PROMUS HOTEL CORPORATION
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement, dated as of December __, 1997
[the Merger Closing Date], is made by and among Promus Hotel Corporation, a
Delaware corporation formerly named Parent Holding Corp. (the "Company"), GE
Investment Hotel Partners I, Limited Partnership, a Delaware limited
partnership ("GEHOP"), GE Investment Management Incorporated, a ___________
corporation ("GEIM"), and the Trustees of General Electric Pension Trust
("GEPT"), MetPark Funding, Inc., a Delaware corporation ("Met Sub"), The
Xxxxxxxxx Family Trust ("Xxxxxxxxx"), Xxxxxxxxx Investment Trust
("Investment"), Xx. Xxxxxxx X. Xxxxxx ("Xxxxxx"), Ridge Partners, L.P., a
Delaware limited partnership ("Ridge") and Red Lion, a California Limited
Partnership (the "RL Partnership").
WHEREAS, the stockholders of the Company who are parties hereto
(the "Holders") were parties to an Incorporation and Registration Rights
Agreement dated as of December __, 1993, as amended, with Doubletree
Corporation, a Delaware corporation ("Doubletree") (the "Doubletree
Registration Rights Agreement") pursuant to which such Holders had certain
registration rights with respect to shares of common stock of Doubletree
held by them; and
WHEREAS, Doubletree and Promus Hotel Corporation, a Delaware
corporation ("Old Promus") have combined their businesses (the "Merger") and
formed the Company as a new holding company pursuant to the terms of the
Agreement and Plan
of Merger dated as of September 1, 1997 among Doubletree, Old Promus and the
Company; and
WHEREAS, pursuant to the Merger, the outstanding shares of
Doubletree common stock have been converted into shares of common stock, par
value $.01 per share, of the Company ("Common Stock"); and
WHEREAS, the Company has agreed to provide the Holders registration
rights substantially identical to those held by such Holders pursuant to the
Doubletree Registration Rights Agreement;
NOW, THEREFORE, in consideration of the foregoing and intending to
be legally bound, the Parties agree as follows:
1. CERTAIN DEFINITIONS . As used in this Agreement, the
following terms shall have the following respective meanings:
"COMMISSION" means the United States Securities and Exchange
Commission, or any other federal agency administering the Securities Act at
the time.
"ELIGIBLE SECURITIES" means the shares of Common Stock held by the
Holders as of the date hereof, or acquired by them pursuant to (i) the
exercise of options to purchase an aggregate of 20,000 shares of Doubletree
Common Stock, issues on June 30, 1994, to GEHOP (the "GEHOP Options") and
(ii) the Warrants to purchase an aggregate of 262,753 shares of Doubletree
Common Stock, issued on November 8, 1996, to PT Investments Inc. (the "GEPT
Warrant"), it being understood that pursuant to the terms of the Merger
Agreement, all obligations of Doubletree under the GEHOP Options
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and the GEPT Warrant shall have been assumed by the Company pursuant to the
terms set forth in the Merger Agreement). Any shares of Common Stock issued
pursuant to the GEHOP Options and/or the GEPT Warrant will be aggregated
together with shares of Common Stock owned by GEHOP in order to determine the
amount of Eligible Securities or shares of Common Stock owned by GEHOP.
"HOLDER" means a registered holder of outstanding Eligible
Securities.
"SECURITIES ACT" means the Securities Act of 1933, as amended, or
any similar Federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.
2. ORGANIZATION OF THE COMPANY; REQUIRED REGISTRATION.
(a) At any time after the date of this Agreement, GEHOP, Met Sub
or the RL Partnership may deliver to the Company a written request that the
Company file and use its best efforts to cause to become effective a
registration statement under the Securities Act with respect to such number
of the Eligible Securities (a "Registration Request") owned by such Holder
(the "Requesting Holder"). Promptly following receipt of a Registration
Request, the Company shall deliver to all Holders (other than the Requesting
Holder) a notice (the "Initiation Notice") of such receipt providing the
identity of the Requesting Holder and the number of shares included in such
Registration Request. Except as otherwise provided in Section 2(b)(i)(A)
hereof, the Company shall not be required to file and use its best efforts to
cause to become effective, pursuant to a Registration Request under this
Section 2, more than two registration statements at the
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demand of GEHOP, more than one registration statement at the demand of Met
Sub, or more than four registration statements at the request of the RL
Partnership.
