Exhibit 10.5
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT (this "Agreement"), dated as of July 29,
2002, by and among Sunterra Corporation, a Maryland corporation (the "Company"),
Xxxxxxx Xxxxx Mortgage Lending, Inc., a Delaware corporation ("Merrill"), and
the Persons identified on Schedule I hereto and their permitted successors,
assignees or transferees (the "Initial Holders").
RECITALS
A. Pursuant to the Third Amended and Restated Joint Plan of
Reorganization Under Chapter 11 of the Bankruptcy Code, As Amended, of the
Company and certain of its affiliates (the "Plan"), upon satisfaction of certain
conditions, the Company will issue Common Stock and/or Plan Warrants (both as
defined below) to the Initial Holders in the amounts set forth on Schedule I
hereto.
X. Xxxxxxx and the Company have entered into the Exit Financing
Agreements in order to effect an exit financing as contemplated by the Plan and
in connection therewith have agreed to enter into the Merrill Warrant Agreement;
C. In order to induce the Initial Holders to agree to the Plan, and to
induce Merrill to enter into the Exit Financing Agreements and as a condition
thereof, the Company has agreed to grant the securities registration rights to
Merrill and the Initial Holders set forth herein.
AGREEMENTS
In consideration of the premises and the mutual covenants herein
contained and of other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
1. Definitions and General Interpretive Principles. In addition to the
capitalized terms defined elsewhere in this Agreement, the following capitalized
terms shall have the following meanings when used in this Agreement:
"Adverse Disclosure" means public disclosure of material non-public
information, which disclosure in the good faith judgment of the chief executive
officer or chief financial officer of the Company (i) would be required to be
made in any registration statement filed with the Commission by the Company so
that such registration statement would not be materially misleading; (ii) would
not be required to be made at such time but for the filing of such registration
statement; and (iii) would materially and adversely interfere with any business
combination transaction in or in connection with which the Company would issue
shares of Common Stock or would result in the premature disclosure of any
pending financing, acquisition, corporate reorganization or other corporate
development involving the Company or any of its subsidiaries.
"Commission" means the United States Securities and Exchange
Commission and any agency succeeding to its functions.
"Common Stock" means the common stock, $0.01 par value per share, of
the Company.
"Deferment" means the number of days after the effective date of the
Shelf Registration Statement on which a Shelf Suspension has been in effect or
on which such Registration Statement has otherwise not continued to be effective
for purposes of the offer or sale of Registrable Securities thereunder.
"Exit Financing Agreements" means the Loan Agreement, dated the date
hereof, between the Company (and certain of its subsidiaries) and Xxxxxxx Xxxxx
Mortgage Capital Inc., as agent, and related documentation, including the
Warrant Agreement between the Company and Xxxxxxx Xxxxx Mortgage Capital Inc.
(collectively, the "Exit Financing Agreements").
"Holder" means a Xxxxxxx Xxxxxx (including its affiliates) or an
Initial Holder (including its affiliates) or a successor, assignee or transferee
of an Initial Holder or a Xxxxxxx Xxxxxx, or of any subsequent Holder as
contemplated by Section 11, in each case for so long as such Initial Holder or
Xxxxxxx Xxxxxx, or successor, assignee or transferee of such Holder, holds
Registrable Securities.
"Included Registrable Securities" has the meaning set forth in Section
3(a).
"Indemnified Party" has the meaning set forth in Section 7(c).
"Indemnifying Party" has the meaning set forth in Section 7(c).
"Loss" has the meaning set forth in Section 7(a).
"Xxxxxxx Xxxxxx" means, with respect to the Merrill Warrant and the
Common Stock issuable thereunder, Merrill and its permitted successors,
assignees or transferees.
"Merrill Warrant" means the warrant to purchase shares of Common Stock
issued pursuant to the Warrant Agreement, dated as of the date hereof, between
the Company and Merrill.
"Merrill Warrant Stock" means any Common Stock or other security of
the Company or any successor entity issued or issuable upon exercise of the
Merrill Warrant.
"NASD" means the National Association of Securities Dealers, Inc.
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"Plan Warrants" means the warrants to purchase shares of Common Stock
issued pursuant to the Warrant Agreement entered into pursuant to the Plan by
the Company and Mellon Investor Services LLC, as the warrant agent thereunder,
dated as of the date hereof.
"Plan Warrant Stock" means any Common Stock or other security of the
Company or any successor entity issued or issuable upon exercise of any Plan
Warrant.
"Participant" has the meaning set forth in Section 7(a).
"Person" means a natural person, a partnership, a corporation, a
limited liability company, an association, a joint stock company, a trust, a
joint venture, an unincorporated organization or other entity or a governmental
entity or any department, agency or political subdivision thereof.
"Piggyback Registration" has the meaning set forth in Section 3(a).
"Registrable Securities" means (i) the Common Stock issued under the
Plan to an Initial Holder, (ii) the Plan Warrant Stock issuable upon exercise of
Plan Warrants issued to an Initial Holder, (iii) the Merrill Warrant Stock and
(iv) in the case of (ii) and (iii), any securities of the Company or any
successor entity that may be issued or distributed in respect thereof by way of
stock dividend, stock split or other distribution, consolidation,
reclassification or similar transaction; provided, however, that the foregoing
securities shall cease to be "Registrable Securities" to the extent that (i) a
registration statement with respect to the sale of such securities has been
declared effective under the Securities Act and such securities have been
disposed of pursuant to such registration statement, (ii) such securities have
been disposed of (A) pursuant to and in accordance with Rule 144 (or any similar
provision then in force) under the Securities Act or (B) pursuant to another
exemption from the registration requirements of the Securities Act pursuant to
which the securities are thereafter freely tradable without restriction under
the Securities Act, (iii) such securities may be disposed of pursuant to Rule
144 (or any similar provision then in force) within the volume limitations
thereunder within a 90 day period or pursuant to Rule 144(k) (or any similar
provision then in force) under the Securities Act or (iv) such securities cease
to be outstanding. For purposes of this Agreement, any reference to a percentage
(or a majority in number) of Registrable Securities shall mean that percentage
of Registrable Securities, collectively, computed on the assumption that all
Plan Warrants and the Merrill Warrant have been exercised.
"Requesting Initial Holders" has the meaning set forth in Section
2(c).
