REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (the "Agreement") is made and entered
into as of January 1, 1996, by and among New York Restaurant Group, L.L.C., a
New York limited liability company (the "Company') and certain holders of the
Company's Common Shares on whose behalf signature pages hereof have been
executed (the "Other Holders"), Xxxxxx X. Xxx Equity Partners Limited
Partnership, a Delaware limited partnership (THLE), THL-CCI Limited Partners, a
Massachusetts limited partnership ("THL-CCI", together with THLE, the "Xxx
Holders"), and the management employees of the Company and certain affiliates of
Xxxx X. Xxxxxxxx listed on Schedule A attached hereto (the "Management
Holders"). THLE and THL-CCI art collectively referred to as "Xxx Group."
This Agreement is made pursuant to the Note Purchase Agreement dated as of
September 29, 1995, by and among the Company and the Xxx Holders of even date
herewith (the "Purchase Agreement"). In order to induce the Xxx Holders to enter
into the Purchase Agreement, the Company has agreed to provide the registration
rights set forth in this Agreement. The execution of this Agreement is a
condition to the Closing under and as defined in the Purchase Agreement.
The parties hereby agree as follows:
1. Definitions
"Best efforts" with respect to the Company shall mean the reasonable
good faith efforts of the Company.
"Business Day" means any day except a Saturday, a Sunday or other
day on which commercial banks in New York, New York are required or authorized
by law to be closed.
"Commission" means the Securities and Exchange Commission and any
successor agency of the United States federal government administering the
Securities Act or the Exchange Act.
"Common Shares" means the membership interests in the Company.
"Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time, and the rules, regulations and interpretations thereunder.
"Holder" means any Person owning Registrable Shares.
"Notes" means the convertible debt issued by the Company pursuant to
the Purchase Agreement.
"Person" means a corporation, an association, a partnership, a
trust, an organization, a business, an individual, or a government or political
agency or other entity.
A "Public Offering" shall mean the completion of a sale of Common
Shares pursuant to a registration statement which has become effective under the
Securities Act, excluding registration statements on Form X-0, X-0 or similar
limited purpose forms.
"Registrable Securities" means (i) the Common Shares, held by the
Management Holders on the date hereof, any Common Shares acquired by the Xxx
Holders upon conversion of the Notes issued pursuant to the Purchase Agreement
(or through conversion of any shares of Preferred Shares of the Company issued
in exchange for such Notes), Common Shares held by the Other Holders, and any
other Common Shares of the Company acquired by any of the foregoing from time to
time and (ii) any capital stock or other securities of the Company into which
the securities referred to in (i) above shall have been changed or any capital
stock or other securities of the Company issued in exchange for, or in a
distribution with respect to, the securities referred to in (i) above.
Securities will cease to be Registrable Securities when (a) they have been
registered under the Securities Act, the registration statement in connection
therewith has been declared effective, and they have been disposed of pursuant
to such effective registration statement, (b) they are distributed to the public
pursuant to Rule 144 (or any similar provision then in force) under the
Securities Act or (c) they have been otherwise transferred and new certificates
or other evidences of ownership for them (not bearing a legend to the effect
that such securities have not been registered under the Securities Act and may
not be sold or transferred in the absence of registration or an exemption
therefrom under the Securities Act, and not subject to any stop transfer order
or other restriction or transfer) have been delivered by or on behalf of the
Company.
"Securities Act" means the Securities Act of 1933, as amended from
time to time, and the rules, regulations and interpretations thereunder.
Terms used as defined terms but not defined herein are as defined in
the Purchase Agreement.
2. Condition Precedent
The rights granted to Holders pursuant to Sections 3, 4 and 5 of
this Agreement will become effective upon the Company changing its status from a
Delaware limited liability company to a business corporation.
3. Xxx Demand Registration
(a) Request for Registration. Subject to Section 6, at any time
after the earlier of (i) a Public Offering or (ii) the fifth anniversary hereof,
one or more Xxx Holders may make a written request to the Company for
registration with the Commission under and in
-2-
accordance with the provisions of the Securities Act of all or part of their
Registrable Securities (a "Xxx Demand Registration"); provided, however, that
the Company need only effect two Xxx Demand Registrations. Such request shall
specify the aggregate number of the Registrable Securities proposed to be sold
and shall also specify the intended method of disposition thereof. Within ten
(10) days after receipt of such request, the Company shall give written notice
(the "Notice") of such registration request to all other Xxx Holders, the
Management Holders and the Other Holders stating that the Company will include
in such registration all Registrable Securities held by the Xxx Holders, the
Management Holders and the Other Holders as to which the Company has received
written requests for inclusion therein within twenty (20) Business Days after
the giving of the Notice. Each Notice shall also specify the number of
Registrable Securities requested to be registered and the intended method of
disposition thereof. Within five (5) Business Days after the expiration of such
twenty (20) business Days, the Company will notify all the Xxx Holders, the
Management Holders and the Other Holders to be included in such registration of
the other Xxx holders; the Management Holders and the Other Holders and the
number of Registrable Securities requested to be included therein.
(b) Participation by Other Parties. No Person shall be permitted to
offer any securities under any Xxx Demand Registration unless such Person is (i)
the Company, a Xxx Xxxxxx, a Management Holder or an Other Holder or is entitled
to exercise "piggyback" registration rights pursuant to contractual commitments
with the Company and (ii) the Holders participating in such Xxx Demand
Registration and their underwriters, if any, in their sole discretion, determine
that such Xxx Demand Registration can accommodate such additional participation.
(c) Effective Registration and Expenses. A registration will not
count as a Xxx Demand Registration until it has become effective. No Xxx Demand
Registration may be requested at a time when a registration is effective with
respect to the securities proposed to be included in such Xxx Demand
Registration. Subject to Section 9, the Company shall pay all Registration
Expenses (as defined in Section 9 below) in connection with a registration made
pursuant to this Section 3, whether or not such registration becomes effective
or Registrable Securities are sold thereunder.
