UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
HealthGrades.Com, Inc.
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(Name of Issuer)
Common Stock
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(Title of Class of Securities)
84748M 10 2
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(CUSIP Number)
Patrick M. Jaeckle
HealthGrades.Com, Inc.
44 Union Blvd., Suite 600
Lakewood, CO 80228
303-716-6509
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
March 17, 2000
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(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 that is the subject of this Schedule 13D, and is filing this
schedule because of ss.ss.240.13d-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 the schedule, including all exhibits. Seess.240.13d-7(b) 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).
<PAGE>
SCHEDULE 13D
CUSIP No. 84748M 10 2
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1 Names of Reporting Persons
Essex Woodlands Health Ventures Fund IV. L.P.
See Item 2 for identification of General Partner
I.R.S. Identification Nos. of Above Persons (entities only)
- -----------------------------------------------------------------
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 Instruction)
WC
- -----------------------------------------------------------------
5 Check if Disclosure of Legal Proceedings is Required Pursuant to Items
2(d) or 2(e)
/ /
- -----------------------------------------------------------------
6 Citizenship or Place of Organization
Delaware
- -----------------------------------------------------------------
7 Sole Voting Power
Number of Shares 4,050,000
Beneficially _____________________________________________________
Owned by 8 Shared Voting Power
Each -0-
Reporting _____________________________________________________
Person 9 Sole Dispositive Power
With 4,050,000
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10 Shared Dispositive Power
-0-
- -----------------------------------------------------------------
11 Aggregate Amount Beneficially Owned by Each Reporting Person
4,050,000
- -----------------------------------------------------------------
12 Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See
Instructions)
/X/
- -----------------------------------------------------------------
13 Percent of Class Represented by Amount in Row (11)
17.9%
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14 Type of Reporting Person (See Instructions)
PN
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<PAGE>
SCHEDULE 13D
CUSIP No. 84748M 10 2
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1 Names of Reporting Persons
Essex Woodlands Health Ventures IV. L.L.C.
See Item 2 for list of Managing Members
I.R.S. Identification Nos. of Above Persons (entities only
- -----------------------------------------------------------------
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 Instruction)
WC
- -----------------------------------------------------------------
5 Check if Disclosure of Legal Proceedings is Required Pursuant to Items
2(d) or 2(e)
/ /
- -----------------------------------------------------------------
6 Citizenship or Place of Organization
Delaware
- -----------------------------------------------------------------
7 Sole Voting Power
Number of Shares 4,050,000
Beneficially _____________________________________________________
Owned by 8 Shared Voting Power
Each -0-
Reporting _____________________________________________________
Person 9 Sole Dispositive Power
With 4,050,000
-----------------------------------------------------
10 Shared Dispositive Power
-0-
- -----------------------------------------------------------------
11 Aggregate Amount Beneficially Owned by Each Reporting Person
4,050,000
- -----------------------------------------------------------------
12 Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See
Instructions)
/ /
- -----------------------------------------------------------------
13 Percent of Class Represented by Amount in Row (11)
17.9%
- -----------------------------------------------------------------
14 Type of Reporting Person (See Instructions)
OO
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<PAGE>
SCHEDULE 13D
CUSIP No. 84748M 10 2
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1 Names of Reporting Persons
James L. Currie
I.R.S. Identification Nos. of Above Persons (entities only)
- -------------------------------------------------------
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 Instruction)
SC
- ------------------------------------------------------
5 Check if Disclosure of Legal Proceedings is Required Pursuant to Items
2(d) or 2(e)
/ /
- -------------------------------------------------------
6 Citizenship or Place of Organization
U.S. Citizen
- -------------------------------------------------------
7 Sole Voting Power
Number of Shares -0-
Beneficially __________________________________________________
Owned by 8 Shared Voting Power
Each 4,050,000
Reporting __________________________________________________
Person 9 Sole Dispositive Power
With -0-
--------------------------------------------------
10 Shared Dispositive Power
4,050,000