"Requesting Merrill Holders" has the meaning set forth in Section
2(d).
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations of the Commission promulgated thereunder.
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"Securities Exchange Act" means the Securities Exchange Act of 1934,
as amended, and the rules and regulations of the Commission promulgated
thereunder.
"Shelf Registration Statement" means a registration statement of the
Company filed with the Commission on Form S-l or, if available, Form S-3 (or any
successors thereto) for an offering to be made on a continuous or delayed basis
pursuant to Rule 415 under the Securities Act (or any similar rule that may be
adopted by the Commission) covering all of the Registrable Securities requested
to be included by the Holders.
"Shelf Suspension" has the meaning set forth in Section 2(i).
"Underwriting Agreement" has the meaning set forth in Section 9.
"Underwritten Offering" means an offering registered under the
Securities Act in which securities of the Company are sold to an underwriter or
underwriters on a firm commitment basis for reoffering to the public.
Whenever used in this Agreement, except as otherwise expressly
provided or unless the context otherwise requires, any noun or pronoun shall be
deemed to include the plural as well as the singular and to cover all genders.
The section captions used in this Agreement are for convenience of reference
only and shall not be construed to affect the meaning, construction or effect
hereof. Unless otherwise specified, the terms "hereof," "herein," "hereunder"
and similar terms refer to this Agreement as a whole, and references herein to
Sections refer to Sections of this Agreement.
2. Shelf Registration.
(a) The Company agrees, subject to the terms hereof and to applicable
law, (x) to use its reasonable best efforts to file, as soon as reasonably
practicable, but not later than 45 days, after the date of filing of its Annual
Report on Form 10-K for its fiscal year ended December 31, 2002, a Shelf
Registration Statement, (y) to use its best efforts to cause the Shelf
Registration Statement to be effective as promptly as possible after date of
filing thereof and (z) to use its best efforts to obtain authorization for
listing of the Registrable Securities (but not including the Plan Warrants or
the Merrill Warrant) on a national securities exchange or to have such
Registrable Securities accepted for quotation on the Nasdaq Stock Market.
(b) Effectiveness, Etc. The Company agrees to use its best efforts to
keep the Shelf Registration Statement continuously effective for a period of six
years (plus the number of days, if any, of any Deferment) from the effective
date thereof or, if earlier, until all of the Registrable Securities covered by
the Shelf Registration Statement have been sold pursuant thereto. The Company
further agrees to supplement or make amendments to the Shelf Registration
Statement if required by (i) Section 5(a)(vi) hereof, (ii) the registration form
utilized by the Company for such registration or by the instructions applicable
to such registration form, or (iii) the Securities Act; provided, however, that
notwithstanding anything to the contrary herein the Company will not be
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required to supplement or amend the Shelf Registration Statement until current
financial information is available so long as the Company is in compliance with
(x) the foregoing clauses (i) and (iii) and (y) its reporting obligations under
the Securities Exchange Act subsequent to the effective date. The Company agrees
to furnish to the Holders copies of any such supplement or amendment prior to
its use or filing with the Commission.
(c) Underwritten Offering at the Request of the Initial Holders. Upon
the written request of one or more Initial Holders (such Initial Holder or
Initial Holders being referred to herein as the "Requesting Initial Holders"),
requesting that the Company amend the Shelf Registration Statement to the extent
necessary for the offering of the Requesting Initial Holders' Registrable
Securities pursuant to an Underwritten Offering, the Company will give prompt
written notice of the requested Underwritten Offering to all other holders of
Registrable Securities and thereupon the Company will use its best efforts to
effect such amendment to the Shelf Registration Statement for an Underwritten
Offering of (x) the Registrable Securities which the Company has been so
requested to include in the Underwritten Offering by the Requesting Initial
Holders and (y) all other Registrable Securities which the Company has been
requested to include in the Underwritten Offering by the Holders thereof by
written request given to the Company within 15 days after the giving of such
written notice by the Company. Notwithstanding the foregoing, the Company shall
have no obligation under this Section 2(c) unless the estimated aggregate
offering price of the Registrable Securities requested for inclusion in such
Underwritten Offering is $10,000,000 or more. In any such Underwritten Offering
requested by the Initial Holders, the Initial Holders representing 50% of the
Registrable Securities to be included in such offering by the Initial Holders
shall have the right to select the investment banker or bankers and manager or
managers to administer the offering and its (or their) counsel, which investment
banker or bankers and manager or managers shall be reasonably satisfactory to
the Company.
(d) Underwritten Offering at the Request of the Merrill Holders. Upon
the written request of one or more Merrill Holders (such Xxxxxxx Xxxxxx or
Merrill Holders being referred to herein as the "Requesting Merrill Holders"),
requesting that the Company amend the Shelf Registration Statement to the extent
necessary for the offering of the Requesting Merrill Holders' Registrable
Securities pursuant to an Underwritten Offering, the Company will give prompt
written notice of the requested Underwritten Offering to all other holders of
Registrable Securities and thereupon the Company will use its best efforts to
effect such amendment to the Shelf Registration Statement for an Underwritten
Offering of (x) the Registrable Securities which the Company has been so
requested to include in the Underwritten Offering by the Requesting Merrill
Holders and (y) all other Registrable Securities which the Company has been
requested to include in the Underwritten Offering by the Holders thereof by
written request given to the Company within 15 days after the giving of such
written notice by the Company. Notwithstanding the foregoing, the Company shall
have no obligation under this Section 2(d) unless the estimated aggregate
offering price of the Registrable Securities requested for inclusion in such
Underwritten Offering is $10,000,000 or more. In any such Underwritten Offering
requested by the Merrill Holders, the Merrill Holders representing 50% of the
Registrable Securities to be included in such offering by the Merrill Holders
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shall have the right to select the investment banker or bankers and manager or
managers to administer the offering and its (or their) counsel, which investment
banker or bankers and manager or managers shall be reasonably satisfactory to
the Company.
(e) Limitation on Amendments. The Company shall not be required to
amend the Shelf Registration Statement pursuant to Sections 2(c) or 2(d) hereof
more than four (4) times in the aggregate, at least one of which amendments
shall be reserved for the Merrill Holders pursuant to Section 2(d); provided
that each amendment so made shall have been effective to permit the sale in an
Underwritten Offering of all of the Registrable Securities included in the Shelf
Registration Statement for that purpose.
