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Exhibit 10.42
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "Agreement") is made as
of March 11, 1997 among Starwood Lodging Trust, a real estate investment trust
organized under the laws of the State of Maryland (the "Trust"), Starwood
Lodging Corporation, a Maryland corporation (the "Corporation") and The
Hermitage, L.P., a Tennessee limited partnership (the "Holder"). Unless
otherwise indicated, capitalized terms used herein are used herein as defined in
Section 1.1.
RECITALS
WHEREAS, pursuant to an Agreement of Purchase and Sale dated as
of January 16, 1997 (the "Purchase Agreement") among SLT Realty Limited
Partnership, a Delaware limited partnership (the "Realty Partnership"), SLC
Operating Limited Partnership, a Delaware limited partnership (the "Operating
Partnership") and Holder, (i) the Realty Partnership and Operating Partnership
are acquiring from the Holder a hotel, and (ii) a portion of the consideration
set forth in Section 2.02 of the Purchase Agreement may, at the election of the
Holder, be paid in Units of the Realty Partnership (as such Units are defined in
the Limited Partnership Agreement of the Realty Partnership ("Realty Units"))
and Units of the Operating Partnership (as such Units are defined in the Limited
Partnership Agreement of the Operating Partnership ("Operating Units")); and
WHEREAS, pursuant to the Purchase Agreement, the parties hereto
desire to set forth the rights of the Holder and the obligations of the Trust
and the Corporation to cause the registration of the Registrable Securities
pursuant to the Securities Act;
NOW, THEREFORE, in consideration of the premises and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
SECTION 1. DEFINITIONS AND USAGE.
1.1. DEFINITIONS. As used in this Agreement:
Beneficially Owning. "Beneficially Owning" means owning Trust
Shares directly, indirectly or constructively by a Person through the
application of Section 318(a) of the Code, as modified by Section 856(d)(5) of
the Code, or Section 544 of the Code, as modified by Section 856(h) of the Code.
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Business Day. "Business Day" means any day other than Saturday,
Sunday and any day on which commercial banks are not open to do business in
Phoenix, Arizona.
Code. "Code" shall mean the Internal Revenue Code of 1986, and
the rules and regulations promulgated thereunder, as amended from time to time.
Commission. "Commission" shall mean the Securities and Exchange
Commission or any other federal agency at the time administering the Securities
Act.
Continuously Effective. "Continuously Effective", with respect to
a specified registration statement, shall mean that such registration statement
shall not cease to be effective and available for Transfers of Registrable
Securities thereunder for longer than either (i) any ten (10) consecutive
Business Days, or (ii) an aggregate of fifteen (15) Business Days during the
period specified in the relevant provision of this Agreement.
Corporation Shares. "Corporation Shares" shall mean the shares of
common stock, par value $.01 per share, of the Corporation.
Exchange Act. "Exchange Act" shall mean the Securities Exchange
Act of 1934 and the rules and regulations of the Commission thereunder, all as
the same shall be in effect at the time.
Exchange Rights Agreement. "Exchange Rights Agreement" shall mean
the Exchange Rights Agreement dated the date hereof among the Trust, the
Corporation, the Realty Partnership, the Operating Partnership and the Holder.
Holder. "Holder" shall have the meaning set forth in the
recitals.
Issuance Percentages. "Issuance Percentage", when used with
respect to the Trust, shall mean 95% and, when used with respect to the
Corporation, shall mean 5%; provided that the Trust and the Corporation may from
time to time change the Issuance Percentages based on their joint determination
of the relative values of the Trust Shares and Corporation Shares.
Operating Partnership. "Operating Partnership" shall have the
meaning set forth in the recitals.
Operating Units. "Operating Units" shall have the meaning set
forth in the recitals.
Ownership Limit. "Ownership Limit" when used with respect to
Trust Shares, has the meaning set forth in the
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Declaration of Trust of the Trust and, when used with respect to the Corporation
Shares, has the meaning set forth in the Restated Articles of Incorporation of
the Corporation, in each case as amended from time to time.
Paired Shares. "Paired Shares" shall mean the Trust Shares and
shares of Corporation Stock which are "paired" pursuant to the Pairing Agreement
dated June 25, 1980 between the Trust and the Corporation, as it may be amended
from time to time.
Person. "Person" shall mean any individual, corporation,
partnership, joint venture, association, joint-stock company, limited liability
company, trust, unincorporated organization or government or other agency or
political subdivision thereof.
Piggyback Registration. "Piggyback Registration" shall have the
meaning set forth in Section 3.
Realty Partnership. "Realty Partnership" shall have the meaning
set forth in the recitals.
Realty Units. "Realty Units" shall have the meaning set forth in
the recitals.
Register, Registered and Registration. "Register", "registered",
and "registration" shall refer to a registration effected by preparing and
filing a registration statement or similar document in compliance with the
Securities Act, and the declaration or ordering by the Commission of
effectiveness of such registration statement or document.