- -------------------------------------------------------
11 Aggregate Amount Beneficially Owned by Each Reporting Person
4,050,000
- -------------------------------------------------------
12 Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See
Instructions)
/ /
- -------------------------------------------------------
13 Percent of Class Represented by Amount in Row (11)
17.9%
- -------------------------------------------------------
14 Type of Reporting Person (See Instructions)
IN
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<PAGE>
SCHEDULE 13D
CUSIP No. 84748M 10 2
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1 Names of Reporting Persons
Marc S. Sandroff
I.R.S. Identification Nos. of Above Persons (entities only)
- -------------------------------------------------------
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 Instruction)
WC
- -------------------------------------------------------
5 Check if Disclosure of Legal Proceedings is Required Pursuant to Items
2(d) or 2(e)
/ /
- -------------------------------------------------------
6 Citizenship or Place of Organization
Delaware
- -------------------------------------------------------
7 Sole Voting Power
Number of Shares -0-
Beneficially __________________________________________________
Owned by 8 Shared Voting Power
Each 4,050,000
Reporting __________________________________________________
Person 9 Sole Dispositive Power
With -0-
--------------------------------------------------
10 Shared Dispositive Power
4,050,000
- -------------------------------------------------------
11 Aggregate Amount Beneficially Owned by Each Reporting Person
4,050,000
- -------------------------------------------------------
12 Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See
Instructions)
/ /
- -------------------------------------------------------
13 Percent of Class Represented by Amount in Row (11)
17.9%
- -------------------------------------------------------
14 Type of Reporting Person (See Instructions)
IN
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<PAGE>
SCHEDULE 13D
CUSIP No. 84748M 10 2
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1 Names of Reporting Persons
Martin P. Sutter
I.R.S. Identification Nos. of Above Persons (entities only)
- -------------------------------------------------------
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 Instruction)
WC
- -------------------------------------------------------
5 Check if Disclosure of Legal Proceedings is Required Pursuant to Items
2(d) or 2(e)
/ /
- -------------------------------------------------------
6 Citizenship or Place of Organization
U.S. Citizen
- -------------------------------------------------------
7 Sole Voting Power
Number of Shares -0-
Beneficially __________________________________________________
Owned by 8 Shared Voting Power
Each 4,050,000
Reporting __________________________________________________
Person 9 Sole Dispositive Power
With -0-
--------------------------------------------------
10 Shared Dispositive Power
4,050,000
- -------------------------------------------------------
11 Aggregate Amount Beneficially Owned by Each Reporting Person
4,050,000
- -------------------------------------------------------
12 Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See
Instructions)
/ /
- -------------------------------------------------------
13 Percent of Class Represented by Amount in Row (11)
17.9%
- -------------------------------------------------------
14 Type of Reporting Person (See Instructions)
IN
- -------------------------------------------------------
<PAGE>
Schedule 13D of
Essex Woodlands Health Ventures Fund IV. L.P.
Essex Woodlands Health Ventures IV. L.L.C.
James L. Currie
Marc S. Sandroff and
Martin P. Sutter
with respect to the Common Stock, par value $0.001 per share
of HealthGrades.Com, Inc.
ITEM 1. SECURITY AND ISSUER
Common Stock, par value $0.001 per share of HealthGrades.Com, Inc. (the
"Company") having its principal office at 44 Union Blvd., Suite 600, Lakewood,
CO 80228.
ITEM 2. IDENTITY AND BACKGROUND
Set forth below is the following information with respect to each of
the persons filing this Schedule 13D (together, the "Filing Persons"): (a) name;
(b) address of principal office and place of business(if entity) or business
address (if individual); (c) citizenship (if individual) or jurisdiction of
organization (if entity); (d) present principal business (if entity); and (e)
present principal occupation or employment (if individual) and the name of any
corporation or other organization in which such employment is conducted.
I.
a. Essex Woodlands Health Ventures Fund IV. L.P. ("Essex Fund")
b. 190 South LaSalle Street, Suite 2800, Chicago, Illinois 60603.
c. Delaware.
d. Venture capital investment.
e. NA
II.
a. Essex Woodlands Health Ventures Fund IV. L.L.C. ("Essex L.L.C.")
b. 190 South LaSalle Street, Suite 2800, Chicago, Illinois 60603.
c. Delaware.
d. Venture capital investment.
e. NA
III.
a. James L. Currie
b. 190 South LaSalle Street, Suite 2800, Chicago, Illinois 60603.
c. U.S. Citizen
d. NA
e. Managing Director, Essex Woodlands Health Ventures Fund IV. L.L.C.
IV.
a. Marc S. Sandroff
b. 190 South LaSalle Street, Suite 2800, Chicago, Illinois 60603.
