Document:

EX-10.2

Exhibit
10.2

EXECUTION COPY

 

 

SPHERIS HOLDING III, INC.

AMENDED AND RESTATED

STOCKHOLDERS’ AGREEMENT

Dated as of October 3, 2008

 

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Page
	 
	1.	 	Additional Offerings	 	 	1	 
	 

	 	 	1.1.	 	 	Additional Offerings; Generally
	 	 	1	 
	 

	 	 	1.2.	 	 	Exercise of Purchase Rights
	 	 	2	 
	 

	 	 	1.3.	 	 	Sale of Unpurchased Securities
	 	 	2	 
	 

	 	 	1.4.	 	 	Future Additional Offerings
	 	 	2	 
	 
	 	 	 	 	 	 	 	 	 	 
	2.	 	Restrictions on Transfers and Sales to Third Parties	 	 	2	 
	 

	 	 	2.1.	 	 	General
	 	 	2	 
	 

	 	 	2.2.	 	 	Tag-Along Rights
	 	 	3	 
	 

	 	 	2.3.	 	 	Company Sale
	 	 	3	 
	 
	 	 	 	 	 	 	 	 	 	 
	3.	 	Election of Directors; Committees	 	 	5	 
	 

	 	 	3.1.	 	 	Board Make-up
	 	 	5	 
	 

	 	 	3.2.	 	 	Replacement Directors
	 	 	6	 
	 

	 	 	3.3.	 	 	Committees
	 	 	6	 
	 

	 	 	3.4.	 	 	Directors of Subsidiaries
	 	 	6	 
	 

	 	 	3.5.	 	 	Board Observers
	 	 	7	 
	 
	 	 	 	 	 	 	 	 	 	 
	4.	 	Legends	 	 	8	 
	 
	 	 	 	 	 	 	 	 	 	 
	5.	 	Covenants, Representations and Warranties	 	 	8	 
	 

	 	 	5.1.	 	 	Actions by the Board Requiring the Approval of the Majority
Warburg Investors; Actions by the Board Requiring the Approval
of the Majority TowerBrook Investors
	 	 	8	 
	 

	 	 	5.2.	 	 	Transactions With Investors
	 	 	10	 
	 

	 	 	5.3.	 	 	Information Rights
	 	 	10	 
	 

	 	 	5.4.	 	 	Warburg Information Rights
	 	 	10	 
	 
	 	 	 	 	 	 	 	 	 	 
	6.	 	Amendment, Modification, Supplement and Waiver	 	 	11	 
	 
	 	 	 	 	 	 	 	 	 	 
	7.	 	Termination of Rights and Obligations Under Certain Sections	 	 	11	 
	 
	 	 	 	 	 	 	 	 	 	 
	8.	 	Parties	 	 	11	 
	 

	 	 	8.1.	 	 	Assignment Generally
	 	 	11	 
	 

	 	 	8.2.	 	 	Termination
	 	 	12	 
	 

	 	 	8.3.	 	 	Agreements to Be Bound
	 	 	12	 
	 
	 	 	 	 	 	 	 	 	 	 
	9.	 	Recapitalizations, Exchanges, etc. Affecting the Shares	 	 	12	 
	 
	 	 	 	 	 	 	 	 	 	 
	10.	 	Further Assurances	 	 	12	 

 

 

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Page
	 
	 	 	 	 	 	 	 	 	 	 
	11.	 	Governing Law	 	 	12	 
	 
	 	 	 	 	 	 	 	 	 	 
	12.	 	Invalidity of Provision	 	 	12	 
	 
	 	 	 	 	 	 	 	 	 	 
	13.	 	Notices	 	 	12	 
	 
	 	 	 	 	 	 	 	 	 	 
	14.	 	Headings; Execution in Counterparts	 	 	15	 
	 
	 	 	 	 	 	 	 	 	 	 
	15.	 	Entire Agreement	 	 	15	 
	 
	 	 	 	 	 	 	 	 	 	 
	16.	 	Injunctive Relief	 	 	15	 
	 
	 	 	 	 	 	 	 	 	 	 
	17.	 	Defined Terms	 	 	15	 
	 

	 	 	17.1.	 	 	Affiliate
	 	 	15	 
	 

	 	 	17.2.	 	 	CHS
	 	 	15	 
	 

	 	 	17.3.	 	 	Common Stock
	 	 	15	 
	 

	 	 	17.4.	 	 	Company Sale
	 	 	16	 
	 

	 	 	17.5.	 	 	Convertible Securities
	 	 	16	 
	 

	 	 	17.6.	 	 	Equity Securities
	 	 	16	 
	 

	 	 	17.7.	 	 	Exchange Act
	 	 	16	 
	 

	 	 	17.8.	 	 	Investors
	 	 	16	 
	 

	 	 	17.9.	 	 	Mandatory Conversion
	 	 	16	 
	 

	 	 	17.10.	 	 	Majority TowerBrook Investors
	 	 	16	 
	 

	 	 	17.11.	 	 	Majority Warburg Investors
	 	 	16	 
	 

	 	 	17.12.	 	 	Owns, Own or Owned
	 	 	16	 
	 

	 	 	17.13.	 	 	Permitted Assignee
	 	 	16	 
	 

	 	 	17.14.	 	 	Person
	 	 	17	 
	 

	 	 	17.15.	 	 	Qualified Public Offering
	 	 	17	 
	 

	 	 	17.16.	 	 	Registration Rights Agreement
	 	 	17	 
	 

	 	 	17.17.	 	 	Restricted Stock Plan
	 	 	17	 
	 

	 	 	17.18.	 	 	Securities Act
	 	 	17	 
	 

	 	 	17.19.	 	 	Shares
	 	 	17	 
	 

	 	 	17.20.	 	 	Spheris Investment
	 	 	17	 
	 

	 	 	17.21.	 	 	Spheris Investment LLC Agreement
	 	 	17	 
	 

	 	 	17.22.	 	 	TowerBrook Investors
	 	 	17	 
	 

	 	 	17.23.	 	 	Transfer
	 	 	17	 
	 

	 	 	17.24.	 	 	Warburg Investors
	 	 	17	 
	 

	 	 	17.25.	 	 	Warburg Pincus
	 	 	17	 

ii

 

AMENDED AND RESTATED STOCKHOLDERS’ AGREEMENT

     This AMENDED AND RESTATED STOCKHOLDERS’ AGREEMENT (this “Agreement”) is dated as of
October 3, 2008 and is entered into by and among Spheris Holding III, Inc., a Delaware corporation
(the “Company”) and the Warburg Investors, the TowerBrook Investors, Spheris Investment and
CHS. Capitalized terms used herein without definition elsewhere in this Agreement are defined in
Section 17 hereof.

RECITALS

     WHEREAS, the Company, the Warburg Investors, the TowerBrook Investors and Spheris Investment
have previously entered into a Stockholders’ Agreement, dated November 5, 2004 as amended by that
certain First Amendment to Stockholders’ Agreement, dated August 17, 2006, that certain Second
Amendment to Stockholders’ Agreement, dated May 2, 2007, and that certain Third Amendment to
Stockholders’ Agreement, dated July 15, 2008 (the “Stockholders’ Agreement”); and

     WHEREAS, on the date hereof, CHS has entered into a Securities Purchase Agreement with the
Company (the “Securities Purchase Agreement”), pursuant to which the Company has, on the
date hereof, issued and sold to CHS and CHS has purchased from the Company shares of Series A
Convertible Preferred Stock of the Company (the “Preferred Stock”); and

     WHEREAS, the Investors and the Company desire to promote their mutual interests by amending
and restating the Stockholders Agreement according to the terms set forth herein.

     NOW, THEREFORE, in consideration of the mutual covenants and obligations set forth in this
Agreement, and to implement the foregoing, the parties hereto agree as follows:

1. Additional Offerings.

     1.1. Additional Offerings; Generally. If at any time after the date hereof, the
Company or any direct or indirect subsidiary of the Company (each a “Subsidiary”) proposes
to issue any Equity Securities (other than the issuance of any Equity Securities (i) to the public
in a firm commitment underwriting pursuant to a registration statement filed under the Securities
Act, (ii) pursuant to the acquisition of another Person by the Company or any Subsidiary (as
consideration for the acquisition and not for the purpose of financing an acquisition), whether by
purchase of stock, merger, consolidation, purchase of all or substantially all of the assets of
such Person or otherwise, (iii) pursuant to an employee stock option plan, stock bonus plan, stock
purchase plan or other management equity program, including without limitation the Restricted Stock
Plan, approved by a majority of the members of the Board (iv) by a Subsidiary to the Company or any
other Subsidiary of the Company or (v) in the form of warrants to purchase Common Stock issued to
lessors of property and/or equipment or to financial institutions or related entities in connection
with commercial credit or debt financing or other similar arrangements which are approved by a
majority of the members of the Board), then, as to each Investor who Owns at least 5% of the Common
Stock (each such Person is hereinafter referred to, for purposes of this Section 1, as a
“Participating Investor” and collectively, such Persons are referred to in this Section 1
as the “Participating Investors”), the Company shall:

 

 

     (a) give written notice (the “Subscription Right Notice”) setting forth in
reasonable detail (i) the designation and all of the terms and provisions of the Equity
Securities proposed to be issued (the “Proposed Securities”), including, where
applicable, the voting powers, preferences and relative participating, optional or other
special rights, and the qualification, limitations or restrictions thereof and interest
rate and maturity; (ii) the price and other terms of the proposed sale of such Proposed
Securities; and (iii) the amount of such Proposed Securities proposed to be issued; and

     (b) offer to issue to each Participating Investor that number of Proposed Securities
equal to the number of Proposed Securities multiplied by such Participating Investor’s
Percentage Interest. For purposes hereof, “Percentage Interest” shall mean, in
respect of any Participating Investor, the percentage determined by dividing (x) the number
of shares of Common Stock Owned by such Participating Investor, by (y) the total number of
shares of Common Stock Owned by the Investors.

     1.2. Exercise of Purchase Rights. Each Participating Investor may exercise its
purchase rights hereunder within twenty (20) business days after receipt of the Subscription Right
Notice. If all of the Proposed Securities offered to the Participating Investors are not fully
subscribed by such Participating Investors, the remaining Proposed Securities will be reoffered to
the Participating Investors upon the terms set forth in this Section 1, until all such Proposed
Securities are fully subscribed for or until all such Participating Investors have subscribed for
all such Proposed Securities which they desire to purchase, except that such Participating
Investors must exercise their purchase rights within ten (10) business days after receipt of all
such reoffers. To the extent that the Company or its Subsidiary, as the case may be, offers two or
more securities in units, the Participating Investors must purchase such units as a whole and will
not be given the opportunity to purchase only one of the securities making up such unit.

     1.3. Sale of Unpurchased Securities. Upon the expiration of the offering periods
described above, the Company or its Subsidiary, as the case may be, will be free to sell such
Proposed Securities that the Participating Investors have not elected to purchase during the ninety
(90) calendar day period immediately following such expiration on terms and conditions no more
favorable to the purchasers thereof than those offered to the Participating Investors. Any
Proposed Securities offered or sold by the Company or its Subsidiary, as the case may be, after
such ninety (90) calendar day period must be reoffered to the Participating Investors pursuant to
this Section 1.

     1.4. Future Additional Offerings. The election by a Participating Investor not to
exercise its subscription rights under this Section 1 in any one instance shall not affect its
right (other than in respect of a reduction in its percentage holdings) as to any subsequent
proposed issuance.