(f) Amendment of Registration for Other Securities. Whenever the
Company shall amend the Shelf Registration Statement pursuant to this Section 2
in connection with an Underwritten Offering, no securities other than
Registrable Securities shall be included among the securities covered by such
registration unless (i) the managing underwriter of such offering shall have
advised each Holder of Registrable Securities to be included in such
Underwritten Offering in writing that the inclusion of such other securities
would not be likely to have an adverse effect on the price of the Registrable
Securities included in such offering or on the timing of such offering or (ii)
the Holders of 75% of the Registrable Securities to be included in such offering
shall have consented in writing to the inclusion of such other securities,
provided that for purposes of determining compliance with this clause, the
consent of Holders seeking to have other securities included in such offering
shall not be counted.
(g) Priority in Underwritten Offering at the Request of the Initial
Holders. If the managing underwriter of an Underwritten Offering requested
pursuant to Section 2(c) shall advise the Company in writing (with a copy to
each holder of Registrable Securities requesting an Underwritten Offering) that,
in its opinion, the number of securities requested to be included in such
Underwritten Offering exceeds the number which can be sold in such offering
without being likely to have an adverse effect on the price of the securities
offered or on the timing of the offering, then the Company shall include in such
Underwritten Offering (to the extent of the number which the Company is so
advised can be sold in such offering) Registrable Securities requested to be
included in such Underwritten Offering (i) first, pro rata among the Initial
Holders on the basis of the percentages of the Registrable Securities held by
such Initial Holders, and (ii) second, and only if all the securities required
in clause (i) have been included, pro rata among the Merrill Holders on the
basis of the percentages of the Registrable Securities held by such Merrill
Holders. In connection with any Underwritten Offering to which the provisions of
this subsection (g) apply, no securities other than Registrable Securities shall
be included in such Underwritten Offering.
(h) Priority in Underwritten Offering at the Request of the Merrill
Holders. If the managing underwriter of an Underwritten Offering requested
pursuant to Section 2(d) shall advise the Company in writing (with a copy to
each holder of Registrable Securities requesting an Underwritten Offering) that,
in its opinion, the number of securities requested to be included in such
Underwritten Offering exceeds the
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number which can be sold in such offering without being likely to have an
adverse effect on the price of the securities offered or on the timing of the
offering, then the Company shall include in such Underwritten Offering (to the
extent of the number which the Company is so advised can be sold in such
offering) Registrable Securities requested to be included in such Underwritten
Offering (i) first, pro rata among the Merrill Holders on the basis of the
percentages of the Registrable Securities held by such Merrill Holders, and (ii)
second, and only if all the securities required in clause (i) have been
included, pro rata among the Initial Holders on the basis of the percentages of
the Registrable Securities held by such Initial Holders. In connection with any
Underwritten Offering to which the provisions of this subsection (h) apply, no
securities other than Registrable Securities shall be included in such
Underwritten Offering.
(i) Suspension of Registration. If the continued use of the Shelf
Registration Statement at any time would require the Company to make an Adverse
Disclosure or would require the inclusion in such Registration Statement of
audited financial statements that are unavailable to the Company for reasons
beyond the Company's reasonable control, the Company may, upon giving written
notice of such action to the Holders, suspend use of such Registration Statement
for the shortest period of time determined in good faith by the Company to be
necessary for such purpose (a "Shelf Suspension"); provided, however, that the
Company shall not be permitted to exercise a Shelf Suspension (i) more than one
time during any twelve (12) month period or (ii) for a period exceeding ninety
(90) days on any one occasion. In the event of a Shelf Suspension, the Holders
agree to suspend, immediately upon their receipt of the notice referred to
above, any sale or offer to sell the Registrable Securities, and the use of the
prospectus related to the Shelf Registration Statement in connection with any
such sale or offer to sell Registrable Securities, and agree not to disclose to
any other Person the fact that the Company has exercised a Shelf Suspension or
any related facts. The Company shall promptly notify the Holders upon the
termination of such Shelf Suspension.
3. Piggyback Registration.
(a) Participation.
(i) If the Company, at any time within the period during which it
is required to use it best efforts to keep the Shelf Registration Statement
effective pursuant to Section 2(b), proposes to file a registration statement
for an Underwritten Offering of equity securities (except pursuant to Sections
2(c) or 2(d)), then, as soon as practicable (but in no event less than fifteen
(15) days prior to the proposed date of filing of such registration statement
with the Commission), the Company shall give written notice of such proposed
filing to all Holders of Registrable Securities and such notice shall offer the
Holders the opportunity to register such number of Registrable Securities as
each such Holder may request in writing (a "Piggyback Registration"). Subject to
Section 3(b), the Company shall include in such registration statement all such
Registrable Securities with respect to which the Company has received written
requests for inclusion therein within fifteen (15) days after the Company's
notice has been given
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("Included Registrable Securities"). If at any time after giving written notice
of any such intention to register any equity securities and prior to the
effective date of the registration statement filed in connection with such
registration, the Company shall determine for any reason not to register or to
delay registration of such equity securities, the Company may, at its election,
give written notice of such determination to each Holder holding Included
Registrable Securities and (x) in the case of a determination not to register,
shall be relieved of its obligation to register any Included Registrable
Securities in connection with such registration and (y) in the case of a
determination to delay registering, shall be permitted to delay registering any
Included Registrable Securities for the same period as the delay in registering
such other equity securities. The Holders agree not to disclose to any other
Person such determination of the Company not to register or to delay
registration of equity securities or any related facts.
(ii) Each Holder making a request for inclusion of its
Registrable Securities in a Piggyback Registration must, and the Company shall
use its reasonable best efforts to make such arrangements with the underwriter
or underwriters so that each such Holder may, participate in such Underwritten
Offering on the same terms as other Persons selling securities in such
Underwritten Offering. Notwithstanding any provision in this Agreement to the
contrary, any Holder participating through a Piggyback Registration shall have
no right to change the intended method or methods of disposition otherwise
applicable.