(d) Priority on Xxx Demand Registrations. In the case of an
underwritten offering effected in connection with a Xxx Demand Registration, if
the managing underwriter or underwriters of such offering delivers a written
opinion to the Holders seeking to register Registrable Securities in such
offering, that in its or their opinion, the number of Registrable Securities
requested to be included in such offering exceeds the number which can be sold
in such offering by virtue of the fact that such excess is reasonably likely
materially and adversely to affect the success or offering price of such
offering, the Company shall include in such registration only such Registrable
Securities as equal the total number which, in the opinion of such holders or
such managing underwriter or underwriters, as the case may be, can be sold
without any such material adverse effect, as follows: first, pro rata among the
Xxx
-3-
Holders on the basis of the amount of Registrable Securities requested to be
included in such registration, second, the Company, third, pro rata among the
Management Holders and the Other Holders on the basis of the amount of
Registrable Securities requested to be included in such registration, and
fourth, those securities which have been requested to be included in such
registration by any other Persons.
(e) Selection of Underwriters. If any Xxx Demand Registration is an
underwritten offering, the Xxx Holders will select and obtain the investment
banker or bankers and managing underwriter or underwriters of nationally
recognized standing that will administer the offering, such investment banker or
bankers and managing underwriter or underwriters to be reasonably satisfactory
to the Company.
4. Management Group Demand Registration
Subject to Section 6, one or more Management Holders may make a
written request to the Company for registration with the Commission under and in
accordance with the provisions of the Securities Act of all or part of their
Registrable Securities having an estimated fair market value of $20,000,000 in
the aggregate (a "Management Demand Registration"); provided, however, that the
Company need only effect two Management Demand Registrations. Such request shall
specify the aggregate number of the Registrable Securities proposed to be sold
and shall also specify the intended method of disposition thereof. Within ten
(10) days after receipt of such request, the Company shall give Notice of such
registration request to all other Management Holders, Xxx Holders, and the Other
Holders, stating that the Company will include in such registration all
Registrable Securities held by the Management Holders, the Xxx Holders, and the
Other Holders as to which the Company has received written requests for
inclusion therein within twenty (20) Business Days after the giving of the
Notice. Each Notice shall also specify the number of Registrable Securities
requested to be registered and the intended method of disposition thereof.
Within five (5) Business Days after the expiration of such twenty (20) Business
Days, the Company will notify all the Management Holders, the Xxx Holders, and
the Other Holders to be included in such registration of the other Management
Holders, Xxx Holders. and the Other Holders and the number of Registrable
Securities requested to be included therein.
(b) Participation by Other Parties. No Person shall be permitted to
offer any securities under any Management Demand Registration unless such Person
is the Company, a Management Holder, an Other Holder, or a Xxx Xxxxxx, or is
entitled to exercise "piggyback" registration rights pursuant to contractual
commitments with the Company and the Holders participating in such Management
Demand Registration and their underwriters, if any, in their sole discretion
that such Management Demand Registration can accommodate such additional
participation.
(c) Effective Registration and Expenses. A registration will not
count as a Management Demand Registration until it has become effective. No
Management Demand
-4-
Registration may be requested at a time when a registration is effective with
respect to the securities proposed to be included in such Management Demand
Registration. Subject to Section 9, the Company shall pay all Registration
Expenses (as defined in Section 9 below) in connection with a registration made
pursuant to this Section 4, whether or not such registration becomes effective
or Registrable Securities are sold thereunder.
(d) Priority on Management Demand Registrations. In the case of an
underwritten offering effected in connection with a Management Demand
Registration, the managing underwriter or underwriters of such offering deliver
a written opinion to the holders of Registrable Securities. that in its or their
opinion the number of Registrable Securities requested to be included in such
offering exceeds the number which can be sold in such offering by virtue of the
fact that such excess is reasonably likely materially and adversely to affect
the success or offering price of such offering, the Company shall include in
such registration only such the Registrable Securities as equal the total number
which, in the opinion of such holders or such managing underwriter or
underwriters, as they case may be, can be sold without any such material adverse
effect, as follows: first, pro rata among the Management Holders on the basis of
the amount of Registrable Securities requested to be included in such
registration, second, the Company, third, pro rata among the Xxx Holders and the
Other Holders on the basis of the amount of Registrable Securities requested to
be included in such registration, and fourth, those securities which have been
requested to be included in such registration by any other Persons.
(e) Selection of Underwriters. If any Management Demand Registration is
an underwritten offering, the Management Holders will select and obtain the
investment bankers or bankers and managing underwriters or underwriters of
nationally recognized standing that will administer the offering, such
investment banker or banker or bankers and managing underwriter or underwriters
to be reasonably satisfactory to the Company.
5. Piggyback Registration
(a) Right to Piggyback. If at any time the Company proposes to file
a registration statement under the Securities Act for any Common Shares or any
options, warrants, units, convertibles, rights or other securities related or
linked to any Common Shares (except with respect to registration statements on
Form S-4 or S-8, or any other form not available for registering the Registrable
Securities for sale to the public), with respect to an offering for its own
account or for the account of another Person (other than the holders of
Registrable Securities in their capacity as such) of any class of security (a
"Proposed Registration"), then the Company shall in each case give written
notice of such proposed filing to the Holders at least forty-five (45) days
before the anticipated filing date, and shall, subject to Section 5(b), include
in such registration statement such amount of Registrable Securities as each
Holder may request within twenty (20) days of the receipt of such notice. The
Company shall register such Registrable Securities on the same terms and subject
to the same conditions applicable to the registration in the Proposed
Registration of equity securities to be sold by the Company or the Person
selling under such Proposed Registration. The Company shall use its
-5-
best efforts to cause the managing underwriter or underwriters of a proposed
underwritten offering to permit the Holders of Registrable Securities requesting
to be included to the registration for such offering to include such securities
in such offering on the same terms and conditions as the securities of the
Company included therein.