Registrable Securities. "Registrable Securities" shall mean: (i)
the Paired Shares issued upon exchange of Realty Units and Operating Units
pursuant to the Exchange Rights Agreement, (ii) any Paired Shares or other
securities issued as (or issuable upon the conversion or exercise of any
warrant, right or other security which is issued as) a dividend or other
distribution with respect to, or in exchange by the Trust and the Corporation
generally for, or in replacement by the Trust and the Corporation generally of,
such Paired Shares; and (iii) any securities issued in exchange for Paired
Shares in any merger or reorganization of the Trust and the Corporation;
provided, however, that Registrable Securities shall not include any securities
which have theretofore been registered and sold pursuant to the Securities Act
or which have been sold to the public pursuant to Rule 144 or any similar rule
promulgated by the Commission pursuant to the Securities Act, and, provided
further, the Trust and the Corporation shall have no obligation under Sections 2
and 3 to register any Registrable Securities if the Trust and the Corporation
shall deliver to the Holder of such Registrable
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Securities an opinion of counsel to the effect that the proposed sale or
disposition of all of the Registrable Securities for which registration was
requested does not require registration under the Securities Act for a sale or
disposition in a single public sale, and, upon written request by the Holder,
the Trust and the Corporation shall remove any and all legends restricting
transfer from the certificates evidencing such Registrable Securities.
Registrable Securities then outstanding. "Registrable Securities
then outstanding" shall mean, with respect to a specified determination date,
the Registrable Securities owned by the Holder on such date and the Registrable
Securities which are issuable upon exchange of Realty Units and Operating Units
owned by the Holder on such date.
Registration Expenses. "Registration Expenses" shall have the
meaning set forth in Section 6.1.
REIT Requirements. "REIT Requirements" shall mean the
requirements for the Trust to (i) qualify as a Real Estate Investment Trust
("REIT") under the Internal Revenue Code of 1986, as amended from time to time,
and the rules and regulations promulgated thereunder, (ii) avoid any federal
income or excise tax liability, (iii) retain its status as grandfathered
pursuant to Section 136(c)(3) of the Deficit Reduction Act of 1984 and (iv)
retain the benefits of that certain private letter ruling issued by the Internal
Revenue Service to the Trust dated as of January 4, 1980.
Securities Act. "Securities Act" shall mean the Securities Act of
1933 and the rules and regulations of the Commission thereunder, all as the same
may be in effect at the time.
Shelf Registration. "Shelf Registration" shall have the meaning
set forth in Section 2.1.
Transfer. "Transfer" shall mean and include the act of selling,
giving, transferring, creating a trust (voting or otherwise), assigning or
otherwise disposing of (other than pledging, hypothecating or otherwise
transferring as security) (and correlative words shall have correlative
meanings); provided however, that any transfer or other disposition upon
foreclosure or other exercise of remedies of a secured creditor after an event
of default under or with respect to a pledge, hypothecation or other transfer as
security shall constitute a "Transfer".
Trust Shares. "Trust Shares" shall mean the shares of
beneficial interest, $.01 par value, of the Trust.
Underwriters' Representative. "Underwriters'
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Representative" shall mean the managing underwriter, or, in the case of a
co-managed underwriting, the managing underwriter designated as the
Underwriters' Representative by the co-managers.
Units. "Units" shall mean Realty Units and Operating Units.
Violation. "Violation" shall have the meaning set forth in
Section 7.1.
1.2. USAGE.
(i) References to a Person are also references to its assigns and
successors in interest (by means of merger, consolidation or sale of all or
substantially all the assets of such Person or otherwise, as the case may be).
(ii) References to Registrable Securities "owned" by a Holder
shall include Registrable Securities beneficially owned by such Person but which
are held of record in the name of a nominee, trustee, custodian, or other agent,
but shall exclude Paired Shares held by a Holder in a fiduciary capacity for
customers of such Person.
(iii) References to a document are to it as amended, waived and
otherwise modified from time to time and references to a statute or other
governmental rule are to it as amended and otherwise modified from time to time
(and references to any provision thereof shall include references to any
successor provision).
(iv) References to Sections or to Schedules or Exhibits are to
sections hereof or schedules or exhibits hereto, unless the context otherwise
requires.
(v) The definitions set forth herein are equally applicable both
to the singular and plural forms and the feminine, masculine and neuter forms of
the terms defined.
(vi) The term "including" and correlative terms shall be deemed
to be followed by "without limitation" whether or not followed by such words or
words of like import.
(vii) The term "hereof" and similar terms refer to this Agreement
as a whole.
(viii) The "date of" any notice or request given pursuant to this
Agreement shall be determined in accordance with Section 11.
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SECTION 2. DEMAND SHELF REGISTRATIONS.
2.1. Subject to Sections 2.4 and 6.3, if the Holder shall make a
written request to the Trust and the Corporation to effect a registration on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act (a
"Shelf Registration") with respect to all or any portion of the Registrable
Securities, then the Trust and the Corporation shall as soon as practicable
cause there to be filed with the Commission such Shelf Registration. The Trust
and the Corporation shall include therein all or any portion of the Registrable
Securities requested by the Holder. Any request made pursuant to this Section
2.1 shall be addressed to the attention of the Secretary of each of the Trust
and the Corporation, and shall specify the number of Registrable Securities to
be registered, the possible intended methods of disposition thereof and that the
request is for a Shelf Registration pursuant to this Section 2.1.
