Company's stage of development so as to be able to evaluate the risks and merits of its investment in the Company and it is able financially to bear the risks thereof; (v) without limiting the representations or warranties of the Company in Section 3 hereof, it has had an opportunity to discuss the Company's business, management and financial affairs with the Company's management, and it has been furnished with copies of documents which it has requested, and (vi) it is making the decision to acquire the Repurchase Stock and the Note in the jurisdiction set forth in its address on Schedule I. (c) (i) It has full right, power, authority and capacity to enter into the Agreement and the other Transaction Documents and to consummate the transactions contemplated hereby and thereby and has taken all necessary action to authorize the execution, delivery and performance of the Agreement and the other Transaction Documents, and (ii) upon the execution and delivery of the Agreement and the other Transaction Documents, the Agreement and the other Transaction Documents to which it is a party shall constitute a valid and binding obligation of the Seller enforceable in accordance with their respective terms, except as 13 enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors' and contracting parties' rights generally and except as enforceability may be subject to general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law) and except as the indemnification agreements of the Seller herein may be legally unenforceable. (d) It understands and agrees that, until registered under the Securities Act or transferred pursuant to the provisions of Rule 144 as promulgated by the SEC, all certificates evidencing any of the Repurchase Stock, whether upon initial issuance or upon any transfer thereof, shall bear a legend, prominently stamped or printed thereon, reading substantially as follows, together with any legends that may be required under applicable state securities laws: "The securities represented by this certificate have not been registered under the Securities Act of 1933 or applicable state securities laws. These securities have been acquired for investment and not with a view to distribution or resale, and may not be sold, mortgaged, pledged, hypothecated or otherwise transferred [for non U.S. persons add: in the United States or to U.S. persons] without an effective registration statement for such securities under the Securities Act of 1933 and applicable state securities laws, or the availability of an exemption from the registration provisions of the Securities Act of 1933 and applicable state securities laws." 6. Conditions to the Obligations of the Sellers. The obligation of each Seller under this Agreement is subject to the fulfillment to the Seller's satisfaction, or the waiver by such Seller, of each of the conditions set forth in this Section 6 on or before the Closing Date. 6.1 Accuracy of Representations and Warranties. Each of the representations and warranties of the Company set forth in Section 3 hereof shall be true and correct on the date of the Closing. 6.2 Performance. All covenants, agreements and conditions contained in this Agreement to be performed or complied with by the Company at or prior to the Closing shall have been performed or complied with by the Company. 6.3 Documents; Corporate Approvals. The Sellers shall have received prior to or at the Closing all of the following documents or instruments, or evidence of completion thereof, each in form and substance satisfactory to the Sellers and their counsel: (a) A copy of the Restated Charter, certified by the Secretary of State of the State of Delaware together with a certified copy of the Certificate of Designations, a copy of the resolutions of the Board of Directors evidencing the approval of this Agreement and the other Transaction Documents, the issuance of the Repurchase Stock and Notes and the other matters contemplated hereby and thereby, and a copy of the By-laws of the Company, all of which shall have been certified by the Secretary of the Company to be true, complete and correct in every particular, and certified copies of all 14 documents evidencing other necessary corporate or other action and governmental approvals, if any, with respect to this Agreement, the Repurchase Stock and the Notes. (b) An opinion of Shipman & Goodwin LLP, counsel to the Company, in the form set forth in Exhibit C. (c) A certificate of the Secretary or an Assistant Secretary of the Company which shall certify the names of the officers of the Company authorized to sign the Transaction Documents, the certificates for the Repurchase Stock, the Notes and the other documents, instruments or certificates to be delivered pursuant to this Agreement by the