(b) Priority on Piggyback Registrations. If in connection with a
Proposed Registration the managing underwriter or underwriters of such offering
delivers a written opinion to the Holders of Securities that the number of
Registrable Securities which they and any other Persons intend to include in
such offering exceeds the number which can be sold in such offering or is
reasonably likely materially and adversely to affect the success or offering
price of such offering, then the amount of securities to be offered for the
accounts of holders shall be reduced as follows: first, the Securities requested
to be included in such registration by other Persons, pro rata in accordance
with the number of such securities held by such Persons requested to be included
in such registration; second, the Registrable Securities of the Holders who have
made requests to be included in such registration. pro rata (in accordance with
the number of Registrable Securities requested to be included in such
registration: and third, the securities which the Company proposes to sell.
(c) Selection of Underwriters. If any Proposed Registration pursuant
to this Section 5 is an underwritten offering (other than an underwritten
offering being conducted pursuant to the exercise of a Xxx Demand Registration
or a Management Demand Registration pursuant to Section 3 or 4 hereof), the
Company will select a managing underwriter or underwriters to administer the
offering, which managing underwriter or underwriters will be of nationally
recognized standing.
6. Restrictions on Public Sale by Holders of Registrable Securities
(a) To the extent not inconsistent with applicable law, each Holder
agrees not to effect any public sale or distribution of securities of the
Company, including a sale pursuant to Rule 144 under the Securities Act, during
the seven (7) days prior to, and during the one hundred eighty (180)-day period
beginning on, the effective date of a registration statement filed by the
Company or, in the case of an underwritten public distribution, the commencement
thereof (except as part of such registration), if and to the extent requested
(i) by the Company or the Holders holding a majority of the Registrable
Securities to be registered in such offering, in the case of a non-underwritten
public offering or (ii) by the managing underwriter or underwriters, in the case
of an underwritten public offering.
(b) If the Company, in its good faith judgment, determines that any
registration of Registrable Securities should not be made or continued because
it would materially interfere with any material financing, acquisition or other
transaction then under active negotiation by the Company (a "Valid Business
Reason"), the Company may postpone filing a registration statement relating to a
Xxx Demand Registration, a Management Demand Registration or any other
registration in which Holders have requested to have Registrable Securities
included until
-6-
such Valid Business Reason no longer exists, but in no event for more than 120
days, and in no event more than once in any 18 month period. The Company shall
give written notice to the Holders who have Registrable Securities registered of
its determination to postpone or withdraw a registration statement and of the
fact that the Valid Business Reason for such postponement or withdrawal no
longer exists, in each case, promptly after the occurrence thereof.
7. Restriction on Public Sale by the Company
The Company agrees (i) not to effect any public sale or distribution
of its equity securities other than (A) a sale or distribution of such
securities in connection with a merger or consolidation by the Company or any of
its Subsidiaries or the acquisition by the Company or any of its Subsidiaries of
the capital stock or substantially all of the assets of any other Person, or (B)
in connection with an employee stock option or other benefit plan, during the
seven days prior to, and during the 180-day period beginning on, (1) the
effective date of any registration statement in which the Holders are
participating pursuant to a Xxx Demand Registration or a Management Demand
Registration (except as part of such registration) (the "Holdback Period"),
except (x) where holders of a majority of the Registrable Securities to be
included in such registration statement by the Xxx Holders, in the case of a Xxx
Demand Registration, or where holders of a majority of the Registrable
Securities to be included in such registration statement by the Management
Holders, in the case of a Management Demand Registration, consent or (y) where
Holders are participating in such registration pursuant to Section 5 in such
registration statement, or (2) the commencement of an underwritten public
distribution of Registrable Securities where the managing underwriter so
reasonably requests; and (ii) that any agreement entered into after the date of
this Agreement pursuant to which the Company issues or agrees to issue any
privately placed securities shall contain a provision under which holders of
such securities agree not to effect any public sale or distribution of any such
securities during such Holdback Period, including a sale pursuant to Rule 144
under the Securities Act (except as part of such registration, if permitted);
provided, however, that the provisions of this Section 7 shall not prevent the
conversion or exchange of any securities pursuant to their terms into or for
other securities.
8. Registration Procedures
Subject to Section 6, whenever the Holders request that any such
securities be registered pursuant to Sections 3, 4 or 5 of this Agreement and
the Company shall use its best efforts to effect the registration and in
connection with any such request the Company shall, as expeditiously as
possible:
(a) in connection with a request pursuant to Section 3 or 4, prepare
and file with the Commission within 60 days, and use its best efforts to prepare
and so file within 45 days after receipt of a request to file a registration
statement, on any form for which the Company then qualifies or which counsel for
the Company shall deem appropriate and which form shall
-7-
be available for the sale of the Registrable Securities in accordance with the
intended method of distribution thereof, and in connection with any registration
statement filed for Registrable Securities hereunder, use its best efforts to
cause such registration statement to become effective; provided that if such
registration statement does not become effective, then any Xxx Demand
Registration or Management Demand Registration prompting such undertaking by the
Company shall be deemed to be rescinded and retracted and shall not be counted
as, or deemed or considered to be or to have been, a Xxx Demand Registration or
Management Demand Registration, as the case may be, for any purpose. In
connection with the preparation and filing of each registration statement
registering Registrable Securities under this Agreement, the Company will give
the Holders on whose behalf such Registrable Securities are to be so registered
and their underwriter, if any, and their respective counsel and accountants, the
opportunity to participate in the preparation of such registration statement,
each prospectus included therein or filed with the Commission, and each
amendment thereof or supplement thereto, and, upon reasonable advance notice and
at reasonable times, will give each of them such access to its hooks and records
(except for such records which the Company determine in good faith to be
confidential and such opportunities to discuss the business of the Company with
its officers, its counsel and the independent public accountants who have
certified its financial statements, as shall be reasonably necessary, in the
opinion of such holders or such underwriters or their respective counsel, in
order to conduct a reasonable and diligent investigation within the meaning of
the Securities Act. The Company shall make such changes to each registration
statement, prospectus, amendment, supplement or any other document to be filed
with respect to a registration under this Agreement as the Holders registering
Registrable Securities in such registration and their counsel shall reasonably
request:
(b) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in connection
therewith as may be necessary to keep such registration statement effective
for a period of not less than 120 days or such shorter period which will