2.2. (i) The Trust and the Corporation shall be entitled to
postpone for up to 90 days the filing of any registration statement otherwise
required to be prepared and filed pursuant to this Section 2, if the Trust and
the Corporation shall furnish to the Holder a certificate signed by the
Secretary of each of the Trust and the Corporation stating that the Board of
Trustees of the Trust and the Board of Directors of the Corporation have in good
faith determined that such registration and the Transfer of Registrable
Securities contemplated thereby would interfere with, or require premature
disclosure of, any material financing, acquisition, disposition, reorganization
or other transaction involving the Realty Partnership, the Operating
Partnership, the Trust or the Corporation or any of their respective
subsidiaries and the Trust or the Corporation, as the case may be, promptly
gives the Holder notice of such determination. If a disclosure of such
transactions occurs prior to the end of the 90-day period, such postponement
shall terminate on such earlier day. The Holder hereby acknowledges that any
notice given by the Trust or the Corporation pursuant to this Section 2.2(i)
shall constitute material non-public information and that the United States
securities laws prohibit any Person who has material non-public information
about a company from purchasing or selling securities of such company or from
communicating such information to any other Person under circumstances in which
it is reasonably foreseeable that such Person is likely to purchase or sell such
securities.
(ii) The Trust and the Corporation shall not be obligated to file
any registration statement pursuant to this Section 2 if, within thirty (30)
days after their receipt of the written request of the Holder, the Trust and the
Corporation notify the Holder that, prior to their receipt of such request,
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they had a plan or intention promptly to register equity securities under the
Securities Act. The Trust and the Corporation shall not be obligated to file any
registration statement pursuant to the preceding sentence, only if the Trust and
the Corporation are actively employing in good faith all reasonable efforts to
cause such registration statements to become effective. The Holder shall have
rights to participate in any such registration on the terms provided in Section
3 hereof.
2.3. Following receipt of a request for a Shelf Registration, the
Trust and the Corporation shall:
(i) File the registration statement with the Commission as
promptly as practicable, and shall use their respective reasonable efforts to
have the registration declared effective under the Securities Act as soon as
reasonably practicable, in each instance giving due regard to the need to
prepare current financial statements, conduct due diligence and complete other
actions that are reasonably necessary to effect a registered public offering.
(ii) Use their respective reasonable efforts to keep the relevant
registration statement Continuously Effective until such date as of which all
the Registrable Securities under the Shelf Registration statement have been
disposed of in a manner described in the registration statement. In no event
will such registration statement be required to be Continuously Effective for
more than 3 years.
2.4. Notwithstanding anything in this Agreement to the contrary,
(a) in no event will the Trust or the Corporation be obligated to effect more
than one Shelf Registration, and (b) no registration shall be effected under
this Agreement and no Transfer of Registrable Securities may be effected if as a
result thereof the Trust would not satisfy the REIT Requirements in any respect
or if such registration or Transfer would result in any Person Beneficially
Owning Paired Shares in excess of the Ownership Limit. For purposes of the
preceding sentence, registration shall not be deemed to have been effected (i)
unless a registration statement with respect thereto has become effective, or
(ii) if after such registration statement has become effective, the related
offer, sale or distribution of Registrable Securities thereunder is prohibited
by any stop order, injunction or other order or requirement of the Commission or
other governmental agency or court for any reason not attributable to the Holder
and such prohibition is not thereafter eliminated. If the Trust and the
Corporation shall have complied with their respective obligations under this
Agreement, a right to demand a registration pursuant to this Section 2 shall be
deemed to have been satisfied upon the effective date of such Shelf
Registration, provided no stop order or similar order, or
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proceedings for such an order, is thereafter entered or initiated.
2.5. A registration pursuant to this Section 2 shall be on such
appropriate registration form of the Commission as shall be selected by the
Trust and the Corporation and shall permit the disposition of the Registrable
Securities in accordance with the intended method or methods of disposition
specified in the request pursuant to Section 2.1.
SECTION 3. PIGGYBACK REGISTRATION.
3.1. If at any time the Trust and the Corporation (either for
itself or pursuant to a registration rights agreement) propose to register
securities under the Securities Act in connection with the public offering
solely for cash on Form X-0, X-0, X-0, or S-11 (or any replacement or successor
forms), the Trust and the Corporation shall promptly give the Holder written
notice of such registration. Upon the written request of the Holder given as
promptly as practicable but in any event within twenty (20) days following the
date of such notice, the Trust and the Corporation shall cause to be included in
such registration statement and use their respective reasonable efforts to be
registered under the Securities Act all the Registrable Securities that the
Holder shall have requested to be registered; provided, however, that such right
of inclusion shall not apply to any registration statement covering an offering
of debt securities or convertible debt securities (any such registration in
which Holder participate pursuant to this Section 3.1 being referred to as a
"Piggyback Registration"). The Trust and the Corporation shall have the absolute
right to delay, withdraw or cease to prepare or file any registration statement
for any offering referred to in this Section 3 without any obligation or
liability to the Holder, it being understood that any Registrable Securities
previously included in any such withdrawn Registration Statement shall not cease
to be Registrable Securities by reason of such inclusion or withdrawal. If the
Holder has requested inclusion of Registrable Securities in a Piggyback
Registration, the Holder may withdraw therefrom by written notice to the Trust,
the Corporation and the underwriter, provided such withdrawal is made prior to
the effective date of the relevant registration statement.