(b) Priority in Piggyback Registration. If the managing underwriter of
any proposed offering of securities included in a Piggyback Registration informs
the Holders holding Included Registrable Securities in writing that, in its
opinion, the total number of securities which such Holders and any other Persons
intend to include in such offering exceeds the number which can be sold in such
offering without being likely to have an adverse effect on the price of the
securities offered or the timing of the offering, then the securities to be
included in such registration shall be allocated as follows:
(i) first, one hundred (100) percent of the securities that the
Company has proposed to sell shall be included therein; and
(ii) second, and only if all the securities referenced in clause
(i) have been included, the number of Included Registrable Securities that, in
the opinion of such underwriter, can be sold without having such adverse effect
shall be included therein, with such number to be allocated pro rata among (x)
the Holders of Included Registrable Securities on the basis of the percentages
of the Included Registrable Securities held by such Holders, provided, however,
that if as a result of the provisions of this Section 3(b), any Holder shall not
be entitled to include at least fifty (50) percent of such Holder's Included
Registrable Securities, such Holder may withdraw such Holder's request to
include all or any number of such Registrable Securities in such registration
statement no later than twenty (20) days prior to its effectiveness; and (y) any
other equity securities eligible for inclusion in such registration.
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4. Black-out Periods. In the event of (i) a registration by the Company
involving the offering and sale by the Company of its equity securities or
securities convertible into or exchangeable for its equity securities or (ii) an
Underwritten Offering involving the offering and sale by Holders of Registrable
Securities, the Holders agree, if requested by the Company (or, in the case of
any Underwritten Offering, by the managing underwriter), not to effect any
public sale or distribution (including any sale pursuant to Rule 144 under the
Securities Act) of any securities of the Company (except, in each case, as part
of the applicable registration, if permitted) which securities are the same as
or similar to those being registered in connection with such registration, or
which are convertible into or exchangeable or exercisable for such securities,
during the period beginning seven (7) days before and ending 90 days (not to
occur more than one (1) time during any twelve (12) month period) after, the
effective date of the registration statement filed in connection with such
registration, to the extent such Holders are timely notified in writing by the
Company or the managing underwriter; provided, that this section shall apply
only to Holders holding fifteen percent (15%) or more of the Registrable
Securities and that, in each case, the Company's executive officers and
directors shall have entered into similar agreements for the same period.
5. Registration Procedures.
(a) In connection with the Company's registration obligations pursuant
to this Agreement, the Company shall, subject to the limitations set forth
herein and to applicable law, use its reasonable best efforts to effect any such
registration so as to permit the sale of the applicable Registrable Securities
in accordance with the intended method or methods of distribution thereof in
conformity with any required time period set forth herein, and in connection
therewith the Company shall:
(i) before filing a registration statement or prospectus with the
Commission, or any amendments or supplements thereto, furnish to the underwriter
or underwriters, if any, and to the Holders holding Registrable Securities to be
included in such registration statement, copies of all documents prepared to be
filed, which documents shall be subject to the reasonable review and comment of
such Holders, such underwriters, if any, and their respective counsel;
(ii) prepare and file with the Commission a registration
statement relating to the registration on any appropriate form under the
Securities Act, which form shall be available for the sale of the Registrable
Securities;
(iii) notify the selling Holders and the managing underwriter or
underwriters, if any, as soon as reasonably practicable after notice thereof is
received by the Company (A) when the applicable registration statement or any
amendment thereto has been filed or becomes effective and when the applicable
prospectus or any amendment or supplement thereto has been filed, (B) of any
written comments by the Commission or any request by the Commission for
amendments or supplements to such registration statement or prospectus or for
additional information, (C) of the issuance by the Commission of any stop order
suspending the effectiveness of such registration
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statement or any order preventing or suspending the use of any preliminary or
final prospectus or the initiation or threat of any proceedings for such
purposes and (D) of the receipt by the Company of any notification with respect
to the suspension of the qualification of the Registrable Securities for
offering or sale in any jurisdiction or the initiation or threat of any
proceeding for such purpose;
(iv) promptly notify each selling Holder and the managing
underwriter or underwriters, if any, when the Company becomes aware of the
occurrence of any event as a result of which the applicable registration
statement or prospectus (as then in effect) contains any untrue statement of a
material fact or omits to state a material fact necessary to make the statements
therein (in the case of the prospectus and any preliminary prospectus, in light
of the circumstances under which they were made) not misleading or, if for any
other reason it shall be necessary to amend or supplement such registration
statement or prospectus in order to comply with the Securities Act and, in
either case as promptly as reasonably practicable thereafter, prepare and file
with the Commission a post-effective amendment or supplement to such
registration statement or prospectus or any document incorporated therein by
reference or file any other required document so that, as thereafter delivered
to the purchasers of Registrable Securities, the prospectus shall not contain an
untrue statement of a material fact or omit to state any material fact necessary
to make the statements therein not misleading;
(v) use its reasonable best efforts to prevent or obtain as
promptly as practicable the withdrawal of any stop order with respect to the
applicable registration statement or other order suspending the use of any
preliminary or final prospectus;
(vi) promptly incorporate in a prospectus supplement or
post-effective amendment to the Shelf Registration Statement such information
furnished in writing to the Company (i) as the managing underwriter or,
underwriters, if any, request to be included, (ii) as a Holder of Registrable
Securities, which Holder, in its reasonable judgment, might be deemed to be an
underwriter or controlling person of the Company, request to be included, (iii)
as an Initial Holder or Xxxxxxx Xxxxxx request to be included, but only to the
extent that such information relates solely to such Initial Holder or Xxxxxxx
Xxxxxx, as the case may be, and (iv) as the Holders of a majority of the
Registrable Securities being sold thereunder agree should be included therein,
relating to the Holders or underwriter or, subject to other applicable
provisions hereof, the plan of distribution to be utilized with respect to such
Registrable Securities, and make all required filings of such prospectus
supplement or post-effective amendment as soon as reasonably practicable after
being notified of the matters to be incorporated in such prospectus supplement
or post-effective amendment;
(vii) furnish to each selling Holder and each managing
underwriter, if any, without charge, as many conformed copies as such Holder or