2. Restrictions on Transfers and Sales to Third Parties.

     2.1. General. No Shares owned by any Investor nor any interest therein nor any rights
related thereto may be Transferred by such Investor unless such Investor complies with the
provisions of this Section 2 and Section 8.3 hereof.

2

 

     2.2. Tag-Along Rights.

          (a) Subject to the other terms of this Section 2.2, and except as required by Section 5.4, no
Investor shall be permitted to Transfer any Shares to one or more third parties unless each other
Investor is offered a right to participate in such Transfer for a purchase price per Share equal to
the purchase price to be received by such Investor then proposing to sell the Shares (the
“Selling Investor”) and on other terms and conditions not less favorable to such other
Investor than those applicable to the Selling Investor. Any Investor who, in accordance with the
terms of Section 2.2(b) below, notifies the Selling Investor that it desires to participate in any
sale of Shares shall have the right to include in such sale an amount of Shares equal to the amount
of Shares the third party actually proposes to purchase multiplied by the percentage obtained by
dividing the number of Shares owned by such participating Investor by the aggregate number of
Shares owned by the Selling Investor and each other Investor exercising its right to participate in
such sale pursuant hereto. For the purposes of this Section 2.2(a), a sale to a “third party”
shall not include a sale to any Permitted Assignee or a sale pursuant to a Qualified Public
Offering. Notwithstanding the foregoing, in the event the Selling Investor is selling only shares
of Preferred Stock, holders of Common Stock shall not have the right to sell shares of Common Stock
pursuant to this Section 2.2(a).

          (b) In the event a Selling Investor is proposing to sell any Shares and, pursuant to this
Section 2.2, the Investors are entitled to participate in such sale, such Selling Investor shall
notify each Investor entitled to participate therein in writing of such proposed sale and its terms
and conditions (and shall provide any other information regarding the proposed transfer that such
other Investor may reasonably request). Within fifteen (15) business days of the date of such
notice, each Investor entitled to participate therein shall notify such Selling Investor if it
elects to participate in such sale. Any Investor that fails to notify the Selling Investor within
such fifteen (15) business day period shall be deemed to have waived its rights hereunder with
respect to such sale. Notwithstanding anything contained in this Section 2.2 to the contrary, in
the event that all or a portion of the purchase price for the Shares being purchased consists of
securities and the sale of such securities to any Investor entitled to participate therein would,
by virtue of the fact that such Investor is not an “accredited investor” (within the meaning of
Rule 501(a) under the Securities Act), require either a registration under the Securities Act or
the preparation of a disclosure document pursuant to Regulation D under the Securities Act (or any
successor regulation) or a similar provision of any state securities law, then, at the option of
the Selling Investor, any one or more of such Investors may receive, in lieu of such securities,
the fair market value of such securities in cash, as determined in good faith by the Board.

     2.3. Company Sale.

          (a) In the event that the Warburg Investors are proposing to consummate a Company Sale to any
Person or Persons that are not Affiliates of any of the Warburg Investors, the Warburg Investors
shall have the right (the “Drag-along Right”), but not the obligation, to require each
other Investor to sell all Shares owned by such Investor in accordance with the terms of such
Company Sale, or in the case of a merger, consolidation or sale of assets, to vote all shares of
capital stock owned by such Investor in favor of, and waive any dissenter or appraisal right it may
have in respect of, such Company Sale; provided, however, that, in the

3

 

event that the TowerBrook Investors Own at least 5% of the Common Stock at the time of such
proposal, the Warburg Investors shall not be permitted to exercise the Drag-along Right unless the
Warburg Investors first comply with Section 2.3(b) below.

          (b) The Warburg Investors shall, as a condition precedent to exercising any Drag-along Right,
deliver to the TowerBrook Investors an offer notice (the “Notice of Offer”) that shall
include (A) an offer (the “TowerBrook Offer”) to effect such Company Sale with the
TowerBrook Investors and (B) the terms of such proposed Company Sale, including the purchase price
in respect thereof, terms of payment and any other material terms and conditions for such sale.
Within ten (10) business days after receipt of the TowerBrook Offer (the “TowerBrook Offer
Period”), the TowerBrook Investors may, at their option, accept the TowerBrook Offer. The
TowerBrook Investors shall give written notice to the Warburg Investors of their acceptance, or
their rejection, of the TowerBrook Offer within the TowerBrook Offer Period. Failure by the
TowerBrook Investors to give notice of their acceptance of the TowerBrook Offer hereunder within
the TowerBrook Offer Period shall be deemed rejection of the TowerBrook Offer. If the TowerBrook
Investors accept the TowerBrook Offer, such notice shall specify the date for the closing of the
Company Sale which shall not be more than forty-five (45) days after such notice and each Investor
shall take such action as may be necessary to consummate the Company Sale as required by this
Section 2.3. The closing of any such Company Sale to the TowerBrook Investors shall take place at
such location as shall be mutually agreeable between the Warburg Investors and the TowerBrook
Investors and the purchase price, to the extent comprised of cash, shall be paid at the closing,
and cash equivalents and documents evidencing any deferred payments of cash permitted shall be
delivered at the closing.

          (c) If the TowerBrook Investors reject (or are deemed to reject) the TowerBrook Offer, the
Warburg Investors may exercise the Drag-along Right on terms no less favorable to the Warburg
Investor than the terms set forth in the applicable TowerBrook Offer; provided,
however, that if the Warburg Investors fail to consummate such Company Sale within
one-hundred and eighty (180) days after the expiration or termination of the TowerBrook Offer
Period, the Drag-along Right shall again be subject to the restrictions of this Section 2.3. To
exercise the Drag-along Right, the Warburg Investors shall give each other Investor a written
notice containing (i) the name and address of the proposed transferee(s) and (ii) the proposed
purchase price, terms of payment and any other material terms and conditions of the Company Sale.

          (d) Upon exercise of the Drag-along Right or acceptance of the TowerBrook Offer (if such
TowerBrook Offer is required hereby), each Investor shall be obligated to sell all Shares owned by
it to the proposed transferee, or, in the case of a merger or sale of assets or other transaction
that requires the vote of the Company’s stockholders, to vote all Shares owned by such Investor in
favor of, and waive any dissenter or appraisal right it may have in respect of, such Company Sale
and shall otherwise take all steps necessary (including delivery of certificates or other
instruments evidencing the shares to be conveyed, duly endorsed and in negotiable form with all the
requisite documentary stamps affixed thereto) to enable him, her or it to facilitate such Company
Sale and to comply with the provisions of this Section 2.3.

          (e) Each Investor required to sell all its Shares pursuant to a Company Sale shall be entitled
to receive in exchange therefor an amount per share equal to the purchase price

4

 

received per share of Common Stock Owned by the Warburg Investors in connection with such
Company Sale (it being understood that, solely for purposes of this Section 2.3, “Owned” shall mean
beneficial ownership, assuming Mandatory Conversion of all outstanding Preferred Stock (whether or
not then convertible) pursuant to Section 5(a)(i) of the Restated Certificate (giving full effect
to, Section 5 of the Restated Certificate)). Such Investors shall otherwise participate in such
Company Sale on other terms and conditions not less favorable to such Investors than those
applicable to the Warburg Investors and, subject to Section 2.3(f) below, shall receive the same
type of consideration received by the Warburg Investors in such Company Sale.

          (f) Notwithstanding anything contained in this Section 2.3 to the contrary, in the event that
all or a portion of the purchase price for the shares being purchased consists of securities and
the sale of such securities to an Investor entitled to participate therein would, by virtue of the
fact that such Investor is not an “accredited investor” (within the meaning of Rule 501(a) under
the Securities Act), require either a registration under the Securities Act or the preparation of a
disclosure document pursuant to Regulation D under the Securities Act (or any successor regulation)
or a similar provision of any state securities law, then, at the option of the Warburg Investors,
any one or more of such Investors may receive, in lieu of such securities, the fair market value of
such securities in cash, as determined in good faith by the Board.

3. Election of Directors; Committees.

     3.1. Board Make-up. As of the date hereof, the Board of Directors of the Company (the
“Board”) shall consist of Jonathan Bilzin, Neal Moszkowski, James W. Doucette, Martin G.
Schweinhart, Steven Simpson, Michael King, Robert Z. Hensley and John A. Kane. From and after the
date hereof, the Investors and the Company shall take all action within their respective power,
including but not limited to, the voting of all Shares Owned by them, required to cause the Board
to consist of no more than ten (10) members, and at all times throughout the term of this
Agreement, to include:

     (a) at the option of the Warburg Investors, for as long as the Warburg Investors Own
at least five percent (5%) of the Common Stock Owned by Investors, two (2) members
designated by Warburg Pincus (such members referred to herein as “Warburg
Directors” and each a “Warburg Director”);

     (b) for as long as the TowerBrook Investors Own at least five percent (5%) of the
Common Stock Owned by Investors, two (2) members designated by the TowerBrook Investors
(such members referred to herein as “TowerBrook Directors” and each a
“TowerBrook Director”);

     (c) at the option of CHS, for as long as CHS Owns at least five percent (5%) of the
Common Stock Owned by Investors, two (2) members designated by CHS (such members referred
to herein as the “CHS Directors” and each a “CHS Director”);

     (d) one (1) member of management who shall be the Chief Executive Officer of the
Company then in office (the “Management Director”);

5

 

     (e) three (3) independent members selected by the Majority Warburg Investors and the
Majority TowerBrook Investors (such members referred to herein as “Independent
Directors” and each an “Independent Director”).

     The parties hereto acknowledge that the four representatives to be designated by the Warburg
Investors and the TowerBrook Investors are the directors that the holders of Preferred Stock are
entitled to elect under the Restated Certificate. The parties hereto further acknowledge that as of
the date hereof there are no Warburg Directors, the TowerBrook Directors are Jonathan Bilzin and
Neal Moszkowski, the CHS Directors are James W. Doucette and Martin G. Schweinhart, the Management
Director is Steven Simpson and the Independent Directors are Robert Z. Hensley, John A. Kane and
Michael King. In addition, subject to the ownership requirements set forth in paragraphs (a) and
(b) of this Section 3.1, the Warburg Investors, on the one hand, and the TowerBrook Investors, on
the other hand, shall be entitled to designate an equal number of directors.

     3.2. Replacement Directors. In the event that any member of the Board designated in
the manner set forth in Section 3.1 hereof is unable to serve, or once having commenced to serve,
is removed or withdraws from the Board (each, a “Withdrawing Director”), such Withdrawing
Director’s replacement (the “Substitute Director”) will be designated by the Investors of
the Company that have the right to designate such director, as applicable, in accordance with
Section 3.1 above. The Investors and the Company agree to take all action within their respective
power, including, but not limited to, the voting of all Shares Owned by them (i) to cause the
election of such Substitute Director promptly following his or her nomination pursuant to this
Section 3.2 and (ii) upon the written request of the Investors that have the right to designate
such director to the Board in accordance with Section 3.1 above, to remove, with or without cause,
any of the Warburg Directors, the TowerBrook Directors or the CHS Directors, as the case may be.

     3.3. Committees. Subject to applicable law and any rules or regulations of any stock
exchange or automated dealer quotation system on which the Common Stock is listed, in the event the
Board shall at any time create a committee of the Board, any such committee shall have, at the
option of the Majority Warburg Investors, at least one Warburg Director so long as the Warburg
Investors are entitled to elect at least one member of the Board and, at the option of the Majority
TowerBrook Investors, at least one TowerBrook Director so long as the TowerBrook Investors are
entitled to elect at least one member of the Board; provided, however, that in
respect of any such Investor, the foregoing shall not apply to any committee formed to consider a
transaction between the Company and such Investor or its Affiliates.