<PAGE>
c. U.S. Citizen
d. NA
e. Managing Director, Essex Woodlands Health Ventures Fund IV. L.L.C.
V. a. Martin P. Sutter
b. 190 South LaSalle Street, Suite 2800, Chicago, Illinois 60603.
c. U.S. Citizen
d. NA
e. Managing Director, Essex Woodlands Health Ventures Fund IV. L.L.C.
During the last five years, none of the Filing Persons (i)has been
convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors) or (ii) has been a party to any civil proceeding of a judicial or
administrative body of competent jurisdiction, and is or was, as a result of
such proceeding, subject to a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to, federal or
state securities laws, or finding any violation with respect to such laws.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
Essex Fund acquired directly 3,000,000 shares of Common Stock of the
Company, and a Warrant to acquire an additional 1,050,000 such shares, pursuant
to a March 3, 2000 Amended and Restated Stock Purchase Agreement, in exchange
for the payment of $6,000,000 the source of which was capital contributed by
partners in Essex Fund.
ITEM 4. PURPOSE OF TRANSACTION.
The purpose of the acquisition of the securities of the Company by the
Filing Persons was to make an investment in the Company. None of the Filing
Persons currently has any plans or proposals that relate to, or which may result
in, any of the matters listed in Items 4(a)-(j) of Schedule 13D (although each
of the Filing Persons reserves the right to develop such plans).
<PAGE>
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
TOTAL OUTSTANDING SHARES. According to information provided to the
Filing Persons by the Company, the number of shares of Common Stock outstanding
on March 17, 2000 was 21,516,468 and the number of shares of Common Stock
subject to the Warrant held by Essex Fund was 1,050,000 for a total of
22,566,468 shares.
ESSEX FUND. As of the date of filing of this Schedule 13D, Essex Fund
is the holder of record of 4,050,000 shares of Common Stock of the Company,
representing approximately 17.9% of the Common Stock outstanding, and has sole
voting and investment power with respect to such securities.
ESSEX L.L.C. Essex L.L.C., as sole General Partner of Essex Fund, may
also be deemed to have sole voting and investment power with respect to such
securities. Essex L.L.C. disclaims beneficial ownership of such securities
except to the extent of its pecuniary interest therein.
MESSRS. CURRIE, SANDROFF AND SUTTER. Under the operating agreement of
Essex L.L.C., Messrs. Currie, Sandroff and Sutter have the power by unanimous
consent (i) to cause the Essex Fund to buy and sell marketable securities of
portfolio companies and (ii) to direct the voting of such securities. As a
result, Messrs. Currie, Sandroff and Sutter may also be deemed to have shared
dispositive power and shared voting power with respect to the securities held by
Essex Fund. Messrs. Currie, Sandroff and Sutter disclaim beneficial ownership of
such securities except to the extent of their respective pecuniary interests
therein.
None of the Filing Persons has effected any transactions in the
securities of the Company during the past 60 days.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS, OR
RELATIONSHIPS WITH RESPECT TO
SECURITIES OF THE ISSUER.
Essex Fund is party to a Co-Sale and Voting Agreement dated as of March
17, 2000 which contains certain commitments regarding election of directors and
a copy of which is attached hereto as Exhibit B.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
Exhibit A. Agreement of Joint Filing, dated as of March 24, 2000,
among the Filing Persons.
<PAGE>
Signature
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
March 24, 2000
ESSEX WOODLANDS HEALTH VENTURES FUND, IV. L.P.
By its general partner:
ESSEX WOODLANDS HEALTH VENTURES, IV. L.L.C.
By: /s/Marc S. Sandroff
------------------------------------------
Name:
------------------------------------------
Managing Director
ESSEX WOODLANDS HEALTH VENTURES, IV. L.L.C.
By: /s/Marc S. Sandroff
------------------------------------------
Name:
------------------------------------------
Managing Director
/s/ James L. Currie
------------------------------------------
James L. Currie
/s/ Marc S. Sandroff
------------------------------------------
Marc S. Sandroff
/s/ Martin P. Sutter
------------------------------------------
Martin P. Sutter
<PAGE>
EXHIBIT A
AGREEMENT OF JOINT FILING
In accordance with Rule 13d-1 (k) under the Securities and
Exchange Act of 1934, as amended, the undersigned hereby agree to the joint
filing on behalf of each of them of a Statement on Schedule 13D, and any
amendments thereto, with respect to the Common Stock, par value $0.0001 per
share, of HealthGrades.Com, Inc., and that this Agreement be included as an
Exhibit to such filing.
