EXHIBIT 10.3
EXECUTION COPY
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UNIT EXCHANGE AND REGISTRATION RIGHTS AGREEMENT
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This UNIT EXCHANGE AND REGISTRATION RIGHTS AGREEMENT ("AGREEMENT"),
dated as of July 19, 2002, between American International Golf, Inc., a Delaware
corporation ("NEWCO") and National Golf Properties, Inc., a Maryland corporation
("NGP"), on the one hand, and Bank of America, N.A. ("BOFA") and the AGC
Noteholders (as defined herein) (collectively, "PLEDGEE") on the other hand.
WHEREAS, Xxxxx X. Xxxxx (individually and as trustee of the Xxxxx X.
Xxxxx Trust dated March 5, 1998 (as amended)) ("XXXXX XXXXX") owns shares of
common stock, par value $.01 per share ("NGP COMMON STOCK") of NGP and common
limited partnership units ("UNITS") of National Golf Operating Partnership,
L.P., a Delaware limited partnership ("NGOP");
WHEREAS, pursuant to the terms of the Third Amended and Restated
Partnership Agreement of NGOP dated as of July 28, 1999, by and among NGP as the
general partner of NGOP, and the limited partners listed on Exhibit A thereto
(as amended, the "NGOP AGREEMENT") each Unit is exchangeable (without payment of
any consideration) for one share of NGP Common Stock;
WHEREAS, pursuant to an Agreement and Plan of Merger and
Reorganization, dated as of March 29, 2002 (as it may be amended, from time to
time, the "MERGER AGREEMENT"), by and among Newco, NGP, NGOP, American Golf
Corporation, a California corporation, Golf Enterprises, Inc., a Kansas
corporation, Xxxxx X. Xxxxx, Dallas P. Price, the Xxxxx X. Xxxxx Trust, the
Dallas P. Price Trust, the AGC Contributors (as defined therein) and the
Transferred Entity Contributors (as defined therein), (x) a wholly owned
subsidiary of Newco will merge with and into NGP (the "NGP MERGER"), and
pursuant thereto each outstanding share of NGP Common Stock will be converted
into the right to receive one fully paid and nonassessable share of common
stock, par value $.01, of Newco ("NEWCO COMMON STOCK"), (y) a wholly owned
subsidiary of Newco will merge with and into NGOP (the "NGOP MERGER"), and
pursuant thereto each Unit (with certain exceptions set forth in the Merger
Agreement) will be converted into the right to receive one share of Newco Common
Stock;
WHEREAS, in furtherance of (i) consummating the transactions
contemplated by the Merger Agreement; (ii) inducing BofA and the holders of the
9.35% senior secured notes due July 1, 2004 issued by AGC (the "AGC
NOTEHOLDERS") to enter into that Restructuring Agreement and Limited Waiver
dated as of July 1, 2002 by and between BofA, the AGC Noteholders and AGC (the
"RESTRUCTURING AGREEMENT"), Xxxxx Xxxxx and the Xxxxx X. Xxxxx Trust have
pledged for the benefit of Pledgee (i) 354,938 shares of NGP Common Stock (the
"PLEDGED STOCK") and (ii) 3,244,626 Units (the "PLEDGED UNITS"), each pursuant
to that certain Stock and Partnership Interest Pledge Agreement dated as of July
19, 2002 (the "Pledge Agreement") by and between Xxxxx Xxxxx, Xxxxx X. Xxxxx
Trust and Pledgee;
WHEREAS, Pledgee has requested that following upon an Event of Default
(as defined herein), Pledgee shall be entitled to immediately exchange the
Pledged Units for shares
of NGP Common Stock consistent with the provisions of the Pledge Agreement
governing the rights of the Pledgee following an Event of Default without regard
to any of the limitations or restrictions on such exchange that are set forth in
the NGOP Agreement; and
WHEREAS, Pledgee has requested certain registration rights in
connection with the Pledged Stock and shares of NGP Common Stock issuable upon
exchange of Pledged Units and in the event that such shares of NGP Common Stock
and the Pledged Units are converted into shares of Newco Common Stock as
provided in the Merger Agreement, and for so long as the Pledge Agreement is
still in effect and not otherwise terminated Pledgee has requested registration
rights with respect to such shares of Newco Common Stock into which such shares
of NGP Common Stock and Pledged Units shall be converted.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements set forth herein, the parties agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01. Capitalized terms used herein but not otherwise defined herein
shall have the same meaning as in the Pledge Agreement.
Section 1.02. As used herein, the following terms shall have the following
meanings:
"AGC NOTEHOLDERS" has the meaning set forth in the recitals.
"BOFA" has the meaning set forth in the preamble.
"BUSINESS DAY" shall mean any day that the New York Stock Exchange is
formally open for trading and that is not a day on which banks in the City of
Los Angeles or the City of New York are authorized or required to close for
regular banking business.
"COMPANY" shall mean NGP, prior to consummation of the transactions
contemplated by the Merger Agreement, or Newco, concurrently with or subsequent
to the consummation of the transactions contemplated by the Merger Agreement.
"XXXXX XXXXX" has the meaning set forth in the recitals.
"DEMAND REGISTRATION" has the meaning set forth in Section 3.01.
"DEMAND REGISTRATION STATEMENT" has the meaning set forth in Section
3.01.
"EXCHANGE" has the meaning attributable to it in the NGOP Agreement.
"EVENT OF DEFAULT" means the earlier to occur of (x) an Alternate Major
Default (as defined in the AGC Collateral Agency Agreement) and (y) October 15,
2002 (unless the Pledged Shares and Pledged Units shall have been released from
the Pledge Agreement at or prior to such time).
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"MERGER AGREEMENT" has the meaning set forth in the recitals.
"NASD" has the meaning set forth in Section 3.07(c) of this Agreement.