terminate when all Registrable Securities covered by such registration statement
have been sold, and comply with the provisions of the Securities Act applicable
to it with respect to the disposition of all securities covered by such
registration statement during the applicable period in accordance with the
intended methods of disposition by the sellers thereof set forth in such
registration statement or supplement to the prospectus. The Company shall not be
deemed to have used its best efforts to keep a registration statement effective
during the applicable period if it intentionally makes any action that would
result in Holders selling the Registrable Securities covered thereby not being
able to sell such Registrable Securities during that period unless such action
is required under applicable law:
(c) furnish to each Holder included in such registration statement
and the managing underwriter or underwriters, if any, without charge, at least
one signed copy of the registration statement and any post-effective amendment
thereto and such number of conformed copies thereof and such number of copies of
the prospectus (including any preliminary prospectus) and any amendments or
supplements thereto, and any documents
-8-
incorporated by reference therein, as such Holder or managing underwriter may
reasonably request in order to facilitate the disposition of the Registrable
Securities being sold by such holder (it being understood that the Company
Consents to the use in accordance with applicable law and the Agreement of the
prospectus and any amendment or supplement thereto by each Holder covered by the
registration statement and the managing underwriter or underwriters (or any
other underwriter or dealer who is required to deliver the prospectus), if any,
in connection with the offering and sale of the Registrable Securities covered
by the prospectus or any amendment or supplement thereto);
(d) notify any Holder on whose behalf Registrable Securities are
being registered under this Agreement of any stop order issued or threatened by
the Commission and take all reasonable actions required to prevent the entry of
such stop order or to remove it if entered and make every reasonable effort to
obtain the withdrawal of any order suspending the effectiveness of the
registration statement at the earliest possible moment;
(e) enter into a written agreement with the managing underwriter or
underwriters selected in the manner herein provided in such form and containing
such representations and warranties by the Company and such other terms and
provisions as are customarily contained in underwriting agreements with respect
to secondary distributions, including, without limitation, provisions relating
to indemnification and contribution. The Holders on whose behalf Registrable
Securities are to be distributed by such underwriters shall be parties to any
such underwriting agreement, and the Company shall make to and for the benefit
of the Holders the representations and warranties and the other agreements made
by the Company to and for the benefit of such underwriters that are of the type
customarily, provided to institutional investors in secondary offerings;
(f) if requested by the managing underwriter or underwriters or any
Holder covered by the registration statement, promptly incorporate in a
prospectus supplement or post-effective amendment such information as the
managing underwriter or underwriters or such holder requests to be included
therein, including, without limitation, with respect to the number of
Registrable Securities being sold by such Holder to such underwriter or
underwriters, the purchase price being paid therefor by such underwriter or
underwriters and with respect to any other terms of the underwritten offering of
the Registrable Securities to be sold in such offering; and make all required
filings of such prospectus supplement or post-effective amendment as soon as
possible after being notified of the matters to be incorporated in such
prospectus supplement or post-effective amendment;
(g) on or prior to the date on which the registration statement is
declared effective, use its best efforts to register or qualify, and cooperate
with the Holders included in such registration statement, the underwriter or
underwriters, if any, and their counsel in connection with the registration or
qualification of, the Registrable Securities covered by the registration
statement for offer and sale under the securities or blue sky laws of each
state and other jurisdiction of the United Stares as any such Holder or
underwriter requests in writing,
-9-
to use its best efforts to keep each such registration or qualification
effective, including through new filings, or amendments or renewals, during the
period such registration statement is required to be kept effective and to do
any and all acts or things necessary or advisable to enable the disposition in
all such jurisdictions of the Registrable Securities covered by the applicable
registration statement, provided, however, that the Company will not be required
(i) to qualify generally to do business in any jurisdiction where it would not
otherwise be required to qualify but for this subsection (g), (ii) to subject
itself to taxation in any such jurisdiction or (iii) to consent to general
service of process in any such jurisdiction;
(h) use its best efforts to cause the Registrable Securities
included in such registration statement to be registered with or approved by
such other governmental agencies or authorities as may be necessary to enable
the seller or sellers or the underwriter or underwriters, if any, thereof to
consummate the disposition of such Registrable Securities;
(i) cooperate with the Holders selling Registerable Securities
covered by the registration statement and the managing underwriter or
underwriters, if any, to facilitate the timely preparation and delivery of
certificates (not bearing any restrictive legends) representing securities to be
sold under the registration statement, and enable such securities to be in such
denominations and registered in such names as the managing underwriter or
underwriters, if any, or such Holders may reasonably request;
(j) immediately notify each Holder on whose behalf Registrable
Securities have been registered pursuant to this Agreement, at any time when a
prospectus relating thereto is required to be delivered under the Securities
Act, of the happening of any event as a result of which the prospectus included
in such registration statement (as then in effect) contains an untrue statement
of a material fact or omits to state any material fact required to be stated
therein or necessary to make the statements therein not misleading and, as
promptly as practicable thereafter, prepare and file with the Commission and
furnish a supplement or amendment to such prospectus so that, as thereafter
delivered to the purchasers of such Registrable Securities, 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
not misleading;
(k) use its best efforts to cause all such Registrable Securities
included in such registration statement to be listed by the date of the first
sale of Registrable Securities pursuant to such registration statement on each
securities exchange on which securities issued by the Company are then listed or
proposed to be listed, if any;
(l) make available for inspection. during normal business hours, by
any Holder on whose behalf Registrable Securities are being registered under
this Agreement, any underwriter participating in any disposition pursuant to
such registration statement, and any attorney, accountant, or other agent
retained by any such Holder or underwriter (collectively, the "Inspectors"), all
financial and other records, pertinent corporate documents, and
-10-
properties of the Company and its Subsidiaries (collectively, the "Records") as
shall be reasonably necessary to enable them to exercise their due diligence
responsibility, and cause the Company's officers, directors, and employees to
supply all information reasonably requested by any such Inspector in connection
with such registration statement. Records which the Company determines, in good
faith, to be confidential shall not be disclosed by the Inspectors unless the
release of such Records is ordered pursuant to a subpoena or other order from a
court of competent jurisdiction or is otherwise required by law or regulation.
The Holder on whose behalf Registrable Securities are being registered under
this Agreement agrees that they will, upon learning that disclosure of such
Records is sought in a court of competent jurisdiction, give notice, to the
extent practicable, to the Company and allow the Company, at the Company's
expense, to undertake appropriate action to prevent disclosure of the Records
deemed confidential;
(m) furnish, at the request of any Holder selling Registerable
Securities in such offering, on any date that any Registrable Security is
delivered to the underwriters for sale pursuant to such registration: (i) an
opinion dated such date from counsel representing the Company for the purposes
of such registration, addressed to the underwriters and to such Holder, stating
that such registration statement has become effective under the Securities Act
and that covers such other matters with respect to the registration as are
customarily covered in opinions of issuers' counsel delivered to underwriters in
connection with underwritten public offerings of securities (including with
respect to such registration statement and the prospectus included therein), and
(ii) a letter dated such date from the independent public accountants retained
by the Company, addressed to such seller, stating that they are independent
public accountants within the meaning of the Securities Act and that, in the
opinion of such accountants, the financial statements of the Company included in
the registration statement or the prospectus, or any amendment thereof or
supplement thereto, comply as to form in all material respects with the
applicable accounting requirements of the Securities Act, and such letter shall
additionally cover such other financial matters (including information with
respect to events subsequent to the date of such financial statements) with
respect to the registration (including with respect to such registration
statement and the prospectus included therein) in respect of which such letter
is being given as are customarily covered in accountant's letters delivered to
underwriters in connection with underwritten public offerings of securities;
(n) otherwise use its best efforts to comply with all applicable
rules and regulations of the Commission, to make available to the Holders on
whose behalf Registrable Securities have been registered an earnings statement
covering a period of twelve months, beginning within three months after the
effective date of the registration statement, which earnings statement shall
satisfy the provisions of Section 11(a) of the Securities Act and Rule 158
thereunder (or other comparable provisions), and to take all such other actions
as the Holders holding a majority of the Registrable Securities being sold by
Xxx Holders. in the case of a Xxx Demand Registration, or the holders of a
majority of the Registrable Securities being sold by Management Holders, in the
case of a Management Demand Registration, or the
-11-
underwriters retained by such holders, if any, may reasonably request an order
to expedite or facilitate the disposition of such Registrable Securities;
(o) keep all Holders on whose behalf Registrable Securities have
been registered advised as to the initiating of proceedings for such
registration and qualification and as to the completion hereof, and will advise
any such Holder, upon request, of the progress of such proceedings; and
(p) in connection with any registration of Registrable Securities
under this Agreement, the Company will provide a transfer agent and registrar
for the Registrable Securities not later than the effective date of such
registration statement.
Each holder for which registration is being effected pursuant hereto
shall use its best efforts to cooperate with the Company, and the Company may
require each seller of Registrable Securities as to which any registration is
being effected to furnish to the Company such information regarding the
distribution of such securities as the Company may from time to time reasonably
request in writing. 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 8(j) hereof, such Holder will
forthwith discontinue disposition of Registrable Securities pursuant to the
registration statement covering such Registrable Securities until such Holder's
receipt of the copies of the supplemented or amended prospectus contemplated by
Section 8(j) hereof, and, if so directed by the Company, such Holder will
deliver to the Company (at the Company's expense) all copies, other than
permanent file copies then in such Holder's possession, of the prospectus
covering such Registrable Securities current at the time of receipt of such
notice. In the event the Company shall give any such notice, the period
mentioned in Section 8(b) hereof shall be extended by the number of days during
the period from and including the date of the giving of such notice pursuant to
Section 8(j) hereof to and including the date when each seller of Registrable
Securities covered by such registration statement shall have received the copies
of the supplemented or amended prospectus contemplated by Section 8(j) hereof.
9. Registration Expenses
All costs and expenses incident to the Company's performance of or
compliance with this Agreement, including without limitation all registration,
qualification and filing fees, transfer taxes, fees and expenses of compliance
with securities or blue sky laws (including reasonable fees and disbursements of
counsel in connection with blue sky qualifications of the Registrable
Securities), rating agency fees, printing expenses, messenger and delivery
expenses, fees of transfer agents and registrars, internal expenses of the
Company (including, without limitation, all salaries and expenses of its
officers and employees performing legal or accounting duties), the fees and
expenses incurred in connection with the listing of the securities to be
registered in accordance with Section 8(k), fees of the National Association of
Securities Dealers, Inc., costs of insurance, including securities acts
liability insurance (if the
-12-
Company elects to obtain such insurance), the fees and disbursements of counsel
for the Company and all independent certified public accountants (including the
expenses of any annual audit, special audit, or "cold comfort" letters required
by or incident to such performance), the fees and expenses of any special
experts retained by the Company in connection with such registration and fees
and expenses of other Persons retained by the Company, the reasonable and
customary fees and expenses of any underwriter (but not including any
underwriting discounts or commissions attributable to the sale of Registrable
Securities by the holders of such Registrable Securities) (all such expenses
being herein called Registration Expenses"), will be borne by the Company. All
other expenses shall be the sole responsibility of the Holders.