managing underwriter may reasonably request of the applicable registration
statement, including all documents incorporated by reference therein or exhibits
to such registration statement;
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(viii) deliver to each selling Holder and each managing
underwriter, if any, without charge, as many copies of the applicable prospectus
(including each preliminary prospectus) as such Holder or managing underwriter
may reasonably request (it being understood that the Company consents to the use
of the prospectus by each of the selling Holders and the underwriter or
underwriters, if any, in connection with the offering and sale of the
Registrable Securities covered by the prospectus);
(ix) on or prior to the date on which the applicable registration
statement is declared effective, use its reasonable best efforts to register or
qualify such Registrable Securities for offer and sale under the securities or
"Blue Sky" laws of each state and other jurisdiction of the United States as any
such selling Holder or underwriter reasonably and timely requests in writing,
and do any and all other acts or things reasonably necessary or advisable to
keep such registration or qualification in effect so as to permit the
commencement and continuance of sales and dealings in such jurisdictions for as
long as may be necessary to complete the distribution of the Registrable
Securities covered by the registration statement; provided that the Company
shall not be required (A) to qualify generally to do business in any
jurisdiction where it is not then so qualified or (B) to take any action which
would subject it to taxation or general service of process in any such
jurisdiction where it is not then so subject;
(x) cooperate with the selling Holders and the managing
underwriter or underwriters, if any, to facilitate the timely preparation and
delivery of certificates representing Registrable Securities to be sold and not
bearing any restrictive legends;
(xi) not later than the effective date of the applicable
registration statement, provide a CUSIP number for all Registrable Securities
included in such registration statement and provide the applicable transfer
agent with printed certificates for the Registrable Securities, which
certificates shall be in a form eligible for deposit with The Depository Trust
Company;
(xii) in the case of an Underwritten Offering, obtain for
delivery to the underwriter or underwriters, with copies to the Holders included
in such registration, an opinion or opinions from counsel for the Company dated
the date of the closing under the underwriting agreement, in customary form,
scope and substance;
(xiii) in the case of an Underwritten Offering, obtain for
delivery to the Company and the underwriter or underwriters, with copies
(subject to the reasonable consent of the certified public accountants referred
to below, determined in accordance with market practice) to the Holders included
in such registration, a comfort letter from the Company's independent certified
public accountants in customary form and covering matters of the type
customarily covered by comfort letters and as the managing underwriter or
underwriters reasonably request, dated the date of execution of the underwriting
agreement and brought down to the closing under the underwriting agreement;
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(xiv) otherwise use its reasonable best efforts to comply with
all applicable rules and regulations of the Commission and make available to its
security holders, as soon as reasonably practicable, an earning statement
covering the period of at least twelve months, but not more than eighteen
months, beginning with the first day of the Company's first full calendar
quarter after the effective date of such registration statement, which earning
statement shall satisfy the provisions of Section 11(a) of the Securities Act
and Rule 158 thereunder, and will furnish to each selling Holder at least five
business days prior to the filing thereof a copy of any amendment or supplement
to such registration statement or prospectus and shall not file any such
amendment or supplement to which any selling Holder shall have reasonably
objected on the grounds that such amendment or supplement does not comply in all
material respects with the requirements of the Securities Act;
(xv) reasonably cooperate with each selling Holder of Registrable
Securities and each underwriter, if any, participating in the disposition of
such Registrable Securities and their respective counsel in connection with any
filings required to be made with the NASD;
(xvi) provide and cause to be maintained a transfer agent and
registrar for all Registrable Securities covered by the applicable registration
statement from and after a date not later than the effective date of such
registration statement;
(xvii) use its reasonable best efforts to cause all Registrable
Securities covered by the applicable registration statement to be listed on each
securities exchange or market on which any of the Company's securities of such
class are then listed or quoted and quoted on each inter-dealer quotation system
on which any of the Company's securities of such class are then quoted; and
(xviii) make available upon reasonable notice at reasonable times
and for reasonable periods for inspection by each Initial Holder and Xxxxxxx
Xxxxxx, and a representative appointed by the Holders holding a majority of the
Registrable Securities covered by the applicable registration statement, by any
managing underwriter or underwriters participating in any disposition to be
effected pursuant to such registration statement and by any attorney, accountant
or other agent retained by such Holders or any such managing underwriter, all
pertinent financial and other records, corporate documents and properties and
officers and employees of the Company as shall be reasonably necessary to enable
them to exercise their due diligence responsibilities and to supply all
information reasonably requested by any such seller, underwriter, attorney,
accountant or agent in connection with such registration statement as shall be
reasonably necessary to enable them to exercise such responsibilities (subject
to the entry by each party referred to in this clause (xviii) into a customary
confidentiality agreement in a form reasonably acceptable to the Company).
(b) The Company may require each selling Holder as to which any
registration is being effected to furnish to the Company such information
regarding itself, the Registrable Securities held by it, the distribution of
such Holder's Registrable
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Securities and such other information relating to such Holder and its ownership
of the applicable Registrable Securities as the Company may from time to time
reasonably request, including information required under Item 507 of Regulation
S-K. Each Holder agrees to furnish such information to the Company and to
cooperate with the Company as necessary to enable the Company to comply with the
provisions of this Agreement. The Company shall have the right to exclude any
Holder that does not comply with the preceding sentence from the applicable
registration.
(c) Each Holder agrees by acquisition of its Registrable Securities
that, upon receipt of any notice from the Company of the occurrence of any event
of the kind described in Section 5(a)(iv), such Holder shall discontinue
disposition of its Registrable Securities pursuant to such registration
statement until such Holder's receipt of the copies of the supplemented or
amended prospectus contemplated by Section 5(a)(iv) and of any additional or
supplemental filings that are incorporated by reference in the prospectus, or
until such Holder is advised in writing by the Company that the use of the
prospectus may be resumed and has received copies, and, if so directed by the
Company, such Holder shall deliver to the Company (at the Company's expense) all
copies, other than permanent file copies then in such Holder's possession, of
the prospectus covering such Registrable Securities which are current at the
time of the receipt of such notice.
