exv4w1



 





Exhibit 4.1




REGISTRATION RIGHTS AGREEMENT




          This Registration Rights Agreement (this “Agreement”) is made and entered into as of
October 1, 2007, by and between Health Benefits Direct Corporation, a Delaware corporation (the
“Company”), and Computer Command and Control Company (the “Stockholder”). The
Company and the Stockholder hereinafter may be referred to individually as a “Party,” and
collectively as the “Parties.”




Background




          This Agreement is made pursuant to the Agreement to Transfer Partnership Interests, dated as
of the date hereof, by and among , HBDC Acquisition LLC, a Delaware limited liability company and
wholly-owned subsidiary of the Company, Stockholder, Noah Prywes, Anthony Newshel, Dominique Butts,
Jeffrey Derr and Amy Fritsky (the “Transfer Agreement”).




Agreement




          The Company and the Stockholder hereby agree as follows:



1. Definitions. As used in this Agreement, the following terms have the meanings specified
in this Section 1.




     (a) “1933 Act” is defined in Section 2(a).



     (b) “1934 Act” is defined in Section 5.



     (c) “Agreement” is defined in the Introduction above.



     (d) “Common Stock” means the Common Stock, par value $0.001 per share, of the Company.



     (e) “Company” is defined in the Introduction above.



     (f) “Losses” is defined in Section 5.



     (g) “Party” and “Parties” are defined in the Introduction above.



     (h) “Person” means any natural person, business trust, corporation, partnership,
limited liability company, joint stock company, proprietorship, association, trust, joint venture,
unincorporated association or any other legal entity of whatever nature.



     (i) “Piggyback Registration” is defined in Section 2(a).



     (j) “Registrable Securities” means the Common Stock acquired by the Stockholder under
the Transfer Agreement. As to any particular Registrable Securities, such securities will cease to
be Registrable Securities when they have been (i) effectively registered under the 1933 Act and
disposed of in accordance with a registration statement covering them, (ii) transferred



 









 







pursuant to Rule 144 (or any similar provision then in force), or (iii) sold in a private
transaction to someone other than the Stockholder.



     (k) “Registration Expenses” means all expenses incident to the Company’s performance
of or compliance with this Agreement, including all registration and filing fees, fees and expenses
of compliance with securities or blue sky laws, printing expenses, messenger and delivery expenses,
expenses and fees for listing the Registrable Securities on exchanges on which similar securities
issued by the Company are then listed, and fees and disbursements of counsel for the Company and of
all independent registered public accountants, underwriters (other than Underwriting Commissions)
and other Persons retained by the Company.



     (l) “SEC” means the Securities and Exchange Commission, or such other comparable
agency or commission, and any successor agency thereto.



     (m) “Stockholder” is defined in the Introduction above.



     (n) “Third Party Registrable Securities” means securities of the Company other than
Registrable Securities, held by a Person other than the Stockholder, that the Company intends to
include in a registration of securities under the 1933 Act.



     (o) “Transfer Agreement” is defined in the Background above.



     (p) “Underwriting Commissions” means all underwriting discounts or commissions
relating to the sale of securities of the Company, but excludes any expenses reimbursed to
underwriters.



2. Piggyback Registrations.




     (a) Right to Piggyback. Whenever the Company proposes to register any of its
securities under the Securities Act of 1933, as amended (the “1933 Act”), and the
registration form to be used may be used for the registration of Registrable Securities, the
Company shall give prompt written notice to all holders of Registrable Securities and shall include
in such registration, subject to the allocation provisions below, all Registrable Securities with
respect to which the Company has received written requests for inclusion within 20 calendar days
after the Company’s mailing of such notice (a “Piggyback Registration”). The Company shall
not select a form of registration statement that imposes, for its use, limitations on the maximum
value or number of securities that may be registered if these limitations would preclude
registration of the Registrable Securities that the Company has been requested to include in such
registration. It is the Company’s current intention to initiate the registration of certain shares
of Common Stock within sixty days after the date of this Agreement.



     (b) Piggyback Expenses. In all Piggyback Registrations, the Company shall pay the
Registration Expenses related to the Registrable Securities of the Stockholder, but the Stockholder
shall pay the Underwriting Commissions related to its Registrable Securities.



     (c) Priority on Primary Registrations. If a Piggyback Registration is an underwritten
primary offering of the Company’s securities, and the managing underwriter(s) advise the Company in
writing that in their opinion the number of securities requested to be included in



2









 







such registration exceeds the number that can be sold in such offering at a price reasonably
related to fair value, the Company shall allocate the securities to be included as follows: (i)
first, the securities the Company proposes to sell on its own behalf, and (ii) second, Registrable
Securities requested to be included in such registration and Third Party Registrable Securities, if
any, pro rata on the basis of the number of Registrable Securities requested to be included in such
registration in proportion to the aggregate number of Registrable Securities requested to be
included in such registration plus Third Party Registrable Securities. For illustration purposes
only, if any Stockholder requests that 100 shares be included in a registration and 200 Third Party
Registrable Securities are also to be included in such registration, but the total remaining
available securities under such registration is 150 shares, then 50 shares of Registrable
Securities, and 100 shares of Third Party Registrable Securities, would be included in such
registration.



     (d) Priority on Secondary Registrations. If a Piggyback Registration is initiated as
an underwritten secondary offering of the Company’s securities and the managing underwriter(s)
advise the Company in writing that in their opinion the number of securities requested to be
included in such registration exceeds the number that can be sold in such offering at a price
reasonably related to fair value, the Company shall allocate the securities to be included as
follows: (i) first, the securities requested to be included by the holders initiating such
registration, or the Company as the case may be, and (ii) second, Registrable Securities requested
to be included in such registration and Third Party Registrable Securities (other than securities
covered by item (i) immediately above), if any, pro rata on the basis of the number of Registrable
Securities requested to be included in such registration in proportion to the aggregate number of
Registrable Securities requested to be included in such registration plus Third Party Registrable
Securities.



     (e) Selection of Underwritten Offerings. If an underwritten offering is contemplated
in connection with a Piggyback Registration, the Company, if the registration is under
Section 2(c), or the holders initiating such registration or the Company, as applicable, if
the registration is under Section 2(d), shall select the investment banker(s) and
manager(s) to be retained in connection with such offering and make any other decisions regarding
the underwriting arrangements for the offering.



3. Contemporaneous Sales.




     Neither the Stockholder nor the Company shall effect any public sale or distribution of equity
securities of the Company or any securities convertible into or exchangeable or exercisable for
such securities during the seven calendar days prior to and the 90 calendar days after any
underwritten Piggyback Registration has become effective (except as part of such underwritten
registration).



3









 





4. Registration Procedures.




     Whenever the Stockholder has requested that any Registrable Securities be registered pursuant
to Section 2 of this Agreement, the Company shall, within a reasonable time:



          (a) prepare and file with the SEC a registration statement with respect to such Registrable
Securities and use its best efforts to cause such registration statement to become effective
(provided that, before filing a registration statement or prospectus or any amendments or
supplements thereto, the Company shall furnish the Stockholder with copies of all such documents
proposed to be filed);




          (b) prepare and file with the SEC such amendments and supplements to such registration
statement and the prospectus used in connection therewith as may be necessary to keep such
registration statement effective for a period of not less than 120 calendar days, or for such
longer period of time as may be necessary to complete the distribution contemplated by the
registration statement;




          (c) furnish to the Stockholder such number of copies of such registration statement, each
amendment and supplement thereto and the prospectus (including each preliminary prospectus)
prepared in conformity with the 1933 Act, and such other documents as such holder may reasonably
request in order to facilitate the disposition of the Registrable Securities owned by such holder;




          (d) use its best efforts to register or qualify such Registrable Securities under such other
securities or blue sky laws of such jurisdictions as the managing underwriter(s) or such holders
may reasonably request;




          (e) at any time when a prospectus relating to such registration is required to be delivered
under the 1933 Act and during the period that the Company is required to keep the registration
statement effective, notify the Stockholder of the happening of any event as a result of which the
prospectus included in such registration statement contains an untrue statement of a material fact
or omits any fact necessary to make the statement therein not misleading in light of the
circumstances then existing, and, at the request of any such holder, the Company shall prepare a
supplement or amendment to such prospectus so that, as thereafter delivered to the purchasers of
such Registrable Securities, such prospectus will not contain an untrue statement of a material
fact or omit to state any fact necessary to make the statement therein not misleading in light of
the circumstances then existing;




          (f) except as otherwise provided herein, cause all such Registrable Securities to be listed or
included on securities exchanges on which similar securities issued by the Company are then listed
or included;




          (g) provide a transfer agent and registrar for all such Registrable Securities and a CUSIP
number for all such Registrable Securities, in each case not later than the effective date of such
registration statement;




4









 





          (h) enter into such customary agreements (including an underwriting agreement in customary
form) and take such other customary actions as may be reasonably necessary to expedite or
facilitate the disposition of such Registrable Securities;




          (i) obtain a “comfort” letter addressed to the Company from its independent public accountants
in customary form and covering such matters of the type customarily covered by “comfort” letters;
and




          (j) make available for inspection by the Stockholder, any underwriter participating in any
disposition pursuant to such registration statement, and any attorney, accountant or other agent
retained by any such holder 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 holder, underwriter, attorney,
accountant or agent in connection with such registration statement.




5. Indemnification.




     (a) The Company shall indemnify, to the extent permitted by law, the Stockholder, and such
Stockholder’s officers, directors and managers and each Person who controls such holder (within the
meaning of the 1933 Act or the Exchange Act of 1934, as amended (the “1934 Act”)), if
applicable, against all losses, claims, damages, liabilities (joint or several) and expenses
(including reasonable attorneys’ and other professionals’ fees) (collectively, “Losses”)
arising out of or resulting from (i) any untrue or alleged untrue statement of material fact
contained in any registration statement, prospectus or preliminary prospectus or any omission or
alleged omission to state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading in light of the circumstances then existing, except
insofar as the same are caused by or contained in any information furnished in writing to the
Company by such holder expressly for use therein or by any such holder’s failure to deliver a copy
of the registration statement or prospectus or any amendments or supplements thereto after the
Company has furnished such holder with a sufficient number of copies of the same; or (ii) any
violation or alleged violation by the Company of any of the 1933 Act, the 1934 Act or any
applicable state securities laws, or any rules promulgated under any such acts or laws. In
connection with an underwritten offering, the Company shall indemnify the underwriters, their
officers and directors, and each Person who controls such underwriters (within the meaning of the
1933 Act or the 1934 Act) to the same extent as provided above with respect to the indemnification
of the Stockholder.



     (b) In connection with any registration statement in which the Stockholder is participating,
the Stockholder shall furnish to the Company in writing such information as is reasonably requested
by the Company for use in any such registration statement or prospectus and shall indemnify, to the
extent permitted by law, the Company, its officers, directors and managers and each Person who
controls the Company (within the meaning of the 1933 Act or the 1934 Act), against any Losses
resulting from any untrue or alleged untrue statement of material fact or any omission or alleged
omission of a material fact required to be stated in the registration statement or prospectus or
any amendment thereof or supplement thereto or necessary to make the statements therein not
misleading in light of the circumstances then existing, but only to the extent that such untrue
statement or omission is contained in information so furnished in writing



5









 







by the Stockholder specifically for use in preparing the registration statement.
Notwithstanding the foregoing, the liability of the Stockholder under this Section 5(b)
shall be limited to an amount equal to the net proceeds actually received by the Stockholder from
the sale of Registrable Securities covered by the registration statement.



     (c) Any Person entitled to indemnification hereunder shall (i) give prompt notice to the
indemnifying Party of any claim with respect to which it seeks indemnification, and (ii) unless in
such indemnified Party’s reasonable judgment a conflict of interest between such indemnified and
indemnifying Parties may exist with respect to such claim, permit such indemnifying Party to assume
the defense of such claim with counsel reasonably satisfactory to the indemnified Party. If such
defense is assumed, the indemnifying Party shall not be subject to any liability for any settlement
made without its consent (but such consent will not be unreasonably withheld). An indemnifying
Party who is not entitled, or elects not, to assume the defense of a claim shall not be obligated
to pay the fees and expenses of more than one counsel for all Parties indemnified by such
indemnifying Party with respect to such claim, unless in the reasonable judgment of any indemnified
Party a conflict of interest may exist between such indemnified Party and any other of such
indemnified Parties with respect to such claim.



6. Participation in Underwritten Offerings.




     No Stockholder may participate in any underwritten offering hereunder unless such Stockholder
(a) agrees to sell its securities on the basis provided in any underwriting arrangements approved
by the Person or Persons entitled hereunder to approve such arrangements under Section
2(e), and (b) completes and executes all questionnaires, powers of attorney, indemnities,
underwriting agreements, holdback agreements and other documents required under the terms of such
underwriting arrangements.



7. Miscellaneous.




     (a) Notices. All notices that are required or permitted hereunder shall be in writing
and shall be sufficient if personally delivered or sent by facsimile, registered or certified mail
or Federal Express or other nationally recognized overnight delivery service. Any notices shall be
deemed given upon the earlier of the date when received at, the day when delivered via facsimile or
the third calendar day after the date when sent by registered or certified mail or the calendar day
after the date when sent by Federal Express to, the address of the respective Party as set forth in
the Transfer Agreement, unless such address has been changed by notice to the other Party hereto.



     (b) Restrictive Legend. Each certificate representing Registrable Securities shall
(unless otherwise permitted by the provisions of this Agreement) be stamped or otherwise imprinted
with a legend substantially similar to the following (in addition to any legend required under
applicable state securities laws or any other applicable agreements):




THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO, AND MAY BE TRANSFERRED
ONLY IN COMPLIANCE WITH, A REGISTRATION RIGHTS AGREEMENT AMONG THE COMPANY, THE
HOLDER OF THESE SECURITIES AND CERTAIN OTHER HOLDERS OF



6









 







THE COMPANY’S SECURITIES, A COPY OF WHICH IS ON FILE AT THE PRINCIPAL OFFICE OF THE
COMPANY AND WILL BE FURNISHED TO THE RECORD HOLDER OF THIS CERTIFICATE WITHOUT
CHARGE UPON WRITTEN REQUEST TO THE COMPANY.



     (c) Amendments and Waivers. The provisions of this Agreement may be amended or
terminated, and the Company may take any action herein prohibited, or omit to perform any act
herein required to be performed by it, only if approved in writing by the each Stockholder or by
any agreement permitted by this Section 7.



     (d) Binding Effect. This Agreement shall bind and inure to the benefit of the
respective successors (including any successor resulting from a merger or similar reorganization),
assigns, heirs, and personal representatives of the Parties. In addition, without limiting the
generality of the foregoing, if any Stockholder liquidates or reorganizes such that its assets are
transferred to its own equity owners or partners or to another entity, such equity owners, partners
or entity shall succeed to all of the rights of such Stockholder hereunder.



     (e) Governing Law. This Agreement shall be construed and interpreted in accordance
with the internal laws of the State of Delaware without regard to any choice of law or conflict of
law, choice of forum or provision, rule or principle (whether of the State of Delaware or any other
jurisdiction) that might otherwise refer construction or interpretation of this Agreement to the
substantive law of another jurisdiction. The Parties hereby irrevocably (i) submit themselves to
the non-exclusive jurisdiction of the state and federal courts sitting in the State of Delaware and
(ii) waive the right and shall not assert by way of motion, as a defense or otherwise in any
action, suit or other legal proceeding brought in any such court, any claim that it, he or she is
not subject to the jurisdiction of such court, that such action, suit or proceeding is brought in
an inconvenient forum or that the venue of such action, suit or proceeding is improper. Each Party
also irrevocably and unconditionally consents to the service of any process, pleadings, notices or
other papers in a manner permitted by the notice provisions of Section 7(a). EACH PARTY HEREBY
IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER
BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE ACTIONS
OF SUCH PARTY IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE AND ENFORCEMENT HEREOF.



     (f) Counterparts. This Agreement may be executed in two or more counterparts
(delivery of which may occur via facsimile), each of which shall be binding as of the date first
written above, and, when delivered, all of which shall constitute one and the same instrument.
This Agreement and any other certificate, instrument, agreement or document required to be
delivered pursuant to the terms of the Transfer Agreement, and any amendments hereto or thereto, to
the extent signed and delivered by means of a facsimile machine or as an attachment to an
electronic mail message in “pdf” or similar format, shall be treated in all manner and respects as
an original agreement or instrument and shall be considered to have the same binding legal effect
as if it were the original signed version thereof delivered in person. At the request of either
Party hereto or to any such agreement or instrument, the Party hereto or thereto shall re-execute
original forms thereof and deliver them to the other Party. No Party hereto or to any such
agreement or instrument shall raise the use of a facsimile machine or electronic mail



7









 







attachment in “pdf” or similar format to deliver a signature or the fact that any signature or
agreement or instrument was transmitted or communicated through the use of a facsimile machine or
as an attachment to an electronic mail message as a defense to the formation of a contract and each
such Party forever waives any such defense. A facsimile signature or electronically scanned copy
of a signature shall constitute and shall be deemed to be sufficient evidence of a Party’s
execution of this Agreement, without necessity of further proof. Each such copy shall be deemed an
original, and it shall not be necessary in making proof of this Agreement to produce or account for
more than one such counterpart.



     (g) Interpretation. Unless the context of this Agreement clearly requires otherwise,
(i) references to the plural include the singular, the singular the plural, the part the whole,
(ii) references to any gender include all genders, (iii) “including” has the inclusive meaning
frequently identified with the phrase “but not limited to,” and (iv) references to “hereunder” or
“herein” relate to this Agreement. The section and other headings contained in this Agreement are
for reference purposes only and shall not control or affect the construction of this Agreement or
the interpretation thereof in any respect. Section, subsection, Schedule and Exhibit references
are to this Agreement unless otherwise specified. Each accounting term used herein that is not
specifically defined herein shall have the meaning given to it under GAAP. Any reference to a
Party’s being satisfied with any particular item or to a Party’s determination of a particular item
presumes that such standard will not be achieved unless such Party shall be satisfied or shall have
made such determination in its sole or complete discretion.



[THE BALANCE OF THIS PAGE INTENTIONALLY LEFT BLANK]




*************************




8









 





          IN WITNESS WHEREOF, the Parties have executed this Registration Rights Agreement as of the
date first written above.




	 	 	 	 	 
	 	HEALTH BENEFITS DIRECT CORPORATION

 	 
	 	By:  	     /s/ Alvin H. Clemens
 	 
	 	 	Name:  	Alvin H. Clemens 	 
	 	 	Title:  	Chief Executive Officer and Chairman 	 
	 
	 	STOCKHOLDER:


COMPUTER COMMAND AND CONTROL COMPANY

 	 
	 	By:  	/s/ Noah S. Prywes (by Robert Oakes, Attorney in fact)
 	 
	 	 	Name:  	Noah S. Prywes 	 
	 	 	Title:  	President 	 
	 



Signature Page to Registration Rights Agreement (CCCC)