3.2. If the Underwriters' Representative shall advise the Trust
and the Corporation that, in its opinion, the amount or type of Registrable
Securities requested to be included in a Piggyback Registration would adversely
affect such offering, or the timing thereof, then the Trust and the Corporation
will include in such registration, to the extent of the amount and class which
the Trust and the Corporation are so advised can be sold without such adverse
effect in such offering: first, all securities, if any, requested to be included
in a registration
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statement pursuant to the exercise of demand registration rights granted by the
Trust and the Corporation; second, all securities proposed to be sold by the
Trust and the Corporation for their own accounts; and third, the Registrable
Securities requested to be included in such registration by Holder pursuant to
this Section 3 and all other securities requested to be included in such
registration pursuant to registration rights agreements with other parties pro
rata based on the estimated gross proceeds from the sale thereof.
SECTION 4. REGISTRATION PROCEDURES. Whenever required under
Section 2 or Section 3 to effect the registration of any Registrable Securities,
the Trust and the Corporation shall, as expeditiously as practicable:
4.1. Prepare and file with the Commission a registration
statement with respect to such Registrable Securities and use their respective
reasonable efforts to cause such registration statement to become effective;
provided, however, that before filing a registration statement or prospectus or
any amendments or supplements thereto, the Trust and the Corporation shall
furnish to one firm of counsel for the Holder, copies of all such documents in
the form substantially as proposed to be filed with the Commission and provide
reasonable opportunity to comment.
4.2. Prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in connection
with such registration statement as may be necessary to comply with the
provisions of the Securities Act and rules thereunder with respect to the
disposition of all securities covered by such registration statement. If the
registration is for an underwritten offering, the Trust and the Corporation
shall amend the registration statement or supplement the prospectus whenever
required by the terms of the underwriting agreement entered into pursuant to
Section 4.5. If the registration statement is for a Shelf Registration, the
Trust and the Corporation shall amend the registration statement or supplement
the prospectus so that it will remain current and in compliance with the
requirements of the Securities Act for the period specified in Section 2.3(ii),
and if during such period any event or development occurs as a result of which
the registration statement or prospectus contains a misstatement 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, the Trust or the
Corporation shall promptly notify the Holder, amend the registration statement
or supplement the prospectus so that each will thereafter comply with the
Securities Act and furnish to the Holder such amended or supplemented
prospectus, which the Holder shall thereafter use in the Transfer of Registrable
Securities covered by such
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registration statement. Pending any such amendment or supplement described in
this Section 4.2, the Holder shall cease making offers or Transfers of
Registrable Shares pursuant to the prior prospectus. In the event that any
Registrable Securities included in a registration statement subject to, or
required by, this Agreement remain unsold at the end of the period during which
the Trust and the Corporation are obligated to use their respective reasonable
efforts to maintain the effectiveness of such registration statement, the Trust
and the Corporation may file a post-effective amendment to the registration
statement for the purpose of removing such Registrable Securities from
registered status.
4.3. Furnish to the Holder, without charge, such numbers of
copies of the registration statement, any pre-effective or post-effective
amendment thereto, the prospectus, including each preliminary prospectus and any
amendments or supplements thereto, in each case in conformity with the
requirements of the Securities Act and the rules thereunder, and such other
related documents as the Holder may reasonably request in order to facilitate
the disposition of Registrable Securities owned by the Holder.
4.4. Use their respective reasonable efforts (i) to register and
qualify the securities covered by such registration statement under such other
securities or Blue Sky laws of such states where an exemption from registration
is not available and as shall be reasonably requested by the Underwriters'
Representative and (ii) 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 the offer and transfer of
any of the Registrable Securities in any state, at the earliest possible moment;
provided, however, that neither the Trust nor the Corporation shall be required
in connection therewith or as a condition thereto to qualify to do business or
to consent to general service of process in any state.
4.5. In the event of any underwritten offering, use their
respective reasonable efforts to enter into and perform their respective
obligations under an underwriting agreement (including indemnification and
contribution obligations of underwriters), in usual and customary form, with the
managing underwriter or underwriters of such offering. The Trust and the
Corporation shall also cooperate with the Holder, and the Underwriters'
Representative for such offering in the marketing of the Registerable
Securities, including making available the officers, accountants, counsel,
premises, books and records of the Trust and the Corporation for such purpose;
provided, however, that neither the Trust nor the Corporation shall be required
to incur any material out-of-pocket expense pursuant to
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this sentence and; provided, further, that the officers of the Trust and the
Corporation will not be required to participate in more than one "roadshow" in
any twelve month period.