"NEWCO" has the meaning set forth in the preamble.
"NGOP" has the meaning set forth in the recitals.
"NGOP AGREEMENT" has the meaning set forth in the recitals.
"NGP" has the meaning set forth in the preamble.
"NGP CHARTER" shall mean the Amended Articles of Incorporation of NGP
as they may be amended from time to time.
"NGP COMMON STOCK" has the meaning set forth in the recitals.
"OTHER HOLDER" has the meaning set forth in Section 3.03(b) of this
Agreement.
"PIGGY-BACK REQUEST" has the meaning set forth in Section 3.03 of this
Agreement.
"PLEDGE AGREEMENT" has the meaning set forth in the recitals.
"PLEDGEE" has the meaning set forth in the preamble.
"REGISTRABLE SECURITIES" shall mean: (A) the Pledged Stock, (B) the
shares of Newco Common Stock or NGP Common Stock Pledgee may acquire upon
Exchange of the Pledged Units and (C) any shares of Newco Common Stock, NGP
Common Stock or securities of another corporation issued or issuable with
respect to any securities referred to in subdivision (A) or (B) by way of stock
dividend or stock split or in connection with a combination of shares,
recapitalization, merger, consolidation or other reorganization or otherwise. As
to any particular Registrable Securities, once issued such securities shall
cease to be Registrable Securities when (x) a registration statement with
respect to the sale of such securities shall have become effective under the
Securities Act of 1933, as amended, and the rules and regulations promulgated
thereunder (the "SECURITIES ACT") and such securities shall have been disposed
of in accordance with such registration statement, (y) such securities shall
have been transferred pursuant to Rule 144 or Rule 145 (or any successor
provision) under the Securities Act or (z) such securities shall have ceased to
be outstanding.
"REGISTRATION EXPENSES" means all expenses incident to Newco's or NGP's
performance of or compliance with any registration of Registrable Securities
pursuant to this Agreement, including, without limitation, all registration,
filing and National Association of Securities Dealers, Inc. fees, all fees and
expenses of complying with securities or blue sky laws, all word processing,
duplicating and printing expenses, messenger and delivery expenses, the fees and
disbursements of counsel for Newco, NGP and of their independent public
accountants, including the expenses of any special audits or "comfort" letters
required by or incident to such performance and compliance, premiums and other
costs of policies of
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insurance obtained by Newco and/or NGP against liabilities arising out of the
public offering of Registrable Securities being registered and any fees and
disbursements of underwriters customarily paid by issuers, but excluding fees
and disbursements of counsel retained by Pledgee (except, in connection with a
Demand Registration under Section 2.01 hereof, Newco or NGP shall reimburse the
Pledgee for the reasonable fees and disbursements (not to exceed $25,000 in the
aggregate) of not more than one counsel chosen by Pledgee, if and to the extent
that Pledgee is unable to recover such fees and disbursements from AGC pursuant
to the AGC Collateral Agency Agreement (as defined in the Restructuring
Agreement) after using its commercially reasonable efforts therefor), premiums
and other costs of policies of insurance obtained by Pledgee or its agents or
underwriter against liabilities arising out of the public offering of the
Registrable Securities being registered, any fees and disbursements of
underwriters customarily paid by sellers of securities who are not the issuers
of such securities and all underwriting discounts and commissions and transfer
taxes, if any, relating to Registrable Securities.
"SECURITIES ACT" has the meaning set forth in the definition of
Registrable Securities.
"SHELF REGISTRATION" has the meaning set forth in Section 3.01.
"SHELF REGISTRATION STATEMENT" has the meaning set forth in Section
3.01.
"UNITS" has the meaning set forth in the recitals.
ARTICLE II
Section 2.01. Waiver by NGP of NGOP Agreement Provisions. In connection
with each Exchange of Pledged Units by Pledgee as contemplated by Section 8.6 of
the NGOP Agreement, NGP, on its own behalf and in its capacity as the general
partner of NGOP, hereby waives each of the following provisions of the NGOP
Agreement with respect to such Exchange of Pledged Units by Pledgee upon an
Event of Default; provided however that it shall be a condition to such waiver
that Pledgee represent to NGP that, after giving effect to the Exchange of the
Units for which the waiver is given, Pledgee's ownership of NGP Common Stock
shall not violate Article IV.C.3.b.i of the NGP Charter:
(i) clauses (2) and (4) in the first sentence of Section 8.6G of
the NGOP Agreement;
(ii) the limitation on the number of Units that may be subject to
an Exchange contained in clauses (x) and (y) of the second sentence of
Section 8.6G of the NGOP Agreement'
(iii) the provision that the rights of Lending Institution
Transferees (as such term is defined in the NGOP Agreement) be limited
to those of the Common Limited Partner (as such term is defined in the
NGOP Agreement) that pledged such Partner's Partnership Units (as such
term is defined in the NGOP Agreement) to such Lending Institution
Transferees contained in clause (i)(b) of the third sentence of Section
8.6.G of the NGOP Agreement, but only
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to the extent necessary to give effect to the waivers granted pursuant
to this Section 2.01;
(iv) the limitation on the number of Units that may be subject to
an Exchange contained in clause (iii) of the third sentence of Section
8.6.G of the NGOP Agreement, but only to the extent necessary to give
effect to the waivers granted pursuant to this Section 2.01; and
(v) Section 11.6.C of the NGOP Agreement.
NGP shall use its best efforts to effect the Exchange of any Pledged
Units promptly after request by Pledgee, in accordance with this Section 2.01.
NGP represents and warrants that its waiver under this Section 2.01 is the only
action necessary for an effective waiver under the NGOP Agreement of the
provisions set forth in (i) through (v) above.