(b) Within 20 days after the date on which the Company delivers the
Initiation Notice to all Holders, such date to be determined by the notice
provisions of Section 12(b) of this Agreement, the Company will use its best
efforts to register under the Securities Act, for public sale in accordance
with the method of disposition specified in such Registration Request, the
number of shares of Eligible Securities specified in such Registration Request
(and in all notices received from Holders within 20 days after their receipt of
the applicable Initiation Notice); PROVIDED, HOWEVER, that, in the case of a
Registration Request, the proportion that the number of Eligible Securities
requested for inclusion in the registration statement by any Holder (other than
the Requesting Holder) bears to the total number of Eligible Securities then
owned by such Holder shall not exceed the proportion that the number of
Eligible Securities specified in such Registration Request bears to the total
number of Eligible Securities then owned by the Requesting Holder. The Company
will also be entitled to include in any registration statement filed pursuant
to a Registration Request, for sale in accordance with the method of
disposition specified in such Registration Request, such number of shares of
Common Stock as the Company shall desire to sell for its own account. If the
method of sale designated is an underwritten public
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offering, the managing underwriter or underwriters must be reasonably
acceptable to both the Requesting Holder (if any) and the Company, which
acceptance shall not be unreasonably withheld. Notwithstanding the foregoing
provisions of this paragraph (b), to the extent that, in the opinion of the
managing underwriter or underwriters (if the method of disposition shall be
an underwritten public offering), marketing considerations require the
reduction of the number of shares of Common Stock covered by any such
registration, the number of shares of Common Stock to be registered and sold
pursuant to such registration shall be reduced as follows:
(i) if the Requesting Holder shall be GEHOP and the
Registration Request is not the last to which such Holder is entitled
under Section 2(a) and this Section 2(b)(i), or if the Requesting Holder
shall be the RL Partnership and the Registration Request is made pursuant
to this Agreement and is not the first or last such request to which the
RL Partnership is entitled:
(A) the number of shares of Eligible Securities to be registered on
behalf of each Holder shall be reduced (to zero, if necessary)
pro rata according to the number of shares requested to be
registered by each Holder; provided, however, that in the case
of the first Registration Request made by GEHOP and any
registration request made by the RL Partnership (other than its
first or last such Registration Request) if the number of shares
of Eligible Securities requested to be registered by GEHOP or
the RL Partnership, as the case may be, shall be reduced as a
result of this Section 2(b)(i) by 20% or more, such Requesting
Holder shall be entitled to request one registration in addition
to (I) in the case of GEHOP, the two registration requests GEHOP
is entitled to under Section 2(a) of this Agreement and (II) in
the case of the RL Partnership, the four registration requests
the RL Partnership is entitled to under Section 2(a) of this
Agreement; and
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(B) the number of shares of Common Stock to be registered on behalf
of the Company, if any, shall not be reduced;
(ii) if the Requesting Holder shall be Met Sub, or if the
Requesting Holder shall be GEHOP exercising the last Registration Request
to which it is entitled under Section 2(a) and Section 2(b)(i) of this
Agreement, or if the Requesting Holder shall be the RL Partnership
exercising the first or last Registration Request to which it is entitled
under Section 2(a) of this Agreement:
(A) the number of Eligible Securities to be registered on behalf of
each Holder (excluding the Requesting Holder) shall be reduced
(to zero, if necessary) PRO RATA according to the number of
shares requested to be registered by each Holder;
(B) if any additional reduction in the number of shares of Common
Stock to be registered shall be necessary, in the opinion of the
managing underwriter or underwriters, the number of shares of
Common Stock to be registered on behalf of the Company shall be
reduced (to zero, if necessary); and
(C) the number of shares of Eligible Securities to be registered on
behalf of the Requesting Holder shall not be reduced; and
(c) Notwithstanding the foregoing provisions of this Section 2,
the Company shall not be obligated to file a registration statement at the
demand of any Holder pursuant to this Section 2 within 90 days following any
underwritten public offering of Common Stock or of securities of the Company
convertible into or exercisable or exchangeable for Common Stock.
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(d) Notwithstanding the foregoing provisions of this Section 2,
the Company may elect, by written notice given to Met Sub within 20 days
after the Company's receipt of a Registration Request from Met Sub, in lieu
of filing a registration statement at the demand of Met Sub, to purchase from
Met Sub the number of Eligible Securities specified in Met Sub's Registration
Request for cash equal to the Net Proceeds thereof. "Net Proceeds" shall
mean the estimated proceeds that Met Sub would have received from a public
offering of the number of Eligible Securities specified in Met Sub's
Registration Request, net of all underwriting discounts and selling
commissions applicable to the sale of such Eligible Securities and the fees
and expenses of counsel for Met Sub, determined pursuant to the following
procedure:
(i) Met Sub may reach an agreement with the Company as to the
amount of the Net Proceeds.
(ii) If Met Sub and the Company cannot reach agreement as to the
amount of the Net Proceeds within 30 days after the Company's receipt of
Met Sub's Registration Request, either party may request that the Net
Proceeds be determined according to the procedure set forth below.
(iii) Met Sub and the Company shall select an appraiser to
determine the amount of the Net Proceeds as soon as practicable. The
appraiser shall be an investment banking firm of national reputation
having expertise and experience in public offerings of securities of
companies engaging in businesses similar to that of the Company. The
appraiser shall not be an affiliate of any Party. If Met Sub and the
Company are unable to agree on such selection, each of them shall select
one appraiser meeting the criteria set forth in the two
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immediately preceding sentences, and such appraisers shall select a third
appraiser meeting such criteria who shall determine the amount of the Net
Proceeds as soon as practicable. The fees and expenses of all appraisers
shall be paid by the Company. All other expenses of such appraisal shall
be paid by the Holder incurring the same or as the Holders shall otherwise
agree.
(iv) The Company shall pay the amount of the Net Proceeds to Met
Sub within 30 days after such amount has been determined by agreement or
by appraisal, as the case may be.
(e) A Holder shall be deemed not to have exercised a Registration
Request to which it is entitled under Section 2 if (i) the registration
statement relating to such Registration Request does not become effective, or
after it has become effective, is interfered with by any stop order,
injunction or other order or requirement of the Commission or other
governmental agency or court, in each case by reason of an act or omission by
the Company, or (ii) the conditions to closing specified in the purchase
agreement, or underwriting agreement entered into in connection with such
registration statement are not satisfied, and the offering and sale of
Eligible Securities to which such Registration Request relates is not
consummated, because of an act or omission by the Company (other than a
failure of the Company or any of its representatives to execute or deliver
any closing certificate by reason of facts or circumstances not within the
control of the Company or such representatives) or (iii) at any time after a
Party delivers a Registration Request and prior to the effectiveness of the
registration statement relating thereto, the preparation of such registration
statement is discontinued or such registration statement is withdrawn or
abandoned, in each case at the request of the Requesting
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Holder, and such Requesting Holder has elected to pay and has paid to the
Company in full all of the registration expenses (including, without
limitation, Company registration expenses) referenced in Section 5 in
connection with such registration statement.