4.6. Promptly notify the Holder of any stop order issued or
threatened to be issued by the Commission in connection therewith and take all
reasonable actions required to prevent the entry of such stop order or to remove
it if entered.
4.7. Make available for inspection by the Holder, any underwriter
participating in such offering and the representatives of the Holder and
Underwriter (but not more than one firm of counsel to the Holder), all financial
and other information as shall be reasonably requested by them, and provide the
Holder, any underwriter participating in such offering and the representatives
of the Holder and Underwriter the reasonable opportunity to discuss the business
affairs of the Trust and the Corporation with their principal executives and
independent public accountants who have certified the audited financial
statements included in such registration statement, in each case all as
necessary to enable them to exercise their due diligence responsibility under
the Securities Act; provided, however, that information that the Trust or the
Corporation determine to be confidential and which the Trust or the Corporation
advise such Person in writing, is confidential shall not be disclosed unless
such Person signs a confidentiality agreement reasonably satisfactory to the
Trust and the Corporation or the Holder agrees to be responsible for such
Person's breach of confidentiality on terms reasonably satisfactory to the Trust
and the Corporation.
4.8. Use their respective reasonable efforts to obtain a
so-called "comfort letter" from the independent public accountants of the Trust
and the Corporation, and legal opinions of counsel to the Trust and the
Corporation addressed to the Holder, in customary form and covering such matters
of the type customarily covered by such letters, and in a form that shall be
reasonably satisfactory to the Holder. Delivery of any such opinion or comfort
letter shall be subject to the recipient furnishing such written representations
or acknowledgments as are customarily provided by selling shareholders who
receive such comfort letters or opinions.
4.9. Use their respective reasonable efforts to cause the
Registrable Securities covered by such registration statement (i) if the Paired
Shares are then listed on a securities exchange or included for quotation in a
recognized trading market, to continue to be so listed or included for a
reasonable period of time after the offering, and (ii) to be registered with or
approved by such other United States or state governmental agencies or
authorities as may be necessary by virtue of the
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business and operations of the Trust and the Corporation to enable the Holder to
consummate the disposition of such Registrable Securities.
4.10. Take such other actions as are reasonably required in order
to expedite or facilitate the disposition of Registrable Securities included in
each such registration.
SECTION 5. HOLDER OBLIGATIONS. It shall be a condition precedent
to the obligations of the Trust and the Corporation to take any action pursuant
to this Agreement with respect to the Registrable Securities of the Holder that
the Holder shall:
5.1. Furnish to the Trust and the Corporation such information
regarding the Holder, the number of the Registrable Securities owned by it, and
the intended method of disposition of such securities as shall be required to
effect the registration of the Holder's Registrable Securities, and to cooperate
fully with the Trust and the Corporation in preparing such registration.
5.2. Except as set forth in Section 3.1, agree to sell its
Registrable Securities to the underwriters at the same price and on
substantially the same terms and conditions as the Trust and the Corporation or
the other Persons on whose behalf the registration statement was being filed
have agreed to sell its securities, and to execute the underwriting agreement
agreed to by the Holder (in the case of a registration under Section 2) or the
Trust and the Corporation and the Holder (in the case of a registration under
Section 3).
SECTION 6. EXPENSES OF REGISTRATION. Expenses in connection with
registrations pursuant to this Agreement shall be allocated and paid as follows:
6.1. With respect to a Shelf Registration, except as otherwise
provided herein, each of the Trust and the Corporation shall bear and pay all
expenses incurred in connection with any registration, filing, or qualification
of Registrable Securities with respect to such Registration for the Holder,
including all registration, filing and National Association of Securities
Dealers, Inc. fees, all fees and expenses of complying with securities or blue
sky laws, all printing expenses, messenger and delivery expenses, the reasonable
fees and disbursements of counsel for the Trust and the Corporation, and of the
independent public accountants for the Trust and the Corporation, including the
expenses of "cold comfort" letters required by or incident to such performance
and compliance (the "Registration Expenses"), but excluding underwriting
discounts and commissions relating to Registrable Securities (which shall be
paid by the Holder) and
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all fees and expenses of counsel for the Holder; provided, however, that the
Trust and the Corporation shall not be required to pay for any expenses of any
registration proceeding begun pursuant to Section 2 if the registration is
subsequently withdrawn as a result of the failure of the Holder to satisfy its
obligations under this Agreement (in which case the Holder shall bear such
expenses), unless the Holder indicates that such withdrawn registration shall
have constituted the Shelf Registration available to it under Section 2 hereof.
Notwithstanding the preceding sentence, the Trust and the Corporation shall not
be required to bear the first $25,000 of Registration Expenses; the Holder shall
bear and pay the first $25,000 of Registration Expenses. With respect to such
$25,000 of Registration Expenses, the Holder shall include a payment for this
amount with the written request for a Shelf Registration. The Trust and the
Corporation each agree between themselves that they shall bear and pay
Registration Expenses in an amount equal to their respective Issuance Percentage
of such Registration Expenses and that they shall reimburse each other to the
extent necessary to cause each of them to so bear and pay such respective
amounts.