6. Registration Expenses. The Company shall pay all expenses incident to
its performance or compliance with its obligations under this Agreement,
including: (i) all registration and filing fees and any other fees and expenses
associated with filings required to be made with the Commission or the NASD,
(ii) all fees and expenses of compliance with federal and state securities or
"Blue Sky" laws, (iii) all of its printing, duplicating, word processing,
messenger, telephone, facsimile and delivery expenses (including expenses of
printing certificates for the Registrable Securities in a form eligible for
deposit with The Depository Trust Company and of printing prospectuses), (iv)
all fees and disbursements of counsel for the Company and of all independent
certified public accountants of the Company, (v) all fees and expenses incurred
in connection with the listing of the Registrable Securities on any securities
exchange or market or the quotation of the Registrable Securities on any
inter-dealer quotation system, (vi) all fees and expenses of any escrow agent or
attorney in fact for selling Holders and (vii) the reasonable fees and expenses
of not more than one lead outside counsel for all Holders (selected by the
Holders of a majority of the Registrable Securities included in a registration
that do not, by virtue of the following provisos, have separate counsel) in an
amount not to exceed $35,000; provided, however, that (x) in the event of a
Underwritten Offering pursuant to Section 2(c), the Initial Holders representing
50% of the Registrable Securities to be included in such offering by the Initial
Holders shall be entitled to select a separate outside counsel (whose reasonable
fees and expenses shall not exceed $35,000) and (y) in the event of a
Underwritten Offering pursuant to Section 2(d), the Merrill Holders representing
50% of the Registrable Securities to be included in such offering by the Merrill
Holders shall be entitled to select a separate outside counsel (whose reasonable
fees and expenses shall not exceed $35,000). In addition, the Company shall pay
its internal expenses (including salaries and expenses of its officers and
employees performing legal or accounting
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duties), the expense of any audit and the fees and expenses of any Person,
including special experts, retained by the Company in connection with such
registration. The Company shall not be required to pay (xx) any other costs or
expenses in the course of the transactions contemplated hereby, (yy) any
expenses incurred by the Holders (except as provided in clauses (i), (ii), (vi)
and (vii) of the preceding sentence), (yy) any underwriting discounts or
commissions or transfer taxes attributable to the sale of Registrable Securities
or (zz) any fees and expenses of counsel to any underwriter.
7. Indemnification.
(a) Indemnification by the Company. The Company agrees to indemnify
and hold harmless, to the fullest extent permitted by law, each Holder selling
Registrable Securities and its respective officers, directors, members, partners
and employees and each Person who controls (within the meaning of the Securities
Act and the Securities Exchange Act) such selling Holder (each a "Participant")
from and against any and all losses, claims, damages, judgments, liabilities and
reasonable expenses (including reasonable costs of investigation and legal
expenses) caused by, arising out of or based upon (i) any untrue or alleged
untrue statement of a material fact contained in any registration statement
under which such Registrable Securities were registered under the Securities Act
(including any final, preliminary or summary prospectus contained therein or any
amendment thereof or supplement thereto or any documents incorporated by
reference therein) or (ii) any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein (in the case of a prospectus or preliminary prospectus, in light of the
circumstances under which they were made) not misleading (each a "Loss" and
collectively "Losses"); provided, however, that the Company shall not be liable
to any Participant in any such case to the extent that any such Loss is caused
by written information furnished to the Company by such Holder expressly for use
in the preparation thereof, or if such untrue statement or alleged untrue
statement or omission or alleged omission is corrected in an amendment or
supplement to such prospectus which has been made available to the Holders and
the relevant Holder fails to deliver such prospectus as so amended or
supplemented, if such delivery is required under applicable law or the
applicable rules of any securities exchange, prior to or concurrently with the
sales of the Registrable Securities to the Person asserting such Loss.
(b) Indemnification by the Holders. Each selling Holder agrees
(severally and not jointly) to indemnify and hold harmless, to the fullest
extent permitted by law, the Company, its directors, officers and employees and
each Person who controls the Company (within the meaning of the Securities Act
and the Securities Exchange Act) from and against any and all Losses to the
extent, but only to the extent, that any such Loss is caused by, arises out of
or is based upon any information furnished in writing by such selling Holder to
the Company specifically for inclusion in any registration statement under which
such Registrable Securities were registered under the Securities Act (including
any final, preliminary or summary prospectus contained therein or any amendment
thereof or supplement thereto or any documents incorporated by reference
therein) and was not corrected in a subsequent writing prior to or concurrently
with the
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sale of the Registrable Securities to the Person asserting such Loss. The
liability of any Holder under this paragraph shall in no event exceed the amount
by which proceeds (less underwriting fees and discounts) received by such Holder
from sales of Registrable Securities giving rise to such obligations exceed the
amount of any Loss which such Holder has otherwise been required to pay by
reason of such untrue statement or omission.
(c) Indemnification Proceedings. Any Person entitled to
indemnification hereunder (an "Indemnified Party") shall (i) give prompt written
notice to the Person from whom such indemnification may be sought (the
"Indemnifying Party") of any claim with respect to which it seeks
indemnification, provided, however, that the failure so to notify the
Indemnifying Party shall not relieve it of any obligation or liability which it
may have hereunder or otherwise except to the extent it is materially prejudiced
by such failure and (ii) permit such Indemnifying Party to assume the defense of
such claim with counsel reasonably satisfactory to the Indemnified Party;
provided, however, that the Indemnified Party shall have the right to select and
employ separate counsel and to participate in the defense of such claim, and the
fees and expenses of such counsel shall be at the expense of the Indemnified
Party, unless (A) the Indemnifying Party has agreed in writing to pay such fees
or expenses, (B) the Indemnifying Party shall have failed to assume the defense
of such claim within a reasonable time after having received notice of such
claim from the Indemnified Party and to employ counsel reasonably satisfactory
to the Indemnified Party, (C) in the reasonable judgment of the Indemnified
Party, based on advice of its counsel, a conflict of interest exists between the
Indemnified Party and the Indemnifying Party with respect to such claims or (D)
the Indemnified Party has reasonably concluded (based on advice of counsel) that
there may be legal defenses available to it or other Indemnified Parties that
are different from or in addition to those available to the Indemnifying Party
(in which case, if the Indemnified Party notifies the Indemnifying Party in
writing that the Indemnified Party 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 claim on behalf of the Indemnified Party).
If such defense is assumed by the Indemnifying Party, or if such defense is not
assumed by the Indemnifying Party but the Indemnifying Party acknowledges that
the Indemnified Party is entitled to indemnification hereunder, the Indemnifying
Party shall not be subject to any liability for any settlement made without its
consent, which consent shall not be unreasonably delayed or withheld; provided,
that an Indemnifying Party shall not be required to consent to any settlement
involving the imposition of equitable remedies or involving the imposition of
any material obligations on such Indemnifying Party other than financial
obligations for which such Indemnified Party will be indemnified hereunder. If
the Indemnifying Party assumes the defense, the Indemnifying Party shall have
the right to settle such action without the consent of the Indemnified Party;
provided, that the Indemnifying Party shall be required to obtain the consent of
the Indemnified Party (which consent shall not be unreasonably withheld) if the
settlement includes any admission of wrongdoing on the part of the Indemnified
Party or any equitable remedies or restriction on the Indemnified Party or its
officers, directors or employees and no Indemnifying Party shall consent to
entry of any judgment or enter into any settlement which does not include as an
unconditional term thereof the giving by the
-15-
claimant or plaintiff to each Indemnified Party of an unconditional release from
all liability in respect of such claim or litigation. An Indemnifying Party (or,
as the case may be, Indemnifying Parties) shall not, in connection with any
proceeding or related proceedings in the same jurisdiction, be liable for the
reasonable fees, disbursements and other charges of more than one separate firm
admitted to practice in such jurisdiction at any one time from all Indemnified
Parties collectively unless (x) the employment of more than one counsel has been
authorized in writing by such Indemnifying Party (or Indemnifying Parties) or
(y) a conflict exists or may exist (based on advice of counsel to an Indemnified
Party) between such Indemnified Party and other Indemnified Parties, in each of
which cases the Indemnifying Party (or Indemnifying Parties) shall be obligated
to pay the reasonable fees and expenses of such additional counsel or counsels.
The indemnification provided for under this Agreement shall remain in full force
and effect regardless of any investigation made by or on behalf of the
Indemnified Party or any officer, director or controlling Person of such
Indemnified Party and shall survive the transfer of Registrable Securities.
(d) Contribution. If for any reason the indemnification provided for
in paragraphs (a) and (b) of this Section 7 is unavailable to an Indemnified
Party or is insufficient to hold it harmless as contemplated by paragraphs (a)
and (b) of this Section 7, then the Indemnifying Party shall contribute to the
amount paid or payable by the Indemnified Party as a result of such Loss in such
proportion as is appropriate to reflect the relative fault of the Indemnifying
Party on the one hand and the Indemnified Party on the other. The relative fault
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by the Indemnifying
Party or the Indemnified Party and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such untrue
statement or omission. Notwithstanding anything in this Section 7(d) to the
contrary, no Indemnifying Party (other than the Company) shall be required
pursuant to this Section 7(d) to contribute any amount in excess of the amount
by which the proceeds (less underwriting fees and discounts) received by such
Indemnifying Party from the sale of Registrable Securities in the offering to
which the Losses of the Indemnified Parties relate exceed the amount of any
damages which such Indemnifying Party has otherwise been required to pay by
reason of such untrue statement or omission. The parties hereto agree that it
would not be just and equitable if contribution pursuant to this Section 7(d)
were determined by pro rata allocation or by any other method of allocation that
does not take account of the equitable considerations referred to in the
preceding sentences. 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.
8. Compliance with Rule 144. The Company shall use its best efforts to file
the reports required to be filed by it under the Securities Act and the
Securities Exchange Act so long as the Company is obligated to file such
reports, and it shall take such further action as any Holder may reasonably
request, all to the extent required from time to time to enable such Holder to
sell Registrable Securities without registration under the
-16-
Securities Act within the limitation of the exemptions provided by (a) Rule 144
under the Securities Act, as such Rule may be amended from time to time, or (b)
any similar rules or regulations hereafter adopted by the Commission. Upon the
written request of any Holder, the Company shall deliver to such Holder a
written statement as to whether it has complied with such requirements.
Notwithstanding the foregoing, the Company shall not be required by this Section
8 to file any such reports that were first required to be filed prior to the
date of this Agreement.
9. Underwriting Agreements. If requested by the underwriters for any
Underwritten Offering requested by Holders pursuant to Sections 2(c) or 2(d),
the Company and the Holders of Registrable Securities to be included therein
shall enter into an underwriting agreement with such underwriters, such
agreement to be reasonably satisfactory in form and substance to (i) the
Company, (ii) in the case of an Underwritten Offering requested by the Initial
Holders pursuant to Section 2(c), the Initial Holders holding a majority of the
Registrable Securities to be included in such Underwritten Offering by the
Initial Holders, (iii) in the case of an Underwritten Offering requested by the
Merrill Holders pursuant to Section 2(d), the Merrill Holders holding a majority
of the Registrable Securities to be included in such Underwritten Offering by
the Merrill Holders, and (iv) the underwriters, and to contain such terms and
conditions as are generally prevailing in agreements of that type (such
agreement an "Underwriting Agreement"). No Holder shall be required to enter
into an Underwriting Agreement unless, at such Holder's request, any or all of
the representations and warranties made by, and the other agreements on the part
of, the Company to and for the benefit of such underwriters shall also be made
to and for the benefit of such Initial Holder. No Holder shall be required to
make any representations or warranties to, or agreements with, the Company or
the underwriters other than (i) representations and warranties contained in a
writing furnished by such Holder expressly for use in such registration
statement, (ii) representations, warranties and agreements regarding such
Holder, the Registrable Securities and such Holder's intended method of
distribution thereof and (iii) any other representation, warranty or agreement
required by law. The Holders holding any Registrable Securities to be included
in any Underwritten Offering pursuant to Section 3 hereof shall enter into such
an underwriting agreement at the request of the Company.
10. Amendments and Waivers. Except as otherwise provided in this Agreement,
this Agreement may only be amended, modified or supplemented by, and any waivers
or consents to departure from the provisions of this Agreement shall be
effective only upon, receipt of the written consent of: (a)(i) in the case of an
amendment, modification, supplement, consent or waiver that waives a request for
an Underwritten Offering pursuant to Sections 2(c) or 2(d) previously made or
reduces the number of times such requests may be made, each Initial Holder or
Xxxxxxx Xxxxxx affected by such amendment, modification, supplement, consent or
waiver and (ii) in the case of any other amendment, modification, supplement,
consent or waiver, each Initial Holder affected by such amendment, modification,
supplement, consent or waiver; provided that, in the case of an Initial Holder,
such Initial Holder owns at least 10% of the Registrable Securities; (b) the
Company; and (c) the Holders holding a majority of the Registrable Securities.
Any amendment, modification, supplement, consent or waiver must be made in
writing.