Company or any of its officers, together with the true signatures of such officers. The Sellers may conclusively rely on such certificate until they shall receive a further certificate of the Secretary or an Assistant Secretary of the Company canceling or amending the prior certificate and submitting the signatures of the officers named in such further certificate. (d) A certificate of the President of the Company stating that the representations and warranties of the Company contained in Section 3 hereof and otherwise made by the Company in writing in connection with the transactions contemplated hereby are true and correct and that all conditions required to be performed prior to or at the Closing have been performed as of the Closing. (e) The Stockholders' Agreement in the form set forth in Exhibit D shall have been duly executed and delivered by the parties named therein. (f) The Registration Rights Agreement in the form set forth in Exhibit E shall have been duly executed and delivered by the parties named therein. (g) Certificates of Good Standing for the Company from the Secretaries of State of Delaware, Massachusetts, Rhode Island, Vermont, Maine, New Jersey, New York, Pennsylvania and all other jurisdictions in which the Company is qualified to do business as a foreign corporation. (h) The Sellers, the Company and DVI Business Credit Corporation shall have duly executed and delivered a Subordination Agreement in the form set forth in Exhibit F. (i) The Company shall have duly executed and delivered a Note to each Seller in the form set forth in Exhibit A. 6.4 Payment of Costs. The Company shall have paid for the costs, expenses, taxes and filing fees as required in Section 10. 6.5 Board of Directors. The Board of Directors of the Company following the Closing shall consist of seven (7) members, of which the members shall be: John C. Garbarino, 15 Angus M. Duthie, Kevin J. Dougherty, Steven W. Garfinkle, Frank H. Leone, Donald W. Hughes and Edward L. Cahill. Each committee of the Board of Directors shall include either Donald W. Hughes or Edward L. Cahill as one of its members. 6.6 Sellers' Participation. All Sellers specified on Schedule I hereto shall participate in the transactions contemplated hereby. 6.7 Consents, Waivers, Etc. Prior to the Closing, the Company shall have obtained all consents or waivers, if any, necessary to execute and deliver this Agreement, issue the Repurchase Stock and the Notes and to carry out the transactions contemplated hereby and thereby, and all such consents and waivers shall be in full force and effect. All corporate and other action and governmental filings necessary to effectuate the terms of this Agreement, the Repurchase Stock and the Notes and other agreements and instruments executed and delivered by the Company in connection herewith shall have been made or taken, except for any post-sale filing that may be required under federal or state securities laws. In addition to the documents set forth above, the Company shall have provided to the Sellers any other information or copies of documents that they may reasonably request. 7. Conditions to the Obligations of the Company. The obligation of the Company under this Agreement is subject to the fulfillment to the Company's satisfaction, or the waiver in writing by the Company, of each of the conditions set forth in this Section 7 on or before each Closing Date. 7.1 Accuracy of Representations and Warranties. Each of the representations and warranties of the Sellers set forth in Section 4 hereof shall be true and correct on the date of the Closing. 7.2 Performance. All covenants, agreements and conditions contained in this Agreement to be performed or complied with by the Sellers at or prior to the Closing shall have been performed or complied with by the Sellers. 7.3 Approvals. The Company shall have received prior to or at Closing from each Seller a certificate of an authorized person of such Seller stating that the representations and warranties of such Seller contained in Section 4 hereof and otherwise made by such Seller in writing in connection with the transactions contemplated hereby are true and correct and that all conditions required to be performed prior to or at the Closing have been performed as of the Closing. 7.4 Stockholders' Agreement, Registration Rights Agreement and Subordination Agreement. The Stockholders' Agreement, Registration Rights Agreement and Subordination Agreement shall have been duly executed and delivered by the Sellers. 7.5 Sellers' Participation. All Sellers specified on Schedule I hereto shall participate in the transactions contemplated hereby. 16 8. Successors and Assigns. The provisions of this Agreement shall bind and inure to the benefit of the respective successors and permitted assigns of the parties hereto. 