EXHIBIT 4.2
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (the "AGREEMENT") is entered into as of
__________ ___, 2001 by and among [NEWCO], a Delaware corporation (the
"COMPANY"), WPH-Xxxxxxx, LLC, a Delaware limited liability company ("LLC"),
Apollo Real Estate Investment Fund, L.P., a Delaware limited partnership
("APOLLO") , Blackacre WPH, LLC, a Delaware limited liability company
("BLACKACRE"), Highridge Pacific Housing Investors, L.P., a California limited
partnership ("HIGHRIDGE", and together with Apollo and Blackacre, the
"MEMBERS"), The Xxxxx and Xxxxxxxx Xxxxxxx Foundation, a Hawaii non-profit
corporation (the "FOUNDATION"), and Xxxxx X. Xxxxxxx, as sole trustee for the
Xxxxx X. Xxxxxxx Revocable Living Trust and the Xxxxx X. Xxxxxxx 1998 Qualified
Annuity Trust (collectively with the Foundation, "XXXXX XXXXXXX").
RECITALS
A. The Members, Xxxxxxx Homes, Inc., a Delaware corporation ("XXXXXXX"), and
certain other parties have entered into an Agreement and Plan of Reorganization,
dated as of September 12, 2000 (the "REORGANIZATION AGREEMENT"), which provides
for, among other things, the transfer to the Company of certain partnership and
membership interests by the Members, the merger of Xxxxxxx with a wholly-owned
subsidiary of the Company, and the issuance by the Company to (a) the LLC of
shares of the Company's Class B Common Stock, par value $0.001 per share (the
"CLASS B COMPANY SHARES"), and (b) the stockholders of Xxxxxxx, including Xxxxx
Xxxxxxx, of the Company's Class A Common Stock, par value $0.001 per share (the
"CLASS A COMPANY SHARES") (either Class A Company Shares or Class B Company
Shares may be referred to herein as "COMPANY SHARES").
B. Under the LLC's operating agreement (the "OPERATING AGREEMENT"), those
individuals listed on Schedule I hereto may receive Company shares from the LLC
upon the occurrence of certain events (these individuals referred to herein as
"MANAGEMENT HOLDERS"). Upon dissolution of the LLC, the Members and the
Management Holders will receive the Class B Company Shares held therein pursuant
to the terms of the Operating Agreement. Upon the occurrence of certain events
set forth in the Company's Certificate of Incorporation, the Class B Company
Shares held by the LLC, the Members or the Management Holders will convert to
Class A Company Shares.
C. As a condition to the closing of the transactions contemplated by the
Reorganization Agreement (the "REORGANIZATION"), the LLC, the Members and Xxxxx
Xxxxxxx desire to obtain and the Company has agreed to grant, upon the terms and
subject to the conditions set forth in this Agreement, certain registration
rights to the LLC, the Members and Xxxxx Xxxxxxx with respect to the Class A
Company Shares.
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AGREEMENT
The parties hereby agree as follows:
1. REGISTRATION RIGHTS.
1.1 DEFINITIONS. For purposes of this Section 1:
(a) "EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the SEC promulgated thereunder.
(b) "HOLDER" means each of the LLC, Xxxxx Xxxxxxx and, upon distribution
of Company Shares by the LLC to a Member or Management Holder, such Member or
Management Holder, so long as such person is a holder of outstanding Registrable
Securities.
(c) "PERSON" means an individual, partnership, joint venture, limited
liability company, corporation, trust, unincorporated organization or government
or any department or agency thereof.
(d) "PROSPECTUS" means the prospectus included in any Registration
Statement (including, without limitation, a prospectus that discloses
information previously omitted from a prospectus filed as part of an effective
registration statement in reliance upon Rule 430A), as amended or supplemented
by any prospectus supplement, with respect to the terms of the offering of any
portion of the Registrable Securities covered by such Registration Statement and
all other amendments and supplements to the prospectus, including post-effective
amendments, and all material incorporated or deemed to be incorporated by
reference in such prospectus.
(e) "REGISTRATION STATEMENT" means any registration statement of the
Company which covers any of the Registrable Securities pursuant to the
provisions of this Agreement, including the Prospectus, amendments and
supplements to such registration statement, including post-effective amendments,
all exhibits, and all material incorporated or deemed to be incorporated by
reference in such registration statement.
(f) "REGISTER," "REGISTERED," and "REGISTRATION" refer to a registration
effected by preparing and filing a registration statement or similar document in
compliance with the Securities Act and the subsequent declaration or ordering of
the effectiveness of such registration statement or document.
(g) "REGISTRABLE SECURITIES" means the Class A Company Shares issued
upon conversion of the Class B Company Shares or issued by the Company for the
purpose of satisfying an indemnification obligation of Xxxxxxx pursuant to
Section 9.6 of the Reorganization Agreement or, with respect to Xxxxx Xxxxxxx,
the Class A Company shares Xxxxx Xxxxxxx receives upon the Reorganization.
(h) "SEC" means the United States Securities and Exchange Commission or
any successor agency thereto.
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(i) "SECURITIES ACT" means the Securities Act of 1933, as amended, and
the rules and regulations of the SEC promulgated thereunder.
1.2 DEMAND REGISTRATIONS
(a) DEMAND REGISTRATIONS. (i) At any time and from time to time, a
Holder or Holders (other than Management Holders) of at least 1,000,000 shares
of the Registrable Securities shall have the right, by written notice delivered
to the Company by or on behalf of the Holders, to require the Company to
register (the "DEMAND REGISTRATIONS") under the Securities Act 100% of the
Registrable Securities held by such Holder or Holders in accordance with this
Section 1.2. All requests made pursuant to this Section 1.2 shall specify the
number of the Registrable Securities to be registered and the intended methods
of disposition thereof. Notwithstanding anything to the contrary contained in
this Agreement, a Demand Registration may include a registration statement that
contemplates a distribution of securities on a delayed or continuous basis
pursuant to Rule 415 under the Securities Act (a "SHELF REGISTRATION") if the
Company is eligible to use such a registration statement at the time of such
request.