6.2. The Holder shall not bear or pay any Registration Expenses
incurred in connection with any Piggyback Registrations pursuant to Section 3,
but excluding underwriting discounts and commissions relating to Registrable
Securities (which shall be paid by the Holder) and all fees and expenses of
counsel for the Holder.
6.3. Notwithstanding anything to the contrary in this Agreement,
(i) no request for Shelf Registration pursuant to Section 2.1 may be made unless
such request is accompanied by a payment of $25,000 and (ii) the Trust and the
Corporation shall have no obligation to make a Shelf Registration pursuant to
Section 2.1 effective until the Holder has satisfied its obligation under
Section 6.1 to bear and pay Registration Expenses. The $25,000 referred to in
the preceding sentence shall be considered an advance of the Holder's payment of
Registration Expenses pursuant to Section 6.1 and if such Registration Expenses
do not exceed $25,000, then any excess shall be refunded to the Holder.
SECTION 7. INDEMNIFICATION; CONTRIBUTION. If any Registrable
Securities are included in a registration statement under this Agreement:
7.1. To the extent permitted by applicable law, each of the Trust
and the Corporation, severally and not jointly, shall indemnify and hold
harmless the Holder, each Person, if any, who controls the Holder within the
meaning of the Securities Act, and each officer, director, partner and employee
of the
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Holder and such controlling Person, against any and all losses, claims,
damages, liabilities and expenses (joint or several), including reasonable
attorneys' fees and disbursements and reasonable expenses of investigation,
incurred by such party pursuant to any actual or threatened action, suit,
proceeding or investigation, or to which any of the foregoing Persons may
otherwise become subject under the Securities Act, the Exchange Act or other
federal or state laws, insofar as such losses, claims, damages, liabilities and
expenses 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 such registration statement, including any
preliminary prospectus or final prospectus contained therein, or any amendments
or supplements thereto; or
(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;
provided, however, that the indemnification required by this Section 7.1 shall
not apply to amounts paid in settlement of any such loss, claim, damage,
liability or expense if such settlement is effected without the consent of the
Trust or the Corporation (which consent shall not be unreasonably withheld), nor
shall the Trust or the Corporation be liable in any such case for any such loss,
claim, damage, liability or expense to the extent that it arises out of or is
based upon a Violation which occurs in reliance upon and in conformity with
information furnished to the Trust or the Corporation by the indemnified party
in writing expressly for use in connection with such registration; and provided,
further, that the indemnity agreement contained in this Section 7 shall not
apply to the extent that any such loss is based on or arises out of an untrue
statement or alleged untrue statement of a material fact, or an omission or
alleged omission to state a material fact, contained in or omitted from any
preliminary prospectus if the final prospectus shall correct such untrue
statement or alleged untrue statement, or such omission or alleged omission, and
a copy of the final prospectus has not been sent or given to such person at or
prior to the confirmation of sale to such person if an underwriter or Holder was
under an obligation to deliver such final prospectus and failed to do so.
7.2. To the extent permitted by applicable law, the Holder shall
indemnify and hold harmless the Trust, the Corporation, each of the Trustees of
the Trust, each of the directors of the Corporation, each of the officers of the
Trust or the Corporation who shall have signed the registration statement, each
Person, if any, who controls the Trust or the Corporation within the meaning of
the Securities Act, against any
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and all losses, claims, damages, liabilities and expenses (joint and several),
including reasonable attorneys' fees and disbursements and reasonable expenses
of investigation, incurred by such party pursuant to any actual or threatened
action, suit, proceeding or investigation, or to which any of the foregoing
Persons may otherwise become subject under the Securities Act, the Exchange Act
or other federal or state laws, but only insofar as such losses, claims,
damages, liabilities and expenses arise out of or are based upon any Violation,
in each case to the extent that such Violation arises out of or is based upon
information furnished by the Holder in writing expressly for use in connection
with such registration; provided, however, that (x) the indemnification required
by this Section 7.2 shall not apply to amounts paid in settlement of any such
loss, claim, damage, liability or expense if such settlement is effected without
the consent of the relevant Holder (which consent shall not be unreasonably
withheld) and (y) in no event shall the amount of any indemnity under this
Section 7.2 exceed the gross proceeds from the applicable offering received by
the Holder.