ARTICLE III
REGISTRATION RIGHTS
Section 3.01. Shelf Registration Statement. The Company shall prepare
and file a "shelf" registration statement (the "SHELF REGISTRATION STATEMENT")
with respect to the Registrable Securities covering the issuance, as applicable,
and resale thereof by the Pledgee on an appropriate form for an offering to be
made on a continuous or delayed basis pursuant to Rule 415 (the "SHELF
REGISTRATION") within 15 Business Days of a written request by Pledgee, which
request may be made by Pledgee only following the occurrence of an Event of
Default. The Company shall use its best efforts to cause the Shelf Registration
Statement to be declared effective within 60 days of the filing of the Shelf
Registration Statement. The Company shall use its best efforts to keep such
Shelf Registration Statement continuously effective until the earliest of (A)
the termination of this Agreement pursuant to Section 5.11 and (B) the date on
which the Registrable Securities may be sold without volume restrictions in
accordance with Rule 144.
Notwithstanding the foregoing, the Company shall not be obligated to
effect a Shelf Registration pursuant to this Section 3.01 unless the Company is
then eligible to use Form S-3 or other short form registration statement under
the Securities Act. The Company shall use its reasonable best efforts to be
eligible to use Form S-3 or other short form registration statement under the
Securities Act. In the event that the Company is not obligated to effect a Shelf
Registration under this Section 3.01, within 15 Business Days of a written
request by Pledgee that the Company effect a registration of Registrable
Securities (a "DEMAND REGISTRATION"), which request may be made by Pledgee only
(x) following the occurrence of an Event of Default and (y) once in each
twelve-month period, the Company shall be obligated to prepare, file and cause
to become effective a registration statement on Form S-1 or other appropriate
form (a "DEMAND REGISTRATION STATEMENT"). The Company shall use its best efforts
to cause the Demand Registration Statement to be declared effective within 60
days of the filing of the Demand Registration Statement. The Company shall use
its best efforts to keep such Demand Registration Statement effective for 90
days or until 75% of the Registrable Securities included therein have been sold,
if earlier.
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Pledgee shall have priority over all other persons (including the
Company) with respect to shares of Company Common Stock to be registered
pursuant to the Shelf Registration Statement or the Demand Registration
Statement, and neither the Company nor any person with piggy-back registration
rights may register any shares with respect to a Shelf Registration Statement or
a Demand Registration Statement unless all Registrable Securities proposed to be
registered by the Pledgee in connection therewith shall be included in such
registration.
Section 3.02. Piggy-back Registration Rights. Except as set forth in
Section 3.02(c), in the event that the Company at any time after an Event of
Default has occurred and is continuing proposes to register any NGP Common Stock
(or Newco Common Stock, as applicable) under the Securities Act, whether or not
for sale for its own account, in a manner that would permit registration of
Registrable Securities for sale for cash to the public under the Securities Act,
it shall in the case of each such proposed registration give prompt written
notice of such proposed filing and of the rights of Pledgee under this Section
3.02 to Pledgee (but in any event not less than ten Business Days before the
anticipated filing date), so as to allow Pledgee to participate in such
registration. Such notice shall specify, to the extent known by the Company at
the time of such notice, the estimated number of shares of NGP Common Stock (or
Newco Common Stock, as applicable) proposed to be registered, the proposed date
of filing such registration statement, any proposed means of distribution of
such shares, any proposed managing underwriter or underwriters of such shares
and an estimate by the Company of the maximum offering price thereof. The
Company shall further notify Pledgee of any changes in the estimated number of
shares of stock so proposed to be registered. Subject to the terms and
conditions hereof, such notice shall offer Pledgee the opportunity to include in
such registration statement such number of Registrable Securities as Pledgee may
request. Upon the written request of Pledgee made within seven Business Days
after receipt of the Company's notice (which request shall specify the number of
Registrable Securities intended to be disposed of and the intended method of
disposition thereof, the written request of Pledgee being the "PIGGY-BACK
REQUEST"), the Company shall use its best efforts to cause the offering of the
Registrable Securities so specified in the Piggy-back Request to be registered
as soon as is reasonably practicable concurrently with the registration of the
Company's stock, under the Securities Act, to the extent required to permit the
disposition (in accordance with such intended methods thereof) of the
Registrable Securities so requested to be registered; provided, that:
(a) If, at any time after giving such written notice of its intention
to register any NGP Common Stock (or Newco Common Stock, as applicable) and
prior to the effective date of the registration statement filed in connection
with such proposed registration, the Company shall determine for any bona fide
reason not to register such stock, the Company may, at its election, give
written notice of such determination to Pledgee and thereupon the Company shall
be relieved of its obligation to register such Registrable Securities in
connection with the registration of such common stock (without prejudice to the
Pledgee's right to request a Shelf Registration or a Demand Registration
pursuant to Section 3.01) but shall not be relieved from its obligation to pay
the Registration Expenses incurred therewith.
(b) If the registration referred to in the first sentence of this
Section 3.02 is to be an underwritten registration and the Company is advised in
writing (with a copy to
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Pledgee) by the managing underwriter or underwriters that, in its or their good
faith view, the inclusion of all or a part of such Registrable Securities of
Pledgee in such registration would be reasonably likely to adversely affect the
price, timing or distribution of the offering and sale of the Registrable
Securities then contemplated, then the number of securities that can, in the
good faith view of such managing underwriter or underwriters, be sold in such
offering without so adversely affecting such offering shall be included in such
registration in the following priority: (i) first, NGP Common Stock (or Newco
Common Stock, as applicable), that the Company proposes to sell for its own
account (if the registration was initiated by Company) or, if the registration
is in response to a demand registration right of a party other than Pledgee
(each, an "OTHER HOLDER") whose registration rights require such a priority,
such stock of the Other Holder(s) demanding such registration proposes to sell
to the extent of such a priority, (ii) second, such shares of NGP Common Stock
(or Newco Common Stock, as applicable) as the Pledgee and any Other Holders
shall have intended to register on a pro rata basis according to the total
number of shares of NGP Common Stock (or Newco Common Stock, as applicable)
intended to be registered by each such person and (iii) third, such shares of
NGP Common Stock (or Newco Common Stock) as the Company shall have intended to
register (if such registration was not initiated by the Company).