3. PIGGYBACK REGISTRATION.
(a) if the Company at any time proposes to register Common Stock
under the Securities Act for sale to the public, whether for its own account
or for the account of other security holders or both (except with respect to
registration statements subject to Section 2 or registration statements on
Form X-0, X-0 or another form not available for registering the Eligible
Securities for sale to the public), each such time it will give written
notice to all Holders of its intention to do so. Upon the written request of
any Holder (a "Piggyback Request"), given within 20 days after the date on
which the Company delivers the notice of proposed registration to all
Holders, such date to be determined by the notice provisions of Section 12(c)
of this agreement, the Company will use its best efforts to cause the
Eligible Securities as to which registration shall have been so requested to
be covered by the registration statement proposed to be filed by the Company.
(b) In the event that any registration statement described in this
Section 3 shall relate, in whole or in part, to an underwritten public offering
of shares of Common Stock, the Eligible Securities to be registered must be
sold through the same underwriters as have been selected by the Company or any
other person who initiated the filing of the registration statement by
exercising a right to require the Company to do so (a "Requesting Non-Party
Stockholder"). Otherwise, the method of distribution of the Eligible
Securities to be sold by any Holder making a Piggyback Request shall be as
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specified therein. The number of shares of Common Stock to be included in
such registration statement on account of any person (other than the Company
and any Requesting Non-Party Stockholder) may be reduced if and to the extent
that the managing underwriter or underwriters shall be of the opinion that
such inclusion would adversely affect the marketing of the total number of
shares of Common Stock proposed to be sold, and the number of shares to be
registered and sold by each person (other than the Company and any Requesting
Non-Party Stockholder) shall be reduced pro rata according to the number of
shares requested to be registered by such person. Notwithstanding the
foregoing provisions of this Section 3, the Company may withdraw any
registration statement referred to in this Section 3 without thereby
incurring any liability to any requesting Holder.
4. REGISTRATION PROCEDURES. If and whenever the Company is
required by the provisions of Section 2 to effect the registration of any
Eligible Securities under the Securities Act, the Company shall:
(a) prepare and file with the Commission a registration statement
with respect to such securities which will permit the public sale thereof in
accordance with the method of distribution specified in the applicable
Registration Request, and the Company shall use its best efforts (i) to cause
such registration statement to be filed within 60 days of receipt of the
same, (ii) to cause such registration statement to be declared effective as
promptly as practicable and (iii) to maintain the effectiveness of such
registration statement for a period of not less than 90 days;
(b) promptly prepare and file with the Commission such amendments
and supplements to such registration statement and the prospectus used in
connection
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therewith as may be necessary to effect and maintain the effectiveness of
such registration statement for the period specified in Section 4(a) and as
to comply with the provisions of the Securities Act with respect to the
disposition of all Eligible Securities covered by such registration statement
in accordance with the intended method of disposition set forth in such
registration statement for such period, including such amendments or
supplements as are necessary to cure any untrue statement or omission
referred to in Section 4(e)(vi);
(c) provide to the managing underwriter or underwriters and not
more than one counsel for all underwriters and to the Holders of Eligible
Securities to be included in such registration statement and not more than
one counsel for all such Holders (such counsel to be reasonably acceptable to
the Company) the opportunity to participate in the preparation of (i) such
registration statement, (ii) each prospectus relating thereto and included
therein or filed with the Commission and (iii) each amendment or supplement
thereto;
(d) make available for inspection by the parties referred to in
Section 4(c) such financial and other information and books and records of
the Company, and cause the officers, directors and employees of the Company,
and counsel and independent certified public accountants of the Company, to
respond to such inquiries, as shall be reasonably necessary, in the judgment
of respective counsel to such Holders and such underwriter or underwriters,
to conduct a reasonable investigation within the meaning of the Securities
Act; PROVIDED, HOWEVER, that each such person shall be required to maintain
in confidence and not to disclose to any other person any information or
records reasonably designated by the Company in writing as being confidential
until such time as
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(i) such information becomes a matter of public record (whether by virtue of
its inclusion in such registration statement or otherwise), (ii) such person
shall be required to disclose such information pursuant to the subpoena or
order of any court or other governmental agency or body having jurisdiction
over the matter or (iii) such information is required to be set forth in such
registration statement or the prospectus included therein or in an amendment
to such registration statement or an amendment or supplement to such
prospectus in order that such registration statement, prospectus, amendment
or supplement, as the case may be, shall not contain an untrue statement of a
material fact or omit to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, and such
information has not been so set forth after the request by a Holder to such
effect; and PROVIDED, FURTHER, that the Company need not make such
information available, nor need it cause any officer, director or employee to
respond to such inquiry, unless each such Holder and such counsel, upon the
Company's request, execute and deliver to the Company an undertaking to
substantially the same effect contained in the immediately preceding PROVISO;
(e) immediately notify the persons referred to in Section 4(c) and
(if requested by any such person) confirm such advice in writing, (i) when
such registration statement or any prospectus included therein or any
amendment or supplement thereto has been filed and, with respect to such
registration statement or any such amendment, when the same has become
effective, (ii) of any material comments by the Commission with respect
thereto or any request by the Commission for amendments or supplements to
such registration statement or prospectus or for additional information,
(iii) of the issuance by the Commission of any stop order suspending the
effectiveness of such
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registration statement or the initiation of any proceedings for that purpose,
(iv) if at any time the representations and warranties of the Company
contemplated by Section 4(l)(i) cease to be true and correct in all material
respects, (v) of the receipt by the Company of any notification with respect
to the suspension of the qualification of any Eligible Securities for sale in