     3.4. Directors of Subsidiaries.

     (a) For so long as the TowerBrook Investors are entitled to elect at least one member
of the Board, the TowerBrook Investors shall be entitled to designate one director to the
board of directors of each Subsidiary. In the event that the TowerBrook Investors exercise
their right pursuant to this Section 3.4, the Company shall take all action within its
power to cause such designee to be appointed to such boards.

     (b) For so long as Warburg Pincus is entitled to elect at least one member of the
Board, Warburg Pincus shall be entitled to designate one director to the board of

6

 

directors of each Subsidiary. In the event that Warburg Pincus exercises its right
pursuant to this Section 3.4, the Company shall take all action within its power to cause
such designee to be appointed to such boards.

     (c) For so long as CHS is entitled to elect at least one member of the Board and
Warburg Pincus and the TowerBrook Investors are each entitled to elect at least one member
of the Board, CHS shall be entitled to designate one director to the board of directors of
each Subsidiary to which Warburg Pincus and the TowerBrook Investors have designated a
director. During any period in which CHS is entitled to elect at least one member of the
Board and neither Warburg Pincus nor the TowerBrook Investors are entitled to elect at
least one member of the Board, CHS shall be entitled to designate one director to the board
of directors of each Subsidiary. In the event that CHS exercises its right pursuant to
this Section 3.4, the Company shall take all action within its power to cause such designee
to be appointed to such boards.

     3.5. Board Observers.

     (a) For so long as there are no Warburg Directors serving on the Board and the Warburg
Investors Own at least five percent (5%) of the Common Stock Owned by Investors, the
Warburg Investors shall be entitled to designate two non-voting observers (the “Warburg
Observers”), who shall be entitled to observe meetings of the Board. For so long as
there are no TowerBrook Directors serving on the Board and the TowerBrook Investors Own at
least five percent (5%) of the Common Stock Owned by Investors, the TowerBrook Investors
shall be entitled to designate two non-voting observers (the “TowerBrook Observers”
and, together with the Warburg Observers, the “Board Observers”), who shall be
entitled to observe meetings of the Board.

     (b) The Board Observers shall be entitled to receive notice of all meetings of the
Board at the same time and in the same manner as the Board, and have full rights to attend
all meetings thereof and all meetings (whether such meetings are formal or informal, are
convened in person, telephonically, or by any other telecommunication means) of any
committee or subcommittee of the Board, including, without limitation, any executive
committee. The Company shall provide the Board Observers all materials distributed to the
Board and all other information related to the Company which is made available to, or which
would otherwise be available upon reasonable request by, the Board or committee members
thereof. The Company shall also pay the reasonable out-of-pocket expenses incurred by the
Board Observers in connection with attending the meetings of the Board and all committees
thereof (including travel and related expenses).

     (c) No Board Observer shall (i) be permitted to act in any way as a director of the
Board, (ii) be included for purposes of determining a quorum at a meeting of the Board for
the transaction of business or otherwise, (iii) vote on any matter presented to or voted
upon by the Board or (iv) without the prior consent of the Board, disclose non-public,
competitively sensitive Company information to anyone outside of the Company.

7

 

     (d) The Chairman of the Board shall be entitled to, in its reasonable discretion,
excuse any Board Observer from any meeting or proceeding of the Board, to the extent that
the Chairman of the Board in good faith believes that such action is required in order to
comply with applicable law.

4. Legends. A copy of this Agreement shall be filed with the Secretary of the Company and
kept with the records of the Company. Each certificate or other instrument representing Shares
owned by any Investor shall bear upon its face the following legends, as appropriate:

     (i) THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT AND
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”),
OR ANY STATE SECURITIES LAW AND MAY NOT BE OFFERED, SOLD, ASSIGNED, PLEDGED, HYPOTHECATED OR
OTHERWISE DISPOSED OF UNLESS AND UNTIL REGISTERED UNDER THE ACT AND ANY APPLICABLE STATE
SECURITIES LAWS UNLESS, IN THE OPINION OF COUNSEL TO THE HOLDER OF SUCH SECURITIES, WHICH
COUNSEL MUST BE, AND THE FORM AND SUBSTANCE OF WHICH OPINION ARE, REASONABLY SATISFACTORY TO
SPHERIS HOLDING III, INC. (THE “COMPANY”), SUCH OFFER, SALE, ASSIGNMENT, PLEDGE,
HYPOTHECATION, TRANSFER OR OTHER DISPOSITION IS EXEMPT FROM REGISTRATION OR IS OTHERWISE IN
COMPLIANCE WITH THE ACT, SUCH LAWS AND THE AMENDED AND RESTATED STOCKHOLDERS’ AGREEMENT
DATED AS OF OCTOBER 3, 2008, BY AND AMONG THE COMPANY, WARBURG PINCUS PRIVATE EQUITY VIII,
L.P., TOWERBROOK INVESTORS L.P., SPHERIS INVESTMENT LLC AND CHS/COMMUNITY HEALTH SYSTEMS,
INC. (THE “STOCKHOLDERS’ AGREEMENT”).

     (ii) THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO RESTRICTIONS ON
TRANSFER AND OTHER CONDITIONS, AS SPECIFIED IN THE STOCKHOLDERS’ AGREEMENT, COPIES OF WHICH
ARE ON FILE AT THE OFFICE OF THE COMPANY AND WILL BE FURNISHED WITHOUT CHARGE TO THE HOLDER
OF SUCH SECURITIES UPON WRITTEN REQUEST.

In addition, certificates representing Shares shall bear any legends required by the applicable
laws of any states.

5. Covenants, Representations and Warranties.

     5.1. Actions by the Board Requiring the Approval of the Majority Warburg Investors;
Actions by the Board Requiring the Approval of the Majority TowerBrook Investors.

     (a) Without the approval of (x) the Board and (y) for so long as the Warburg Investors
own at least five percent (5%) of the Common Stock Owned by Investors, the

8

 

affirmative vote of the Majority Warburg Investors, the Company will not, and will not
permit any Subsidiary to:

     (i) sell, lease, or dispose of assets in excess of $5,000,000 outside of the ordinary
course of business;

     (ii) incur indebtedness for borrowed money in excess of $2,000,000 in any fiscal year;

     (iii) make capital expenditures in any fiscal year in excess of an amount equal to 110%
of the capital expenditures described in the operating plan of the Company approved by the
Board (the “Operating Plan”) for such fiscal year;

     (iv) engage in any material business or activity other than that described in the
Operating Plan;

     (v) materially change its accounting methods or policies or change its auditors;

     (vi) increase the compensation of its senior executives other than as described in the
Operating Plan;

     (vii) approve the Operating Plan; or

     (viii) take, agree to take or resolve to take any actions in furtherance of any of the
foregoing.

     (b) Without the written approval of the Majority TowerBrook Investors, the Company
will not:

     (i) amend, alter or repeal the preferences, special rights or other powers of the
Preferred Stock in a manner that (a) would adversely affect the rights of one holder of
Preferred Stock, in its capacity as a holder of Preferred Stock, without similarly affecting
the rights of all other holders of Preferred Stock or (b) changes the economic terms of the
Preferred Stock other than the issuance of Equity Securities of which the TowerBrook
Investors have or had been granted purchase rights pursuant to Section 1 hereof;

     (ii) authorize or effect any merger or consolidation or other reorganization of the
Company with or into another corporation or other entity other than in connection with a
Company Sale to any Person or Persons that are not Affiliates of any of the Warburg
Investors; or

     (iii) amend, alter or repeal the Restated Certificate or bylaws of the Company in a
manner that (a) would adversely affect the rights of one holder of Preferred Stock, in its
capacity as a holder of Preferred Stock, without similarly affecting the rights of all other
holders of Preferred Stock or (b) changes the economic terms of the Preferred Stock other
than the issuance of Equity Securities of which the TowerBrook Investors have or had been
granted purchase rights pursuant to Section 1 hereof.

9

 

     5.2. Transactions With Investors. So long as TowerBrook Investors Owns at least 5% of
the Common Stock Owned by Investors, the Company will not enter, and will cause its subsidiaries
not to enter, into any Warburg Affiliated Transaction without the approval of the Investors that
Own a majority of the Common Stock Owned by Investors other than the Warburg Investors and, for so
long as Spheris Investment is an Affiliate of Warburg Pincus, Spheris Investment. For the purposes
hereof, “Warburg Affiliated Transaction” shall mean, at any time that Warburg Pincus and Affiliates
of Warburg Pincus Own twenty percent (20%) or more of the aggregate Common Stock Owned by
Investors, any transaction outside the ordinary course of business of the Company and its
Subsidiaries (other than the issuance of Equity Securities of which the TowerBrook Investors have
or had been granted purchase rights pursuant to Section 1 hereof) with Warburg Pincus or any
Affiliate of Warburg Pincus.

     5.3. Information Rights. At any time that the Company is not required to file
periodic reports pursuant to the Exchange Act, or, if required and the Company fails to file such
required periodic reports with the Securities and Exchange Commission (the “SEC”) for any
reason whatsoever, the Company shall provide to each Investor, by electronic means or otherwise,
essentially the same financial statements that would be contained in Annual Reports on Form 10-K
and in Quarterly Reports on Form 10-Q, if the Company were required to file, or did not fail to
file, such periodic reports, it being understood and agreed that such information shall (a) be
provided to the Investors no later than the date on which the Company would have been required to
file such report with the SEC and (b) include, without limitation, annual audited financial
statements and unaudited quarterly financial statements, each prepared in accordance with generally
accepted accounting principles. Without limiting the foregoing, from and after the date hereof, on
reasonable prior written notice, the Company and its subsidiaries shall make their respective
representatives reasonably available to each Investor that Owns at least 10% of the Common Stock
Owned by all Investors to discuss the business, results of operations and other matters pertaining
to the Company and its subsidiaries. Any and all information provided to any Investor pursuant to
the terms of this Agreement (other than any information that is generally available to the public
through no breach of the terms of this Agreement) shall be treated as confidential information by
such Investor and such Investor shall use its reasonable best efforts to ensure that such
information is not disclosed or otherwise divulged to any third party (other than such Investor’s
counsel, accountants and other professional advisors in connection with services being performed by
any such professional for such Investor and to the members, partners and limited partners of the
Warburg Investors and the TowerBrook Investors).

     5.4. Warburg Information Rights.

     (a) In addition to the rights provided for in Paragraph 5.3, the Warburg Investors
will be entitled to the following contractual rights:

     (i) The Warburg Investors shall be permitted to consult with management of the Company
and its Subsidiaries (“Management”) on significant business issues, including
Management’s proposed annual operating plans, and Management will make itself available to
meet with the Warburg Investors regularly at mutually agreeable times for such consultation
and to review progress in achieving said plans;

10

 

     (ii) In the event of any material development to or affecting the Company’s business,
the Company shall notify the Warburg Investors and provide the Warburg Investors with the
opportunity, on reasonable prior written notice, to consult with Management with respect
thereto; and

     (iii) On reasonable prior written notice, the Warburg Investors may discuss the
business operations, properties and financial and other conditions of the Company with
Management and with the Company’s independent accountants and investment bankers;

provided, however, that the Board shall be entitled to, in its reasonable discretion, limit the
foregoing rights to the extent that the Board in good faith believes that such action is required
in order to comply with applicable law.

     (b) The aforementioned rights are intended to satisfy the requirement of management
rights for purposes of qualifying the Warburg Investors’ investments in the Company as
“venture capital investments” for purposes of the Department of Labor “plan assets”
regulation, 29 C.F.R. §2510.3-101. In the event the aforementioned rights are not
satisfactory for such purpose, the Company and the Warburg Investors shall reasonably
cooperate in good faith to agree upon mutually satisfactory management rights that satisfy
such regulations.

6. Amendment, Modification, Supplement and Waiver. This Agreement may be amended, modified
or supplemented, and the enforcement of any provision hereof may be waived, with, and only with,
the prior written consent of the Company and each Investor Owning at least five percent (5%) of the
Common Stock Owned by Investors.

7. Termination of Rights and Obligations Under Certain Sections. All rights and
obligations pursuant to Sections 1, 2, 5, 8, 9, and 10 of this Agreement shall terminate upon the
closing of a Qualified Public Offering. Without limiting the foregoing, this Agreement or any
portion hereof shall terminate upon the written consent of each Investor Owning at least five
percent (5%) of the Common Stock Owned by Investors.

8. Parties.

     8.1. Assignment Generally. The provisions of this Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective heirs, legal representatives,
successors and assigns; provided, that no Investor shall be permitted to assign any of his,
her or its obligations pursuant to this Agreement without the prior written consent of the Company,
the Majority Warburg Investors and the Majority TowerBrook Investors, unless such assignment is in
connection with a Transfer explicitly permitted by this Agreement and, prior to such assignment,
such assignee complies with the requirements of Section 8.3; provided, further,
that the parties hereto acknowledge and agree that, subject to compliance with Section 8.3 hereof,
Spheris Investment shall be permitted to assign its rights and obligations under this Agreement
from time to time in accordance with the terms of Section 13 of the Spheris Investment LLC
Agreement. Notwithstanding the foregoing, the rights and obligations set forth in Section 2.3 and
Section 3, and Sections 5.2 and 5.4 may not be assigned.

11

 

     8.2. Termination. Any party to, or Person who is subject to, this Agreement that
ceases to Own any Shares shall cease to be a party to, or Person who is subject to, this Agreement
and thereafter shall have no rights or obligations hereunder; provided, however,
that a Transfer of Shares not explicitly permitted under this Agreement shall not relieve any
Investor of any of his, her or its obligations hereunder.

     8.3. Agreements to Be Bound. Notwithstanding anything to the contrary contained in
this Agreement, as a condition precedent to the effectiveness of any Transfer of Shares the
transferee thereof shall be required to agree in writing to be bound by the terms and conditions of
this Agreement pursuant to an instrument of assumption reasonably satisfactory in substance and
form to the Company (a “Joinder”).

9. Recapitalizations, Exchanges, etc. Affecting the Shares. Except as otherwise provided
herein, the provisions of this Agreement shall apply to the fullest extent set forth herein with
respect to (a) the Shares and (b) any and all Equity Securities of the Company or any successor or
assign of the Company (whether by merger, consolidation, sale of assets or otherwise) which may be
issued in respect of, in exchange for, or in substitution for the Shares, by reason of any stock
dividend, split, reverse split, combination, recapitalization, reclassification, merger,
consolidation or otherwise. Except as otherwise expressly provided herein, this Agreement is not
intended to confer, and does not confer, upon any Person, except for the parties hereto, any rights
or remedies hereunder.

10. Further Assurances. Each party hereto or Person subject hereto shall do and perform or
cause to be done and performed all such further acts and things and shall execute and deliver all
such other agreements, certificates, instruments and documents as any other party hereto or Person
subject hereto may reasonably request in order to carry out the intent and accomplish the purposes
of this Agreement and the consummation of the transactions contemplated hereby.

11. Governing Law. This Agreement and the rights and obligations of the parties hereunder
and the Persons subject hereto shall be governed by, and construed and interpreted in accordance
with, the laws of the State of Delaware, without giving effect to the choice of law principles
thereof.

12. Invalidity of Provision. The invalidity or unenforceability of any provision of this
Agreement in any jurisdiction shall not affect the validity or enforceability of the remainder of
this Agreement in that jurisdiction or the validity or enforceability of this Agreement, including
that provision, in any other jurisdiction.

13. Notices. All notices, requests, demands, waivers and other communications required or
permitted to be given under this Agreement shall be in writing and shall be deemed to have been
duly given if (a) delivered personally, (b) mailed, certified or registered mail with postage
prepaid, (c) sent by next-day or overnight mail or delivery or (d) sent by telecopy (including
facsimile) or telegram, as follows:

	 	(i)	 	If to the Company, to it at:

Spheris Holding III, Inc.

9009 Carothers Parkway

12

 

Suite C-3

Franklin, Tennessee 37067

Facsimile No.: (615) 261-1792

Attention: Steven Simpson

with a copy to:

Willkie Farr & Gallagher

787 Seventh Avenue

New York, New York 10019

Facsimile No.: (212) 728-8111

Attention: Steven J. Gartner, Esq.

                   Mark A. Cognetti, Esq.

	 	(ii)	 	If to Warburg Pincus, to it at:

Warburg Pincus Private Equity VIII, L.P.

c/o Warburg Pincus LLC

466 Lexington Avenue

New York, New York 10017

Facsimile No.: (212) 878-9100

Attention: Joel Ackerman

                   Tenno Tsai

with a copy to:

Willkie Farr & Gallagher

787 Seventh Avenue

New York, New York 10019

Facsimile No.: (212) 728-8111

Attention: Steven J. Gartner, Esq.

                   Mark A. Cognetti, Esq.

	 	(iii)	 	If to TowerBrook, to it at:

TowerBrook Investors L.P.

430 Park Avenue

New York, NY 10022

Facsimile No.: (917) 591-9856

Attention: General Counsel and Jonathan Bilzin

with a copy to:

Kirkland & Ellis LLP

153 East 53rd Street

New York, NY 10022-4675

Facsimile No.: (212) 446-4900

Attention: W. Brian Raftery, Esq.

13

 

	 	(iv)	 	If to Spheris Investment LLC, to it at

c/o Warburg Pincus LLC

466 Lexington Avenue

New York, New York 10017

Facsimile No.: (212) 878-9100

Attention: Joel Ackerman

                     Tenno Tsai

with a copy to:

Spheris Inc.

9009 Carothers Parkway

Suite C-3

Franklin, Tennessee 37067

Facsimile No.: (615) 261-1792

Attn: Steven Simpson

	 	(v)	 	If to CHS/Community Health Systems, Inc., to it at

	 
	 	 	 	Community Health Systems Professional

     Services Corporation

4000 Meridian Boulevard

Franklin, Tennessee 37067

Facsimile No.: (615) 465-3012

Attn: Senior Vice President, Acquisitions &

          Development

with a copy to:

Community Health Systems Professional

     Services Corporation

4000 Meridian Boulevard

Franklin, Tennessee 37067

Facsimile No: (615) 373-9704

Attention: General Counsel

     (vi) If to any other Investor, to such Investor at the address or facsimile number
listed on the signature page hereto or the Joinder Agreement executed by such Investor or as
such Investor shall designate to the Company in writing in accordance with the terms hereof,
with a copy to the Company and Investors at their respective addresses indicated herein;

     or, in each case, to such other Person or address as any party shall specify by notice in
writing to the Company and Investors. Any notice so addressed shall be deemed to be given: if

14

 

delivered personally or by telecopy (including facsimile) or telegram, on the date of such
delivery, if a business day, otherwise on the first business day thereafter; if mailed by certified
or registered mail with postage prepaid, on the third business day after the date of such mailing;
and if sent by next-day or overnight mail or delivery, on the first business day following the date
of such mailing or delivery.

14. Headings; Execution in Counterparts. The headings and captions contained herein are
for convenience only and shall not control or affect the meaning or construction of any provision
hereof. This Agreement may be executed in any number of counterparts, each of which shall be
deemed to be an original and which together shall constitute one and the same instrument.

15. Entire Agreement. This Agreement, together with Registration Rights Agreement and the
other agreements and documents referenced herein, including in the recitals hereto (collectively,
the “Other Agreements”), embodies the entire agreement and understanding of the parties
hereto in respect of the subject matter contained herein. There are no restrictions, promises,
representations, warranties, covenants or undertakings relating to the Shares, other than those
expressly set forth or referred to herein and other than those set forth in the Other Agreements.
This Agreement and the Other Agreements supersede all prior agreements and understandings among
each of the parties with respect to such subject matter, and it is the understanding of all parties
hereto that any such prior agreement is hereby terminated, null and void as of the date hereof.

16. Injunctive Relief. The Shares cannot readily be purchased or sold in the open market,
and for that reason, among others, the Company and the Investors will be irreparably damaged in the
event this Agreement is not specifically enforced. Each of the parties therefore agrees that in
the event of a breach of any provision of this Agreement, the aggrieved party may elect to
institute and prosecute proceedings in any court of competent jurisdiction to enforce specific
performance or to enjoin the continuing breach of this Agreement. Such remedies shall, however, be
cumulative and not exclusive, and shall be in addition to any other remedy which the Company or the
Investors may have. Each party hereto hereby irrevocably submits to the non-exclusive jurisdiction
of the state and federal courts in New York, New York for the purposes of any suit, action or other
proceeding arising out of or based upon this Agreement or the subject matter hereof. Each party
hereto hereby consents to service of process by mail made in accordance with Section 13 hereof.

17. Defined Terms. As used in this Agreement, the following terms shall have the meanings
ascribed to them below:

     17.1. Affiliate. “Affiliate” shall mean, with respect to any Person, a Person
directly or indirectly, through one or more intermediaries, controlling, controlled by, or under
common control with, such Person.

     17.2. CHS. “CHS” shall mean CHS/Community Health Systems, Inc., a Delaware
corporation.

     17.3. Common Stock. “Common Stock” shall mean common stock, par value $0.01 per
share, of the Company.

15

 

     17.4. Company Sale. “Company Sale” shall mean any sale (including by merger or
consolidation) of all of the Shares owned by the Warburg Investors or any sale of all or
substantially all of the assets of the Company and its Subsidiaries, on a consolidated basis, in
either case, to any Person.

     17.5. Convertible Securities. “Convertible Securities” shall mean any warrants,
options or other rights to acquire, and any equity and debt securities convertible into, capital
stock of the Company or any Subsidiary.

     17.6. Equity Securities. “Equity Securities” shall mean any equity securities of any
kind of the Company or any Subsidiary, including any Convertible Securities.

     17.7. Exchange Act. “Exchange Act” shall mean the Securities Exchange Act of 1934, as
amended.

     17.8. Investors. “Investors” shall mean the Warburg Investors, the TowerBrook
Investors, Spheris Investment, CHS and their respective transferees and assigns that become parties
to this Agreement pursuant to Section 8.3 hereof.

     17.9. Mandatory Conversion. “Mandatory Conversion” shall have the meaning ascribed to
such term in the Restated Certificate.

     17.10. Majority TowerBrook Investors. “Majority TowerBrook Investors” shall mean the
TowerBrook Investors that Own the majority of the aggregate Common Stock Owned by the TowerBrook
Investors.

     17.11. Majority Warburg Investors. “Majority Warburg Investors” shall mean the
Warburg Investors that Own the majority of the aggregate Common Stock Owned by the Warburg
Investors.

     17.12. Owns, Own or Owned. “Owns,” “Own,” or “Owned” shall mean
beneficial ownership within the meaning of Rule 13d-3 under the Exchange Act, assuming the
conversion (whether or not then convertible) of all outstanding Preferred Stock (which for purposes
hereof shall mean assuming the conversion (whether or not then convertible) of all outstanding
Preferred Stock into the number of shares of Common Stock into which such Preferred Stock is
convertible at the then applicable Conversion Rate in accordance with, and as adjusted from time to
time by, the Restated Certificate without giving effect to subclauses 5(a)(x) and 5(a)(z) of the
Restated Certificate).

     17.13. Permitted Assignee. A “Permitted Assignee” shall mean, with respect to each
Investor, any Affiliate of such Investor and any member, general partner or limited partner of such
Investor (or any Person holding an equity interest in any such member, general partner or limited
partner); provided, that in each instance, any such transferee agrees to be bound by the
provisions of this Agreement in accordance with the terms of Section 8.3 hereof.

16

 

     17.14. Person. “Person” shall mean an individual, partnership, corporation, limited
liability company, business trust, joint stock company, trust, unincorporated association, joint
venture, governmental authority or other entity of whatever nature.

     17.15. Qualified Public Offering. “Qualified Public Offering” shall have the meaning
ascribed to such term in the Restated Certificate.

     17.16. Registration Rights Agreement. “Registration Rights Agreement” shall mean that
certain Amended and Restated Registration Rights Agreement, dated as of the date hereof, by and
among the Company and the investors ascribed thereto.

     17.17. Restricted Stock Plan. “Restricted Stock Plan” shall mean the Spheris Holding
III, Inc. Stock Incentive Plan.

     17.18. Securities Act. “Securities Act” shall mean the Securities Act of 1933, as
amended.

     17.19. Shares. “Shares” shall mean shares of Common Stock and Convertible Securities
(including Preferred Stock) convertible into Common Stock.

     17.20. Spheris Investment. “Spheris Investment” shall mean Spheris Investment LLC and
its transferees and assigns.

     17.21. Spheris Investment LLC Agreement. “Spheris Investment LLC Agreement” shall
mean the Amended and Restated Limited Liability Company Agreement of Spheris Investment LLC.

     17.22. TowerBrook Investors. “TowerBrook Investors” shall mean TowerBrook Investors
L.P.

     17.23. Transfer. “Transfer” (or any variation thereof used herein) shall mean any
direct or indirect sale, assignment, mortgage, transfer, pledge, hypothecation or other disposal.

     17.24. Warburg Investors. “Warburg Investors” shall mean Warburg Pincus, Warburg
Pincus Netherlands Private Equity VIII C.V. I and WP-WP VIII Investors L.P.

     17.25. Warburg Pincus. “Warburg Pincus” shall mean Warburg Pincus Private Equity
VIII, L.P.

[signature pages follow]

17

 

     IN WITNESS WHEREOF, the undersigned has executed this Stockholders’ Agreement as of the date
first above written.

	 	 	 	 	 
	 	SPHERIS HOLDING III, INC.

 	 
	 	By:  	/s/ Steven E. Simpson
 	 
	 	 	Name:  	Steven E. Simpson 	 
	 	 	Title:  	President & CEO 	 
	 

[Stockholders’ Agreement Signature Page]

18

 

     IN WITNESS WHEREOF, the parties hereto have executed this Stockholders’ Agreement as of the
date first above written.

	 	 	 	 	 
	 	WARBURG PINCUS PRIVATE EQUITY VIII, L.P.

 	 
	 	By:  	 Warburg Pincus Partners LLC, its General Partner
 	 
	 
	 	 	 
	 	By:  	                                              /s/ Joel Ackerman
 	 
	 	 	Name:  	Joel Ackerman 	 
	 	 	Title:  	Authorized Signatory 	 
	 
	 	WARBURG PINCUS NETHERLANDS PRIVATE EQUITY VIII C.V. I

 	 
	 	By:  	 Warburg Pincus Partners LLC, its General Partner
 	 
	 
	 	 	 
	 	By:  	                                              /s/ Joel Ackerman
 	 
	 	 	Name:  	Joel Ackerman 	 
	 	 	Title:  	Authorized Signatory 	 
	 
	 	WP-WP VIII INVESTORS L.P.

 	 
	 	By:  	 Warburg Pincus Partners LLC, its General Partner
 	 
	 
	 	 	 
	 	By:  	                                              /s/ Joel Ackerman
 	 
	 	 	Name:  	Joel Ackerman 	 
	 	 	Title:  	Authorized Signatory 	 
	 

[Stockholders’ Agreement Signature Page]

19

 

     IN WITNESS WHEREOF, the undersigned has executed this Stockholders’ Agreement as of the date
first set forth above.

	 	 	 	 	 
	 	TOWERBROOK INVESTORS L.P.

 	 
	 	By:  	/s/ Glenn F. Miller
 	 
	 	 	Name:  	Glenn F. Miller 	 
	 	 	Title:  	Attorney-in-Fact 	 
	 

[Stockholders’ Agreement Signature Page]

20

 

     IN WITNESS WHEREOF, the undersigned has executed this Stockholders’ Agreement as of the date
first set forth above.

	 	 	 	 	 
	 	CHS/COMMUNITY HEALTH SYSTEMS, INC.

 	 
	 	By:  	/s/ Kenneth D. Hawkins
 	 
	 	 	Name:  	Kenneth D. Hawkins 	 
	 	 	Title:  	Senior Vice President,
 Acquisitions &
Development 	 
	 

[Stockholders’ Agreement Signature Page]

21

 

     IN WITNESS WHEREOF, the undersigned has executed this Stockholders’ Agreement as of the date
first above written.

	 	 	 	 	 
	 	SPHERIS INVESTMENT LLC

 	 
	 	By:  	 Warburg Pincus Private Equity VIII, L.P., Warburg
Pincus Netherlands Private Equity VIII C.V. I and
 WP-WP VIII Investors L.P., together, its Managing Members
 	 
	 
	 	By:  	                                       Warburg Pincus Partners LLC, their General Partner
 	 
	 
	 	 	 
	 	By:  	                    /s/ Joel Ackerman
 	 
	 	 	Name:  	Joel Ackerman 	 
	 	 	Title:  	Authorized Signatory 	 
	 

22EX-10.3

Exhibit
10.3

EXECUTION COPY

SPHERIS HOLDING III, INC.

AMENDED AND RESTATED

REGISTRATION RIGHTS AGREEMENT

          AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT, dated as of October 3, 2008, among the
investors listed on Schedule I hereto (the “Investors”) and Spheris Holding III,
Inc., a Delaware corporation (the “Company”).

RECITALS

          WHEREAS, the Investors (other than CHS/Community Health Systems, Inc. (“CHS”)) have,
pursuant to the terms of that certain Securities Purchase Agreement, dated as of November 5, 2004,
by and among the Company and the Investors (other than CHS) (the “Purchase Agreement”),
purchased shares of Series A Convertible Preferred Stock, par value $0.01 per share, of the Company
(the “Preferred Stock”); and

          WHEREAS, on the date hereof, CHS has, pursuant to the terms of that certain Securities
Purchase Agreement, dated as of the date hereof, by and between the Company and CHS (the “CHS
Purchase Agreement” and, together with the Purchase Agreement, the “Purchase
Agreements”), (i) purchased shares of Preferred Stock and (ii) acquired warrants (the
“Warrants”) to purchase up to 14,275,000 shares of common stock, par value $0.01 per share,
of the Company (the “Common Stock”); and

          WHEREAS, the shares of Preferred Stock are convertible, and the Warrants are exercisable, into
shares of Common Stock; and

          WHEREAS, the Company has agreed, as a condition precedent to the Investors’ obligations under
the Purchase Agreements, to grant the Investors certain Registration rights; and

          WHEREAS, the Company and the Investors desire to amend and restate that certain Registration
Rights Agreement, dated as of November 5, 2004, by and among the Company and the investors named
therein, and to define the Registration rights of the Investors on the terms and subject to the
conditions herein set forth.

          NOW, THEREFORE, in consideration of the foregoing premises and for other good and valuable
consideration, the parties hereby agree as follows:

     SECTION 1. DEFINITIONS

          As used in this Agreement, the following terms have the respective meanings set forth below:

 

 

          Agreement: shall mean this Amended and Restated Registration Rights Agreement among
the Investors and the Company;

          Commission: shall mean the Securities and Exchange Commission or any other federal
agency at the time administering the Securities Act;

          Exchange Act: shall mean the Securities Exchange Act of 1934, as amended;

          Holder: shall mean any holder of Registrable Securities;

          Initial Public Offering: shall mean the initial public offering of shares of Common
Stock pursuant to a Registration under the Securities Act;

          Initiating Holder: shall mean, with respect to any Registration, the Holder or
Holders who deliver a request to the Company pursuant to Section 2(a)(i) that the Company effect
such Registration;

          Majority TowerBrook Investors: shall mean the TowerBrook Investors holding a majority
of the then outstanding Registrable Securities then held by the TowerBrook Investors.

          Majority Warburg Investors: shall mean the Warburg Investors holding a majority of
the then outstanding Registrable Securities then held by the Warburg Investors.

          Person: shall mean an individual, partnership, joint-stock company, corporation,
trust or unincorporated organization, and a government or agency or political subdivision thereof;

          Register, Registered and Registration: shall mean a registration
effected by preparing and filing a registration statement in compliance with the Securities Act
(and any post-effective amendments filed or required to be filed) and the declaration or ordering
of effectiveness of such registration statement;

          Registrable Securities: shall mean (A) shares of Common Stock issuable upon
conversion of the shares of Preferred Stock, (B) any shares of Common Stock issuable to CHS upon
exercise of the Warrants, (C) any other shares of Common Stock held or hereafter acquired by the
Investors and (D) any stock of the Company issued as a dividend or other distribution with respect
to, or in exchange for or in replacement of, the shares of Preferred Stock or Common Stock referred
to in clause (A), (B) or (C);

          Registration Expenses: shall mean all expenses incurred by the Company in compliance
with Section 2(a), (b) and (c) hereof, including, without limitation, all registration and filing
fees, printing expenses, fees and disbursements of counsel for the Company, fees and expenses of
one counsel for the TowerBrook Investors in an amount not to exceed $25,000, fees and expenses of
one counsel for the Warburg Investors in an amount not to exceed $25,000, fees and expenses of one
counsel for CHS in an amount not to exceed $25,000, blue sky fees and expenses and the expense of
any special audits incident to or required by any such Registration (but excluding the compensation
of regular employees of the Company, which shall be paid in any event by the Company);

-2-

 

          Security, Securities: shall have the meaning set forth in Section 2(1) of the
Securities Act;

          Securities Act: shall mean the Securities Act of 1933, as amended;

          Selling Expenses: shall mean all underwriting discounts and selling commissions
applicable to the sale of Registrable Securities and all fees and disbursements of counsel for each
of the Holders other than (i) fees and expenses of one counsel for the TowerBrook Investors in an
amount not to exceed $25,000, (ii) fees and expenses of one counsel for the Warburg Investors in an
amount not to exceed $25,000 and (iii) fees and expenses of one counsel for CHS in an amount not to
exceed $25,000;

          TowerBrook Initiating Holders: shall mean the TowerBrook Investors who in the
aggregate are the Holders of more than 50% of all then outstanding Registrable Securities held by
TowerBrook Investors;

          TowerBrook Investors: shall mean the Investors designated as TowerBrook Investors in
subsection B of Schedule I hereto and their respective transferees and assigns;

          Warburg Initiating Holders: shall mean Warburg Investors who in the aggregate are the
Holders of more than 50% of all then outstanding Registrable Securities held by Warburg Investors;
and

          Warburg Investors: shall mean the Investors designated as Warburg Investors in
subsection A of Schedule I hereto and their respective transferees and assigns.

     SECTION 2. REGISTRATION RIGHTS

          (a) Requested Registration.

     (i) Request for Registration. If the Company shall receive a written request
that the Company effect any Registration with respect to all or a part of the Registrable
Securities from (v) the Warburg Initiating Holders, at any time prior to an Initial Public
Offering, (w) the Warburg Initiating Holders, at any time after 180 days after an Initial
Public Offering, (x) the TowerBrook Initiating Holders, at any time after 180 days after a
Initial Public Offering, (y) CHS, at any time after 180 days after an Initial Public
Offering or (z) the Holders who are Holders of more than 50% of the then outstanding
Registrable Securities, the Company will:

          (1) promptly give written notice of the proposed Registration, qualification or
compliance to all other Holders; and

          (2) as soon as practicable, use its diligent best efforts to effect such
Registration (including, without limitation, the execution of an undertaking to file
post-effective amendments, appropriate qualification under applicable blue sky or
other state securities laws and appropriate compliance with applicable regulations
issued under the Securities Act) as may be so requested and as would permit or
facilitate the sale and distribution of all or such portion of such

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Registrable Securities as are specified in such request, together with all or
such portion of the Registrable Securities of any Holder or Holders joining in such
request as are specified in a written request received by the Company within ten
(10) business days after written notice from the Company is given under Section
2(a)(i)(1) above; provided that the Company shall not be obligated to
effect, or take any action to effect:

     (A) any such Registration pursuant to this Section 2(a) in any
particular jurisdiction in which the Company would be required to execute a
general consent to service of process in effecting such Registration,
qualification or compliance, unless the Company is already subject to
service in such jurisdiction and except as may be required by the Securities
Act or applicable rules or regulations thereunder;

     (B) any such Registration pursuant to clause (w) of this Section
2(a)(i), if the Company has effected three (3) such Registrations pursuant
to requests under clauses (v) and (w) of this Section 2(a)(i) and such
Registrations have been declared or ordered effective and the sales of all
such Registrable Securities requested to be so Registered shall have closed;

     (C) any such Registration pursuant to clause (x) of this Section
2(a)(i), if the Company has effected two (2) such Registrations pursuant to
requests under clause (x) of this Section 2(a)(i) and such Registrations
have been declared or ordered effective and the sales of all such
Registrable Securities requested to be so Registered shall have closed;

     (D) any such Registration pursuant to clause (y) of this Section
2(a)(i), if the Company has effected one (1) such Registration pursuant to
requests under clause (y) of this Section 2(a)(i) and such Registration has
been declared or ordered effective and the sales of all such Registrable
Securities requested to be so Registered shall have closed;

     (E) any such Registration pursuant to clause (z) of this Section
2(a)(i), if the Company has effected two (2) such Registrations pursuant to
a request under clause (z) of this Section 2(a)(i) and such Registrations
have been declared or ordered effective and the sales of all such
Registrable Securities requested to be so Registered shall have closed;

     (F) any such Registration pursuant to this Section 2(a), if the
Registrable Securities requested by the Initiating Holders to be Registered
pursuant to such request do not have an anticipated aggregate public
offering price (before any underwriting discounts and commissions) of at
least $20,000,000;

-4-

 

     (G) any such Registration pursuant to this Section 2(a) during the
period starting with the date sixty (60) days prior to the Company’s good
faith estimate of the date of filing of, and ending on the date six (6)
months immediately following the effective date of, any registration
statement pertaining to securities of the Company (other than a Registration
of securities in a Rule 145 transaction under the Securities Act, with
respect to an employee benefit plan or with respect to the Company’s first
Registered public offering of its stock), provided that the Company is
actively employing in good faith all reasonable efforts to cause such
registration statement to become effective; provided,
however, that the Company may only delay an offering pursuant to
this Section 2(a)(i)(2)(G) for a period of not more than sixty (60) days, if
a filing of any other registration statement is not made within that period
and the Company may only exercise this right once in any twelve (12)-month
period; or

     (H) any such Registration pursuant to this Section 2(a), if the Company
shall furnish to the Initiating Holders a certificate signed by the
President of the Company stating that in the good faith judgment of the
Board of Directors of the Company it would be seriously detrimental to the
Company or its stockholders for a registration statement to be filed in the
near future, in which case the Company’s obligation to use its best efforts
to comply with this Section 2(a) shall be deferred for a period not to
exceed sixty (60) days from the date of receipt of written request from the
Initiating Holders; provided, however, that the Company
shall not exercise such right more than once in any twelve (12)-month
period.

          The registration statement filed pursuant to the request of the Initiating Holders may,
subject to the provisions of Section 2(a)(ii) below, include other securities of the Company which
are held by Persons who, by virtue of agreements with the Company, are entitled to include their
securities in any such Registration (“Other Stockholders”). In the event any Holder
requests a Registration pursuant to this Section 2(a) in connection with a distribution of
Registrable Securities to its partners, the Registration shall provide for the resale by such
partners, if requested by such Holder.

          The Registration rights set forth in this Section 2 may be assigned, in whole or in part, to
any transferee of Registrable Securities (who shall be bound by all obligations of this Agreement).

     (ii) Underwriting. If the Initiating Holders intend to distribute the
Registrable Securities covered by their request by means of an underwriting, they shall so
advise the Company as a part of their request made pursuant to Section 2(a)(i).

          If Other Stockholders request inclusion of their securities in the underwriting, the Holders
shall offer to include the securities of such Other Stockholders in the underwriting and may
condition such offer on their acceptance of the further applicable provisions of this Section 2.
The Holders whose shares are to be included in such Registration and the Company shall

-5-

 

(together with all Other Stockholders proposing to distribute their securities through such
underwriting) enter into an underwriting agreement in customary form with the representative of the
underwriter or underwriters selected for such underwriting by the Initiating Holders and reasonably
acceptable to the Company; provided, however, that such underwriting agreement
shall not provide for indemnification or contribution obligations on the part of the Holders
materially greater than the obligations of the Holders under Section 2(f)(ii). Notwithstanding any
other provision of this Section 2(a), if the representative advises the Holders in writing that
marketing factors require a limitation on the number of shares to be underwritten, the securities
of the Company held by Other Stockholders shall be excluded from such Registration to the extent so
required by such limitation. If, after the exclusion of the shares, further reductions are still
required, the number of Registrable Securities included in the Registration by each Holder shall be
reduced on a pro rata basis (based on the number of shares held by such Holder), by such minimum
number of shares as is necessary to comply with such request. No Registrable Securities or any
other securities excluded from the underwriting by reason of the underwriter’s marketing limitation
shall be included in such Registration. If any Other Stockholder who has requested inclusion in
such Registration as provided above disapproves of the terms of the underwriting, such Person may
elect to withdraw therefrom by written notice to the Company, the underwriter and the Initiating
Holders. The securities so withdrawn shall also be withdrawn from Registration. If the
underwriter has not limited the number of Registrable Securities or other securities to be
underwritten, the Company and officers and directors of the Company may include its or their
securities for its or their own account in such Registration if the representative so agrees and if
the number of Registrable Securities and other securities which would otherwise have been included
in such Registration and underwriting will not thereby be limited.

          (b) Company Registration.

     (i) If the Company shall determine to Register any of its equity securities either for
its own account or for the account of any Other Stockholder, other than a Registration
relating solely to employee benefit plans, or a Registration relating solely to a Rule 145
transaction under the Securities Act, or a Registration on any registration form which does
not permit secondary sales or does not include substantially the same information as would
be required to be included in a registration statement covering the sale of Registrable
Securities, the Company will:

          (1) promptly give to each of the Holders a written notice thereof (which shall
include a list of the jurisdictions in which the Company intends to attempt to
qualify such securities under the applicable blue sky or other state securities
laws); and

          (2) include in such Registration (and any related qualification under blue sky
laws or other compliance), and in any underwriting involved therein, all the
Registrable Securities specified in a written request or requests, made by the
Holders within fifteen (15) days after receipt of the written notice from the
Company described in clause (1) above, except as set forth in Section 2(b)(ii)
below. Such written request may specify all or a part of the Holders’ Registrable
Securities. In the event any Holder requests inclusion in a Registration pursuant
to this Section 2(b) in connection with a distribution of

-6-

 

Registrable Securities to its partners, the Registration shall provide for the
resale by such partners, if requested by such Holder.

     (ii) Underwriting. If the Registration of which the Company gives notice is
for a Registered public offering involving an underwriting, the Company shall so advise each
of the Holders as a part of the written notice given pursuant to Section 2(b)(i)(1) above.
In such event, the right of each of the Holders to Registration pursuant to this Section
2(b) shall be conditioned upon such Holders’ participation in such underwriting and the
inclusion of such Holders’ Registrable Securities in the underwriting to the extent provided
herein. The Holders whose shares are to be included in such Registration shall (together
with the Company and the Other Stockholders distributing their securities through such
underwriting) enter into an underwriting agreement in customary form with the representative
of the underwriter or underwriters selected for underwriting by the Company;
provided, however, that such underwriting agreement shall not provide for
indemnification or contribution obligations on the part of the Holders materially greater
than the obligations of the Holders under Section 2(f)(ii). Notwithstanding any other
provision of this Section 2(b), if the representative determines that marketing factors
require a limitation on the number of shares to be underwritten, and (x) if such
Registration is the Initial Public Offering, the representative may (subject to the
allocation priority set forth below) exclude from such Registration and underwriting some or
all of the Registrable Securities which would otherwise be underwritten pursuant hereto, and
(y) if such Registration is other than the Initial Public Offering, the representative may
(subject to the allocation priority set forth below) limit the number of Registrable
Securities to be included in the Registration and underwriting to not less than twenty-five
percent (25%) of the shares included therein (based on the number of shares). The Company
shall so advise all Holders of securities requesting Registration, and the number of shares
of securities that are entitled to be included in the Registration and underwriting shall be
allocated in the following manner: the securities of the Company held by officers and
directors of the Company (except shares held by them as Holders) and Other Stockholders
shall be excluded from such Registration and underwriting to the extent required by such
limitation, and, if a limitation on the number of shares is still required, the number of
            shares that may be included in the Registration and underwriting by each of the Holders
shall be reduced, on a pro rata basis (based on the number of shares held by such Holder),
by such minimum number of shares as is necessary to comply with such limitation. If any of
the Holders or any officer, director or Other Stockholder disapproves of the terms of any
such underwriting, he may elect to withdraw therefrom by written notice to the Company and
the underwriter. Any Registrable Securities or other securities excluded or withdrawn from
such underwriting shall be withdrawn from such Registration.

          (c) Form S-3. Following the Initial Public Offering, if the Company meets the
eligibility requirements for use of Form S-3, the Company shall use its best efforts to qualify for
Registration on Form S-3 for secondary sales. After the Company has qualified for the use of Form
S-3, each Holder shall have the right to request an unlimited number of Registrations on Form S-3
(such requests shall be in writing and shall state the number of shares of Registrable Securities
to be disposed of and the intended method of disposition of shares by such Holders),

-7-

 

provided that the Company shall not be obligated to effect, or take any action to
effect, any such Registration pursuant to this Section 2(c):

     (i) unless the Holder or Holders requesting Registration propose to dispose of shares
of Registrable Securities having an aggregate price to the public (before deduction of
Selling Expenses) of more than $5,000,000;

     (ii) within one hundred eighty (180) days of the effective date of the most recent
Registration pursuant to this Section 2(c) in which securities held by the requesting Holder
could have been included for sale or distribution;

     (iii) in any particular jurisdiction in which the Company would be required to execute
a general consent to service of process in effecting such Registration, qualification or
compliance, unless the Company is already subject to service in such jurisdiction and except
as may be required by the Securities Act or applicable rules or regulations thereunder;

     (iv) during the period starting with the date sixty (60) days prior to the Company’s
good faith estimate of the date of filing of, and ending on the date six (6) months
immediately following the effective date of, any registration statement pertaining to
securities of the Company (other than a Registration of securities in a Rule 145 transaction
under the Securities Act or with respect to an employee benefit plan), provided that the
Company is actively employing in good faith all reasonable efforts to cause such
registration statement to become effective; provided, however, that the
Company may only delay an offering pursuant to this Section 2(c)(iv) for a period of not
more than sixty (60) days, if a filing of any other registration statement is not made
within that period and the Company may only exercise this right once in any twelve
(12)-month period; or

     (v) if the Company shall furnish to the requesting Holders a certificate signed by the
President of the Company stating that in the good faith judgment of the Board of Directors
of the Company it would be seriously detrimental to the Company or its stockholders for a
registration statement to be filed in the near future, in which case the Company’s
obligation to use its best efforts to comply with this Section 2(c) shall be deferred for a
period not to exceed sixty (60) days from the date of receipt of written request from the
Holders; provided, however, that the Company shall not exercise such right
more than once in any twelve (12)-month period.