(ii) The number of Demand Registrations to be exercised by the LLC
or the Members pursuant to this Section 1.2 shall not exceed five in the
aggregate. The LLC shall only be entitled to exercise its rights under Section
1.2 on behalf of the Members. As part of any written request provided by the LLC
pursuant to Section 1.2, the LLC shall state on which Member's behalf it is
making such request, and the Company shall be entitled to fully rely on such
statement. Notwithstanding anything to the contrary contained in this Agreement,
(A) Apollo shall not be entitled to exercise its rights under Section 1.2, and
the LLC shall not be entitled to exercise its rights under Section 1.2 on behalf
of Apollo, more than three times taken collectively, (B) Blackacre shall not be
entitled to exercise its rights under Section 1.2, and the LLC shall not be
entitled to exercise its rights under Section 1.2 on behalf of Blackacre, more
than one time taken collectively, and (C) Highridge shall not be entitled to
exercise its rights under Section 1.2, and the LLC shall not be entitled to
exercise its rights under Section 1.2 on behalf of Highridge, more than one time
taken collectively.
(iii) Xxxxx Xxxxxxx shall be entitled to one Demand Registration
under Section 1.2.
(b) FILING AND EFFECTIVENESS. The Company shall use its best efforts to
file each of the Demand Registrations within 30 days (or 90 days if the Company
is not subject to the reporting requirements of Section 13 of the Exchange Act)
and shall use its best efforts to cause the same to be declared effective by the
SEC within 90 days (or 150 days if the Company is not subject to the reporting
requirements of Section 13 of the Exchange Act) of the date on which the holders
of Registrable Securities first give the written notice (a "DEMAND NOTICE")
required by Section 1.2(a) with respect to such Demand Registration. If any
Demand Registration is requested to be a Shelf Registration, the Company shall
keep the Registration Statement filed in respect thereof effective for a period
of nine months from the date on which the SEC declares such Registration
Statement effective or such shorter period which will terminate when all
registered Registrable Securities covered by such Registration Statement have
been sold pursuant to such Registration Statement.
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(c) LIMITATION ON DEMAND REGISTRATIONS. Notwithstanding anything to the
contrary set forth in Section 1.2(a), but subject to Sections 1.6 and 2, the
Company shall not be obligated to file a Registration Statement with respect to
a Demand Registration upon a request by a Holder under Section 1.2(a): (1) if
the Holders, together with the holders of any other securities of the Company
entitled to inclusion in such registration, propose to sell less than one
million shares of Registrable Securities; (2) if the Company shall furnish to
the 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 and its stockholders for such Demand
Registration or any other registration to be effected at such time, in which
event the Company shall have the right to defer the filing of the Registration
Statement for a period of not more than 90 days after receipt of the request of
the Holder or Holders under this Section 1.2; PROVIDED, HOWEVER, that the
Company shall not utilize this right more than once in any 12-month period; (3)
if the Company has, within the 12-month period preceding the date of such
request, already effected one Demand Registration for the Holders pursuant to
this Section 1.2; (4) in any particular jurisdiction in which the Company would
be required to qualify to do business or to execute a general consent to service
of process in effecting such registration, qualification or compliance; or (5)
prior to nine months following the date of this Agreement.
(d) EFFECTIVE DEMAND REGISTRATION. A registration shall not constitute a
Demand Registration until the Registration Statement has become effective and
remains continuously effective for the lesser of (i) the period during which all
Registrable Securities registered in the Demand Registration are sold and (ii)
90 days; provided, however, that a registration shall not constitute a Demand
Registration if (x) after such Demand Registration has become effective, such
registration or the related offer, sale or distribution of Registrable
Securities thereunder is interfered with by any stop order, injunction or other
order or requirement of the SEC or other governmental agency or court for any
reason not attributable to the Holders requesting such registration and such
interference is not thereafter eliminated or (y) the conditions to closing
specified in the underwriting agreement, if any, entered into in connection with
such Demand Registration are not satisfied or waived, other than by reason of an
act, omission, circumstance or condition by or relating to the Holders
requesting such registration.
(e) UNDERWRITING PROCEDURES. If the Holders requesting such registration
so elect, the offering of Registrable Securities pursuant to a Demand
Registration shall be in the form of a firm commitment underwritten offering and
the managing underwriter or underwriters selected for such offering shall be the
Approved Underwriter (as hereinafter defined) selected in accordance with
Section 2(g). With respect to any firm commitment underwritten offering, the
Company shall enter into a reasonable and customary underwriting agreement with
the Approved Underwriter. If the Approved Underwriter advises the Company and
the Holders in writing that in its opinion the aggregate amount of Class A
Company Shares requested to be included in such offering is sufficiently large
to have a material adverse effect on the success of such offering, then the
Company shall include in such registration only the aggregate amount of Class A
Company Shares that in the opinion of the Approved Underwriter may be sold
without any such material adverse effect and the Holders shall be allowed to
include such amount of Registrable Securities in the aggregate as the managing
underwriter(s) deems appropriate prior to any Class A Company Shares being
included on behalf of the Company or any other person, including other
stockholders exercising piggyback registration rights (pursuant to this
Agreement or otherwise).
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(f) NO PIGGY-BACK ON DEMAND REGISTRATIONS WITHOUT CONSENT. Neither the
Company nor any of its stockholders (other than the Holders) shall have the
right to include any securities of the Company in any Demand Registration, and
the Company shall not enter into any agreements providing any such right to any
of its stockholders, without the written consent of the Holders of a majority of
the Registrable Securities.
(g) SELECTION OF UNDERWRITERS. The Holders requesting a Demand
Registration shall select and obtain one or more investment banking firms of
national reputation to act as the managing underwriters of the offering
(collectively, the "APPROVED UNDERWRITER"); PROVIDED, HOWEVER, that the Approved
Underwriter shall, in any case, be acceptable to the Company in its reasonable
judgment.