10. Indemnification
(a) Indemnification by Company. The Company agrees to indemnify and
to save and hold harmless each Holder and any underwriter for such Holder, the
officers, directors and partners, and each person who controls such Holder or
any such underwriter (within the meaning of the Securities Act or the Exchange
Act) from and against any and all losses, claims, damages, liabilities, and
expenses (including reasonable attorneys fees and expenses and reasonable costs
of investigation) to which the Holder or underwriter or any such other person
may be subject, under the Securities Act or otherwise, arising out of or based
on any untrue or alleged untrue statement of a material fact contained in any
registration statement or prospectus relating to the Registrable Securities or
in any amendment or supplement thereto or in any preliminary prospectus or any
other document incident to the registration of Registrable Securities under the
Securities Act or the qualification of the Registrable Securities under any
state securities laws, or arising out of or based upon any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, or arising out of or
based upon any violation or alleged violation by the Company of the Securities
Act, the Exchange Act or any other federal or state securities laws, rules or
regulations applicable to the Company and relating to action or inaction by the
Company in connection with any such registration or qualification, except
insofar as the same arise out of reliance upon any untrue statement or omission
furnished in writing to the Company by such Holder (or, if it is an underwritten
offering, an underwriter selected by such Holders), expressly for use therein;
provided that the Company shall not be required to indemnify any Holder for
damages caused by such Holder's continuing to use a prospectus with respect to
which such Holder has received a notice pursuant to Section 8(j) hereof and has
not received a notice of the amendment or supplementation of such prospectus, as
contemplated in Section 8(j). In connection with an underwritten offering, the
Company will, pursuant to a separate agreement, agree to indemnify the
underwriters thereof, their officers, directors and partners and partners of
partners, and each person who controls (within the meaning of the Securities
Act) such underwriters (collectively, "Securities Professionals") to the same
extent as provided above.
-13-
(b) Indemnification by Holder of Registrable Securities. In
connection with any registration statement in which a Holder is participating,
each such Holder will furnish to the Company in writing such information and
affidavits with respect to such Holder as the Company reasonably requests for
use in connection with any such registration statement or prospectus and agrees
to indemnify, to the extent permitted by law, each of the Company's directors
and officers, and each Person who controls the Company (within the meaning of
the Securities Act) and, if it is an underwritten offering, the underwriters,
against any losses, claims, damages, liabilities, and expenses arising out of or
based on any untrue statement of a material fact or any omission of a material
fact required to be stared in the registration statement or prospectus or any
amendment thereof or supplement thereto or necessary to make the statements
therein not misleading, to the extent, but only to the extent, that such untrue
statement or omission is made in reliance upon and in conformity with
information with respect to such Holder furnished in writing to the Company by
such Holder specifically for use in such registration statement or prospectus or
amendment thereof or supplement thereto; provided, however, that the liability
of any such Holder under this Section 10 (including, without limitation, Section
10(d) below) shall be limited to the proportion of any such losses, claims,
damages, liabilities and expenses which is equal to the proportion that the
public offering price of securities sold by such Holder under such registration
statement bears to the total public offering price of all securities sold
thereunder, and shall in no event exceed the net proceeds of the sale of
Registrable Securities being sold pursuant to said registration statement or
prospectus by such Holder; and provided further that no such Holder shall be
required to indemnify the Company for damages caused by any Person other than
such holder, including the Company, continuing to use a prospectus (prior to its
amendment or supplementation) more than three days after the Company has
received a notice by such Holder of any such untrue statement or omission
contained in such prospectus.
(c) Conduct of Indemnification Proceeding. If any action, suit,
investigation or proceeding (including any governmental investigation) is
brought or asserted against any selling Holder (or its officers, directors,
partners, partners of partners or agents) or any person controlling any such
Holder in respect of which indemnity may be sought from the Company, the Company
shall assume the defense thereof, including the employment of counsel reasonably
satisfactory to such Holder, to represent such Holder and its officers,
directors, partners, partners of partners, agents and controlling persons in
connection with investigating, defending or preparing to defend any such action,
suit, investigation or proceeding, and shall pay all reasonable expenses in
connection therewith. Such Holder or such other person shall have the right to
employ separate counsel in any such action and either direct its own defense or
participate in the Company's defense thereof, but the fees and expenses of such
counsel shall be at the expense of such Holder or such other person, unless (i)
the Company has agreed to pay such fees and expenses or (ii) the named parties
to any such actions, suit, investigation or proceeding (including any impleaded
parties) include both such Holder or such other person, and such Holder or such
other person shall have reasonably concluded that there may be one or more legal
defenses available to such Holder or such other person which are different from
or additional to those available to the Company or (iii) the Company shall not
-14-
have provided its counsel to take charge of such defense, then in any of such
events referred to in clauses (i), (ii) or (iii), if such Holder or such other
person notifies the Company in writing that it elects to employ separate counsel
at the expense of the Company. the Company shall not have the right to assume
the defense of such action or proceeding on behalf of such Holder or such other
person, it being understood, however, that the Company shall not, in connection
with any one such action, suit, investigation or proceeding or separate but
substantially similar or relaxed actions, suits, investigations or proceedings
in the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the fees and expenses of more than one separate
firm of attorneys (together with appropriate local counsel) at any time for the
Holders and such other persons, which firm shall be designated in writing by a
majority of such Holders. The Company shall nor be liable for any settlement of
any such action suit, investigation or proceeding effected without the Company's
written consent (but such consent shall not be unreasonably withheld), but if
any action, suit, investigation or proceeding is settled with the Company's
consent, or if there be a final judgment for the plaintiff in any such action,
suit, investigation or proceeding, the Company agrees to indemnify and hold
harmless such Holder and such other person from and against any loss or
liability (to the extent stated above) by reason of such settlement or judgment.
The Company will not consent to entry of any judgment or enter into any
settlement which does not include as an unconditional term thereof the giving by
the claimant or plaintiff to such indemnified party of a release from all
liability in respect of such action, claim or litigation.
(d) Contribution. If the indemnification provided for in this
Section 10 is unavailable to an indemnified party under this Section 10 in
respect of any losses, claims, damages, liabilities, expenses or judgments
referred to herein, then each such 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,
expenses and judgments (i) as between the Company and such Holders on the one
hand and the Securities Professionals on the other, in such proportion as is
appropriate to reflect the relative benefits received by the Company and such
Holders on the one hand and the Securities Professionals on the other from the
offering of the Registrable Securities, or if such allocation is not permitted
by applicable law, in such proportion as is appropriate to reflect not only such
relative benefits, but also the relative fault of the Company and such Holders
on the one hand and of the Securities Professionals on the other in connection
with the statements or omissions which resulted in such losses, claims, damages,
liabilities, expenses or judgments as well as any other relevant equitable
considerations and (ii) as between the Company on the one hand and each such
Holder on the other, in such proportion as is appropriate to reflect the
relative fault of the Company and of each such Holder in connection with such
statements or omissions, as well as any other relevant equitable considerations.