          The Company shall give written notice to all Holders of the receipt of a request for
Registration pursuant to this Section 2(c) and shall provide a reasonable opportunity for other
Holders to participate in the Registration, provided that if the Registration is for an
underwritten offering, the terms of Section 2(a)(ii) above shall apply to all participants in such
offering. Subject to the foregoing, the Company will use its best efforts to effect promptly the
Registration of all shares of Registrable Securities on Form S-3 to the extent requested by the
Holder or Holders thereof for purposes of disposition. In the event any Holder requests a
Registration pursuant to this Section 2(c) in connection with a distribution of Registrable
Securities to its

-8-

 

partners, the Registration shall provide for the resale by such partners, if requested by such
Holder.

          (d) Expenses of Registration. All Registration Expenses incurred in connection with
any Registration, qualification or compliance pursuant to this Section 2 shall be borne by the
Company, and all Selling Expenses shall be borne by the Holders of the securities so Registered pro
rata on the basis of the number of their shares so Registered other than fees and expenses of
counsel, which, to the extent not included in Registration Expenses, shall be borne by the Holder
incurring such fees and expenses of counsel (or, if incurred by a Holder or Holders on behalf of
one or more other Holders, pro rata on the basis of the number of their shares so Registered).

          (e) Registration Procedures. In the case of each Registration effected by the Company
pursuant to this Section 2, the Company will keep the Holders, as applicable, advised in writing as
to the initiation of each Registration and as to the completion thereof. At its expense, the
Company will:

     (i) keep such Registration effective for a period of one hundred twenty (120) days or
until the Holders (or in the case of a distribution to the partners of such Holder, such
partners), as applicable, have completed the distribution described in the registration
statement relating thereto, whichever first occurs; provided, however, that
(1) such one hundred twenty (120)-day period shall be extended for a period of time equal to
the period during which the Holders or partners, as applicable, refrain from selling any
securities included in such Registration in accordance with the provisions in Section 2(i)
hereof; and (2) in the case of any Registration of Registrable Securities on Form S-3 which
are intended to be offered on a continuous or delayed basis, such one hundred and twenty
(120)-day period shall be extended until all such Registrable Securities are sold, provided
that Rule 415, or any successor rule under the Securities Act, permits an offering on a
continuous or delayed basis, and provided further that applicable rules under the Securities
Act governing the obligation to file a post-effective amendment permit, in lieu of filing a
post-effective amendment which (x) includes any prospectus required by Section 10(a) of the
Securities Act or (y) reflects facts or events representing a material or fundamental change
in the information set forth in the registration statement, the incorporation by reference
of information required to be included in (x) and (y) above to be contained in periodic
reports filed pursuant to Section 12 or 15(d) of the Exchange Act in the registration
statement;

     (ii) furnish such number of prospectuses and other documents incident thereto as each
of the Holders, as applicable, from time to time may reasonably request;

     (iii) notify each Holder of Registrable Securities covered by such Registration at any
time when a prospectus relating thereto is required to be delivered under the Securities Act
of the happening of any event as a result of which the prospectus, any preliminary
prospectus or free writing prospectus and any amendment thereof or supplement thereto
included 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

-9-

 

be stated therein or necessary to make the statements therein not misleading in the
light of the circumstances then existing; and

     (iv) furnish, on the date that such Registrable Securities are delivered to the
underwriters for sale, if such securities are being sold through underwriters or, if such
securities are not being sold through underwriters, on the date that the registration
statement with respect to such securities becomes effective, (1) an opinion, dated as of
such date, of the counsel representing the Company for the purposes of such Registration, in
form and substance as is customarily given to underwriters in an underwritten public
offering and reasonably satisfactory to a majority in interest of the Holders participating
in such Registration, addressed to the underwriters, if any, and to the Holders
participating in such Registration and (2) a letter, dated as of such date, from the
independent certified public accountants of the Company, in form and substance as is
customarily given by independent certified public accountants to underwriters in an
underwritten public offering and reasonably satisfactory to a majority in interest of the
Holders participating in such Registration, addressed to the underwriters, if any, and if
permitted by applicable accounting standards, to the Holders participating in such
Registration.

          (f) Indemnification.

     (i) The Company will indemnify each of the Holders, as applicable, each of its
officers, directors and partners, and each Person controlling each of the Holders, with
respect to each Registration which has been effected pursuant to this Section 2, and each
underwriter, if any, and each person who controls any underwriter, against all claims,
losses, damages and liabilities (or actions in respect thereof) arising out of or based on
any untrue statement (or alleged untrue statement) of a material fact contained in any
prospectus, preliminary prospectus, free writing prospectus and any amendment thereof or
supplement thereto, offering circular or other document (including any related registration
statement, notification or the like) incident to any such Registration, qualification or
compliance, or based on 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, or
any violation by the Company of the Securities Act or the Exchange Act or any rule or
regulation thereunder applicable to the Company and relating to action or inaction required
of the Company in connection with any such Registration, qualification or compliance, and
will reimburse each of the Holders, each of its officers, directors and partners, and each
Person controlling each of the Holders, each such underwriter and each Person who controls
any such underwriter, for any legal and any other expenses reasonably incurred in connection
with investigating and defending any such claim, loss, damage, liability or action, provided
that the Company will not be liable in any such case to the extent that any such claim,
loss, damage, liability or expense arises out of or is based on any untrue statement or
omission based upon written information furnished to the Company by the Holders or
underwriter and stated to be specifically for use therein.

     (ii) Each of the Holders will, if Registrable Securities held by it are included in the
securities as to which such Registration, qualification or compliance is

-10-

 

being effected, indemnify the Company, each of its directors and officers and each
underwriter, if any, of the Company’s securities covered by such a registration statement,
each person who controls the Company or such underwriter, each Other Stockholder and each of
their officers, directors, and partners, and each person controlling such Other Stockholder
against all claims, losses, damages and liabilities (or actions in respect thereof) arising
out of or based on any untrue statement (or alleged untrue statement) of a material fact
contained in any such registration statement, prospectus, preliminary prospectus, free
writing prospectus and any amendment thereof or supplement thereto, offering circular or
other document made by such Holder about such Holder, or any omission (or alleged omission)
to state therein a material fact required to be stated therein or necessary to make the
statements by such Holder about such Holder therein not misleading, and will reimburse the
Company and such Other Stockholders, directors, officers, partners, persons, underwriters or
control persons for any legal or any other expenses reasonably incurred in connection with
investigating and defending any such claim, loss, damage, liability or action, in each case
to the extent, but only to the extent, that such untrue statement (or alleged untrue
statement) or omission (or alleged omission) is made in such registration statement,
prospectus, preliminary prospectus, free writing prospectus and any amendment thereof or
supplement thereto, offering circular or other document in reliance upon and in conformity
with written information furnished to the Company by such Holder and stated to be
specifically for use therein; provided, however, that the obligations of each of the Holders
hereunder shall be limited to an amount equal to the net proceeds to such Holder of
securities sold as contemplated herein.

     (iii) Each party entitled to indemnification under this Section 2(f) (the
“Indemnified Party”) shall give notice to the party required to provide
indemnification (the “Indemnifying Party”) promptly after such Indemnified Party has
actual knowledge of any claim as to which indemnity may be sought, and shall permit the
Indemnifying Party to assume the defense of any such claim or any litigation resulting
therefrom; provided that counsel for the Indemnifying Party, who shall conduct the defense
of such claim or any litigation resulting therefrom, shall be approved by the Indemnified
Party (whose approval shall not unreasonably be withheld) and the Indemnified Party may
participate in such defense at such party’s expense (unless the Indemnified Party shall have
reasonably concluded that there may be a conflict of interest between the Indemnifying Party
and the Indemnified Party in such action, in which case the fees and expenses of counsel
shall be at the expense of the Indemnifying Party), and provided further that the failure of
any Indemnified Party to give notice as provided herein shall not relieve the Indemnifying
Party of its obligations under this Section 2(f) unless the Indemnifying Party is materially
prejudiced thereby. 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. Each Indemnified Party shall furnish such
information regarding itself or the claim in question as an Indemnifying Party may
reasonably request in writing and as shall be reasonably required in connection with the
defense of such claim and litigation resulting therefrom.

-11-

 

     (iv) If the indemnification provided for in this Section 2(f) is held by a court of
competent jurisdiction to be unavailable to an Indemnified Party with respect to any loss,
liability, claim, damage or expense referred to herein, then the Indemnifying Party, in lieu
of indemnifying such Indemnified Party hereunder, shall contribute to the amount paid or
payable by such Indemnified Party as a result of such loss, liability, claim, damage or
expense in such proportion as is appropriate to reflect the relative fault of the
Indemnifying Party on the one hand and of the Indemnified Party on the other in connection
with the statements or omissions which resulted in such loss, liability, claim, damage or
expense, as well as any other relevant equitable considerations. The relative fault of the
Indemnifying Party and of the Indemnified Party shall be determined by reference to, among
other things, whether the untrue (or alleged untrue) statement of a material fact or the
omission (or alleged omission) to state a material fact relates to information supplied by
the Indemnifying Party or by the Indemnified Party and the parties’ relative intent,
knowledge, access to information and opportunity to correct or prevent such statement or
omission.

     (v) Notwithstanding the foregoing, to the extent that the provisions on indemnification
and contribution contained in the underwriting agreement entered into in connection with any
underwritten public offering contemplated by this Agreement are in conflict with the
foregoing provisions, the provisions in such underwriting agreement shall be controlling.

          (g) Information by the Holders.

     (i) Each of the Holders holding securities included in any Registration shall furnish
to the Company such information regarding such Holder and the distribution proposed by such
Holder as the Company may reasonably request in writing and as shall be reasonably required
in connection with any Registration, qualification or compliance referred to in this Section
2.

     (ii) In the event that, either immediately prior to or subsequent to the effectiveness
of any registration statement, any Holder shall distribute Registrable Securities to its
partners, such Holder shall so advise the Company and provide such information as shall be
necessary to permit an amendment to such registration statement to provide information with
respect to such partners, as selling security holders. Promptly following receipt of such
information, the Company shall file an appropriate amendment to such registration statement
reflecting the information so provided. Any incremental expense to the Company resulting
from such amendment shall be borne by such Holder.

          (h) Rule 144 Reporting.

          With a view to making available the benefits of certain rules and regulations of the
Commission which may permit the sale of restricted securities to the public without Registration,
the Company agrees to:

-12-

 

     (i) make and keep public information available as those terms are understood and
defined in Rule 144 under the Securities Act (“Rule 144”), at all times from and
after ninety (90) days following the effective date of the first Registration under the
Securities Act filed by the Company for an offering of its securities to the general public;

     (ii) use its 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 at
any time after it has become subject to such reporting requirements, as applicable; and

     (iii) so long as a Holder owns any Registrable Securities, furnish to such Holder upon
request, a written statement by the Company as to its compliance with the reporting
requirements of Rule 144 (at any time from and after ninety (90) days following the
effective date of the first registration statement filed by the Company for an offering of
its securities to the general public), and of the Securities Act and the Exchange Act (at
any time after it has become subject to such reporting requirements, as applicable), a copy
of the most recent annual or quarterly report of the Company, and such other reports and
documents so filed as such Holder may reasonably request in availing itself of any rule or
regulation of the Commission allowing such Holder to sell any such securities without
Registration.

          (i) “Market Stand-off” Agreement. Each of the Holders agrees, if requested by the
Company and an underwriter of equity securities of the Company, not to sell or otherwise transfer
or dispose of any Registrable Securities held by such Holder during the 180-day period following
the effective date of a registration statement of the Company filed under the Securities Act,
provided that:

     (i) such agreement only applies to the Initial Public Offering; and

     (ii) all officers and directors of the Company enter into similar agreements.

          If requested by the underwriters, the Holders shall execute a separate agreement to the
foregoing effect. The Company may impose stop-transfer instructions with respect to the shares (or
securities) subject to the foregoing restriction until the end of said 180-day period. The
provisions of this Section 2(i) shall be binding upon any transferee who acquires Registrable
Securities.

          (j) Additional Registration Rights. The Company shall not, without first obtaining
the written consent of the Holders who are Holders of more than 50% of the then outstanding
Registrable Securities, grant future Registration rights on terms more favorable than the
Registration rights granted pursuant to this Agreement.

-13-

 

          (k) Termination. The Registration rights set forth in this Section 2 shall not be
available to any Holder during any period in which, in the opinion of counsel to the Company, all
of the Registrable Securities then owned by such Holder could be sold in any ninety (90)-day period
pursuant to Rule 144. The Registration rights set forth in this Section 2 shall terminate with
respect to any Holder at such time as all of the Registrable Securities held by such Holder have
been sold in a Registration pursuant to the Securities Act or pursuant to Rule 144.

     SECTION 3. MISCELLANEOUS

          (a) Directly or Indirectly. Where any provision in this Agreement refers to action to
be taken by any Person, or which such Person is prohibited from taking, such provision shall be
applicable whether such action is taken directly or indirectly by such Person.

          (b) Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of New York applicable to contracts made and to be performed entirely
within such State.

          (c) Section Headings. The headings of the sections and subsections of this Agreement
are inserted for convenience only and shall not be deemed to constitute a part thereof.

          (d) Notices.

     (i) All communications under this Agreement shall be in writing and shall be delivered
by hand or facsimile or mailed by overnight courier or by registered or certified mail,
postage prepaid:

          (1) if to the Company, to Spheris Holding III, Inc., Suite C-3, 9009 Carothers
Parkway, Franklin, Tennessee 37067, Attention: Chief Executive Officer Steven
Simpson (facsimile: (615) 261-1792), or at such other address as it may have
furnished in writing to the Company and Holders, with a copy to Bass Berry & Sims
PLC, 1700 Riverview Tower, 900 S. Gay Street, Knoxville, TN 37902, Attention Laura
Brothers, Esq.

          (2) if to the Warburg Investors, at the address or facsimile number listed
beneath such Investors’ name on Schedule I hereto, or at such other address
or facsimile number as it may have been furnished in writing the Company and
Holders, with a copy to Willkie Farr & Gallagher LLP, 787 Seventh Avenue, New York,
NY 10019 (facsimile: (212) 728-9222), Attention: Steven J. Gartner, Esq. and Mark A.
Cognetti, Esq.

          (3) if to the TowerBrook Investors, at the address or facsimile number listed
beneath such Investors’ name on Schedule I hereto, or at such other address
or facsimile number as may have been furnished in writing to the Company and
Holders, with a copy to Kirkland & Ellis LLP, 153 East 53rd Street, New
York, NY 10022-4675 (facsimile: (212) 446-4900), Attention: W. Brian Raftery, Esq.

-14-

 

          (4) if to CHS, at the address or facsimile number listed beneath such
Investor’s name on Schedule I hereto, or at such other address or facsimile
number as may have been furnished in writing to the Company and Holders, with a copy
to Community Health Systems Professional Services Corporation, 4000 Meridian
Boulevard, Franklin, TN 37067 (facsimile: (615) 373-9704), Attention: General
Counsel.

     (ii) Any notice so addressed shall be deemed to be given: if delivered by hand or
facsimile, on the date of such delivery; if mailed by overnight courier, on the first
business day following the date of such mailing; and if mailed by registered or certified
mail, on the third business day after the date of such mailing.

          (e) Reproduction of Documents. This Agreement and all documents relating hereto,
including, without limitation, any consents, waivers and modifications which may hereafter be
executed may be reproduced by the Holders by any photographic, photostatic, microfilm, microcard,
miniature photographic or other similar process and the Holders may destroy any original document
so reproduced. The parties hereto agree and stipulate that any such reproduction shall be
admissible in evidence as the original itself in any judicial or administrative proceeding (whether
or not the original is in existence and whether or not such reproduction was made by the Holders in
the regular course of business) and that any enlargement, facsimile or further reproduction of such
reproduction shall likewise be admissible in evidence.

          (f) Successors and Assigns. This Agreement shall inure to the benefit of and be
binding upon the successors and assigns of each of the parties.

          (g) Entire Agreement; Amendment and Waiver. This Agreement constitutes the entire
understanding of the parties hereto relating to the subject matter hereof and supersedes all prior
understandings among such parties. This Agreement may be amended, and the observance of any term
of this Agreement may be waived, with (and only with) the written consent of the Company, the
Majority Warburg Investors, the Majority TowerBrook Investors and CHS.

          (h) Severability. In the event that any part or parts of this Agreement shall be held
illegal or unenforceable by any court or administrative body of competent jurisdiction, such
determination shall not affect the remaining provisions of this Agreement which shall remain in
full force and effect.

          (i) Counterparts. This Agreement may be executed in two or more counterparts
(including by facsimile or email attachment), each of which shall be deemed an original and all of
which together shall be considered one and the same agreement.

[Remainder of Page Intentionally Left Blank]

-15-

 

          IN WITNESS WHEREOF, the undersigned has executed this Amended and Restated Registration Rights
Agreement as of the date first above written.

	 	 	 	 	 
	 	SPHERIS HOLDING III, INC.

 	 
	 	By:  	/s/ Steven E. Simpson
 	 
	 	 	Name:  	Steven E. Simpson 	 
	 	 	Title:  	President & CEO 	 
	 

[Amended and Restated Registration Rights Agreement]

-16-

 

          IN WITNESS WHEREOF, the undersigned have executed this Amended and Restated Registration
Rights Agreement as of the date first above written.

	 	 	 	 	 
	 	WARBURG PINCUS PRIVATE EQUITY VIII, L.P.

 	 
	 	By:  	WARBURG PINCUS PARTNERS LLC, its General Partner
 
	 	 	 
	 	By:  	                                      /s/ Joel Ackerman
 	 
	 	 	Name:  	Joel Ackerman 	 
	 	 	Title:  	Authorized Signatory 	 
	 

	 	 	 	 	 
	 	WARBURG PINCUS NETHERLANDS PRIVATE EQUITY VIII C.V. I

 	 
	 	By:  	WARBURG PINCUS PARTNERS LLC, its General Partner
 
	 	 	 
	 	By:  	                                      /s/ Joel Ackerman
 	 
	 	 	Name:  	Joel Ackerman 	 
	 	 	Title:  	Authorized Signatory 	 
	 

	 	 	 	 	 
	 	WP-WP VIII INVESTORS L.P.

 	 
	 	By:  	WARBURG PINCUS PARTNERS LLC, its General Partner
 
	 	 	 
	 	By:  	                                      /s/ Joel Ackerman
 	 
	 	 	Name:  	Joel Ackerman 	 
	 	 	Title:  	Authorized Signatory 	 
	 

[Amended and Restated Registration Rights Agreement]

-17-

 

          IN WITNESS WHEREOF, the undersigned has executed this Amended and Restated Registration Rights
Agreement as of the date first set forth above.

	 	 	 	 	 
	 	SPHERIS INVESTMENT LLC

 	 
	 	By:  	Warburg Pincus Private Equity VIII, L.P., Warburg Pincus Netherlands Private Equity VIII C.V. I and WP-WP VIII Investors
L.P., together, its Managing Members
 	 
	 	 	 	 
	 
	 	 	 
	 	By:  	Warburg Pincus Partners LLC, their General Partner
 	 
	 	 	 	 
	 
	 	 	 
	 	By:  	                                      /s/ Joel Ackerman
 	 
	 	 	Name:  	Joel Ackerman 	 
	 	 	Title:  	Authorized Signatory 	 
	 

[Amended and Restated Registration Rights Agreement]

-18-

 

     IN WITNESS WHEREOF, the undersigned has executed this Amended and Restated Registration Rights
Agreement as of the date first set forth above.

	 	 	 	 	 
	 	TOWERBROOK INVESTORS L.P.

 	 
	 	By:  	/s/ Glenn F. Miller
 	 
	 	 	Name:  	Glenn F. Miller 	 
	 	 	Title:  	Attorney-in-Fact 	 
	 

[Amended and Restated Registration Rights Agreement]

 

     IN WITNESS WHEREOF, the undersigned has executed this Amended and Restated Registration Rights
Agreement as of the date first set forth above.

	 	 	 	 	 
	 	CHS/COMMUNITY HEALTH SYSTEMS, INC.

 	 
	 	By:  	/s/ Kenneth D. Hawkins
 	 
	 	 	Name:  	Kenneth D. Hawkins 	 
	 	 	Title:  	Senior Vice President, Acquisitions & Development 	 
	 

[Amended and Restated Registration Rights Agreement]

 

Schedule I

 

Subsection A

“Warburg Investors”

Investor Name and Address

Warburg Pincus Private Equity VIII, L.P.

466 Lexington Avenue

New York, NY 10017-3147

Facsimile: (212) 878-9361

Attention: Joel Ackerman and David Wenstrup
 

Warburg
Pincus Netherlands Private Equity VIII C.V. I

466 Lexington Avenue

New York, NY 10017-3147

Facsimile: (212) 878-9361

Attention: Joel Ackerman and David Wenstrup
 

WP-WP
VIII Investors L.P.

466 Lexington Avenue

New York, NY 10017-3147

Facsimile: (212) 878-9361

Attention: Joel Ackerman and David Wenstrup
 

Spheris
Investment LLC

c/o Warburg Pincus Private Equity VIII, L.P.

466 Lexington Avenue

New York, NY 10017-3147

Facsimile: (212) 878-9361

Attention: Joel Ackerman and David Wenstrup

-21-

 

Subsection B

“TowerBrook Investors”

Investor Name and Address

TowerBrook Investors L.P.

430 Park Avenue

New York, NY 10022

Facsimile: (917) 591-9856

Attention: General Counsel and Jonathan Bilzin

-22-

 

Subsection C

“CHS”

Investor Name and Address

CHS/Community Health Systems, Inc.

4000 Meridian Boulevard

Franklin, TN 37067

Facsimile: (615) 465-3012

Attention: Senior Vice President, Acquisitions & Development

-23-

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