any jurisdiction or the initiation or threatening of any proceeding for such
purpose or (vi) at any time when a prospectus is required to be delivered
under the Securities Act, of the occurrence or failure to occur of any event,
or any other change in law, fact or circumstance, as a result of which such
registration statement, prospectus or any amendment or supplement thereto, or
any document incorporated by reference in any of the foregoing, contains an
untrue statement of a material fact or omits to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading in light of the circumstances then existing;
(f) take reasonable efforts to obtain the withdrawal at the
earliest practicable date of any order suspending the effectiveness of such
registration statement or any post-effective amendment thereto;
(g) if requested by the managing underwriter or underwriters or
the Holders of at least a majority of the Eligible Securities being sold in
connection with an underwritten public offering, promptly incorporate in a
prospectus supplement or post-effective amendment such information as such
managing underwriter or underwriters or such Holders reasonably specify
should be included therein relating to the terms of the sale of such Eligible
Securities, including, without limitation, information with respect to the
number of Eligible Securities being sold to such underwriters, the names and
descriptions of such Holders, the purchase price being paid therefor by such
underwriters
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and any other terms of the underwritten (or best efforts underwritten)
offering of the Eligible Securities to be sold in such offering; and make all
required filings of such prospectus supplement or post-effective amendment
promptly after notification of the matters to be incorporated in such
prospectus supplement or post-effective amendment;
(h) furnish to each Holder of Eligible Securities included in such
registration and each managing underwriter, if any, thereof an executed copy
of such registration statement, each such amendment and supplement thereto
(in each case including all exhibits thereto, whether or not such exhibits
are incorporated by reference therein) and such number of copies of the
prospectus included in such registration statement (including each
preliminary prospectus and any summary prospectus) and each amendment or
supplement thereto, in conformity with the requirements of the Securities
Act, as such Holder and managing underwriter, if any, may reasonably request
in order to facilitate the disposition of such Eligible Securities by such
Holder or by the participating underwriters;
(i) use its best efforts to (i) register or qualify the Eligible
Securities to be included in such registration statement under such other
securities laws or blue sky laws of such jurisdictions as any Holder of such
Eligible Securities and each managing underwriter, if any, thereof shall
reasonably request, (ii) keep such registrations or qualifications in effect
for so long as is necessary to effect the disposition of such Eligible
Securities in the manner contemplated by the registration statement, the
prospectus included therein and any amendment or supplement thereto and (iii)
take any and all such actions as may be reasonably necessary or advisable to
enable such Holder and any participating underwriter or underwriters to
consummate the disposition in such
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jurisdictions of such Eligible Securities; PROVIDED, HOWEVER, that the
Company shall not be required for any such purpose to (A) qualify generally
to do business as a foreign corporation or a broker-dealer in any
jurisdiction wherein it would not otherwise be required to qualify but for
the requirements of this Section 4(i), (B) subject itself to taxation in any
such jurisdiction or (C) consent to general service of process in any such
jurisdiction;
(j) cooperate with the Holders of the Eligible Securities included
in such registration and the managing underwriters, if any, to facilitate the
timely preparation and delivery of certificates representing Eligible
Securities to be sold, which certificates shall be printed, lithographed or
engraved, or produced by any combination of such methods, on steel engraved
borders and which shall not bear any restrictive legends; and, in the case of
an underwritten public offering, enable such Eligible Securities to be
registered in such names as the managing underwriter or underwriters may
request at least two business days prior to any sale of such Eligible
Securities;
(k) provide not later than the effective date of the registration
statement a CUSIP number for all Eligible Securities;
(l) enter into an underwriting agreement, engagement letter,
agency agreement, "best efforts" underwriting agreement or similar agreement,
as appropriate, and take such other actions in connection therewith as the
Holders of at least a majority of the Eligible Securities to be included in
such registration shall reasonably request in order to expedite or facilitate
the disposition of such Eligible Securities, and in connection therewith,
whether or not an underwriting agreement is entered into and whether or not
the registration is an underwritten public offering, (i) make such
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representations and warranties to the Holders of such Eligible Securities
included in such registration and the underwriters, if any, in form,
substance and scope as are customarily made in an underwritten public
offering; (ii) obtain an opinion of counsel to the Company in customary form
and covering such matters as are customarily covered by such an opinion as
the Holders of at least a majority of such Eligible Securities and the
managing underwriters, if any, may reasonably request, addressed to each
selling Holder and the underwriters, if any, and dated the effective date of
such registration statement (or, if such registration includes an
underwritten public offering, dated the date of the closing under the
underwriting agreement); (iii) obtain a "cold comfort" letter from the
independent certified public accountants of the Company addressed to the
Holders of the Eligible Securities included in such registration and the
underwriters, if any, dated the effective date of such registration statement
(and, if such registration includes an underwritten public offering, also
dated the date of the closing under the underwriting agreement), such letter
to be in customary form and covering such matters as are customarily covered
by such letters; (iv) deliver such documents and certificates as may be
reasonably requested by the Holders of at least a majority of the Eligible
Securities included in such registration and the managing underwriter or
underwriters, if any, to evidence compliance with clause (i) above and with
any customary conditions contained in the underwriting agreement or other
agreement entered into by the Company; and (v) undertake such obligations
relating to expense reimbursement, indemnification and contribution as are
provided in Sections 5, 6 and 7 hereof;
(m) make available to its security holders, as soon as reasonably
practicable after the sale of Eligible Securities, an earning statement
covering a period of
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at least twelve months which shall satisfy the provisions of Section 11(a) of
the Securities Act (including, at the option of the Company, pursuant to Rule
158 thereunder); and
(n) otherwise use its best efforts to comply with all applicable
rules and regulations of the Commission.