(c) The Company shall not be required to effect any registration of
Registrable Securities under this Section 3.02 if such registration (1) is
incidental to the registration of any of its securities in connection with any
Rule 415 offering (other than the Shelf Registration described in Section 3.01)
or incidental to a registration only for debt securities, (2) is to be effected
on Form S-4 or Form S-8 (or successor forms) or (3) in connection with mergers
or similar transactions, exchange offers, share dividends, dividend reinvestment
plans or stock option or other executive or employee benefit or compensation
plans.
(d) Pledgee shall be entitled to have its Registrable Securities
included in an unlimited number of piggyback registrations under this Section
3.02.
(e) If Pledgee disapproves of the terms of the underwriting of the
Company's offering under this Section 3.02, the Pledgee may elect to withdraw
therefrom by written notice to the Company and the managing underwriters at
least two Business Days prior to the effective date of the registration. Any
Registrable Securities excluded or withdrawn from such underwriting shall also
be withdrawn from registration and shall not be transferred in a public
distribution prior to 90 days after the effective date of the registration
statement relating thereto, or such shorter period of time as the managing
underwriters shall require.
Section 3.03. Expenses. Except as provided herein, the Company shall
pay all Registration Expenses incurred in connection with any registration made
or requested to be made pursuant to this Article 3 whether or not any such
registration statement becomes effective. Notwithstanding the foregoing, Pledgee
shall be responsible for the fees and expenses of counsel to Pledgee (except, in
connection with a Demand Registration under Section 2.01 hereof, Newco or NGP
shall reimburse the Pledgee for the reasonable fees and disbursements (not to
exceed $25,000 in the aggregate) of not more than one counsel chosen by Pledgee,
if and to the extent that Pledgee is unable to recover such fees and
disbursements from AGC pursuant to the AGC Collateral Agency Agreement (as
defined in the Restructuring
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Agreement) after using its commercially reasonable efforts therefor), any
applicable underwriting discounts or commissions, transfer taxes and its own
internal administrative and similar costs, which shall not constitute
Registration Expenses.
Section 3.04. Selection of Underwriters. The lead managing underwriter
for any registration requested under this Article 3 effected by means of a firm
commitment underwriting shall be selected (x) by the Company or the Other
Holder, as applicable, and shall be reasonably acceptable to Pledgee
participating in such registration, in the case of a Piggy-back Registration and
(y) by the Pledgee, in the case of a Demand Registration or a Shelf Registration
and shall be reasonably acceptable to the Company.
Section 3.05. Cash Payment. Notwithstanding any other provision set
forth herein, upon an Event of Default, the Company shall have the right (but
shall not be obligated), in lieu of effecting a Shelf Registration or a Demand
Registration with respect to the Registrable Securities, to purchase from
Pledgee all (but not less than all) of the Registrable Securities for cash. The
Company may exercise this right, by written notice to Pledgee within two
Business Days of receipt of Pledgee's request for such registration. The
purchase price for the Registrable Securities applicable to the Company's right
to purchase under this Section 3.05 will be 98.0% of the average of the high and
low sales prices on the New York Stock Exchange (or, if such Registrable
Securities are not traded or quoted on the New York Stock Exchange, any national
securities exchange or dealer quotation system on which the Registrable
Securities are then traded or quoted) of the Registrable Securities on each of
the 20 trading days immediately preceding, but not including, the day of
delivery of the Company's notice to Pledgee to purchase such Registrable
Securities. Such notice delivered by the Company shall be irrevocable and shall
specify the number of shares to be purchased pursuant to this Section 3.05, and
shall give rise to a binding agreement between the Company and Pledgee with
respect to the purchase and sale of the number of shares specified in such
notice with such closing to take place no later than 5 Business Days thereafter.
Section 3.06. Registration Procedures. In connection with any Shelf
Registration Statement or Demand Registration Statement under Section 3.01
hereof, the Company will use its best efforts to effect the registration of such
Registrable Securities in accordance with the intended method of disposition
thereof as quickly as practicable (and in any event within the periods referred
to in Section 3.01), and in connection with any such request and any
registration statement in connection with a Piggy-back Request:
(a) The Company will furnish to the counsel selected by Pledgee copies of
all such documents proposed to be filed, which documents will be subject to
the review of such counsel before any such filing is made, and shall permit
such counsel 5 Business Days to review such documents, and the Company will
comply with any reasonable request made by such counsel to make changes in
any information contained in such documents relating to the Pledgee. The
Company shall furnish to Pledgee such number of conformed copies of such
registration statement and of each amendment and supplement thereto (in each
case including all exhibits), such number of copies of the prospectus
contained in such registration statements and any supplements thereto and
any other prospectus filed under the Securities Act, and such other
documents, including documents incorporated by reference, as the Pledgee may
reasonably request.
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The Company consents the use of the prospectus or any amendment thereto by
the Pledgee and the underwriters, if any, in connection with the offering
and sale of the Registrable Securities covered by the prospectus or any
supplement or amendment thereto (unless the Company gives prior written
notice to the contrary due to an event specified in subsection (b) or (f)
below);
(b) The Company will notify Pledgee and counsel for Pledgee promptly in
writing (i) when a registration statement has become effective and when any
post-effective amendments and supplements thereto become effective, (ii) of
any request by the SEC or any state securities authority for post-effective
amendments and supplements to a registration statement that has become
effective, (iii) of the issuance by the SEC or any state securities
authority of any stop order suspending the effectiveness of a registration
statement or the initiation of any proceedings for that purpose, (iv) if,
during the period a registration statement is effective, the representations
and warranties of the Company contained in any underwriting agreement,
securities sales agreement or other similar agreement, if any, relating to
such offering cease to be true and correct in all material respects, (v) of
the receipt by the Company of any notification with respect to the
suspension of the qualification of the Registrable Securities for sale in
any jurisdiction or the initiation or threatening of any proceeding for such
purpose, and (vi) of any determination by the Company that a post-effective
amendment to a registration statement would be appropriate.