9. Survival of Representations and Warranties. All representations and warranties shall survive and remain in full force and effect after the Closing with respect to the Company. 10. Costs, Expenses and Taxes. The Company agrees to pay in connection with the preparation, execution and delivery of this Agreement and the other Transaction Documents and the issuance of the Repurchase Stock and the Notes, the reasonable fees and out-of-pocket expenses collectively of Testa, Hurwitz & Thibeault, LLP, special counsel for the Sellers. In addition, the Company shall pay any and all stamp and similar transfer taxes payable or determined to be payable in connection with the execution and delivery of this Agreement and the Transaction Documents, the issuance of the Repurchase Stock and the Notes and the other instruments and documents to be delivered hereunder or thereunder, and agrees to save the Sellers harmless from and against any and all liabilities with respect to or resulting from any delay in paying or omission to pay such taxes. 11. Notices. All notices, requests, consents and other communications under this Agreement shall be in writing (including facsimile communication) and shall be delivered by hand, by telecopier, by express overnight courier service or mailed by first class mail, postage prepaid, and shall be given, if to Company, to: 175 Derby Street, Suite 36 Hingham, MA 02043 Attention: President Fax: (781) 741-5499 with a copy to: Donna L. Brooks, Esq. Shipman & Goodwin LLP One American Row Hartford, CT 06103 Fax: (860) 251-5999 if to any Seller, to: To the applicable address and fax number set forth in Schedule I. 17 with a copy to: Barbara M. Johnson, Esq. Testa, Hurwitz & Thibeault, LLP 125 High Street Boston, MA 02110 Fax: (617) 790-0144 or at such other address as to which such party may inform the other parties in writing in compliance with the terms of this Section. Notices provided in accordance with this Section 11 shall be deemed delivered upon personal delivery, receipt by telecopy, or overnight mail, or 48 hours after deposit in the mail in accordance with the above. 12. Brokers. The Company and the Sellers (i) represent and warrant to the other that they have retained no finder or broker in connection with the transactions contemplated by this Agreement, and (ii) shall indemnify and hold harmless the other from and against any and all claims, liabilities, or obligations with respect to brokerage or finders' fees or commissions or consulting fees in connection with the transactions contemplated by this Agreement, asserted by any person on the basis of any statement or representation alleged to have been made by such indemnifying party. 13. Entire Agreement. This Agreement, together with the instruments and other documents hereby contemplated to be executed and delivered in connection herewith, contains the entire agreement and understanding of the parties hereto, and supersedes any prior agreements or understandings between or among them, with respect to the subject matter hereof, including the Series A Convertible Preferred Stock Purchase Agreement dated November 6, 1996, which will be of no further force or effect. 14. Amendments and Waivers. Except as otherwise expressly set forth in this Agreement, any term of this Agreement may be amended and the observance of any term of this Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively), with the written consent of the Company and holders of at least a majority of the outstanding Repurchase Stock. No waivers of or exceptions to any term, condition or provision of this Agreement, in any one or more instances, shall be deemed to be, or construed as, a further or continuing waiver of any such term, condition or provision. 15. Counterparts. This Agreement may be executed in several counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. A facsimile signature shall constitute an original signature hereto. 16. Captions. The captions of the sections, subsections and paragraphs of this Agreement have been added for convenience only and shall not be deemed to be a part of this Agreement. 18 17. Severability. Each provision of this Agreement shall be interpreted in such manner as to validate and give effect thereto to the fullest lawful extent, but if any provision of this Agreement is determined by a court of competent jurisdiction to be invalid or unenforceable under applicable law, such provision shall be ineffective only to the extent so determined and such invalidity or unenforceability shall not affect the remainder of such provision or the remaining provisions of this Agreement. 