7.3. Promptly after receipt by an indemnified party under this
Section 7 of notice of the commencement of any action, suit, proceeding,
investigation or threat thereof made in writing for which such indemnified party
may make a claim under this Section 7, such indemnified party shall deliver to
the indemnifying party a written notice thereof and the indemnifying 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 disbursements 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 following 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 7 to the extent of such prejudice but shall
not relieve the indemnifying party of any liability that it may have to any
indemnified party otherwise than pursuant to this Section 7. Any fees and
expenses incurred by the indemnified party (including any fees and expenses
incurred in connection with investigating or preparing to defend such action or
proceeding) shall be paid to the indemnified party, as incurred, within thirty
(30) days of written notice thereof to the indemnifying party (regardless of
whether it is ultimately determined that an indemnified party is not entitled
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to indemnification hereunder). Any such indemnified party shall have the right
to employ separate counsel in any such action, claim or proceeding and to
participate in the defense thereof, but the fees and expenses of such counsel
shall be the expenses of such indemnified party unless (i) the indemnifying
party has agreed to pay such fees and expenses or (ii) the indemnifying party
shall have failed to promptly assume the defense of such action, claim or
proceeding or (iii) the named parties to any such action, claim or proceeding
(including any impleaded parties) include both such indemnified party and the
indemnifying party, and such indemnified party shall have been advised by
counsel that there may be one or more legal defenses available to it which are
different from or in addition to those available to the indemnifying party and
that the assertion of such defenses would create a conflict of interest such
that counsel employed by the indemnifying party could not faithfully represent
the indemnified party (in which case, if such indemnified party notifies the
indemnifying party in writing that it elects to employ separate counsel at the
expense of the indemnifying party, the indemnifying party shall not have the
right to assume the defense of such action, claim or proceeding on behalf of
such indemnified party, it being understood, however, that the indemnifying
party shall not, in connection with any one such action, claim or proceeding or
separate but substantially similar or related actions, claims or proceedings in
the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the reasonable fees and expenses of more than one
separate firm of attorneys (together with appropriate local counsel) at any time
for all such indemnified parties, unless in the reasonable judgment of such
indemnified party a conflict of interest may exist between such indemnified
party and any other of such indemnified parties with respect to such action,
claim or proceeding, in which event the indemnifying party shall be obligated to
pay the fees and expenses of such additional counsel or counsels).
7.4. If the indemnification required by this Section 7 from the
indemnifying party is unavailable to an indemnified party hereunder in respect
of any losses, claims, damages, liabilities or expenses referred to in this
Section 7:
(i) The indemnifying party, in lieu of indemnifying such
indemnified party, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages, liabilities or
expenses in such proportion as is appropriate to reflect the relative fault of
the indemnifying party and indemnified parties in connection with the actions
which resulted in such losses, claims, damages, liabilities or expenses, as well
as any other relevant equitable considerations. The relative fault of such
indemnifying party and indemnified parties shall be determined by reference to,
among other things,
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whether any Violation has been committed by, or relates to information supplied
by, such indemnifying party or indemnified parties, and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such Violation. The amount paid or payable by a party as a result of the losses,
claims, damages, liabilities and expenses referred to above shall be deemed to
include, subject to the limitations set forth in Section 7.1 and Section 7.2,
any legal or other fees or expenses reasonably incurred by such party in
connection with any investigation or proceeding.
(ii) The parties hereto agree that it would not be just and
equitable if contribution pursuant to this Section 7.4 were determined by pro
rata allocation or by any other method of allocation which does not take into
account the equitable considerations referred to in Section 7.4(i). 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 who was
not guilty of such fraudulent misrepresentation.
7.5. If indemnification is available under this Section 7, the
indemnifying parties shall indemnify each indemnified party to the full extent
provided in this Section 7 without regard to the relative fault of such
indemnifying party or indemnified party or any other equitable consideration
referred to in Section 7.4.
7.6. The obligations of the Trust, the Corporation and the Holder
under this Section 7 shall survive the completion of any offering of Registrable
Securities pursuant to a registration statement under this Agreement, and
otherwise.
SECTION 8. HOLDBACK. The Holder, if so requested by the
Underwriters' Representative in connection with an offering of any securities
covered by a registration statement filed by Trust and the Corporation, whether
or not Holder's securities are included therein, shall not effect any public
sale or distribution of Paired Shares or any securities convertible into or
exchangeable or exercisable for Paired Shares, including a sale pursuant to Rule
144 under the Securities Act (except as part of such underwritten registration),
during the 15-day period prior to, and during the 90-day period beginning on,
the date such registration statement is declared effective under the Securities
Act by the Commission. In order to enforce the foregoing covenant, the Trust and
the Corporation shall be entitled to impose stop-transfer instructions with
respect to the Registrable Securities of the Holder until the end of such
period. The Holder shall have the right to participate in any such registration
on the terms provided in Section 3 hereof.
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SECTION 9. AMENDMENT, MODIFICATION AND WAIVERS;
FURTHER ASSURANCES.
(i) This Agreement may be amended with the consent of the Trust
and the Corporation and the Trust and the Corporation may take any action herein
prohibited, or omit to perform any act herein required to be performed by it,
only if the Trust and the Corporation shall have obtained the written consent of
the Holder to such amendment, action or omission to act.
(ii) No waiver of any terms or conditions of this Agreement shall
operate as a waiver of any other breach of such terms and conditions or any
other term or condition, nor shall any failure to enforce any provision hereof
operate as a waiver of such provision or of any other provision hereof. No
written waiver hereunder, unless it by its own terms explicitly provides to the
contrary, shall be construed to effect a continuing waiver of the provisions
being waived and no such waiver in any instance shall constitute a waiver in any
other instance or for any other purpose or impair the right of the party against
whom such waiver is claimed in all other instances or for all other purposes to
require full compliance with such provision.