(c) The Company will use its best efforts to (i) register or qualify the
Registrable Securities under such other securities or blue sky laws of such
jurisdictions in the United States (where an exemption is not available) as
Pledgee or managing Underwriter or Underwriters, if any, reasonably (in
light of Pledgee's intended plan of distribution) requests by the time the
registration statement relating thereto is declared effective by the SEC and
(ii) cause such Registrable Securities to be registered with or approved by
such other governmental agencies or authorities, including the National
Association of Securities Dealers ("NASD"), as may be necessary by virtue of
the business and operations of the Company and do any and all other
acts and things that may be reasonably necessary or advisable to enable
Pledgee to consummate the disposition of the Registrable Securities;
provided that the Company will not be required to (A) qualify generally to
do business in any jurisdiction where it would not otherwise be required to
qualify but for this paragraph (c), (B) subject itself to taxation in any
such jurisdiction or (C) consent to general service of process in any such
jurisdiction except as may be required by the Securities Act.
(d) The Company will use best efforts to cause all Registrable Securities
covered by such registration statement to be registered with or approved by
such other governmental agencies or authorities as may be necessary to
enable the Pledgee to consummate the disposition of such Registrable
Securities;
(e) If such registration includes an underwritten public offering, the
Company will furnish to Pledgee a signed counterpart of (x) an opinion of
counsel for the Company, dated the date of the closing under the
underwriting agreement, and (y) a "comfort letter," dated the effective date
of such registration statement (and a supplement to such
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"comfort letter" dated the date of the closing under the underwriting
agreement), signed by the independent public accountants who have certified
the Company's financial statements included in such registration statement,
covering substantially the same matters with respect to such registration
statement (and the prospectus included therein) and, in the case of the
accountants' letter, with respect to events subsequent to the date of such
financial statements, as are customarily covered in opinions of issuer's
counsel and in accountants' letters delivered to the underwriters in
underwritten public offerings of securities and, in the case of the
accountants' letter, such other financial matters, as the Pledgee (or the
underwriters, if any) may reasonably request;
(f) The Company shall notify the Pledgee at any time when the Company is
aware that a prospectus relating to Registrable Securities is required to be
delivered under the Securities Act, promptly upon becoming aware of the
happening of any event as a result of which the prospectus included in such
registration statement, as then in effect, includes 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 in the
light of the circumstances under which they were made, and at the request of
the Pledgee as promptly as reasonably practicable prepare and furnish to the
Pledgee a reasonable number of copies of a supplement to or an amendment of
such prospectus as may be necessary so that, as thereafter delivered to the
purchasers of such securities, such prospectus shall not include an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading in
light of the circumstances under which they were made;
(g) The Company shall make every reasonable effort to obtain the withdrawal
of any order suspending effectiveness of the Shelf Registration Statement or
the Demand Registration Statement at the earliest possible moment;
(h) The Company shall otherwise use its best efforts to comply with the
Securities Act and the Exchange Act and with all applicable rules and
regulations of the SEC, and not file any amendment or supplement to such
registration statement or prospectus to which the Pledgee 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;
(i) The Company shall provide a transfer agent and registrar for all
Registrable Securities covered by such registration statement not later than
the effective date of such registration statement and shall cooperate with
the Pledgee and the managing underwriters, if any, to facilitate the timely
preparation and delivery of certificates representing Registrable Securities
to be sold and not bearing any restrictive legends and cause such
Registrable Securities to be in such denomination and registered in such
names as the managing underwriters may request at least two Business Days
prior to any sale of Registrable Securities to the underwriters; and
(j) The Company shall use its best efforts to list all NGP Common Stock or
Newco Common Stock, as applicable, covered by such registration statement on
any securities
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exchange on which any of the NGP Common Stock or Newco Common Stock is then
listed.
The Company may require Pledgee to furnish such information regarding
Pledgee and the distribution of its securities as the Company may from time to
time reasonably request in writing for the purpose of registering the
Registrable Securities hereunder.
The Pledgee agrees by acquisition of the Registrable Securities that
upon receipt of any notice from the Company of the happening of any event of the
kind described in subdivision (f) of this Section 3.06, the Pledgee will
forthwith discontinue its disposition of Registrable Securities pursuant to the
registration statement relating to such Registrable Securities until the
Pledgee's receipt of the copies of the supplemented or amended prospectus
contemplated by subdivision (f) of this Section 3.06 and, if so directed by the
Company, will deliver to the Company (at the Company's expense) all copies then
in the Pledgee's possession, other than permanent file copies, of the prospectus
relating to such Registrable Securities current at the time of receipt of such
notice.
Section 3.07. Requested Underwritten Offerings. If requested by the
underwriters for any underwritten offering of Registrable Securities by Pledgee
under a registration pursuant to Section 3.01 or 3.02, the Company and Pledgee
will enter into a customary underwriting agreement with such underwriters for
such offering, to contain such representations and warranties and such other
terms as are customarily contained in agreements of this type, including,
without limitation, indemnities to the effect and to the extent provided in
Article 4.