18. Waiver of Preemptive Rights. The Sellers representing the holders of at least a majority in interest of the Series A Preferred hereby by waive any rights of first refusal pursuant to Article VI of the Series A Convertible Preferred Stock Purchase Agreement dated as of November 6, 1996, including any notice requirements related thereto, with respect to the issuance and sale of the Repurchase Stock. 19. Governing Law. This Agreement shall be governed by and interpreted and construed in accordance with the laws of the State of Delaware. Each of the parties hereby irrevocably submits to the jurisdiction of any United States federal court sitting in the State of Delaware (or, if such court shall not accept such jurisdiction, any state court sitting in Delaware) in any action, suit or proceeding brought against it by the other party under this Agreement. [Remainder of page intentionally left blank] 19 IN WITNESS WHEREOF, the Company and the Sellers have executed this Agreement as of the day and year first above written. OCCUPATIONAL HEALTH + REHABILITATION INC By: /s/ Keith G. Frey -------------------------------------------------- Name: Keith G. Frey Title: CFO SELLERS: CAHILL, WARNOCK STRATEGIC PARTNERS FUND, L.P. By: Cahill, Warnock Strategic Partners, L.P. By: /s/ Donald W. Hughes -------------------------------------------------- Title: General Partner STRATEGIC ASSOCIATES, L.P. By: Cahill, Warnock Strategic Partners, L.P. By: /s/ Donald W. Hughes -------------------------------------------------- Title: General Partner AXA U.S. GROWTH FUND LLC By: /s/ Thomas J. McKinley -------------------------------------------------- Title: Managing Member PANTHEON GLOBAL PCC LIMITED By: /s/ Sarita Keen -------------------------------------------------- Title: Alternate Director DOUBLE BLACK DIAMOND II, LLC By: /s/ Thomas J. McKinley -------------------------------------------------- Title: Managing Member /s/ Thomas J. McKinley ----------------------------------------------------- Vincent Worms, signed by Thomas J. McKinley pursuant to a power of attorney THE VENTURE CAPITAL FUND OF NEW ENGLAND III, L.P. By: FH & Co. III, L.P., its General Partner By: /s/ Kevin J. Dougherty -------------------------------------------------- Title: General Partner BANCBOSTON VENTURES, INC. By: /s/ John McCormick -------------------------------------------------- Title: Vice President VENROCK ASSOCIATES VENROCK ASSOCIATES II, L.P. By: /s/ Anthony B. Envin -------------------------------------------------- Title: General Partner ASSET MANAGEMENT ASSOCIATES, 1989, L.P. By: AMC Partners 89, L.P., General Partner By: /s/ Craig Taylor -------------------------------------------------- Title: General Partner
Series A Shares of Name and Preferred Repurchase Address of Sellers Shares Cash Notes Stock - ---------------------------------------- --------- -------------- -------------- ---------- Cahill, Warnock Strategic Partners Fund, 679,042 $ 1,294,049.41 $ 1,294,049.41 770,871 L.P. One South Street Suite 2150 Baltimore, Maryland 21202 Attn: Mr. Donald W. Hughes with copy to: Edward L. Cahill HLM Management 222 Berkley Street Boston, MA 02116 Strategic Associates, L.P. 37,625 71,701.91 $ 71,701.91 42,713 One South Street Suite 2150 Baltimore, Maryland 21202 Attn: Mr. Donald W. Hughes with copy to: Edward L. Cahill HLM Management 222 Berkley Street Boston, MA 02116 AXA U.S. Growth Fund LLC 86,667 165,161.18 $ 165,161.18 98,387 c/o Partech International 50 California Street Suite 3200 San Francisco, CA 94111 Attn: Mr. Thomas G. McKinley Pantheon Global PCC Limited 173,334 330,322.37 $ 330,322.37 196,775 Pantheon Ventures, Inc. Transamerica Center 600 Montgomery Street 23rd Floor San Francisco, CA 94111 Attn: Jay Pierrepont Double Black Diamond II, LLC 16,667 $ 31,762.28 $ 31,762.28 18,921 c/o Partech International 50 California Street Suite 3200 San Francisco, CA 94111 Attn: Mr. Thomas G. McKinley
Series A Shares of Name and Preferred Repurchase Address of Sellers Shares Cash Notes Stock - ---------------------------------------- --------- -------------- -------------- ---------- Vincent Worms 6,665 $ 12,701.48 $ 12,701.48 7,566 50 California Street Suite 3200 San Francisco, CA 94111 Asset Management Associates, 1989, L.P. 83,333 $ 158,807.58 $ 158,807.58 94,602 Alloy Ventures 480 Cowper Street, 2nd Floor Palo Alto, CA 94301 Attn: Mr. Craig C. Taylor Venrock Associates 66,667 $ 127,047.21 $ 127,047.21 75,683 Room 5508 30 Rockefeller Plaza New York, New York 10112 Attn: Mr. Anthony Evnin Venrock Associates II, L.P. 100,000 $ 190,569.86 $ 190,569.86 113,523 Room 5508 30 Rockefeller Plaza New York, New York 10112 Attn: Mr. Anthony Evnin The Venture Capital Fund of New England, 66,667 $ 127,047.21 $ 127,047.21 75,683 III, L.P. 30 Washington Street Wellesley Hills, MA 02481-1905 Attn: Mr. Kevin J. Dougherty BancBoston Ventures, Inc. 100,000 $ 190,569.86 $ 190,569.86 113,523 BancBoston Capital Mail Stop: MA DE 10210A 175 Federal Street, Apt. 10th Floor Boston, MA 02110 Attn: Mr. John B. McCormick TOTAL 1,416,667 $ 2,699,740.35 $ 2,699,740.35 1,608,247
EX-99.5 7 dex995.txt POWER OF ATTORNEY FOR RICHARD A. FARRELL Exhibit 99.5 POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that the person whose signature appears below hereby constitutes and appoints Kevin J. Dougherty, Harry J. Healer, Jr., Andrew E. Taylor, Jr., Shaka Scott and Kevin Shnier, and any one of them acting singly, the true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for the undersigned and in the undersigned's name, place and stead, in any and all capacities (until revoked in writing) to sign any and all instruments, certificates and documents required to be executed on behalf of the undersigned as an individual or on behalf of the undersigned's holding company, as the case may be, pursuant to sections 13 and 16 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and any and all regulations promulgated thereunder, and to file the same, with all exhibits thereto, and any other documents in connection therewith, with the Securities and Exchange Commission, and with any other entity when and if such is mandated by the Exchange Act or by the By-laws of the National Association of Securities Dealers, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary fully to all intents and purposes as the undersigned might or could do in person thereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. IN WITNESS WHEREOF, this Power of Attorney has been signed as of April 7, 2003. Signature: /s/ Richard A. Farrell ------------------------- Name: Richard A. Farrell (please print) EX-99.6 8 dex996.txt POWER OF ATTORNEY FOR HARRY J. HEALER, JR. Exhibit 99.6 POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that the person whose signature appears below hereby constitutes and appoints Kevin J. Dougherty, Andrew E. Taylor, Jr., Shaka Scott and Kevin Shnier, and any one of them acting singly, the true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for the undersigned and in the undersigned's name, place and stead, in any and all capacities (until revoked in writing) to sign any and all instruments, certificates and documents required to be executed on behalf of the undersigned as an individual or on behalf of the undersigned's holding company, as the case may be, pursuant to sections 13 and 16 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and any and all regulations promulgated thereunder, and to file the same, with all exhibits thereto, and any other documents in connection therewith, with the Securities and Exchange Commission, and with any other entity when and if such is mandated by the Exchange Act or by the By-laws of the National Association of Securities Dealers, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary fully to all intents and purposes as the undersigned might or could do in person thereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. IN WITNESS WHEREOF, this Power of Attorney has been signed as of April 7, 2003. Signature: /s/ Harry J. Healer, Jr. ------------------------- Name: Harry J. Healer, Jr. (please print) EX-99.7 9 dex997.txt POWER OF ATTORNEY FOR WILLIAM C. MILLS, III Exhibit 99.7 POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that the person whose signature appears below hereby constitutes and appoints Kevin J. Dougherty, Harry J. Healer, Jr., Andrew E. Taylor, Jr., Shaka Scott and Kevin Shnier, and any one of them acting singly, the true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for the undersigned and in the undersigned's name, place and stead, in any and all capacities (until revoked in writing) to sign any and all instruments, certificates and documents required to be executed on behalf of the undersigned as an individual or on behalf of the undersigned's holding company, as the case may be, pursuant to sections 13 and 16 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and any and all regulations promulgated thereunder, and to file the same, with all exhibits thereto, and any other documents in connection therewith, with the Securities and Exchange Commission, and with any other entity when and if such is mandated by the Exchange Act or by the By-laws of the National Association of Securities Dealers, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary fully to all intents and purposes as the undersigned might or could do in person thereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. IN WITNESS WHEREOF, this Power of Attorney has been signed as of April 7, 2003. Signature: /s/ William C. Mills, III ------------------------- Name: William C. Mills, III (please print) -----END PRIVACY-ENHANCED MESSAGE-----