The relative benefits received by the Company and such Holders on the one hand
and the Securities Professionals on the other shall be deemed to be in the same
proportion as the total proceeds from the offering (net of underwriting
discounts and commissions but before deducting expenses) received by the Company
and such Holders bear to the total underwriting discounts and commissions
received by the Securities Professionals, in each case as set forth on the table
on
-15-
the cover page of the prospectus. The relative fault of the Company, of each
such Holder and of the Securities Professionals shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by such party, and the party's relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Company and such Holders agree that it would not be
just and equitable if contribution pursuant to this Section 10(d) were
determined by pro rata allocation (even if such Holders were treated as one
entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to in the immediately
preceding sentences. The amount paid or payable by an indemnified party as a
result of the losses, claims, damages, liabilities, expenses or judgments
referred to in the immediately preceding paragraph shall be deemed to include,
subject to the limitations set forth above, any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
Section 10(d), no Securities Professional shall be required to contribute any
amount in excess of the amount by which the total price at which the Registrable
Securities of such Holder were offered to the public exceeds the amount of any
damages which such Holder has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission. No Person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any Person who was
not guilty of such fraudulent misrepresentation.
11. Certain Limitations in Connection with Future Grants of Registration
Rights
(a) From and after the date of this Agreement, the Company shall not
enter into any agreement with any holder or prospective holder of any securities
of the Company providing for the granting to such holder of demand registration
rights unless such agreement includes provisions to the effect that,
notwithstanding Section 3 hereof, if any Holder requests inclusion of its
Registrable Securities in such registration, each such Holder's Registrable
Securities will be given priority over the securities sought to be registered by
the holders of such demand registration rights (in proportion to their relative
holdings of Registrable Securities) if marketing factors require a limitation on
the number of securities to be included in such registration statement.
(b) From and after the date of this Agreement, the Company shall not
enter into any agreement with any holder or prospective holder of any securities
providing for the granting to such holder of incidental or piggyback
registration rights unless such agreement includes provisions to the effect
that, in the case of a registered underwritten public offering of the Common
Shares to which Section 3, 4 or 5 hereof applies. such agreement gives the
following priority to the Holders if marketing factors require a limitation on
the number of securities of the Company to be included in such offering;
-16-
(i) Holders shall have the right to include in each
registration to which Section 3, 4 or 5 hereof applies all Registrable
Securities they desire to include whether or not the Company or any other holder
of the Company's securities has requested or is planning a registration of
securities; and
(ii) Holders shall have the right to include in each
registration to which Section 5 hereof applies all Registrable Securities they
desire to include before inclusion of other securities of the Company.
12. Miscellaneous
(a) Rule 144. The Company covenants that, at all times after it has
filed a registration statement pursuant to the requirements of the Securities
Act relating to any class of securities of the Company, it will file any reports
required to be filed by it under the Securities Act and the Exchange Act and
that it will take such further action as any holder of Registrable Securities
may reasonably request, all to the extent required from time to time to enable
Holders to sell Registrable Securities without registration under the Securities
Act within the limitation of the exemptions provided by Rule 144 that has become
effective under the Securities Act, as such Rule may be amended from time to
time, or any similar rules or regulations hereafter adopted by the Commission.
Upon the request of any Holder, the Company will deliver to such Holder a
written statement as to whether it has complied with such requirements.
(b) Representations and Warranties of the Company. The Company
represents and warrants to each Purchaser as follows: the execution, delivery
and performance of this Agreement by the Company have been duly authorized by
all requisite limited liability company action and will not violate any
provision of law, any order of any court or other agency of government, the
Certificate of Formation or the Limited Liability Company Agreement of the
Company, or any provision of any indenture. agreement or other instrument to
which it or any of its properties or answers is bound, or conflict with, result
in a breach of or constitute (with due notice or lapse of time or both) a
default under any such indenture, agreement or other instrument, or result in
the creation or imposition of any lien, charge or encumbrance of any nature
whatsoever upon any of the properties or assets of the Company. This Agreement
has been duly executed and delivered by the Company and constitutes the legal,
valid and binding obligation of the Company, enforceable in accordance with its
terms.
(c) Specific Performance. The parties agree that irreparable damage
will result in the event that this Agreement is not specifically enforced, and
the parties agree that any damage available at law for a breach of this
Agreement would not be an adequate remedy. Therefore, the provisions hereof and
the obligations of the parties hereunder shall be enforceable in a court of
equity, or other tribunal with jurisdiction, by a decree of specific
performance, and appropriate injunctive relief may be applied for and granted in
connection therewith. Such remedies and all other remedies provided for in this
Agreement shall,
-17-
however, be cumulative and not exclusive and shall be in addition to any other
remedies which a party may have under this Agreement or otherwise.
(d) Remedies. The rights and remedies of each Holder hereunder shall
be independent of the rights and remedies of any other Holder except as
otherwise expressly provided herein. Without limiting the foregoing, if the
Company or any other person has any rights, claims or defenses against any
Holder, such rights, claims or defenses shall not apply with respect to any
other Holder, except as otherwise expressly provided herein. The taking of any
action or the failure to take any action by any holder of this Agreement shall
not, and shall not be deemed to, constitute the taking of any action or the
failure to take any action by any other Holder, except as expressly set forth in
this Agreement.
(e) Amendments and Waivers. Except as otherwise provided herein, the
provisions of this Agreement may not be amended, restated, modified, or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given, unless the Company has obtained the written consent of the
holders of a majority of the each of the Xxx Holders then entitled to the
benefits of this Agreement.