Section 3.08. Covenants Relating to Rule 144/145. Company will prepare
and file in a timely manner, information, documents and reports in compliance
with the Exchange Act so as to comply with the requirements of such Act and the
rules and regulations thereunder. If at any time Company is not required to file
reports in compliance with either Section 13 or Section 15(d) of the Exchange
Act, the Company at its expense will forthwith, upon the written request of the
Pledgee, make available adequate current public information with respect to the
Company within the meaning of paragraph (c)(2) of Rule 144 under the Securities
Act.
Section 3.09. Postponement and Suspension. Notwithstanding anything
herein to the contrary, the Company may (x) postpone any registration which is
requested pursuant to Section 3.01 or delivery of a prospectus or supplement or
amendment pursuant to Section 3.06(f) or (y) suspend the effectiveness of the
Shelf Registration Statement filed pursuant to Section 3.01 if it determines in
its good faith judgment, following advice of counsel, that in view of the
advisability of deferring public disclosure of material corporate developments
or other information, the disclosures required to be made pursuant thereto would
not be in the best interests of the Company at that time. In the event the
Company makes any such election, Pledgee agrees to keep confidential the fact of
such election and any information provided by the Company in connection
therewith. No single postponement pursuant to this Section 3.09 of any
registration which is requested pursuant to Section 3.01 or delivery of a
prospectus or supplement or amendment pursuant to Section 3.06(g) or suspension
of the
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effectiveness of the Shelf Registration Agreement shall exceed 60 days and there
shall be no more than 2 such postponements or suspensions in any twelve-month
period.
Section 3.10. Decisionmaking by Pledgee. For purposes of all
decisionmaking by Pledgee under this Agreement, including, but not limited to
the decision to request registration, whichever of BofA or the Required
Purchasers (as defined in the Collateral Agency Agreement) delivered the
Enforcement Directive(as defined in the Collateral Agency Agreement) to the
Collateral Agent under the Collateral Agency Agreement, such party shall have
the sole right to make decisions as Pledgee under this Agreement, such decisions
to be for the benefit of both the BofA and the AGC Noteholders hereunder.
ARTICLE IV
INDEMNIFICATION
Section 4.01. Indemnification by The Company. In the event of any
registration of any Registrable Securities of the Company under the Securities
Act, the Company will indemnify and hold harmless the Pledgee and its officers,
directors and agents, each other Person who participates as an underwriter, if
any, in the offering or sale of such securities and each other Person who
controls any such underwriter within the meaning of the Securities Act (each, an
"INDEMNIFIED HOLDER"), against any losses, claims, damages, expenses (including
legal fees) or liabilities, joint or several, to which Pledgee or any such
underwriter or controlling person may become subject under the Securities Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions or
proceedings, whether commenced or threatened, in respect thereof) arise out of
or are based upon any untrue statement or alleged untrue statement of any
material fact contained in the registration statement under which such
Registrable Securities were registered under the Securities Act, any preliminary
prospectus, final prospectus or summary prospectus contained therein, or any
amendment or supplement thereto, or 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, and Company will reimburse the Pledgee and
each such underwriter and controlling person for any legal or any other expenses
reasonably incurred by them in connection with investigating or defending any
such loss, claim, liability, action or proceedings; provided that Company shall
not be liable in any such case to the extent that any such loss, claim, damage,
liability (or action or proceeding in respect thereof) or expense arises out of
or is based upon (i) an untrue statement or alleged untrue statement or omission
or alleged omission made in such registration statement, any such preliminary
prospectus, final prospectus, summary prospectus, amendment or supplement in
reliance upon and in conformity with written information furnished to Company by
the Pledgee for use in the preparation thereof, (ii) the use of any prospectus
after such time as the obligation of Company to keep the same effective and
current has expired (and Pledgee has received notice thereof from Company), or
(iii) the use of any prospectus after such time as Company has advised the
Pledgee that the filing of a post-effective amendment or supplement thereto is
required, except such prospectus as so amended or supplemented, and provided
further that Company shall not be liable to any Person who participates as an
underwriter in the offering or sale of Registrable Securities or any other
Person, if any, who controls such underwriter within the meaning of the
Securities Act in any such case to the extent that any such loss, claim, damage,
liability (or action or proceeding in respect thereof) or expense arises out of
the matters described in (i), (ii)
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or (iii) above or such Person's failure to send or give a copy of the final
prospectus or supplement to the Persons asserting an untrue statement or alleged
untrue statement or omission or alleged omission at or prior to the written
confirmation of the sale of Registrable Securities to such Person if such
statement or omission was corrected in such final prospectus or supplement. Such
indemnity shall remain in full force and effect regardless of any investigation
made by or on behalf of the Pledgee or any such underwriter or controlling
person and shall survive the transfer of such securities by the Pledgee.
If any action or proceeding (including any governmental investigation
or inquiry) shall be brought or asserted against an Indemnified Holder in
respect of which indemnity may be sought from the Company, such Indemnified
Holder shall promptly notify the Company in writing, and the Company shall
assume the defense thereof (including the employment of counsel reasonably
satisfactory to such Indemnified Holder) and the payment of all expenses. Such
Indemnified Holder shall have the right to employ separate counsel in any such
action and to participate in the defense thereof, but the fees and expenses of
such counsel shall be paid by such Indemnified Holder unless (a) the Company has
agreed to pay such fees and expenses or (b) the Company shall have failed to
assume the defense of such action or proceeding or shall have failed to employ
counsel reasonably satisfactory to such Indemnified Holder in any such action or
proceeding or (c) the named parties to any such action or proceeding (including
any impleaded parties) include both such Indemnified Holder and the Company, and
such Indemnified Holder shall have been reasonably advised by counsel that
representation of other parties by the same counsel would be inappropriate due
to actual or potential material differing interests between them (in which case,
if such Indemnified Holder 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 Indemnified Holder, it being understood, however, that the Company shall
not, in connection with any one such action or proceeding or separate but
substantially similar or related actions or proceedings in the same jurisdiction
arising out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys at any
time for such Indemnified Holder and any other Indemnified Holders). The Company
shall not be liable for any settlement of any such action or proceeding effected
without its written consent, but if settled with its written consent, or if
there be a final judgment for the plaintiff in any such action or proceeding,
the Company agrees to indemnify and hold harmless such Indemnified Holders from
and against any loss or liability by reason of such settlement or judgment.