(iii) Each of the parties hereto shall execute all such further
instruments and documents and take all such further action as any other party
hereto may reasonably require in order to effectuate the terms and purposes of
this Agreement.
SECTION 10. ASSIGNMENT; BENEFIT. This Agreement shall be binding
upon and inure to the benefit of and be enforceable by the parties hereto and
their respective successors and assigns. In addition, and whether or not any
express assignment shall have been made, the provisions of this Agreement which
are for the benefit of the parties hereto other than the Corporation and the
Trust, shall also be for the benefit of and enforceable by any subsequent holder
of any Registrable Securities, subject to all the provisions herein, including
those respecting the minimum numbers or percentages of shares of Registrable
Securities required in order to be entitled to certain rights, or take certain
actions, contained herein.
SECTION 11. MISCELLANEOUS.
11.1. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware, without giving
regard to the conflict of laws principles thereof.
11.2. NOTICES. All notices and requests given pursuant to this
Agreement shall be in writing and shall be made by hand-delivery, first-class
mail (registered or certified, return receipt requested), confirmed facsimile or
overnight air
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courier guaranteeing next Business Day delivery to the relevant address
specified in the Exchange Rights Agreement. Except as otherwise provided in this
Agreement, the date of each such notice and request shall be deemed to be, and
the date on which each such notice and request shall be deemed given shall be:
at the time delivered, if personally delivered or mailed; when receipt is
acknowledged, if sent by facsimile; and the next Business Day after timely
delivery to the courier, if sent by overnight air courier guaranteeing next
Business Day delivery.
11.3. ENTIRE AGREEMENT; INTEGRATION. This Agreement supersedes
all prior agreements between or among any of the parties hereto with respect to
the subject matter contained herein and therein, and such agreements embody the
entire understanding among the parties relating to such subject matter.
11.4. SECTION HEADINGS. Section headings are for convenience of
reference only and shall not affect the meaning of any provision of this
Agreement.
11.5. COUNTERPARTS. This Agreement may be executed in any number
of counterparts, each of which shall be an original, and all of which shall
together constitute one and the same instrument. All signatures need not be on
the same counterpart.
11.6. SEVERABILITY. If any provision of this Agreement shall be
invalid or unenforceable, such invalidity or unenforceability shall not affect
the validity and enforceability of the remaining provisions of this Agreement,
unless the result thereof would be unreasonable, in which case the parties
hereto shall negotiate in good faith as to appropriate amendments hereto.
11.7. TERMINATION. This Agreement may be terminated at any time
by a written instrument signed by the Trust, the Corporation and the Holder.
Unless sooner terminated in accordance with the preceding sentence, this
Agreement (other than Section 7 hereof) shall terminate in its entirety on such
date as there shall be (a) no Registrable Securities outstanding, and (b) no
securities outstanding which are convertible or exchangeable into Registrable
Securities; provided that any Paired Shares previously subject to this Agreement
shall not be Registrable Securities following the sale of any such shares in an
offering registered pursuant to this Agreement.
11.8. STARWOOD LODGING TRUST. The parties hereto understand and
agree that the name "Starwood Lodging Trust" is a designation of the Trust and
its Trustees (as Trustees but not personally) under the Declaration of Trust,
and all persons dealing with the Trust shall look solely to the Trust's assets
for the enforcement of any claims against the Trust, and that the
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Trustees, officers, agents and security holders of the Trust assume no personal
liability for obligations entered into on behalf of the Trust, and their
respective individual assets shall not be subject to the claims of any person
relating to such obligations.
11.9. SUBMISSION TO JURISDICTION. Each of the parties hereto and
each of the Holder irrevocably submits and consents to the jurisdiction of the
United States District Court for the Southern District of New York and the
United States District Court for the District of Maryland in connection with any
action or proceeding arising out of or relating to this Agreement, and
irrevocably waives any immunity from jurisdiction thereof and any claim of
improper venue, forum non conveniens or any similar basis to which it might
otherwise be entitled in any such action or proceeding.
11.10. SPECIFIC PERFORMANCE. Each of the parties acknowledges and
agrees that in the event of any breach of this Agreement, the non-breaching
party or parties would be irreparably harmed and could not be made whole by
monetary damages. The parties hereby agree that in addition to any other remedy
to which they may be entitled at law or in equity, they shall be entitled to
compel specific performance of this Agreement in any action instituted in any
court of the United States or any state thereof having subject matter
jurisdiction for such action.
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IN WITNESS WHEREOF, this Agreement has been duly executed by the
parties hereto as of the date first written above.
STARWOOD LODGING TRUST,
a Maryland real estate investment
trust
By:________________________________
Name:
Title:
STARWOOD LODGING CORPORATION,
a Maryland corporation
By:________________________________
Name:
Title:
THE HERMITAGE, L.P.
By: Hermitage of Nashville, Inc.,
its General Partner
By:____________________________
Pace Xxxxxx
President
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