This Agreement may be executed in any number of counterparts,
each of which shall be deemed to be an original and all of which together shall
be deemed to constitute one and the same Agreement.
IN WITNESS WHEREOF, each of the undersigned hereby executes
this Agreement as of March 24, 2000.
ESSEX WOODLANDS HEALTH VENTURES FUND, IV. L.P.
By its general partner:
ESSEX WOODLANDS HEALTH VENTURES, IV. L.L.C.
By: /s/ Marc S. Sandroff
----------------------------------------
Name:
Managing Director
ESSEX WOODLANDS HEALTH VENTURES, IV. L.L.C.
By: /s/ Marc S. Sandroff
---------------------------------------
Name:
Managing Director
/s/ James L. Currie
-------------------------------------------
James L. Currie
/s/ Marc S. Sandroff
-------------------------------------------
Marc S. Sandroff
/s/ Martin P. Sutter
-------------------------------------------
Martin P. Sutter
<PAGE>
EXHIBIT B
COSALE AND VOTING AGREEMENT
This CoSale and Voting Agreement (this "Agreement") is made as of March
17, 2000 among HealthGrades.com, Inc., a Delaware corporation (the "Company"),
Essex Woodlands Health Ventures Fund IV, L.P., an Illinois partnership
("Essex"), PaineWebber, as custodian for William J. Punk, I.R.A. ("PW"), Punk,
Ziegal & Company Investors, L.L.C. ("Punk"), and Chancellor V, L. P. ("Invesco"
and with Punk, PW and Essex collectively the "Investors"), Kerry Hicks
("Hicks"), Paul Davis ("Davis"), David Hicks ("D. Hicks") and Patrick Jaeckle
("Jaeckle" and with Hicks, Davis and D. Hicks collectively, the "Founders") (the
Investors and the Founders are sometimes referred to herein as the
"Shareholders").
RECITALS
A. The Founders own certain outstanding shares of Common Stock, par
value $0.001 per share ("Common Stock"), of the Company.
B. The Investors have purchased shares of Common Stock and warrants
(the "Warrants") to purchase Common Stock (the "Equity Securities") pursuant to
a Amended and Restated Stock Purchase Agreement dated March 3, 2000.
C. In order to induce the Investors to purchase the Common Stock, the
Shareholders have agreed to provide certain co-sale and voting rights with
respect to their holdings of the Company's Common Stock.
NOW, THEREFORE, in consideration of the mutual promises and other
consideration hereinafter set forth, the adequacy and receipt of which is hereby
acknowledged by the parties hereto, the parties agree as follows:
1. Right of Co-Sale.
----------------
1.1. The Right. If at any time any Founder (a "Selling Founder")
proposes to sell shares of Common Stock pursuant to a bona fide offer from a
party or parties other than other Founders or any of the Investors and such sale
is a private transaction, then the Selling Founder shall provide notice of such
proposed sale to the Investors, such notice containing (i) notice that the
Selling Founder intends on selling his shares, (ii) the material terms and
conditions of such sale, (iii) any written materials or agreements setting forth
the agreement between the Selling Founder and the purchaser, and (iv) each
Investor's "pro rata portion" (as defined below) in the sale (assuming all
Investors elect to be Co-Sellers). The Investors shall be entitled to sell their
pro rata portion on the same terms and conditions as the Selling Founder. If any
of the Investors notifies the Selling Founder in writing within 10 days after
receipt of the notification of such proposed sale from the Selling Founder, such
Investor or Investors (the "Co-Seller") shall have the right to sell up to its
pro rata portion of Common Stock which the Selling Founder proposes to sell to
such third party; whereupon the Selling Founder shall assign so much of his
interest in the agreement of sale as is proportionate to each Co-Seller's pro
rata portion in the sale of Common Stock (or such lesser amount if so elected by
such Co-Seller) and each Co-Seller shall
<PAGE>
assume its respective part of the obligations of the Selling Founder under such
agreement, provided, however, no Co-Seller shall be required to give any
covenants, representations or warranties other than with respect to title to its
Equity Securities. For the purposes of this Section 1.1 the "pro rata portion"
which each Co-Seller shall be entitled to sell shall be an amount of Equity
Securities (assuming the issuance of all shares of Common Stock, issuable upon
exercise of the Warrants) equal to a fraction of the total amount of Common
Stock proposed to be sold, the numerator of which is the aggregate of all Equity
Securities (assuming the conversion of all such securities to Common Stock)
which are then held by such Co-Seller and the denominator is the aggregate of
all Common Stock then held by the Selling Founder and all Equity Securities
(assuming the conversion of all such securities to Common Stock) then held by
all Co-Sellers who have elected to exercise their co-sale rights. Each of the
Investors shall notify the Selling Founder whether it elects to sell an amount
equal to or less than its pro rata portion of the Common Stock so offered
1.2. Failure to Notify. If within 10 days after the Selling Founder
gives the aforesaid notice to Investors, none of the Investors notifies the
Selling Founder that it desires to sell any or all of its pro rata portion of
the Common Stock described in such notice at the price and on the terms and
conditions set forth therein, then the Selling Founder may sell during the
120-day period immediately following the expiration of such 10-day period such
Common Stock as to which the Investors did not indicate a desire to sell to
other persons at the same price and upon the same terms and conditions as those
set forth in the notice. In the event the Selling Founder has not sold the
Common Stock on the same terms and conditions as those set forth in the notice
within such 120-day period, the Selling Founder shall not thereafter sell any
Common Stock without first notifying the Investors in the manner provided above.