Section 4.02. Indemnification by the Pledgee. Company may require, as a
condition to including any Registrable Securities of the Pledgee in any
registration statement filed pursuant to Section 3.01, that Company shall have
received an undertaking reasonably satisfactory to it from the Pledgee to
indemnify and hold harmless (in the same manner and to the same extent as set
forth in Section 4.01) Company each agent, director, and officer of Company and
each other Person, if any, who controls Company within the meaning of the
Securities Act, with respect to any untrue statement or alleged untrue statement
of a material fact in or omission or alleged omission to state a material fact
from such registration statement, any preliminary prospectus, final prospectus
or summary prospectus contained therein, or any amendment or supplement thereto,
if such untrue statement or alleged untrue statement or omission or alleged
omission was made in reliance upon and in conformity with written
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information with respect to the Pledgee furnished to Newco by the Pledgee as
required for use in the preparation of such registration statement, preliminary
prospectus, final prospectus, summary prospectus, amendment or supplement;
provided, however, that the Pledgee shall not be liable to the extent that the
losses, liabilities or expenses arise out of or are based upon (i) the use by
Company of any prospectus after such time as the obligation of Company to keep
the same effective and current has expired or (ii) the use by Company of any
prospectus after such time as the Pledgee has advised Company that the filing of
a post-effective amendment or supplement thereto is required with respect to any
information contained in such prospectus concerning the Pledgee, except such
prospectus as so amended or supplemented. Such indemnity shall remain in full
force and effect regardless of any investigation made by or on behalf of Company
or any such director, officer, or controlling person and shall survive the
transfer of such securities by the Pledgee.
Section 4.03. Notices of Claims, etc. Promptly after receipt by an
indemnified party of notice of the commencement of any action or proceeding
involving a claim referred to in the preceding subdivisions of this Article 4,
such indemnified party will, if a claim in respect thereof is to be made against
an indemnifying party, give written notice to the latter of the commencement of
such action, provided that the failure of any indemnified party to give notice
as provided herein shall not relieve the indemnifying party of its obligations
under the preceding subdivisions of this Article 4, except to the extent that
the indemnifying party is actually and materially prejudiced by such failure to
give notice. In case any such action is brought against an indemnified party,
unless a conflict of interest between such indemnified and indemnifying parties
exists in respect of such claim, the indemnifying party shall be entitled to
participate in and to assume the defense thereof, jointly with any other
indemnifying party similarly notified to the extent that it may wish, with
counsel reasonably satisfactory to such indemnified party, and after notice from
the indemnifying party to such indemnified party of its election so to assume
the defense thereof, the indemnifying party shall not be liable to the
indemnified party for any legal or other expenses subsequently incurred by the
latter in connection with the defense thereof other than reasonable costs of
investigation. No indemnifying party shall, without the prior written consent of
the indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever in respect of which indemnification or contribution could be sought
under this agreement (whether or not the indemnified parties are actual or
potential parties thereto), unless such settlement, compromise or consent (i)
includes an unconditional release of each indemnified party from all liability
arising out of such litigation, investigation, proceeding or claim, (ii) is
accompanied or preceded by reimbursement of expenses of each such indemnified
party and (iii) does not include a statement as to or an admission of fault,
culpability or a failure to act by or on behalf of any indemnified party.
Section 4.04. Contribution. If for any reason the foregoing indemnity
is unavailable, or is insufficient to hold harmless an indemnified party, then
the indemnifying party shall contribute to the amount paid or payable by the
indemnified party as a result of the expense, loss, damage or liability, (i) 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
(determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or omission relates to information supplied
by the indemnifying
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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), or (ii) if the allocation provided by clause (i) above
is not permitted by applicable law or provides a lesser sum to the indemnified
party than the amount hereinafter calculated, in the proportion as is
appropriate to reflect not only the relative fault of the indemnifying party and
the indemnified party, but also the relative benefits received by the
indemnifying party on the one hand and the indemnified party on the other, as
well as any other relevant equitable considerations. No indemnified party guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any indemnifying party
who was not guilty of such fraudulent misrepresentation.
The Company and the Pledge agree that it would not be just and
equitable if contribution pursuant to this Section 4.04 were determined by pro
rata allocation or by any other method of allocation which does not take account
of the equitable considerations referred to in the immediately preceding
paragraph. Notwithstanding the provisions of this Section 4.04, an Indemnified
Holder shall not be required to contribute any amount in excess of the amount by
which the total price at which the securities sold by such Indemnified Holder or
its affiliated Indemnified Holders and distributed to the public exceeds the
amount of any damages which such Indemnified Holder or its affiliated
Indemnified Holders 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.
ARTICLE V
MISCELLANEOUS
Section 5.01. Notices, etc. All notices, requests, demands or other
communications required by or otherwise with respect to this Agreement shall be
in writing and shall be deemed to have been duly given to any party when
delivered personally (by courier service or otherwise), when delivered by
telecopy if receipt is confirmed by return telecopy, or five days after being
mailed by registered or certified mail, return receipt requested, in each case
to the applicable addresses set forth below:
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If to Newco or NGP:
0000 00xx Xxxxxx
Xxxxx 0000
Xxxxx Xxxxxx, Xxxxxxxxxx 00000
Facsimile: (000) 000-0000
Attention: General Counsel
with a copy to:
Wachtell, Lipton, Xxxxx & Xxxx
00 X. 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxx X. Xxxxx, Esq.
Xxxxx X. Xxxx, Esq.
If to the Pledgee:
At the addresses set forth in the Restructuring Agreement
with a copy to:
Xxxxx X. Xxxxx
0000 00xx Xxxxxx
Xxxxx Xxxxxx, Xxxxxxxxxx 00000
with a copy to:
Xxxxxx & Xxxxxxx
000 Xxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000
Facsimile: (000) 000-0000
Attention: Xxxxx X. Xxxxxx, Esq.
J. Xxxxx Xxxxxxxx, Esq.
or to such other address as such party shall have designated
by notice so given to each other party.
Section 5.02. Amendments, Waivers, etc. This Agreement may not be
amended, supplemented, waived or otherwise modified except by an instrument in
writing signed by the party against whom enforcement is sought. The failure of
any party to exercise any right, power or remedy provided under this Agreement
or otherwise available in respect hereof at law or in equity, or to insist upon
compliance by any other party with its obligations hereunder, and any custom or
practice of the parties at variance with the terms hereof, shall not constitute
a waiver by such party of its right to exercise any such or other right, power
or remedy or to demand such compliance.
-16-
Section 5.03. Entire Agreement. This Agreement embodies the entire
agreement and understanding between the parties relating to the subject matter
hereof and supersedes all prior agreements and understandings relating to such
subject matter.
Section 5.04. Severability. If any term of this Agreement or the
application thereof to any party or circumstance shall be held invalid or
unenforceable to any extent, the remainder of this Agreement and the application
of such term to the other parties or circumstances shall not be affected thereby
and shall be enforced to the greatest extent permitted by applicable law.
Section 5.05. Successors and Assigns. This Agreement shall be binding
upon and shall inure to the benefit of and be enforceable by the parties and
their respective successors and assigns; provided that neither the rights nor
the obligations of any party may be assigned or delegated (by operation of law
or otherwise) without the prior written consent of the other parties, except
that the Pledgee may transfer the registration rights granted hereunder to its
affiliates and BofA and/or the AGC Noteholders may transfer the registration
rights hereunder to any purchaser of the Loan Indebtedness or the Purchase
Indebtedness, respectively (each as defined in the Restructuring Agreement).
Section 5.06. Remedies. In addition to being entitled to exercise all
rights provided herein and granted by law, including recovery of damages, the
Pledgee shall be entitled to specific performance of its rights under this
Agreement. The Company agrees that monetary damages would not be adequate
compensation for any loss incurred by reason of a breach by it of the provisions
of this Agreement and hereby agrees to waive the defense in any action for
specific performance that a remedy at law would be adequate.
Section 5.07. Material Prejudice. On or after the date of this
Agreement, the Company shall not enter into any agreement with respect to its
securities which materially prejudices the rights granted to the Pledgee in this
Agreement or otherwise conflicts in any material respect with the provisions
hereof. The Company may enter into agreements providing for registration rights
substantially similar to the registration rights provided herein with respect to
shares of NGP Common Stock, subject to the preceding sentence.
Section 5.08. Governing Law. This Agreement and all disputes hereunder
shall be governed by and construed and enforced in accordance with the laws of
the State of Delaware, without regard to any applicable conflicts of law
provisions thereof that may require the application of the laws of another
jurisdiction (except to the extent that mandatory provisions of the federal law
apply).
Section 5.09. Name, Captions. The name assigned this Agreement and the
section captions used herein are for convenience of reference only and shall not
affect the interpretation or construction hereof.
Section 5.10. Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original, but all
of which together shall constitute one instrument. Each counterpart may consist
of a number of copies each signed by less than all, but together signed by all,
the parties hereto.
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Section 5.11. Termination. This Agreement shall terminate and be of no
further force and effect upon the earlier of the date upon which (i) all
Registrable Securities held by the Pledgee have been sold pursuant to a
registration statement hereunder or have otherwise ceased to be Registrable
Securities, (ii) the Pledge Agreement shall have been terminated or otherwise
cease to be of effect or (iii) the Pledged Stock and the Pledged Units are
otherwise released from the pledge under the Pledge Agreement; provided that,
notwithstanding this Section 5.11, the provisions of Article 4 shall survive the
termination of this Agreement.
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IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the date first above written.
AMERICAN INTERNATIONAL GOLF, INC.
By: /s/ Xxxx X. Xxxxxx
----------------------------------------
Name: Xxxx X. Xxxxxx
Title: Secretary and Treasurer
NATIONAL GOLF PROPERTIES, INC.
By: /s/ Xxxx X. Xxxxxx
----------------------------------------
Name: Xxxx X. Xxxxxx
Title: CFO and Secretary
BANK OF AMERICA, N.A.
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Senior Vice President
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Noteholders:
TEACHERS INSURANCE AND ANNUITY
ASSOCIATION OF AMERICA
By:/s/ Roi X. Xxxxxx
----------------------------
Its: Director - Special Situations
THE TRAVELERS INSURANCE COMPANY
By:/s/ Xxxxxx Xxxxxxxxxxxx
----------------------------
Its: Investment Officer
JEFFERSON-PILOT LIFE INSURANCE
COMPANY
By:/s/ Xxxxxx X. Xxxxxx, XX
----------------------------
Its: Vice President
NATIONAL LIFE INSURANCE COMPANY
By:/s/ R. Xxxxx Xxxxxxx
----------------------------
Its: Vice President, NL Capital
LIFE INSURANCE COMPANY OF THE
SOUTHWEST
By:/s/ R. Xxxxx Xxxxxxx
----------------------------
Its: Vice President, NL Capital
AUSA LIFE INSURANCE COMPANY, INC.
By:/s/ Xxxx Xxxxxx
----------------------------
Its: Vice President
PFL LIFE INSURANCE COMPANY
By:/s/ Xxxx Xxxxxx
----------------------------
Its: Vice President
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