The provisions of subsections (b) through (n) of this Section 4
shall also apply to registrations pursuant to Section 3; PROVIDED, HOWEVER,
that, for the purposes of this paragraph, the time period set forth in
Section 4(b) during which the Company must file amendments or supplements to
the registration statement and prospectus to keep such registration effective
shall also be deemed to be 90 days.
Notwithstanding the provisions of Section 4(a), the Company's
obligation to file a registration statement, or cause such registration
statement to become effective, shall be suspended for a period not to exceed
90 days if there exists at the time material non-public information relating
to the Company that, in the reasonable opinion of the Company, should not be
disclosed. In such an event, the Company shall promptly inform all Holders
of the Company's decision to defer filing of a registration statement and
shall notify all Holders promptly (but in any event not later than upon the
expiration of the 90-day period specified in the immediately preceding
sentence) of the recommencement of the Company's efforts to file the
registration statement and to cause the registration statement to become
effective.
In connection with each registration of Eligible Securities
hereunder, the Holders thereof will furnish to the Company in writing such
information with respect to themselves and the proposed distribution by them
as shall be reasonably necessary in
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order to assure compliance with applicable federal and state securities laws.
Each such Holder also agrees to notify the Company as promptly as
practicable of any inaccuracy or change in information previously furnished
by such Holder to the Company or of the occurrence of any other event, in
either case as a result of which any prospectus relating to such registration
contains an untrue statement of a material fact regarding such Holder or the
distribution of such Eligible Securities or omits to state any material fact
regarding such Holder or the distribution of such Eligible Securities
required to be stated therein or necessary to make the statements therein not
misleading in light of the circumstances then existing, and promptly to
furnish to the Company any additional information required to correct and
update such previously furnished information or required so that such
prospectus shall not contain, with respect to such Holder or the distribution
of such Eligible Securities, an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to make
the statements therein not misleading in light of the circumstances then
existing. Each such Holder further agrees that upon giving any notice
referred to in the immediately preceding sentence, or upon receipt of any
notice from the Company pursuant to Section 4(e)(vi) hereof, such Holder
shall forthwith discontinue the disposition of Eligible Securities pursuant
to the registration statement applicable to such Eligible Securities until
such Holder shall have received copies of an amended or supplemented
registration statement or prospectus, and if so directed by the Company, such
Holder shall deliver to the Company (at the Company's expense) all copies,
other than permanent file copies, then in such Holder's possession of the
prospectus covering such Eligible Securities at the time of receipt of such
notice.
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5. EXPENSES. The Company shall pay all expenses incurred in
complying with Sections 2 and 3, including without limitation all
registration and filing fees, printing expenses, fees and disbursements of
counsel and independent public accountants for the Company, fees and expenses
(including counsel fees) incurred in connection with complying with state
securities or "blue sky" laws (other than those which by law must be paid by
the selling security holders), fees of the National Association of Securities
Dealers, Inc., transfer taxes, fees of transfer agents and registrars and
stock exchange listing fees, but excluding all underwriting discounts and
selling commissions applicable to the sale of Eligible Securities and fees
and expenses of counsel for the selling Holders. All expenses of
participating sellers other than those assumed by the Company in this
Agreement shall be borne by such sellers in proportion to the number of
shares sold by each seller or as they may otherwise agree.
6. INDEMNIFICATION.
(a) In the event of a registration of Eligible Securities under
the Securities Act pursuant to Section 2 or 3, the Company shall indemnify
and hold harmless each selling Holder, each underwriter of such Eligible
Securities thereunder and each other person, if any, who controls such
selling Holder or underwriter within the meaning of the Securities Act,
against any losses, claims, damages or liabilities, joint or several, to
which such selling Holder, underwriter or controlling person may become
subject under the Securities Act or otherwise, and will reimburse each such
selling Holder, underwriter and controlling person for any legal or other
expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action, as such expenses
are incurred, insofar as such losses, claims, damages or
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liabilities (or actions in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of any material fact
contained in any registration statement under which such Eligible Securities
were registered under the Securities Act pursuant to Section 2 or 3, any
preliminary prospectus or final prospectus contained therein, or any
amendment or supplement thereof, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading;
PROVIDED, HOWEVER, that the Company shall not be liable to any such selling
Holder, underwriter or controlling person in any such case if and to the
extent that any such loss, claim, damage or liability arises out of or is
based upon an untrue statement or alleged untrue statement or omission or
alleged omission made in conformity with information furnished by such
selling Holder, underwriter or controlling person in writing specifically for
use in such registration statement or prospectus.
(b) In the event of a registration of any of the Eligible
Securities under the Securities Act pursuant to Section 2 or 3, each selling
Holder of such Eligible Securities, severally and not jointly, will indemnify
and hold harmless the Company, each underwriter and each person, if any, who
controls the Company or any underwriter within the meaning of the Securities
Act, each officer of the Company who signs the registration statement, each
director of the Company, each other seller of securities registered by the
registration statement covering such Eligible Securities and each person, if
any, who controls such seller, against all losses, claims, damages or
liabilities, joint or several, to which the Company or any such officer,
director, underwriter, other seller or controlling person may become subject
under the Securities Act or otherwise, and shall reimburse the
20
Company and each such officer, director, underwriter, other seller and
controlling person for any legal or other expenses reasonably incurred by
them in connection with investigating or defending any such loss, claim,
damage, liability or action, but only to the extent that any such loss,
claim, damage or liability (or action in respect thereof) arises out of or is
based upon an untrue statement or alleged untrue statement or omission or
alleged omission made in reliance upon and in conformity with information
pertaining to such Holder furnished in writing to the Company by such Holder
specifically for use in the registration statement or prospectus relating to
such Eligible Securities. Notwithstanding the immediately preceding
sentence, the liability of each such Holder hereunder shall not in any event
exceed the net proceeds received by such Holder from the sale of Eligible
Securities covered by such registration statement.