(f) Notices. Any notice, request, instruction, or other document to
be given hereunder by any party to another shall be in writing, shall be
delivered personally or by overnight courier service or sent by certified mail,
postage prepaid and return receipt requested, or by facsimile transmission
(receipt confirmed) to the Company at 0000 Xxxxx Xxxxxx, 0xx xxxxx, Xxx Xxxx,
Xxx Xxxx 00000, Attention: President (facsimile transmission number: (212)
355-0120), and to each Xxx Xxxxxx at the address set forth on its signature page
to the Purchase Agreement (or to such other address as any subsequent holder of
Registrable Securities or any other parry to whom notice is to be given may
provide in a written notice to the other parties), and (except when delivered
personally) shall be deemed received three days after such notice is sent. A
copy of any notice sent to a Xxx Xxxxxx shall also be delivered to Xxxxxxxx,
Xxxxxxx & Xxxxxx, A Professional Corporation, 000 Xxxxxxx Xxxxxx, Xxxxxx, XX
00000 (facsimile transmission number: (000) 000-0000), Attention: Xxxxxxx X.
Xxxxxx, and a copy of any notice sent to the Company shall also be delivered to
Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx, Xxx Xxx Xxxx Xxxxx, Xxx Xxxx, Xxx
Xxxx, 00000 (facsimile transmission number: (000) 000-0000) Attention: Xxxxxxx
Xxxxxxx, P.C.
(g) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each of the parties
permitted by the next two sentences of this Section 10(g). The Company may not
assign any of its obligations, duties or rights under this Agreement except with
the written consent of a majority in interest of the Holders. In addition to any
assignment by operation of law, each holder of Registrable Securities may
assign, in whole or in part, any or all of its rights (and/or obligations) under
this Agreement to any Person to whom Registrable Securities may be transferred
pursuant to Section 6.2 of the Limited Liability Company Agreement of the
Company or to whom
-18-
Convertible Notes of the Company may be transferred pursuant to Section 13.12 of
the Purchase Agreement.
(h) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(i) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(j) Severability. In the event that any one or more of the
provisions contained herein, or any application of any provision contained
herein, shall be held invalid, illegal, or unenforceable in any jurisdiction,
the validity, legality, and enforceability of any such provision in every other
respect and of the remaining provisions contained herein shall not be affected
or impaired thereby and any such invalidity, illegality or unenforceability in
any jurisdiction shall not invalidate or render such provision unenforceable in
any other jurisdiction.
(k) Entire Agreement; Supersession of Prior Agreements. This
Agreement, together with the Purchase Agreement and the other agreements
contemplated thereby, are intended by the parties as a final expression of their
agreement and intended to be a complete and exclusive statement of the agreement
and understanding of the parties hereto in respect of the subject matter
contained herein and therein. There are no restrictions, promises, warranties or
undertakings, other than those set forth or referred to herein and therein. This
Agreement, together with the Purchase Agreement and the other agreements
contemplated therein, supersede all prior agreements and understandings among
the parties with respect to such subject matter.
(l) Attorneys' Fees. In any action or proceeding brought to enforce
any provision of this Agreement or where any provision hereof is validly
asserted as a defense, the successful party shall be entitled to recover
reasonable attorneys' fees and expenses in addition to any other available
remedy.
(m) Governing Law. This Agreement shall be governed by and construed
in accordance with the internal laws of the State of New York, applicable to
contracts made and to be performed wholly within that State without regard to
principles of conflicts of law.
[The rest of this page intentionally left blank.]
-19-
IN WITNESS WHEREOF, the parries have executed this Registration Rights
Agreement under seal as of the date first written above.
NEW YORK RESTAURANT GROUP. ON BEHALF OF, AND PURSUANT
L.L.C. TO POWERS OF ATTORNEY
By: LA CITE, INC.., its Manager DELEGATED BY, THE MANAGEMENT
HOLDERS LISTED ON SCHEDULE A
HERETO:
By: /s/ [ILLEGIBLE] By: /s/ [ILLEGIBLE]
-------------------------- --------------------------
Name: Name:
Title:
ON BEHALF OF, AND PURSUANT TO
POWERS OF ATTORNEY DELEGATED
BY, THE OTHER HOLDERS
XXXXXX X. XXX EQUITY
PARTNERS, L.P. /s/ [ILLEGIBLE]
By: THE EQUITY ADVISORS LIMITED ------------------------------
PARTNERSHIP
By: THE EQUITY TRUST
By:
--------------------------
THL-CCI LIMITED PARTNERSHIP
By: THL INVESTMENT MANAGEMENT GROUP
By:
--------------------------
-20-
IN WITNESS WHEREOF, the parries have executed this Registration Rights
Agreement under seal as of the date first written above.
NEW YORK RESTAURANT GROUP. ON BEHALF OF, AND PURSUANT
L.L.C. TO POWERS OF ATTORNEY
By: LA CITE, INC.., its Manager DELEGATED BY, THE MANAGEMENT
HOLDERS LISTED ON SCHEDULE A
HERETO:
By: By:
-------------------------- --------------------------
Name: Name:
Title:
ON BEHALF OF, AND PURSUANT TO
POWERS OF ATTORNEY DELEGATED
BY, THE OTHER HOLDERS
XXXXXX X. XXX EQUITY
PARTNERS, L.P.
By: THE EQUITY ADVISORS LIMITED ------------------------------
PARTNERSHIP
By: THE EQUITY TRUST
By: /s/ [ILLEGIBLE]
--------------------------
THL-CCI LIMITED PARTNERSHIP
By: THL INVESTMENT MANAGEMENT GROUP
By: /s/ [ILLEGIBLE]
--------------------------
-20-
Registration Rights Agreement
Schedule A
Management Holder
-----------------
Thursday's Supper Pub, Inc.
White & Xxxxxxxxx, Inc.
The New York Restaurant Group, Inc.
La Cite, Inc.
Xxxx X. Xxxxxxxx
Xxxxxx Xxxxx
Xxxx Xxxxxx
Xxxxx Xxxx