1.3. Limitations to Right of Co-Sale. Without regard and not subject to
the provisions of this Agreement:
(a) a Founder may sell or otherwise assign for consideration or
gift Common Stock to any or all of his ancestors, descendants, spouse,
employees of the Company or to a custodian, trustee (including a
trustee of a voting trust), executor, or other fiduciary for the
account of or a trust for the benefit of his ancestors, descendants or
spouse, provided that each such transferee or assignee, prior to the
completion of the sale, transfer, gift or assignment, shall have
executed documents assuming the obligations of a Founder under this
Agreement with respect to the transferred securities;
(b) a Founder may sell shares of Common Stock, the proceeds of
which are used to exercise stock options issued under the Company's
stock option plan;
(c) a Founder may pledge and/or sell shares of Common Stock to
the Company; and
(d) a Founder may sell shares of Common Stock in the open market
in amounts not to exceed the limitations permitted under Rule 144.
<PAGE>
2. Voting.
------
2.1. Designees to Board of Directors. The Shareholders agree to vote
all securities of the Company over which they have voting control and to take
all other necessary or desirable actions within their control (whether as
shareholders, directors or officers of the Company or otherwise, and including
without limitation attendance at meetings in person or by proxy for purposes of
obtaining a quorum and execution of written consents in lieu of meetings), and
the Company shall take all necessary and desirable actions within its control
(including, without limitation, calling special board and shareholder meetings),
so that:
(a) The Company shall have a Board of Directors comprising of no
more than eight (8) members;
(b) At the option of Essex, one designee of Essex and, at the
option of Invesco, one designee of Invesco shall be elected to the
Board of Directors; and
(c) In the event that a director designated by Essex or Invesco
for any reason ceases to serve as a member of the Board of Directors
during his or her term of office, at the option of Essex or Invesco,
as applicable, the resulting vacancy on the Board of Directors shall
be filled by a designee of Essex or Invesco, as applicable.
3. Committees.
----------
3.1. Audit Committee. At the option of Essex and Invesco, as
applicable, the directors designated by Essex and Invesco shall serve as members
of the Audit Committee of the Company.
3.2. Compensation Committee. At the option of Essex and Invesco, as
applicable, the directors designated by Essex and Invesco shall serve as members
of the Compensation Committee.
4. Miscellaneous.
-------------
4.1. Legends. All instruments evidencing Equity Securities held by
Shareholders shall be legended, describing the obligations of Shareholders under
this Agreement.
4.2. Effectiveness and Termination. This Agreement, and the respective
rights and obligations of the Shareholders hereto, shall become effective on the
date hereof, and shall terminate:
(a) with respect to Section 1 above, upon the earlier of: (i)
when the Investors cease to own in the aggregate five percent (5%) or
more of the issued and outstanding shares of Common Stock of the
Company, and (ii) on the third anniversary of the date hereof;
(b) with respect to Sections 2 and 3 above and the obligation to
elect Essex to the Board of Directors and the Audit and Compensation
Committee,
<PAGE>
upon the later of (i) the fifth anniversary of the date
hereof, and (ii) the date on which Essex fails to own in the aggregate
more than 5% of the issued and outstanding Common Stock;
(c) with respect to Sections 2 and 3 above and the obligation to
elect Invesco to the Board of Directors and the Audit and Compensation
Committee, upon the later of (i) the fifth anniversary of the date
hereof, and (ii) the date on which Invesco fails to own in the
aggregate more than 5% of the issued and outstanding Common Stock; and
(d) notwithstanding anything contained herein to the contrary,
this Agreement will terminate upon a Change of Control Transaction. A
"Change of Control Transaction" shall mean (i) a transaction in which
all of the shares of Common Stock are exchanged for cash or other
securities of a third party and such transaction results in the
holders of Common Stock holding less than fifty percent (50%) of the
voting power of the surviving entity, or (ii) the sale or transfer of
all or substantially all of the Company's assets.
4.3. Notices. All communications (other than those sent to shareholders
generally) provided for hereunder shall be in writing and delivered or mailed by
registered or certified mail, or by reputable overnight delivery, to the notice
addresses set forth in that Stock Purchase Agreement or, with respect to the
Founders, to the then current address set forth on the books and records of the
Company.
4.4. Successors and Assigns. This Agreement shall be binding upon the
Company, the Shareholders and their successors and assigns and shall inure to
the Investors' benefit and to the benefit of the Investors' respective
successors and assigns.
4.5. Complete Agreement; Amendments. This Agreement constitutes the
full and complete agreement of the parties hereto with respect to the subject
matter hereof. This Agreement supersedes and takes the place of all prior
agreements relating to its subject matter. No amendment, modification or
termination of any provisions of this Agreement shall be valid unless in writing
and signed by the Company and each of the Shareholders.
4.6. Severability. Should any part of this Agreement for any reason be
declared invalid, such decision shall not affect the validity of any remaining
portion, which remaining portion shall remain in force and effect as if this
Agreement had been executed with the invalid portion thereof eliminated and it
is hereby declared the intention of the parties hereto that they would have
executed the remaining portion of this Agreement without including therein any
such part, parts, or portion which may, for any reason, be hereafter declared
invalid.
4.7. Specific Performance. In addition to any and all other remedies
that may be available at law, in the event of any breach of this Agreement, each
party hereto shall be entitled to specific performance of the agreements and
obligations of the Company and the other parties hereto hereunder and to such
other injunctive or other equitable relief as may be granted by a court of
competent jurisdiction.
<PAGE>
4.8. Governing Law. This Agreement and securities issued and sold
hereunder shall be governed by and construed in accordance with the internal
laws of the State of Delaware.
4.9. Captions. The descriptive headings of the various paragraphs or
parts of this Agreement are for convenience only and shall not affect the
meaning or construction of any of the provisions hereof.
4.10. Number and Gender. Where required by the context, singular words
or pronouns shall be construed as plural, plural words and pronouns shall be
construed as singular and the gender of personal pronouns shall be construed as
either masculine, feminine or neuter.
4.11. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall constitute one Agreement binding on all the
parties hereto.
[The remainder of this page is intentionally left blank.]
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
COMPANY:
HEALTHGRADES.COM, INC.
By: /s/ Patrick M. Jaeckle
Patrick M. Jaeckle
President
FOUNDERS:
/s/ Kerry Hicks
Kerry Hicks
/s/ Patrick Jaeckle
Patrick Jaeckle
/s/ David Hicks
David Hicks
/s/ Paul Davis
Paul Davis
INVESTORS:
ESSEX WOODLANDS HEALTH VENTURES FUND
IV. L.P.
By its general partner:
ESSEX WOODLANDS HEALTH VENTURES, IV.
L.L.C.
By: /s/ Marc Sandroff
Marc Sandroff
Managing Director
<PAGE>
CHANCELLOR V., L.P.
By: IPC Direct Associates V, L.L.C.
Its General Partner
By: INVESCO Private Capital, Inc.
Its Managing Member
By:/s/ Howard E. Goldstein
Howard E. Goldstein
Managing Director
PUNK, ZIEGEL & COMPANY INVESTORS,
L.L.C.
By: /s/ John L. Bligh
John L. Bligh
Administrative Member
PAINEWEBBER, AS CUSTODIAN FOR WILLIAM
J. PUNK, I.R.A.
By: /s/ William J. Punk
William J. Punk