(c) Promptly after receipt by an indemnified party hereunder of
notice of the commencement of any action, such indemnified party, if a claim
in respect thereof is to be made against an indemnifying party hereunder,
shall notify such indemnifying party in writing thereof, but the omission so
to notify such indemnifying party shall not relieve such indemnifying party
from any liability that it may have to any indemnified party other than under
this Section 6 and, unless the failure to so provide notice materially
adversely affects or prejudices such indemnifying party's defense against any
action, shall not relieve such indemnifying party from any liability that it
may have to any indemnified party under this Section 6. In case any such
action shall be brought against any indemnified party and it shall notify an
indemnifying party of the commencement thereof, such indemnifying party shall
be entitled to participate in and, to the extent it shall wish, to assume and
undertake the defense thereof with counsel reasonably
21
satisfactory to such indemnified party, and, after notice from such
indemnifying party to such indemnified party of its election so to assume and
undertake the defense thereof, such indemnifying party shall not be liable to
such indemnified party under this Section 6 for any legal expenses
subsequently incurred by such indemnified party in connection with the
defense thereof other than reasonable costs of investigation and of liaison
with counsel so selected; PROVIDED, HOWEVER, that, if the defendants in any
such action include both the indemnified party and the indemnifying party and
the indemnified party shall have reasonably concluded that there may be
reasonable defenses available to it that are different from or additional to
those available to the indemnifying party or if the interests of the
indemnified party reasonably may be deemed to conflict with the interests of
the indemnifying party, the indemnified party shall have the right to select
a separate counsel and to assume and undertake the defense of such action,
with the expenses and fees of such separate counsel and other expenses
related to such defense to be reimbursed by the indemnifying party as
incurred.
(d) No indemnifying party shall be liable for any amounts paid in
a settlement effected without the consent of such indemnifying party, which
consent shall not be withheld unreasonably. No indemnifying party shall
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 the indemnified party of a release from all liability in respect
of such claim or litigation.
(e) The reimbursements required by this Section 6 shall be made by
periodic payments during the course of the investigation or defense, as and
when bills are received and expenses incurred.
22
7. CONTRIBUTION. If for any reason the indemnity set forth in
Section 6 is unavailable or is insufficient to hold harmless an indemnified
party, then the indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of the aggregate losses,
claims, damages, liabilities and expenses of the nature contemplated by said
indemnity (i) in such proportion as is appropriate to reflect the relative
fault of the indemnifying party on the one hand and such indemnified party on
the other (determined by reference to, among other things, whether the untrue
statement of a material fact or omission to state a material fact relates to
information supplied by the indemnifying party or such indemnified party and
the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such untrue statement or omission), or (ii)
if the allocation provided by clause (i) above is not permitted by applicable
law or provides a lesser sum to such indemnified party than the amount
hereinafter calculated, in such proportion as is appropriate to reflect not
only the relative fault of the indemnifying party and such indemnified party
but also the relative benefits received by the indemnifying party on the one
hand and such indemnified party on the other, as well as any other relevant
equitable considerations.
The Company and the Parties agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by PRO
RATA allocation or by any other method of allocation which does not take
account of the equitable considerations referred to in the immediately
preceding paragraph. The amount paid or payable by an indemnified party as a
result of the losses, claims, damages, liabilities or expenses referred to in
such paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by such
23
indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Section 7, a Holder
shall not be required to contribute any amount in excess of the amount by
which the net proceeds of the sale of Eligible Securities sold by such Holder
and distributed to the public exceeds the amount of any damages which such
Holder has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person which is
not guilty of such fraudulent misrepresentation.
In the event that any terms of an indemnification or contribution
provision contained in an underwriting agreement executed by or on behalf of
the Company and a Holder differs from a provision in Section 6 or this
Section 7, the provisions in such underwriting agreement shall determine the
rights and obligations of the Company, such Holder and each underwriter that
is a party thereto.
8. UNDERWRITING AGREEMENT. If Eligible Securities are to be
sold pursuant to a registration statement in an underwritten offering
pursuant to Section 2 or 3, the Company and each selling Holder of Eligible
Securities agrees to enter into a written agreement with the managing
underwriter or underwriters selected in the manner herein provided in such
form and containing such provisions as are reasonably satisfactory to the
Company and each such selling Holder and as are customary in the securities
business for such an arrangement among such underwriter or underwriters, each
such selling Holder and companies of the Company's size and investment
stature. No Holder of
24
Eligible Securities may participate in any underwritten sale of Eligible
Securities pursuant to Section 2 or 3 hereof unless such Holder (i) agrees to
sell such Holder's securities in accordance with any underwriting
arrangements approved by the persons entitled hereunder to specify the method
of distribution of the securities being registered and (ii) completes and
executes all questionnaires, powers of attorney, indemnities, underwriting
agreements and other documents reasonably required under the terms of such
underwriting arrangements.
9. LIMITATIONS ON SUBSEQUENT REGISTRATION RIGHTS. If, subsequent
to the date hereof, the Company grants to any holders or prospective holders
of the Company's securities the right to require that the Company register
any securities of the Company under the Securities Act, such registration
rights shall be granted subject to the rights of the Holders to include all
or part of their Eligible Securities in any such registration on the terms
and conditions set forth in Section 3.
10. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to the Holders as follows:
(a) The execution, delivery and performance of this Agreement by the
Company have been duly authorized by all requisite action and will not violate
any provision of law, any order of any court or other agency of government, the
certificate of incorporation or By-laws of the Company or any provision of any
indenture, agreement or other instrument by which the Company or any of its
properties or assets is bound and will not conflict with, result in a breach of
or constitute (with due notice or lapse of time or both) a default under any
such indenture, agreement or other instrument or result in the
25
creation or imposition of any lien, charge or encumbrance of any nature
whatsoever upon any of the properties or assets of the Company.
(b) This Agreement has been duly executed and delivered by the
Company and constitutes the legal, valid and binding obligation of the Company,
enforceable in accordance with its terms.
11. RULE 144.
The Company hereby covenant with the Holders of Eligible Securities that if
and to the extent it shall be required to do so under the Securities Exchange
Act of 1934, as amended, and the rules and regulations thereunder, as the
same may be amended and in effect at the time (the "Exchange Act"), the
Company shall timely file the reports required to be filed by it under the
Exchange Act or the Securities Act (including, but not limited to, the
reports under Sections 13 and 15(d) of the Exchange Act referred to in
subparagraph (c)(1) of Rule 144 adopted by the Commission under the
Securities Act) and shall take such further action as any Holder of Eligible
Securities may reasonably request, all to the extent required from time to
time to enable such Holder to sell Eligible Securities without registration
under the Securities Act within the limitations of the exemption provided by
Rule 144 under the Securities Act, as such Rule may be amended from time to
time, or any similar rule or regulation hereafter adopted by the Commission.
Upon the request of any Holder of Eligible Securities, the Company shall
deliver to such Holder a written statement as to whether it has complied with
such requirements
12. MISCELLANEOUS.
26
(a) All covenants and agreements contained in this Agreement by or
on behalf of any of the signatories shall bind and inure to the benefit of the
respective successors and assigns of the signatories, whether so expressed or
not. If any transferee of any Holder of Eligible Securities shall acquire
Eligible Securities in any manner (other than by way of a registered public
offering), whether by operation of law or otherwise, such Eligible Securities
shall be held subject to all of the terms of this Agreement, and by taking and
holding such Eligible Securities such transferee shall be entitled to receive
the benefits of and be conclusively deemed to have agreed to be bound by and to
perform all of the terms and provisions of this Agreement. The benefits to
which any such transferee shall be entitled shall include, without limitation,
the rights to register Eligible Securities under Sections 2 and 3 hereof;
PROVIDED, HOWEVER, that any such transferee shall not be entitled to deliver to
the Company a Registration Request pursuant to Section 2 hereof unless such
transferee acquired from its transferor at least a majority of the Eligible
Securities owned by such transferor at the time of the transfer. If the
Company shall so request, any such successor or assign shall agree in writing
to acquire and hold the Eligible Securities subject to all of the terms hereof.
One or more transferees of Eligible Securities owned by the RL Partnership may
deliver a Registration Request pursuant to Section 2 if (i) such transferees
have received such Eligible Securities in compliance with applicable Federal
and state securities laws, (ii) such transferees have agreed in a writing, in
form and substance reasonably satisfactory to the Company, to be bound by this
Agreement, with the same duties and obligations as a Holder thereunder, and
(iii) the transferee or transferees that so deliver such Registration Request
hold at least a majority of the then outstanding Exchange Shares which have not
been sold pursuant to a
27
registered public offering. This Section 12(a) shall not be deemed to create
any right on the part of any Holder to transfer Eligible Securities in
contravention of any restriction thereon contained in any other agreement to
which such Holder is a party.
(b) All notices, consents and other communications under the
Registration Rights Agreement required or permitted to be transmitted to the
parties named below shall be in writing and shall be deemed to have been duly
given when (a) delivered by hand, (b) sent by telecopier (with receipt
confirmed), provided that a copy is mailed by registered mail, return receipt
requested, or (c) when received by the addressee, if sent by Express Mail,
Federal Express or other express delivery service (receipt requested), in
each case to the appropriate addresses and telecopier numbers set forth below
(or to such other addresses and telecopier numbers as a party may designate
as to itself by notice to the other parties):
(i) if to the Company, to it at Promus Hotel Corporation, 000
Xxxxxxxxx Xxxx, Xxxxxxx, XX 00000, Attention: General Counsel (telecopy:
(000) 000-0000;
(ii) if to GEHOP, c/o General Electric Investment Hotel Partners
I, Limited Partnership, c/o General Electric Investment Corporation, 0000
Xxxxxx Xxxxxx, X.X. Xxx 0000, Xxxxxxxx XX 00000, Attention: Asset Manager-
Real Estate (telecopier no. (000) 000-0000), with a copy to General
Electric Investment Corporation, 0000 Xxxxxx Xxxxxx, X.X. Xxx 0000,
Xxxxxxxx XX 00000, Attention: General Counsel-Real Estate (telecopier no.
(000) 000-0000, a copy to Wolf, Block, Xxxxxx and Xxxxx-Xxxxx, Packard
Building, 12th Floor, S. E. Corner of 00xx xxx Xxxxxxxx Xxxxxxx,
Xxxxxxxxxxxx, XX 00000, Attention: Xxxxx X.
28
Xxxxxx, Esq. (telecopier no. (000) 000-0000), and a copy to Xxxxx
Xxxxxxxxxx, 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, XX 00000, Attention:
Xxxxxxx X. Xxxxxxxx, Esq. (telecopier no. (000) 000-0000);
(iii) if to Met Sub, c/o Metropolitan Life Insurance
Company, Xxx Xxxxxxx Xxxxxx, Xxx Xxxx, XX 00000, Attention: Xx. Xxxx X.
Xxxxxxxx, Xx. (telecopier no. (000) 000-0000), with a copy to Law
Department, Metropolitan Life Insurance Company, Xxx Xxxxxxx Xxxxxx,
Xxx Xxxx, XX 00000, Attention: Xxxx X. Xxxxx, Esq. (telecopier no.