-17-
Any amendment or waiver effected in accordance with this Section 10 shall be
binding upon each Holder and the Company.
11. Successors, Assigns and Transferees.
(a) The registration rights of any Holder under this Agreement with
respect to any Registrable Securities may be transferred and assigned; provided,
however, that the right to request an amendment for an Underwritten Offering
pursuant to Sections 2(c) or 2(d) may be transferred only by an Initial Holder
or a Xxxxxxx Xxxxxx in connection with the transfer and assignment of at least
10% of such Initial Holder's or Xxxxxxx Xxxxxx'x Registrable Securities to one
entity or one group of controlled affiliates; and provided further, that no such
transfer or assignment of any registration rights under this Agreement shall be
binding upon or obligate the Company under this Agreement to any such transferee
or assignee unless and until (i) the Company shall have received notice of such
transfer or assignment as herein provided and a written agreement of the
transferee or assignee to be bound by the provisions of this Agreement and (ii)
such transferee or assignee holds Registrable Securities. Any transfer or
assignment of the rights and obligations under this Agreement made other than as
provided in the first sentence of this Section 11 shall be null and void.
(b) This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and permitted
assigns.
12. Final Agreement. This Agreement constitutes the final agreement of the
parties concerning the matters referred to herein and supersedes all prior
agreements and understandings with respect thereto.
13. Severability. Whenever possible, each provision of this Agreement will
be interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Agreement is held to be prohibited by or invalid
under applicable law, such provision will be ineffective only to the extent of
such prohibition or invalidity, without invalidating the remainder of this
Agreement.
14. Notices. All notices, demands or other communications or documents to
be given or delivered under or by reason of the provisions of this Agreement
shall be made in writing and shall be deemed to have been received (a) when
delivered personally to the recipient; (b) when sent to the recipient by
telecopy (receipt electronically confirmed by sender's telecopy machine) if
during normal business hours of the recipient, otherwise on the next business
day; one business day after the date when sent to the recipient by reputable
express courier service (charges prepaid); or (c) seven business days after the
date when mailed to the recipient by certified or registered mail, return
receipt requested and postage prepaid. Such notices, demands and other
communications shall be sent to the parties at the addresses indicated below or
in any case to such other address as any party hereto may, from time to time,
designate in writing delivered pursuant to the terms of this Section 14:
If to the Initial Holders, to the addresses set forth on Schedule I
hereto.
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If to Holders other than the Initial Holders, to the addresses set
forth on the stock record books of the Company.
If to the Company, to:
Sunterra Corporation
0000 Xxxx Xxxxxx Xxxxx
Xxxxxxx, Xxxxxxx 00000
Attention: General Counsel
Fax: (000) 000-0000
If to Merrill, to:
Xxxxxxx Xxxxx Mortgage Lending, Inc.,
000 Xxxxxx Xxxxxx
Xxxxxx Xxxx, XX 00000
Attention: Xxxxx Xxxxxxxxx
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
With a copy to:
Attention: Xxxxxxx Xxxxx
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
15. Governing Law; Service of Process; Consent to Jurisdiction. (a) THIS
AGREEMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF
NEW YORK AND FOR ALL PURPOSES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF SUCH STATE, IRRESPECTIVE OF ANY CONTRARY RESULT OTHERWISE
REQUIRED BY APPLICABLE CONFLICT OR CHOICE OF LAW RULES.
(b) To the fullest extent permitted by applicable law, each party
hereto (i) agrees that any claim, action or proceeding by such party seeking any
relief whatsoever arising out of, or in connection with, this Agreement or the
transactions contemplated hereby may be brought in the United States District
Court for the Southern District of New York and in any New York State court
located in the Borough of Manhattan, (ii) agrees to submit to the exclusive
jurisdiction of such courts located in the State of New York for purposes of all
legal proceedings arising out of, or in connection with, this Agreement or the
transactions contemplated hereby and (iii) irrevocably waives any objection
which it may now or hereafter have to the laying of the venue of any such
proceeding brought in such a court and any claim that any such proceeding
brought in such a court has been brought in an inconvenient forum.
16. Counterparts and Facsimile Execution. This Agreement may be executed in
any number of counterparts, each of which when so executed and delivered shall
be
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deemed an original, and such counterparts together shall constitute one
instrument. This Agreement may be executed by the exchange of signatures by
facsimile transmission.
17. Specific Performance. Without limiting or waiving in any respect any
rights or remedies of the parties under this Agreement now or hereafter existing
at law or in equity or by statute, each of the parties hereto shall be entitled
to seek specific performance of the obligations to be performed by the other
party or parties in accordance with the provisions of this Agreement.
18. No Inconsistent Agreements. The Company shall not, on or after the date
of this Agreement, enter into any agreement with respect to its securities that
is inconsistent with the rights granted to the Holders pursuant to this
Agreement.
19. Third Party Beneficiaries. Holders of Registrable Securities and the
Indemnified Parties are intended third party beneficiaries of this Agreement,
and this Agreement shall inure to the benefit of and may be enforced by such
Persons.
[Remainder of page intentionally left blank.
Signature pages follow.]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the date first written above.
SUNTERRA CORPORATION
By: /s/ Xxxxxxxx X. Xxxxxx
---------------------------------------------
Name: Xxxxxxxx X. Xxxxxx
Title: President and Chief Executive Officer
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XXXXXXX XXXXX MORTGAGE LENDING, INC.
By: /s/ Xxxxxxx Xxxxx
---------------------------------------------
Name: Xxxxxxx Xxxxx
Title: Director
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INITIAL HOLDERS:
XXXXX XXXXXXXX, LTD.
By: /s/ Xxxxxxxx X. Xxxxxxxx
---------------------------------------------
Name: Xxxxxxxx X. Xxxxxxxx
Title: General Partner
/s/ Xxxxxxxx X. Xxxxxxxx
---------------------------------------------
Xxxxxxxx X. Xxxxxxxx
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WK INVESTORS LLC
By: /s/ Xxxxxx Xxxxx
---------------------------------------------
Name: Xxxxxx Xxxxx
Title: Vice President and Assistant Secretary
-24-
SCHEDULE I
Initial Holders
Xxxxxxx Xxxxx Mortgage Lending, Inc.
Xxxxx Xxxxxxxx, Ltd.
Xxxxxxxx X. Xxxxxxxx
WK Investors LLC