(h) HOLDER CUTBACK. (i) Subject to Section 1.2(h)(iii), if in the case
of any Demand Registration, the shares to be included by the Holders in such
registration are reduced by the Approved Underwriter by more than forty percent
(40%) of the amount of shares requested to be included by the Holders requesting
such registration pursuant to Section 1.2(a), such registration shall not be
deemed a Demand Registration.
(ii) Subject to Section 1.2(h)(iii), if in the case of any Demand
Registration, the shares to be included by the Holders in such registration are
reduced by the Approved Underwriter by an amount between and including twenty
percent (20%) and forty percent (40%) of the amount of shares requested to be
included by the Holders requesting such registration pursuant to Section 1.2(a),
such registration shall not be deemed a Demand Registration if such Holders
provide written notice to the Company at least five days prior to the
effectiveness of the related Registration Statement that they have withdrawn
their request for a Demand Registration (in which such event the Company shall
be under no obligation to cause or maintain the effectiveness of such
Registration Statement).
(iii) Notwithstanding anything to the contrary contained in Section
1.2(h)(i) or Section 1.2(h)(ii), if 3,000,000 or more shares of the Holders
requesting such registration pursuant to Section 1.2(a) are included in a
registration after a reduction by the Approved Underwriter, such registration
shall be deemed a Demand Registration.
(iv) If in the case of any Demand Registration, the shares to be
included by the Holders in such registration are reduced by the Approved
Underwriter by less than twenty percent (20%) of the amount of shares requested
to be included by the Holders requesting such registration pursuant to Section
1.2(a), such registration shall be deemed a Demand Registration.
1.3 PIGGY-BACK REGISTRATION
(a) RIGHT TO PIGGY-BACK. If at any time the Company proposes to file a
registration statement under the Securities Act (including pursuant to a Demand
Registration) with respect to any class of its equity securities (other than a
registration statement on Form X-0, X-0 (exclusively relating to an offering to
securities required to be registered pursuant to Rule 145 under the Securities
Act) or S-8 or any successor form thereof), whether for its own account or for
the account of any stockholder, then the Company shall give written notice of
such proposed filing to the Holders (other than those making any such Demand
Registration) within ten days after
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receipt of a request for a Demand Registration or, in the event that such
registration statement is not pursuant to a Demand Registration, at least 30
days before the anticipated filing date. Such notice shall offer such Holders
the opportunity to register such amount of Registrable Securities as each such
Holder may request (a "PIGGY-BACK REGISTRATION"). The Company shall include in
each such Piggy-Back Registration all Registrable Securities with respect to
which the Company has received written requests for inclusion therein within 15
days after notice has been duly given to the applicable Holder. The Holders
shall be permitted to withdraw all or any part of the Registrable Securities
from a Piggy-Back Registration at any time prior to the effective date of such
Piggy-Back Registration.
(b) PRIORITY ON PIGGY-BACK REGISTRATIONS. If the proposed registration
relates to an underwritten offering and the managing underwriter determines that
inclusion of all or any portion of the Registrable Securities in such offering
would adversely affect the ability of the underwriter for such offering to sell
all of the securities requested to be included for sale or the price per share
in such offering, the Company and all Holders participating in such registration
shall be allowed to include such amount of Class A Company Shares as the
managing underwriter(s) deems appropriate prior to any Class A Company Shares
being included on behalf of any other person; PROVIDED, HOWEVER, that (i) if the
proposed registration is not a Demand Registration, then prior to any reduction
of the amount of Class A Company Shares intended to be registered by the
Company, the aggregate amount of Class A Company Shares intended to be included
in the offering by all Holders participating in the registration and any other
stockholder exercising registration rights (including those granted pursuant to
Section 1.2(f)) shall be reduced in its entirety (which Class A Company Shares
shall be cut back on a pro rata basis in accordance with the number of shares
proposed to be registered by the Holders participating in the registration and
any other stockholder exercising registration rights (including those granted
pursuant to Section 1.2(f) hereof)) and (ii) if the proposed registration is a
Demand Registration, then prior to any reduction of the amount of Class A
Company Shares intended to be registered by the Holders requesting such
registration pursuant to Section 1.2(a), the aggregate amount of Class A Company
Shares intended to be included in the offering by the Company and any other
stockholder exercising registration rights (including those granted pursuant to
Section 1.2(f) and Section 1.3) shall be reduced in its entirety (which Class A
Company Shares shall be cut back on a pro rata basis in accordance with the
number of shares proposed to be registered by the Company and any other
stockholder exercising registration rights (including those granted pursuant to
Section 1.2(f) and Section 1.3 hereof)).
1.4 HOLDBACK AGREEMENTS.
(a) RESTRICTIONS ON PUBLIC SALE BY HOLDERS OF REGISTRABLE SECURITIES.
Each Holder whose Registrable Securities are covered by a Registration Statement
filed pursuant to Section 1.2 hereof agrees (to the extent timely notified in
writing by the Company or the managing underwriter(s)) not to effect any public
sale or distribution of securities of the Company of any class included in such
Registration Statement, including a sale pursuant to Rule 144 under the
Securities Act (except as part of such underwritten registration), during the
10-day period prior to, and the 90-day period (or such longer period not
exceeding 180 days as may be required by the managing underwriter(s)) beginning
on, the closing date of any underwritten offering made pursuant to such
Registration Statement. The foregoing shall not apply to any Holder if such
Holder is prevented by applicable statute or regulation from entering into any
such agreement;
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PROVIDED, HOWEVER, that any such Holder shall undertake in its request to
participate in such underwritten offering not to effect any public sale or
distribution of the class of Registrable Securities covered by such Registration
Statement (except as part of such underwritten registration) during such period
unless it has provided 45 days' prior written notice of such sale or
distribution to the managing underwriter(s).
(b) RESTRICTIONS ON PUBLIC SALE BY THE COMPANY AND OTHERS. The Company
agrees (i) not to effect any public or private sale or distribution of its
securities, including a sale pursuant to Regulation D under the Securities Act,
during the 10-day period prior to, and the 180-day period beginning on, the
effective date of any underwritten offering made pursuant to such Registration
Statement (except as part of such underwritten registration or pursuant to
registrations on Forms X-0, X-0 (which exclusively relate to an offering of
securities required to be registered pursuant to Rule 145 under the Securities
Act) or S-8 or any successor forms thereto), and (ii) to cause each holder of
its securities purchased from the Company at any time after the date of this
Agreement (other than in a registered public offering) to agree not to effect
any public sale or distribution of any such securities during such period,
including a sale pursuant to Rule 144 under the Securities Act (except as part
of such underwritten registration, if otherwise permitted, or pursuant to
registration on such Forms X-0, X-0 or S-8 or any successor forms thereto).
1.5 REGISTRATION PROCEDURES. In connection with the registration
obligations of the Company pursuant to and in accordance with Section 1.2 of
this Agreement, the Company shall effect such registrations to permit the sale
of such Registrable Securities in accordance with the intended method or methods
of disposition thereof, and pursuant thereto the Company shall as expeditiously
as possible:
(a) notify the selling Holders and the managing underwriters, if any,
promptly, and (if requested by any such Person) confirm such notice in writing,
(i) when a Prospectus or any Prospectus supplement or post-effective amendment
related to such Registrable Securities has been filed, and, with respect to a
Registration Statement or any post-effective amendment related to such
Registrable Securities, when the same has become effective, (ii) of any request
by the SEC for amendments or supplements to such Registration Statement or
related Prospectus or for additional information, (iii) of the issuance by the
SEC of any stop order suspending the effectiveness of such Registration
Statement or the initiation of any proceedings for that purpose, (iv) if at any
time the representations and warranties of the Company contained in any
agreement (including any underwriting agreement) contemplated by Section 1.5(k)
below cease to be materially true and correct, (v) of the receipt by the Company
of any notification with respect to the suspension of the qualification or
exemption from qualification of any of the Registrable Securities for sale in
any jurisdiction or the initiation or threatening of any proceeding for such
purpose, (vi) of the happening of any event which makes any statement made in
such Registration Statement or related Prospectus or any document incorporated
or deemed to be incorporated therein by reference materially untrue or which
requires the making of any changes in such Registration Statement or Prospectus
so that such documents will not contain any untrue statement of a material fact
or omit to state any material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were
made, not misleading, and (vii) of the reasonable determination of the Company
that a post-effective amendment to such Registration Statement would be
appropriate;
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(b) use every reasonable effort to obtain the withdrawal of any order
suspending the effectiveness of a Registration Statement or the lifting of any
suspension of the qualification (or exemption from qualification) of any of the
Registrable Securities for sale in any jurisdiction, at the earliest practicable
time;
(c) if requested by the managing underwriters or any Holder of
Registrable Securities being sold in connection with an underwritten offering,
(i) immediately incorporate in a Prospectus supplement or post-effective
amendment such information as the managing underwriters and such holder agree
should be included therein and as may be required by applicable law, (ii) make
all required filings of such Prospectus supplement or such post-effective
amendment as soon as the Company has received notification of the matters to be
incorporated in such Prospectus supplement or such post-effective amendment and
(iii) supplement or make amendments to such Registration Statement; PROVIDED,
HOWEVER, that the Company shall not be required to take any of the actions in
this Section 1.5(c) which are not, in the opinion of counsel for the Company, in
compliance with applicable law;
(d) furnish to each selling Holder and each managing underwriter, if
any, without charge, at least one signed copy of each Registration Statement
related to such Registrable Securities and any post-effective amendments
thereto, including financial statements and schedules, all documents
incorporated therein by reference and all exhibits (including, if requested,
those previously furnished or incorporated by reference) at the earliest
practicable time under the circumstances before the filing of such documents
with the SEC;
(e) deliver to all selling Holders and the underwriters, if any, without
charge, as many copies of the Prospectus or Prospectuses related to such
Registrable Securities (including each preliminary prospectus) and as many
copies of any amendment or supplement thereto as such Persons may reasonably
request; the Company consents to the use of such Prospectus or any amendment or
supplement thereto by each of the selling holders of Registrable Securities and
the underwriters, if any, in connection with the offering and sale of the
Registrable Securities covered by such Prospectus or any amendment or supplement
thereto;
(f) prior to any public offering of Registrable Securities, to register
or qualify or cooperate with the selling Holders, the underwriters, if any, and
their respective counsel in connection with the registration or qualification
(or exemption from such registration or qualification) of such Registrable
Securities for offer and sale under the securities or Blue Sky laws of such
jurisdictions as any seller or underwriter reasonably requests in writing; keep
each such registration or qualification (or exemption therefrom) effective
during the period such Registration Statement is required to be kept effective
and do any and all other acts or things necessary or advisable to enable the
disposition in such jurisdictions of the Registrable Securities covered by the
applicable Registration Statement; PROVIDED, HOWEVER, that the Company will not
be required to (A) qualify generally to do business in any jurisdiction where it
is not then so qualified, (B) take any action which would subject it to general
service of process in any such jurisdiction where it is not then so subject, or
(C) take any action which would subject it to the assessment of taxes in any
such jurisdiction where it is not then so subject;
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(g) cooperate with the selling Holders and the managing underwriters, if
any, to facilitate the timely preparation and delivery of certificates
representing Registrable Securities to be sold, which certificates shall not
bear any restrictive legends;
(h) cause the Registrable Securities covered by each Registration
Statement to be registered with or approved by such other governmental agencies
or authorities as may be reasonably necessary to enable the seller or sellers
thereof or the underwriters, if any, to consummate the disposition of such
Registrable Securities;
(i) upon the occurrence of any event contemplated by Sections 1.5(a)(vi)
or (vii) above, prepare a supplement or post-effective amendment to each
Registration Statement or a supplement to the related Prospectus or any document
incorporated therein by reference or file any other required document so that,
as thereafter delivered to the purchasers of the Registrable Securities being
sold thereunder, such Prospectus will not contain any untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances in which
they were made, not misleading;
(j) cause all Registrable Securities covered by such a Registration
Statement to be listed on The Nasdaq Stock Market or any securities exchange on
which similar securities issued by the Company are then listed;
(k) enter into such agreements (including an underwriting agreement in
form, scope and substance as is customary in underwritten offerings) and take
all such other reasonable actions in connection therewith (including those
reasonably requested by the managing underwriters, if any, or the holders of a
majority of the Registrable Securities being sold) in order to expedite or
facilitate the disposition of such Registrable Securities and in such connection
(i) make such representations and warranties to the holders of such Registrable
Securities and the underwriters, if any, with respect to the business of the
Company and its Subsidiaries, the Registration Statement, the Prospectus, and
documents, if any incorporated or deemed to be incorporated by reference in the
Registration Statement, in each case, in form, substance and scope as are
customarily made by issuers to underwriters in underwritten offerings and
confirm the same if and when requested; (ii) obtain opinions of counsel to the
Company and updates thereof (which counsel and opinions (in form, scope and
substance) shall be reasonably satisfactory to the managing underwriters, if
any, and the holders of a majority of the Registrable Securities being sold)
addressed to each selling holder and each of the underwriters, if any, covering
the matters customarily covered in opinions requested in underwritten offerings
and such other matters as may be reasonably requested by such holders and
underwriters, (iii) obtain "cold comfort" letters and updates thereof from the
independent certified public accountants of the Company (and, if necessary, any
other certified public accountants of any subsidiary of the Company or of any
business acquired by the Company for which financial statements and financial
data is or is required to be included in the Registration Statement) addressed
to each selling holder of Registrable Securities and each of the underwriters,
if any, such letters to be in customary form and covering matters of the type
customarily covered in "cold comfort" letters in connection with underwritten
offerings; (iv) if an underwriting agreement is entered into, cause the same to
contain indemnification provisions and procedures no less favorable than those
set forth in Section 2 hereof (or such other provisions and procedures
acceptable to a majority of the holders of Registrable Securities covered by
such Registration Statement) with respect to all parties to be indemnified
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pursuant to said Section; and (v) deliver such documents and certificates as may
be required by an applicable underwriting agreement or reasonably requested by
the Holders of a majority of the Registrable Securities being sold and the
managing underwriters to evidence the continued validity of the representations
and warranties of the Company made pursuant to Section 1.5(k)(i) above and to
evidence compliance with any customary conditions contained in the underwriting
agreement or other agreement entered into by the Company;
(l) make available for inspection by a representative of the Holders of
Registrable Securities being sold, any underwriter participating in any
disposition of Registrable Securities, and any attorney or accountant retained
by such selling Holders or underwriter, all relevant financial and other
records, pertinent corporate documents and properties of the Company; and cause
the officers, directors and employees of the Company and its subsidiaries to
supply all information reasonably requested by any such representative,
underwriter, attorney or accountant in connection with such Registration
Statement; PROVIDED, HOWEVER, that any records, information or documents that
are designated by the Company in writing as confidential at the time of delivery
of such records, information or documents shall be kept confidential by such
Persons and their designees unless (i) such records, information or documents
are in the public domain or otherwise publicly available, (ii) disclosure of
such records, information or documents is required by court or administrative
order or (iii) disclosure of such records, information or documents, in the
opinion of counsel to such Person, is otherwise required by law (including,
without limitation, pursuant to the requirements of the Securities Act); and
(m) comply with all applicable rules and regulations of the SEC and make
generally available to its securityholders earning statements satisfying the
provisions of Section 11(a) of the Securities Act and Rule 158 thereunder no
later than 45 days after the end of any 12-month period (or 90 days after the
end of any 12-month period if such period is a fiscal year) (i) commencing at
the end of any fiscal quarter in which Registrable Securities are sold to
underwriters in a firm commitment or best efforts underwritten offering and (ii)
if Registrable Securities are not sold to underwriters in such an offering,
commencing on the first day of the first fiscal quarter of the Company after the
effective date of a Registration Statement, which statements shall cover said
12-month periods.
Each Holder agrees by acquisition of such Registrable Securities that, upon
receipt of any notice from the Company of the happening of any event of the kind
described in Section 1.5(a)(ii), (iii), (v), (vi) or (vii) hereof, such Holder
shall forthwith discontinue disposition of such Registrable Securities covered
by such Registration Statement or Prospectus until such Holder's receipt of the
copies of the supplemented or amended Prospectus contemplated by Section 1.5(i)
hereof, or until it is advised in writing by the Company that the use of the
applicable Prospectus may be resumed, and has received copies of any additional
or supplemental filings which are incorporated or deemed to be incorporated by
reference in such Prospectus.
1.6 REGISTRATION EXPENSES
(a) All reasonable fees and expenses incident to the Company's
performance of or compliance with this Agreement (including (i) all registration
and filing fees, including fees and expenses (A) with respect to filings
required to be made with the National Association of Securities Dealers, Inc.,
and (B) of compliance with securities or Blue Sky laws (including fees and
10
disbursements of counsel for the underwriters or selling holders (SUBJECT TO THE
PROVISIONS OF Section 1.6(b)) in connection with Blue Sky qualifications of the
Registrable Securities and determination of the eligibility of the Registrable
Securities for investment under the laws of such jurisdictions as the managing
underwriters or holders of a majority in number of the Registrable Securities
being sold may designate); (ii) printing expenses; (iii) messenger, telephone
and delivery expenses; (iv) fees and disbursements of counsel for the Company,
and special counsel or other counsel for the sellers of the Registrable
Securities (subject to the provisions of Section 1.6(b)); (v) fees and
disbursements of all independent certified public accountants referenced to in
Section 1.5(k)(iii) hereof (including the expenses of any special audit and
"cold comfort" letters required by or incident to such performance); (vi)
underwriter's fees and expenses (excluding discounts, commissions or fees of
underwriters, selling brokers, dealer managers or similar securities industry
professionals relating to the distribution of the Registrable Securities or
legal expenses of any Person other than the Company, the underwriters and the
selling holders (subject to the provisions of Section 1.6(b)); but including the
fees and expenses of any "qualified independent underwriter" or other
independent appraiser participating in an offering pursuant to Section 3 of
Schedule E to the Bylaws of the National Association of Securities Dealers,
Inc.); (vii) Securities Act liability insurance if the Company so desires such
insurance and; (viii) fees and expenses of all other Persons retained by the
Company) shall be borne by the Company whether or not any Registration Statement
becomes effective. Notwithstanding the foregoing, the Company will not be
required to reimburse the holders of Registrable Securities for their
out-of-pocket expenses arising out of a Demand Registration if the Registration
Statement for such Demand Registration fails to become effective at the request
of the holders of a majority of Registrable Securities participating in such
Demand Registration.
(b) In connection with each Piggy-Back Registration hereunder, the
Company shall reimburse the Holders of the Registrable Securities being
registered in such registration for the reasonable fees and disbursements of not
more than one counsel (or more than one counsel if a conflict exists among such
selling holders in the exercise of the reasonable judgment of counsel for the
selling holders and counsel for the Company) chosen by the Holders of a majority
of such Registrable Securities.
1.7 FURNISH INFORMATION. It shall be a condition precedent to the
bligations of the Company to take any action pursuant to this Section 1 with
respect to the Registrable Securities of any selling Holder that such Holder
shall furnish to the Company such information regarding itself, the Registrable
Securities held by it, and the intended method of disposition of such securities
as shall be required to effect the registration of such Holder's Registrable
Securities. The Company shall have no obligation with respect to any
registration requested pursuant to Section 1.2 of this Agreement if, as a result
of the application of the preceding sentence, the number of shares of the
Registrable Securities to be included in the registration does not equal or
exceed the number of shares required to originally trigger the Company's
obligation to initiate such registration as specified in Section 1.2(a)(i).
2. INDEMNIFICATION.
In the event any Registrable Securities are included in a registration statement
under Section 1:
11
2.1 INDEMNIFICATION BY THE COMPANY. To the extent permitted by law, the
Company will indemnify and hold harmless each Holder and each Person, if any,
who controls such Holder within the meaning of the Securities Act or the
Exchange Act, against any losses, claims, damages, or liabilities (joint or
several) to which they may become subject, under the Securities Act, the
Exchange Act or other federal or state law, insofar as such losses, claims,
damages, or liabilities (or actions in respect thereof) arise out of or are
based upon any of the following statements, omissions or violations
(collectively a "VIOLATION"): (i) any untrue statement or alleged untrue
statement of a material fact contained in any Registration Statement, Prospectus
or preliminary prospectus, (ii) 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, or (iii) any violation or alleged violation
by the Company of the Securities Act, the Exchange Act, any state securities law
or any rule or regulation promulgated under the Securities Act, the Exchange Act
or any state securities law; and the Company will pay, as incurred, any legal or
other expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability, or action; PROVIDED, HOWEVER,
that the indemnity agreement contained in this subsection 2.1 shall not apply to
amounts paid in settlement of any such loss, claim, damage, liability, or action
if such settlement is effected without the consent of the Company, which consent
shall not be unreasonably withheld, nor shall the Company be liable in any such
case for any such loss, claim, damage, liability, or action to the extent that
it arises out of or is based upon a Violation which occurs in reliance upon and
in conformity with written information furnished expressly for use in connection
with such registration by any Holder or controlling person.
2.2 INDEMNIFICATION BY THE HOLDERS. To the extent permitted by law, each
selling Holder will indemnify and hold harmless the Company, each of its
directors, each of its officers who has signed the registration statement, each
person, if any, who controls the Company within the meaning of the Securities
Act or the Exchange Act, any other Holder selling securities in such
registration statement and any controlling person of any such other Holder,
against any losses, claims, damages, or liabilities (joint or several) to which
any of the foregoing persons may become subject, under the Securities Act, the
Exchange Act or other federal or state law, insofar as such losses, claims,
damages, or liabilities (or actions in respect thereof) arise out of or are
based upon any Violation, in each case to the extent (and only to the extent)
that such Violation occurs in reliance upon and in conformity with written
information furnished by such Holder expressly for use in connection with such
registration; and each such Holder will pay, as incurred, any legal or other
expenses reasonably incurred by any person intended to be indemnified pursuant
to this Section 2.2, in connection with investigating or defending any such
loss, claim, damage, liability, or action; PROVIDED, HOWEVER, that the indemnity
agreement contained in this Section 2.2 shall not apply to amounts paid in
settlement of any such loss, claim, damage, liability or action if such
settlement is effected without the consent of the Holder, which consent shall
not be unreasonably withheld; PROVIDED that in no event shall any indemnity
under this subsection 2.2 exceed the gross proceeds from the offering received
by such Holder.
2.3 INDEMNIFICATION PROCEDURES.
(a) Promptly after receipt by an indemnified party under this Section 2
of notice of the commencement of any action (including any governmental action),
such indemnified party will, if a claim in respect thereof is to be made against
any indemnifying party under this Section 2, deliver to the indemnifying party a
written notice of the commencement thereof and the indemni-
12
fying party shall have the right to participate in, and, to the extent the
indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an indemnified party shall
have the right to retain its own counsel, with the fees and expenses to be paid
by the indemnifying party, if representation of such indemnified party by the
counsel retained by the indemnifying party would be inappropriate due to actual
or potential differing interests between such indemnified party and any other
party represented by such counsel in such proceeding. The failure to deliver
written notice to the indemnifying party within a reasonable time of the
commencement of any such action, if prejudicial to its ability to defend such
action, shall relieve such indemnifying party of any liability to the
indemnified party under this Section 2, but the omission so to deliver written
notice to the indemnifying party will not relieve it of any liability that it
may have to any indemnified party otherwise than under this Section 2.
(b) If the indemnification provided in this Section 2 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 therein, 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 that 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 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.
(c) The obligations of the Company and Holders under this Section 2
shall survive the completion of any offering of Registrable Securities in a
registration statement under Section 1, and otherwise.
3. REPORTS UNDER SECURITIES EXCHANGE ACT OF 1934. With a view to making
available to the Holders the benefits of Rule 144 promulgated under the
Securities Act and any other rule or regulation of the SEC that may at any time
permit a Holder to sell securities of the Company to the public without
registration, the Company agrees to use its best efforts to:
(a) make and keep public information available, as those terms are
understood and defined in Rule 144, at all times;
(b) file with the SEC in a timely manner all reports and other documents
required of the Company under the Securities Act and the Exchange Act; and
(c) furnish to any Holder, so long as the Holder owns any Registrable
Securities, forthwith upon request (i) a written statement by the Company that
it has complied with the reporting requirements of Rule 144, the Securities Act
and the Exchange Act, (ii) a copy of the most recent annual or quarterly report
of the Company and such other reports and documents so filed by the Company, and
(iii) such other information as may be reasonably requested in availing
13
any Holder of any rule or regulation of the SEC which permits the selling of any
such securities without registration.
4. TERMINATION OF REGISTRATION RIGHTS. The rights granted under Section 1
shall terminate upon the earlier of (a) five years following the date of this
Agreement or (b) with respect to any Holder, at such time as such Holder may
sell all of such Holder's Registrable Securities in any one three month period
pursuant to Rule 144 (or such successor rule as may be adopted).
5. MISCELLANEOUS.
5.1 NOTICES. All notices and other communications given or made pursuant
hereto shall be in writing and shall be deemed to have been duly given or
made as of the date delivered or mailed if delivered personally or by
recognized overnight delivery service or mailed by registered or certified
mail (postage prepaid, return receipt requested), or sent by facsimile
transmission (confirmation received) to the parties at the following
addresses and facsimile transmission numbers (or at such other address or
number for a party as shall be specified by like notice), except that notices
after the giving of which there is a designated period within which to
perform an act and notices of changes of address or number shall be effective
only upon receipt:
(a) if to the Company:
Xxxxxxx Homes, Inc.
000 Xxxx Xxxxxx Xxxx, 0xx Xxxxx
Xxxxxxxx, Xxxxxx 00000
Facsimile No.: (000) 000-0000
with a copy to:
Xxxxxxx X. Xxxxx, Esq.
Xxxxxx, Xxxxxxxxxx & Xxxxxxxxx LLP
000 Xxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Facsimile No.: (000) 000-0000
(b) if to the LLC or the Members:
Xxxxxx Xxxxxxxxx
c/o Western Pacific Housing
000 Xxxxxxxxxxx Xxxx., Xxxxx 000
Xx Xxxxxxx, XX 00000
Facsimile No.: (000) 000-0000
14
AND
Xxxx Xxxxxxxxxxxxx
Apollo Real Estate Advisors
0000 Xxxxxx xx xxx Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Facsimile No.: (000) 000-0000
AND
Xxxxxx X. Xxxxxx
Blackacre WPH, LLC
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile No.: (000) 000-0000
with a copy to:
Xxxxx X. Xxxxxxx, Esq.
Xxxxxx, Xxxxx & Bockius LLP
000 X. Xxxxx Xxx., 00xx Xxxxx
Xxx Xxxxxxx, XX 00000
Facsimile No.: (000) 000-0000
AND
Xxxxxx X. Xxxxxxxx, Esq.
Xxxxxxx, Xxxx & Xxxxx LLP
000 0xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile No.: (000) 000-0000
(c) if to Xxxxx Xxxxxxx:
Xxxxx X. Xxxxxxx
Xxxxxxx Homes, Inc.
000 Xxxx Xxxxxx Xxxx, 0xx Xxxxx
Xxxxxxxx, Xxxxxx 00000
Facsimile No.: (000) 000-0000
15
with a copy to:
Xxxxxxx X. Xxxxx, Esq.
Xxxxxx, Xxxxxxxxxx & Xxxxxxxxx LLP
000 Xxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Facsimile No.: (000) 000-0000
5.2 INTERPRETATION. Capitalized terms used herein which are not defined
herein shall the meanings assigned to them in the Reorganization Agreement. When
a reference is made in this Agreement to Sections, subsections or Exhibits, such
reference shall be to a Section, subsection or Exhibit to this Agreement unless
otherwise indicated. The words "include," "includes" and "including" when used
herein shall be deemed in each case to be followed by the words "without
limitation." The headings contained in this Agreement are for reference purposes
only and shall not affect in any way the meaning or interpretation of this
Agreement. The words "herein" and "hereby" and similar references mean, except
where a specific Section reference is expressly indicated, the entire Agreement
rather than any specific Section. Except as otherwise expressly provided herein,
all monetary amounts referenced in this Agreement shall mean U.S. dollars. All
capitalized terms defined herein are equally applicable to both the singular and
plural forms of such terms.
5.3 SEVERABILITY. If any term or other provision of this Agreement is
invalid, illegal or incapable of being enforced by any rule of law or public
policy, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect so long as the economic or legal substance of
the transactions contemplated hereby is not affected in any manner adverse to
any party. Upon such determination that any term or other provision is invalid,
illegal or incapable of being enforced, the parties hereto shall negotiate in
good faith to modify this Agreement so as to effect the original intent of the
parties as closely as possible in an acceptable manner to the end that
transactions contemplated hereby are fulfilled to the greatest extent possible.
5.4 SUCCESSORS AND ASSIGNS. This Agreement may not be assigned by
operation of law or otherwise; PROVIDED, HOWEVER, that LLC and the Members may
assign their rights and obligations under this Agreement (without the need for
an express assignment) to the Management Holders in connection with the
assignment to the Management Holders of the Registrable Securities; PROVIDED
FURTHER, that each of Apollo and Blackacre may assign its rights and obligations
under this Agreement to a Person or Persons who agree in writing to be bound by
all the terms and provisions of this Agreement.
5.5 AMENDMENTS. This Agreement may not be amended or modified except by
an instrument in writing signed by all of the parties hereto.
5.6 FURTHER ASSURANCES. Each party agrees to cooperate fully with the
other parties and to execute such further instruments, documents and agreements
and to give such further written assurances as may be reasonably requested by
any other party to evidence and reflect the transactions described herein and
contemplated hereby and to carry into effect the intents and purposes of this
Agreement.
16
5.7 MUTUAL DRAFTING. This Agreement is the joint product of the parties
hereto and each provision hereof has been subject to the mutual consultation,
negotiation and agreement of the parties hereto and shall not be construed for
or against any party hereto.
5.8 GOVERNING LAW. This Agreement shall be governed by, and construed in
accordance with, the internal laws of the State of Delaware applicable to
agreements made and to be performed entirely within such State (without giving
effect to such State's choice of law principles).
5.9 DISPUTE RESOLUTION. Any dispute, controversy or claim between the
parties relating to, arising out of or in connection with this Agreement (or any
subsequent agreements or amendments thereto), including as to its existence,
enforceability, validity, interpretation, performance or breach or as to
indemnification or damages, including claims in tort, whether arising before or
after the termination of this Agreement (any such dispute, controversy or claim
being herein referred to as a "Dispute"), shall be settled without litigation
and only by use of the alternative dispute resolution procedure set forth in
Section 12.13 of the Reorganization Agreement. Subsections (a) through (d) of
Section 12.13 of the Reorganization Agreement are hereby incorporated herein;
except that the Company, the LLC and Xxxxx Xxxxxxx shall be deemed a party
thereunder.
5.10 CONSENT TO JURISDICTION; WAIVERS. Each of the parties hereto
irrevocably submits to the exclusive jurisdiction of (a) the Delaware Chancery
Court, and (b) the United States District Court for Delaware, for the purposes
of confirming, modifying or vacating any alternative dispute resolution award
provided in accordance with Section 2.10 (an "Award Action"). Each of the
parties hereto agrees to commence any Award Action relating hereto either in the
United States District Court for Delaware or if such Award Action may not be
brought in such court for jurisdictional reasons, in the Delaware Chancery
Court. Each of the parties hereto further agrees that service of any process,
summons, notice or document by U.S. registered mail to such party's respective
address set forth in Section 2.2 shall be effective service of process for any
Award Action in Delaware with respect to any matters to which it has submitted
to jurisdiction in this Section 2.10. Each of the parties hereto irrevocably and
unconditionally waives any objection to the laying of venue of any Award Action
arising out of this Agreement in (i) the Delaware Chancery Court, or (ii) the
United States District Court for Delaware, and hereby further irrevocably and
unconditionally waives and agrees not to plead or claim in any such court that
any such Award Action brought in any such court has been brought in an
inconvenient forum.
5.11 WAIVER OF JURY TRIAL. Each of the parties hereto irrevocably and
unconditionally waives trial by jury in any Award Action relating to this
Agreement or any transaction contemplated hereby or thereby, and for any
counterclaim with respect thereto.
5.12 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, and by the different parties hereto in separate counterparts, each
of which when executed shall be deemed to be an original but all of which taken
together shall constitute one and the same agreement.
17
5.13 ENTIRE AGREEMENT. This Agreement, together with all Exhibits hereto,
constitute the entire agreement and supersede all prior agreements and
undertakings, both written and oral, among the parties hereto with respect to
the subject matter hereof.
5.14 NO INCONSISTENT AGREEMENTS; UNDERWRITING AGREEMENT. The Company shall
not, on or after the date of this Agreement, enter into any agreement with
respect to its securities which is inconsistent with the rights granted to the
Holders in this Agreement or otherwise conflicts with the provisions hereof;
PROVIDED, HOWEVER, that to the extent the Company and the Holders in a proposed
registration shall enter into an underwriting or similar agreement, which
agreement contains provisions covering one or more issues addressed in this
Agreement, the provisions contained in this Agreement addressing such issue or
issues shall be superseded with respect to such registration by such other
agreement. The Company has not entered into any agreement with respect to its
securities granting any registration rights to any person other than this
Agreement.
[Signature Page Follows]
18
The parties have executed this Agreement as of the date first above written.
[NEWCO]
By:_______________________________________
Name:
Title:
WPH-XXXXXXX, LLC, a Delaware limited liability
company
By:_______________________________________
Name:
Title:
APOLLO REAL ESTATE INVESTMENT FUND,
L.P., a Delaware limited partnership
By: APOLLO REAL ESTATE ADVISORS, L.P.,
a Delaware limited partnership,
Its General Partner
By: APOLLO REAL ESTATE MANAGEMENT, INC.,
a Delaware corporation,
Its General Partner
By: ________________________________
Xxxxxxx X. Xxxxxx
Its Vice President
19
BLACKACRE WPH, LLC,
a Delaware limited liability company
By: BLACKACRE CAPITAL GROUP, L.P.,
a Delaware limited partnership,
Its Managing Member
By: BLACKACRE CAPITAL MANAGEMENT CORP.,
a Connecticut corporation,
Its General Partner
By: _____________________________
Xxxxxx X. Xxxxxx
Its Vice President
HIGHRIDGE PACIFIC HOUSING INVESTORS,
L.P., a California limited partnership
By: WPH ACQUISITIONS, INC.,
a California corporation,
Its General Partner
By: ___________________________________
Xxxxxx X. Xxxxxxxxx
Its CFO and Secretary
THE XXXXX AND XXXXXXXX XXXXXXX FOUNDATION,
a Hawaii non-profit corporation
By: __________________________________________
Name: Xxxxx X. Xxxxxxx
Title:
20
XXXXX X. XXXXXXX, as sole trustee for the Xxxxx
X. Xxxxxxx Revocable Living Trust and the Xxxxx X.
Xxxxxxx 1998 Qualified Annuity Trust
-------------------------------------------------
Xxxxx X. Xxxxxxx
21