(000) 000-0000);
(iv) if to Xxxxxx, to Xx. Xxxxxxx X. Xxxxxx, 00000 Xxxxx Xxxx,
Xxxxxxxxxx, XX 00000 (telecopier no. (000) 000-0000);
(v) if to Ridge, to it c/o Xx. Xxxxxxx X. Xxxxxx, 0000 Xxxxx
Xxxx, Xxxxxxxxxx, XX 00000 (telecopier no. (000) 000-0000);
(vi) if to Investment, to it c/o Mr. Xxxxx Xxxxxxxxx, Contrarian
Group, Inc., 000 Xxxxxxx Xxxxxx Xxxxx, Xxxxx 000, Xxxxxxx Xxxxx, XX 00000
(telecopier no. (000) 000-0000);
(vii) if to the RL Partnership to Red Lion, a California
Limited Partnership, x/x Xxxxxxxx Xxxxxx Xxxxxxx & Co., 0000 Xxxx Xxxx
Xxxx, Xxxxx 000, Xxxxx Xxxx, XX 00000; telephone (000) 000-0000
(telecopier no. (000) 000-0000) ; and
(viii) if to Xxxxxxxxx, to Xx. Xxxxx X. Xxxxxxxxx, Contrarian
Group, Inc., 000 Xxxxxxx Xxxxxx Xxxxx, Xxxxx 000, Xxxxxxx Xxxxx, XX 00000
(telecopier no. (000) 000-0000).
29
(c) This Agreement shall be governed by and construed in accordance
with the laws of the State of New York.
(d) This Agreement may not be amended or modified, and no provision
hereof may be waived, except in writing, and such writing shall only be
effective with respect to a Party who has executed such writing; PROVIDED,
HOWEVER that any such amendment, modification or waiver shall only be required
to be so executed by a Party the rights of which under this Agreement would be
adversely affected in any material respect by such amendment, modification or
waiver. The failure of any of the Parties to insist upon strict adherence to
any term of this Agreement on any occasion.
(e) This Agreement may be executed in two or more counterparts, each
of which shall be deemed in original, but all of which together shall
constitute one and the same instrument.
(f) The Parties acknowledge that there may be no adequate remedy at
law if any Party fails to perform any of its obligations hereunder and that
each Party may be irreparably harmed by any such failure, and accordingly agree
that each Party, in addition to any other remedy to which it may be entitled in
law or in equity, shall be entitled to compel specific performance of the
obligations of any other Party under this Agreement in accordance with the
terms and conditions of this Agreement in any court of the United States or any
state thereof having jurisdiction. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(g) In the event that any one or more of the provisions contained
herein, or the application thereof in any circumstances, is held invalid,
illegal or unenforceable in any respect for any reason, the validity, legality
and enforceability of any such provision
30
in every other respect and of the remaining provisions contained herein shall
not be in any way impaired thereby, it being intended that all of the rights
and privileges of the Holders shall be enforceable to the fullest extent
permitted by law.
(h) This Agreement is intended by the parties as a final
expression of their agreement and a complete and exclusive statement of the
agreement and understanding of the parties hereto in respect of the subject
matter contained herein and therein. There are no restrictions, promises,
warranties or undertakings other than those set forth or referred to herein
or therein. This Agreement supersedes all prior agreements and
understandings between the Parties with respect to such subject matter.
(i) EXCEPT AS OTHERWISE PROVIDED IN SECTION 12(f) HEREOF, EACH PARTY
IRREVOCABLY AGREES THAT ALL DISPUTES IN ANY WAY, MANNER OR RESPECT ARISING OUT
OF OR FROM OR RELATED TO THIS AGREEMENT SHALL BE RESOLVED BY ARBITRATION IN XXX
XXXX XX XXX XXXX, XXXXX XX XXX XXXX, UNDER THE RULES OF THE AMERICAN
ARBITRATION ASSOCIATION. The arbitrator to resolve any such dispute shall be
selected by the Parties who are involved in the dispute, shall have expertise
and experience in the resolution of disputes similar to the dispute to be
resolved and shall not be an affiliate of any Party. If such Parties are
unable to agree on such selection, each such Party select one arbitrator
meeting the criteria set forth in the immediately preceding sentence and such
arbitrators shall select an arbitrator meeting such criteria to resolve such
dispute as soon as practicable. The fees and expenses of any arbitrator
selected by a Party shall be paid by such Party; the fees and expenses of any
other arbitrators shall be shared equally by the Parties who are involved in
the dispute.
31
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement
as of the date first written above.
PROMUS HOTEL CORPORATION METPARK FUNDING, INC.
By:_______________________________ By: _______________________________
Name: Name:
Title: Title:
GE INVESTMENT HOTEL PARTNERS I, RIDGE PARTNERS, L.P.
LIMITED PARTNERSHIP
By: GE Investment Management By: Kelrick, Inc., its general partner
Incorporated, its general partner
By: __________________________ By: ___________________________
Name: Name:
Title: Title:
THE XXXXXXXXX FAMILY TRUST
__________________________________ By: _______________________________
Xxxxxxx X. Xxxxxx Xxxxx X. Xxxxxxxxx, Trustee
__________________________________ THE XXXXXXXXX INVESTMENT TRUST
Xxxxx X. Xxxxxxxxx
By: _______________________________
Xxxxx X. Xxxxxx, Trustee
GE INVESTMENT HOTEL PARTNERS I, RED LION, a California Limited
LIMITED PARTNERSHIP Partnership
By: GE Investment Management By: RLA-GP Inc., its general partner
Incorporated, its general partner
By: __________________________ By: _______________________________
Name: Name:
Title: Title:
