Exhibit 10.109
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement"), dated as of
December 11, 1997, is by and among XXXX-XXXX REALTY CORPORATION, a Maryland
corporation (the "Company"), and the persons and entities listed on Schedule I
attached hereto and made a part hereof (such individuals and entities,
collectively the "Investors" and each individually an "Investor").
W I T N E S S E T H:
WHEREAS, pursuant to a Contribution and Exchange Agreement, dated
September 18, 1997, by and between the Company, Xxxx-Xxxx Realty, L.P., a
Delaware limited partnership (the "Operating Partnership"), the Xxxx
Contributors (as defined therein) ("MC"), the Xxxx Entities (as defined therein)
("ME") and Patriot American Leasing and Management Corporation, ("PALMC", and
together with MC and ME, collectively, "XXXX"), as amended by the First
Amendment, dated as of December 11, 1997 (as amended, the "Contribution
Agreement") XXXX, the Company and the Operating Partnership have agreed to
combine their respective properties and related assets and, in consideration
therefor, the Operating Partnership will issue to certain of the Xxxx
Contributors and Xxxx Entities (i) common units of limited partner interests
(the "Xxxx Units") in the Operating Partnership, (ii) preferred units of limited
partner interests (the "Preferred Units") in the Operating Partnership, (iii)
warrants to purchase additional Xxxx Units (the "Unit Warrants"), and (iv)
warrants to purchase common stock ("Common Stock") of the Company, par value
$.01 per share (the "Stock Warrants"; and together with the Xxxx Units, the
Preferred Units and the Unit Warrants, collectively, "Cali Securities");
WHEREAS, the Preferred Units will be redeemable for Xxxx Units;
WHEREAS, the Xxxx Units (whether issued pursuant to the terms of the
Contribution Agreement or pursuant to the exercise of the Unit Warrants) will be
redeemable for unregistered shares of Common Stock;
WHEREAS, the Stock Warrants are exercisable for unregistered shares of
Common Stock; and
WHEREAS, the Company has agreed to provide the Investors with certain
registration rights as set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants and
obligations hereinafter set forth, and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties
hereto, intending to be legally bound, hereby agree as follows:
1. DEFINITIONS. For purposes of this Agreement, capitalized terms used
herein shall
have the meanings set forth in the preambles hereto and in this Section 1.
1.1 "Cali Group" shall mean those individuals and entities, other
than the Company, that received Units at the time of the initial public offering
of the Company.
1.2 "Commission" shall mean the Securities and Exchange Commission
or any other federal agency at the time administering the Securities Act.
1.3 "Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended.
1.4 "Holder" shall mean any registered holder, from time to time,
of Registrable Securities.
1.5 "Initiating Holders" shall mean any Holder or Holders who, in
the aggregate, are Holders of Registrable Securities representing at least
fifty-one percent (51%) of the Registrable Securities then outstanding, and who
initiate a request pursuant to Section 3.1 below for the registration of all or
part of such Holder or Holders' Registrable Securities.
1.6 "Person" shall mean any individual, firm, corporation,
partnership, trust, incorporated or unincorporated association, joint venture,
joint stock company, government (or an agency or political subdivision thereof)
or other entity of any kind.
1.7 "Register", "registered" and "registration" shall refer to a
registration effected by preparing and filing a registration statement with the
Commission in compliance with the Securities Act and applicable rules and
regulations thereunder, and the declaration or ordering of the effectiveness of
such registration statement by the Commission.
1.8 "Registrable Securities" shall mean any of the following which
are held, or upon conversion would be held, by any Investor and its permitted
transferees pursuant to the terms of the Unit Warrants, the Stock Warrants or
under the partnership agreement governing the Operating Partnership or the
Contribution Agreement, in the case of the Xxxx Units and Preferred Units
("Permitted Transferees"): (a) shares of Common Stock issuable upon the
redemption of the Xxxx Units (including Xxxx Units received pursuant to the
redemption of Preferred Units or exercise of the Unit Warrants), which Xxxx
Units, Preferred Units or Unit Warrants are held by any Investor on the date
hereof and any such Xxxx Units, Preferred Units or Unit Warrants subsequently
transferred to an Investor's Permitted Transferees, (b) shares of Common Stock
issuable upon exercise of the Stock Warrants, (c) shares of Common Stock then
outstanding which were issued as, or upon the conversion or exercise of other
securities issued as, a dividend or other distribution with respect to or in
replacement of other Registrable Securities, (d) shares of Common Stock then
issuable upon the conversion or exercise of other securities which were issued
as a dividend or other distribution with respect to or in replacement of other
Registrable Securities, and (e) any equity securities of the Company issued or
issuable with respect to the securities referred to in clauses (a) through (d)
by way of a stock dividend or stock split or in connection with a combination of
shares, recapitalization, merger, consolidation or other reorganization;
PROVIDED, HOWEVER, that any such Registrable Securities shall cease to be
Registrable Securities when (i) a registration statement with respect to the
sale of such securities
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shall have become effective under the Securities Act and such securities shall
have been disposed of in accordance with such registration statement, (ii) they
shall have been sold as permitted by Rule 144 (or any successor provision) under
the Securities Act, (iii) they shall be eligible for sale pursuant to Rule
144(k) (or any successor provision) under the Securities Act as confirmed in a
written opinion of counsel to the Company addressed to the Investor and its
Permitted Transferees, (iv) they shall have been otherwise transferred, new
certificates for them not bearing a legend restricting further transfer shall
have been delivered by the Company and subsequent public distribution of them
shall not require registration of them under the Securities Act, or (v) they
shall have ceased to be outstanding. For purposes of this Agreement, a Person
will be deemed to be a holder of Registrable Securities whenever such Person has
the unqualified right to acquire such Registrable Securities (by conversion,
redemption or otherwise, but disregarding any legal restrictions upon the
exercise of such right), whether or not such acquisition has actually been
effected.
1.9 "Registration Expenses" shall mean all expenses incurred by the
Company in compliance with this Agreement, excluding Selling Expenses but
including, without limitation, all registration and filing fees, printing
expenses, fees and disbursements of counsel for the Company, and the fees and
expenses of one counsel for all Holders, all blue sky fees and expenses, and the
expense of any special audits incident to or required by any such registration
(but excluding the compensation of regular employees of the Company, which shall
be paid in any event by the Company).
1.10 "Securities Act" shall mean the Securities Act of 1933, as
amended, or any similar federal statute enacted hereafter, and the rules and
regulations of the Commission thereunder, all as the same shall be in effect
from time to time.
1.11 "Selling Expenses" shall mean all underwriting discounts and
commissions applicable to the sale of Registrable Securities.
1.12 "1994 Registration Rights Agreement" shall mean that certain
Registration Rights Agreement dated as of August 31, 1994 by any among the
Company and the Cali Group.
1.13 "RM Registration Rights Agreement" shall mean that certain
Registration Rights Agreement dated as of January 31, 1997 by and among the
Company and the other signatories thereto.
2. COMPANY REGISTRATION.
2.1 At any time after April 30, 1999, if the Company shall
determine to register any of its shares of Common Stock or other securities
("Other Securities") issued by it having terms substantially similar to the
Common Stock, either for its own account or the account of a security holder or
holders exercising any demand registration rights, other than a registration
relating solely to employee benefit plans or a registration relating solely to a
Rule 145 (under the Securities Act) transaction, the Company will:
(a) promptly give to each Holder written notice thereof (which shall
include a list of the jurisdictions in which the Company intends to attempt
to qualify such securities
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under the applicable blue sky or other state securities laws); and
(b) include in such registration (and any related qualification under
blue sky laws or other compliance), and in any underwriting involved
therein, all the Registrable Securities specified in a written request or
requests made by any Holder within fifteen (15) days after receipt of the
written notice from the Company described in clause (a) above, except as
set forth in Section 2.3 below. Such written request may specify all or a
part of a Holder's Registrable Securities.
Notwithstanding the foregoing, the rights under this Section 2.1 shall not
apply to any Holder if the Company has not included in the shares to be
registered thereunder shares of stock held by any holder, other than the
Company.
2.2 UNDERWRITING. If the registration of which the Company gives
notice is for a registered public offering involving an underwriting, the
Company shall so advise the Holders as a part of the written notice given
pursuant to Section 2.1(a). The right of any Holder to require registration
pursuant to this Section 2 shall be conditioned upon such Holder's participation
in such underwriting and the inclusion of such Holder's Registrable Securities
in the underwriting to the extent provided herein. All Holders proposing to
distribute their securities through such underwriting shall (together with the
Company and any officers, directors or Other Shareholders (as defined below)
distributing their securities through such underwriting) enter into an
underwriting agreement in customary form with the representative of the
underwriter or underwriters selected by the Company. "Other Shareholders" shall
mean Persons who, by virtue of their agreements with the Company, are entitled
to include their securities in such registration, which includes officers,
directors and Persons requesting registration under the 1994 Registration Rights
Agreement or the RM Registration Rights Agreement.
2.3 LIMITATIONS ON SHARES TO BE INCLUDED. With respect to Company
registrations, notwithstanding any other provision of this Section 2, if the
representative of the underwriters advises the Company in writing that marketing
factors require a limitation or elimination on the number of shares to be
underwritten, the representative may (subject to the allocation priority set
forth below) limit the number of Registrable Securities to be included in the
registration and underwriting. The Company shall so advise all Holders of
securities requesting registration, and the number of shares of securities that
are entitled to be included in the registration and underwriting shall be
allocated FIRST, to the Company for securities being sold for its own account or
to the security holder or holders exercising any demand registration rights on
such security holder or holders' account, and SECOND, among all such Holders
requesting registration hereunder or Other Shareholders requesting registration
pursuant to the exercise of piggyback registration rights, in each case in
proportion, as nearly as practicable, to the respective amounts of Registrable
Securities or other securities of the Company (the "Additional Shares") which
are held by such Holders or Other Shareholders which they had requested to be
included in such registration at the time of filing the registration statement.
If any Holder of Registrable Securities or any Other Shareholder disapproves of
the terms of any such underwriting, he may elect to withdraw therefrom by
written notice to the Company and the underwriter. The limitations contained in
this Section 2.3 shall not apply in any respect to Section 2.6 below.
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2.4 WITHDRAWAL FROM REGISTRATION. Any Holder requesting inclusion
of Registrable Securities pursuant to this Section 2 may, at any time prior to
the effective date of the registration statement relating to such registration,
revoke such request by delivering written notice of such revocation to the
Company; PROVIDED, HOWEVER, that if the Company, in consultation with its
financial and legal advisors, determines that such revocation would materially
delay the registration or otherwise require a recirculation of the prospectus
contained in the registration statement, then such Holder shall have no such
right to revoke its request. If the withdrawal of any Registrable Securities or
Additional Shares would allow, within the marketing limitations set forth above,
the inclusion in the underwriting of a greater number of shares of Registrable
Securities or Additional Shares, then, to the extent practicable and without
delaying the underwriting, the Company shall offer to the Holders and to the
Other Shareholders an opportunity to include additional shares of Registrable
Securities or Additional Shares, as the case may be, in the proportions and in
the priorities discussed in Section 2.3 above.
2.5 TERMINATION OR WITHDRAWAL BY COMPANY. The Company shall have
the right to terminate or withdraw any registration initiated by it under this
Section 2 prior to the effectiveness of such registration whether or not any
Holder has elected to include securities in such registration.
2.6 CERTAIN SHELF REGISTRATIONS. The foregoing notwithstanding, on
December 11, 1998 (the "Anniversary Date"), or as soon thereafter as is
reasonably practicable, the Company shall, at its expense, register the
Registrable Securities for resale, and, if necessary to permit their issuance to
an Investor or its permitted transferees, for initial issuance upon redemption
of Xxxx Units or exercise of the Stock Warrants, through a shelf registration
statement pursuant to Rule 415 under the Securities Act, which shelf
registration statement shall cover only the Registrable Securities. The Company
shall, at its expense, use its best efforts to maintain the effectiveness of
such registration statement until the earlier of (i) such time as when all of
the Registrable Securities have been disposed of or (ii) three (3) years after
the redemption or exercise, as the case may be, of all of the Xxxx Units and
Stock Warrants (including Xxxx Units received upon conversion of Preferred Units
or exercise of the Unit Warrants) into Common Stock. Notwithstanding anything
in this Section 2.6 to the contrary, if at the Anniversary Date the Company
determines, in the good faith judgment of the Board of Directors of the Company,
with the advice of counsel, that the filing of such shelf registration statement
would require the disclosure of non-public material information the disclosure
of which would have a material adverse effect on the Company or would otherwise
adversely affect a material financing, acquisition, disposition, merger or other
significant transaction, the Company shall deliver a certificate to such effect
signed by its President or any Vice President to the Holders and the Company
shall not be required to effect a registration pursuant to this Section 2.6
until the earlier of (A) three (3) days after the date upon which such material
information is disclosed to the public or ceases to be material or (B) 90 days
after the Company makes such good faith determination.
3. REQUESTED REGISTRATION.
3.1 REQUEST FOR REGISTRATION. At any time on or after April 30,
1999, if any Registrable Securities are outstanding and the Holders (and any
prior holder) have not yet had the opportunity to register such shares pursuant
to Section 2 above, including without limitation
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pursuant to Section 2.6 above, upon written notice from Initiating Holders
requesting that the Company effect any registration with respect to all or part
of the Registrable Securities held by such Initiating Holders, the Company shall
(a) promptly give written notice of the proposed registration to all other
Holders (the "Demand Registration Notice") and (b) as soon as practicable but
not later than sixty (60) days after receipt of the request from the Initiating
Holders, use its reasonable best efforts, as that phrase is commonly understood
to mean in registration rights agreements, and take all appropriate action to
effect such registration (including, without limitation, the execution of an
undertaking to file post-effective amendments, appropriate qualification under
the blue sky or other state securities laws requested by Initiating Holders and
appropriate compliance with applicable regulations issued under the Securities
Act) as may be so requested and as would permit or facilitate the sale and
distribution of all or such portion of such Registrable Securities as are
specified in such request, together with all or such portion of the Registrable
Securities of any Holder or Holders joining in such request as are specified in
a written request given within thirty (30) days after receipt of the Demand
Registration Notice; PROVIDED, HOWEVER, that:
(i) if, upon receipt of a registration request pursuant to this
Section 3, the Company is advised in writing by a nationally recognized
independent investment banking firm selected by the Company to act as lead
underwriter in connection with a public offering of securities by the
Company (a "Company Offering") that, in such firm's opinion, a registration
at the time and on the terms requested would materially adversely affect
such Company Offering that had been contemplated by the Company prior to
the notice by the Initiating Holders, the Company shall not be required to
effect a registration pursuant to this Section 3 until the earliest of (A)
three months after the completion of such Company Offering, (B) the
termination of any "black out" period, if any, required by the underwriters
to be applicable to any Holder who has requested to have any Registrable
Securities registered in connection with such registration, (C) promptly
after abandonment of such Company Offering or (D) four months after the
date of written notice from the Initiating Holders demanding registration
pursuant to this Section 3;
(ii) if, while a registration request is pending pursuant to this
Section 3, the Company determines, in the good faith judgment of the Board
of Directors of the Company, with the advice of counsel, that the filing of
a registration statement would require the disclosure of non-public
material information the disclosure of which would have a material adverse
effect on the Company or would otherwise adversely affect a material
financing, acquisition, disposition, merger or other significant
transaction, the Company shall deliver a certificate to such effect signed
by its President or any Vice President to the proposed selling Holders and
the Company shall not be required to effect a registration pursuant to this
Section 3 until the earlier of (A) three (3) days after the date upon which
such material information is disclosed to the public or ceases to be
material or (B) 90 days after the Company makes such good faith
determination; and
(iii) the provisions of this Section 3 shall not be applicable if a
Shelf Registration under Section 2.6 hereof is effective and available for
use (unless Holders desire to dispose of such shares pursuant to an
underwritten public offering as contemplated by Section 3.4 hereof, in
which case the rights granted under this Section 3.1 shall apply without
regard to whether or not such Holders had an opportunity to register such
shares
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pursuant to Section 2.6 above)
3.2 COMPANY SHARES TO BE INCLUDED. The registration statement
filed pursuant to the request of the Initiating Holders may, subject to the
provisions of Section 3.5 below, include securities of the Company being sold
for the account of the Company (the "Company Shares").
3.3 WITHDRAWAL OF REGISTRATION. If the Initiating Holders inform
the Company by written notice that they are withdrawing their registration
request made pursuant to Section 3.1 above and the Company decides to go forward
with such registration on its own behalf, then the Initiating Holders shall not
be required to pay any of the Company's out-of-pocket expenses. If the Company
elects not to go forward with such registration on its own behalf, the
Initiating Holders shall be required to pay the Company's out-of-pocket
expenses.
3.4 UNDERWRITING.
(a) If the Initiating Holders intend to distribute the
Registrable Securities covered by their request by means of an underwriting,
they shall so advise the Company as a part of their request made pursuant to
this Section 3 and the Company shall include such information in the Demand
Registration Notice, and such Demand Registration Notice shall also state that
any registration pursuant to this Section 3 shall be conditioned upon such
Holder's participation in such underwriting and the inclusion of such Holder's
Registrable Securities in the underwriting to the extent provided herein and
subject to the limitations provided herein. A Holder may elect to include in
such underwriting all or a part of such Holder's Registrable Securities.
(b) The Company shall (together with all Holders proposing
to distribute their securities through such underwriting) enter into an
underwriting agreement in customary form with the representative of the
underwriter or underwriters selected for such underwriting by a majority in
interest of the Initiating Holders.
3.5 LIMITATIONS ON SHARES TO BE INCLUDED. Notwithstanding any
other provision of this Section 3, if the representative of the underwriters
advises the Company or the Initiating Holders in writing that marketing factors
require a limitation on the number of shares to be underwritten or that the
inclusion of Company Shares may adversely affect the sale price (of the shares
to be registered) that may be obtained, Company Shares shall be excluded from
such registration to the extent so required by such limitation, and if a
limitation of the number of shares is still required, the number of shares that
may be included in the registration and underwriting shall be allocated among
all Holders in proportion, as nearly as practicable, to the respective amounts
of Registrable Securities which they have requested to be included in such
registration statement. If the Company or any Holder of Registrable Securities
who has requested inclusion in such registration as provided above disapproves
of the terms of any such underwriting, such Person may elect to withdraw such
Person's Registrable Securities or Company Shares therefrom by written notice to
the Company, the underwriter and the Initiating Holders. If the withdrawal of
any Registrable Securities or Company Shares would allow, within the marketing
limitations set forth above, the inclusion in the underwriting of a greater
number of
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shares of Registrable Securities, to the extent practicable and without delaying
the underwriting, the Company shall offer to the Holders an opportunity to
include additional shares of Registrable Securities.
4. EXPENSES OF REGISTRATION. All Registration Expenses incurred in
connection with the registration or qualification of, or compliance with, any
registration statement under Sections 2 and 3 of this Agreement shall be borne
by the Company. All Selling Expenses shall be borne pro rata by each Holder and
each Other Shareholder in accordance with the number of shares sold.
5. REGISTRATION PROCEDURES.
5.1 In the case of each registration to be effected by the Company
pursuant to this Agreement, the Company will keep each Holder advised in writing
as to the initiation of each registration and all amendments thereto and as to
the completion thereof, advise any such Holder, upon request, of the progress of
such proceedings, use its best efforts to effect the registration of any
Registrable Securities under the Securities Act, and will, at its expense:
(a) Prepare and file with the Commission a registration
statement covering such Registrable Securities and use its best efforts to cause
such registration statement to be declared effective by the Commission and to
keep such registration effective for a period of one hundred eighty (180) days
or until the Holder or Holders have completed the distribution described in the
registration statement relating thereto, whichever first occurs; PROVIDED,
HOWEVER, that the Company shall keep such registration effective for longer than
one hundred and eighty (180) days if the costs and expenses associated with such
extended registration are borne by the selling Holders; PROVIDED FURTHER,
HOWEVER, that the foregoing shall not apply to any registration statement filed
pursuant to Section 2.6 hereof.
(b) Prepare and file with the Commission such amendments
and supplements to such registration statement and the prospectus used in
connection therewith as may be necessary to keep such registration statement
effective and to comply with the provisions of the Securities Act with respect
to the disposition of all Registrable Securities covered by such registration
statement until such time as all of such Registrable Securities have been
disposed of in accordance with the intended methods of disposition by the seller
or sellers thereof set forth in such registration statement;
(c) Furnish to each seller of Registrable Securities
covered by such registration statement and each Holder two conformed copies of
such registration statement and of each such amendment and supplement thereto
(in each case including all exhibits), such number of copies of the prospectus
contained in such registration statement (including each preliminary prospectus
and any summary prospectus) and any other prospectus filed under Rule 424 under
the Securities Act, in conformity with the requirements of the Securities Act,
and such other documents, as such seller or Holder, as the case may be, may
reasonably request;
(d) Promptly notify each seller of Registrable Securities
covered by such registration statement and each Holder at any time when a
prospectus relating thereto is required to be delivered under the Securities
Act, of the happening of any event as a result of
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which the prospectus included in such registration statement, as then in effect,
includes an untrue statement of a material fact or omits to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading or incomplete in the light of the circumstances then existing,
and at the request of any such seller, prepare and furnish to such seller 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 shares, 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 or incomplete
in the light of the circumstances then existing;
(e) Use its best efforts (i) to register or qualify all
Registrable Securities and other securities covered by such registration
statement under such other securities or blue sky laws of such states of the
United States of America where an exemption is not available and as the sellers
of Registrable Securities covered by such registration statement shall
reasonably request, (ii) to keep such registration or qualification in effect
for so long as such registration statement remains in effect and (iii) to take
any other action which may be reasonably necessary or advisable to enable such
sellers to consummate the disposition in such jurisdictions of the securities to
be sold by such sellers; PROVIDED, HOWEVER, that the Company shall not for any
such purpose be required to (x) qualify generally to do business as a foreign
corporation in any jurisdiction wherein it would not but for the requirements of
this clause (e) be obligated to be so qualified, (y) subject itself to taxation
in any such jurisdiction or (z) consent to general service of process in any
such jurisdiction;
(f) Use its best efforts to cause all Registrable
Securities covered by such registration statement to be registered with or
approved by such other federal or state governmental agencies or authorities as
may be necessary in the opinion of counsel to the Company and counsel to the
seller or sellers of Registrable Securities to enable the seller or sellers
thereof to consummate the disposition of such Registrable Securities;
(g) Use its best efforts to list all such Registrable
Securities registered in such registration on each securities exchange or
automated quotation system on which the Common Stock of the Company is then
listed;
(h) Provide and cause to be maintained a transfer agent and
registrar for all Registrable Securities and a CUSIP number for all such
Registrable Securities, in each case not later than the effective date of such
registration;
(i) Make available for inspection by any seller of
Registrable Securities and each Holder, any underwriter participating in any
disposition pursuant to such registration statement, and any attorney or
accountant retained by any such seller, Holder or underwriter, all financial and
other records, pertinent corporate documents and properties of the Company, and
cause the Company's officers, directors, employees and independent accountants
to supply all information reasonably requested by any such seller, Holder,
underwriter, attorney or accountant in connection with such registration
statement, which information shall be subject to reasonable restrictions
concerning confidentiality and non-disclosure;
(j) Furnish to each selling Holder upon request a signed
counterpart,
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addressed to the selling Holder, of
(iii) an opinion of counsel for the Company, dated the
effective date of the registration statement and in form reasonably
acceptable to the Company and such Holder, and
(iv) "comfort" letters signed by the Company's independent
public accountants who have examined and reported on the Company's
financial statements included in the registration statement, to the extent
permitted by the standards of the American Institute of Certified Public
Accountants,
in the case of (i) and (ii) covering substantially the same matters with respect
to the registration statement (and the prospectus included therein) and (in the
case of the accountants' "comfort" letters) with respect to events subsequent to
the date of the financial statements, as are customarily covered in opinions of
issuer's counsel and in accountants' "comfort" letters delivered to the
underwriters in underwritten public offerings of securities;
(k) Furnish to each selling Holder a copy of all
correspondence from or to the Commission in connection with any such offering;
(l) In the event of the issuance of any stop order
suspending the effectiveness of a registration statement, or of any order
suspending or preventing the use of any related prospectus or suspending the
qualification of any Registrable Securities included in such registration
statement for sale in any jurisdiction, the Company will use its reasonable best
efforts promptly to obtain the withdrawal of such order; and
(m) Otherwise use its best efforts to comply with all
applicable rules and regulations of the Commission, and, if required, make
available to its security holders, as soon as reasonably practicable, an
earnings statement covering the period of at least twelve months, but not more
than eighteen months, beginning with the first month after the effective date of
the registration statement, which earnings statement shall satisfy the
provisions of Section 11(a) of the Securities Act and Rule 158 thereunder.
5.2 It shall be a condition precedent to the obligations of the
Company to take any action pursuant to this Agreement that the Holders proposing
to register Registrable Securities shall furnish to the Company such information
regarding them, the Registrable Securities held by them, and the intended method
of distribution of such Registrable Securities as the Company shall reasonably
request and as shall be required in connection with the action to be taken by
the Company.
5.3 In connection with the preparation and filing of each
registration statement under this Agreement, the Company will give the Holders
on whose behalf such Registrable Securities are to be registered and their
underwriters, if any, and their respective counsel and accountants, the
opportunity to participate in the preparation of such registration statement,
each prospectus included therein or filed with the Commission, and each
amendment thereof or supplement thereto, and will give each such Holder such
access to the Company's books and records and such opportunities to discuss the
business of the Company with its officers, its
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counsel and the independent public accountants who have certified the Company's
financial statements, as shall be necessary, in the opinion of such Holders or
such underwriters or their respective counsel, in order to conduct a reasonable
and diligent investigation within the meaning of the Securities Act. Without
limiting the foregoing, each registration statement, prospectus, amendment,
supplement or any other document filed with respect to a registration under this
Agreement shall be subject to review and reasonable approval by the Holders
registering Registrable Securities in such registration and by their counsel.
6. INDEMNIFICATION.
6.1 INDEMNIFICATION BY THE COMPANY. In the event of any
registration of any securities of the Company under the Securities Act, the
Company will indemnify and hold harmless each Holder, each of its officers,
directors, partners, employees, agents, attorneys and consultants and each
Person controlling such Holder, and each underwriter, if any, and each Person
who controls any underwriter, against all claims, losses, damages and
liabilities, joint and several (or actions, proceedings or settlements in
respect thereof) arising out of or based upon any untrue statement (or alleged
untrue statement) of a material fact contained in any prospectus, offering
circular or other document (including any related registration statement,
notification or the like) incident to any such registration, qualification or
compliance, or based upon any omission (or alleged omission) to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or any violation by the Company of the Securities Act or
any rule or regulation thereunder applicable to the Company and relating to
action or inaction required of the Company in connection with any such
registration, qualification or compliance, and will reimburse each such Holder,
each of its officers, directors and partners, and each Person controlling such
Holder, each such underwriter and each Person who controls any such underwriter,
for any legal and any other expenses reasonably incurred in connection with
investigating and defending or settling any such claim, loss, damage, liability
or action; PROVIDED, HOWEVER, that the Company will not be liable in any such
case to the extent that any such claim, loss, damage, liability or expense
arises out of or is based on any untrue statement or omission made in reliance
upon and based upon written information furnished to the Company by such Holder
or underwriter and expressly stated to be specifically for use therein.
6.2 INDEMNIFICATION BY THE HOLDERS. Each Holder will, if
Registrable Securities held by such Holder are included in the securities as to
which such registration, qualification or compliance is being effected,
severally and not jointly, indemnify the Company, each of its directors and
officers and each underwriter, if any, of the Company's securities covered by
such a registration statement, each Person who controls the Company (other than
such Holder) or such underwriter within the meaning of the Securities Act and
the rules and regulations thereunder, each other such Holder and each of their
officers, directors and partners, and each Person controlling such Holder or
other stockholder, against all claims, losses, damages, expenses and liabilities
(or actions in respect thereof) arising out of or based upon any untrue
statement (or alleged untrue statement) of a material fact contained in any such
registration statement, prospectus, offering circular or other document, 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
will reimburse the Company, each of its directors and officers, each underwriter
or control Person, each other Holder and each of their officers, directors and
partners and each Person controlling such Holder or other shareholder for
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any legal or any other expenses reasonably incurred in connection with
investigating or defending any such claim, loss, damage, liability or action, in
each case to the extent, but only to the extent, that such untrue statement (or
alleged untrue statement) or omission (or alleged omission) is made in such
registration statement, prospectus, offering circular or other document in
reliance upon and in conformity with written information furnished to the
Company by such Holder and expressly stated to be specifically for use therein;
PROVIDED, HOWEVER, that the liability of any such Holder under this Section 6.2
shall be limited to the amount of proceeds received by such Holder in the
offering giving rise to such liability.
6.3 NOTICES OF CLAIMS, PROCEDURES, ETC. Each party entitled to
indemnification under this Section 6 (the "Indemnified Party") shall give notice
to the party required to provide indemnification (the "Indemnifying Party")
promptly after such Indemnified Party has actual knowledge of any claim as to
which indemnity may be sought, and shall permit the Indemnifying Party to assume
the defense of any such claim or any litigation resulting therefrom; PROVIDED,
that counsel for the Indemnifying Party, who shall conduct the defense of such
claim or any litigation resulting therefrom, shall be approved by the
Indemnified Party (whose approval shall not unreasonably be withheld), and the
Indemnified Party may participate in such defense at the Indemnified Party's
sole expense; PROVIDED, FURTHER, that the failure of any Indemnified Party to
give notice as provided herein shall not relieve the Indemnifying Party of its
obligations under this Section 6 unless such failure is prejudicial to the
ability of the Indemnifying Party to defend such claim or action.
Notwithstanding the foregoing, such Indemnified Party shall have the right to
employ its own counsel in any such litigation, proceeding or other action if (i)
the employment of such counsel has been authorized by the Indemnifying Party, in
its sole and absolute discretion, or (ii) the named parties in any such claims
(including any impleaded parties) include any such Indemnified Party and the
Indemnified Party and the Indemnifying Party shall have been advised in writing
(in suitable detail) by counsel to the Indemnified Party either (A) that there
may be one or more legal defenses available to such Indemnified Party which are
different from or additional to those available to the Indemnifying Party, or
(B) that there is a conflict of interest by virtue of the Indemnified Party and
the Indemnifying Party having common counsel, in any of which events, the legal
fees and expenses of a single counsel for all Indemnified Parties with respect
to each such claim, defense thereof, or counterclaims thereto, shall be borne by
the Indemnifying Party. No Indemnifying Party, in the defense of any such claim
or litigation, shall, except with the consent of each Indemnified Party, consent
to entry of any judgment or enter into any settlement (x) which does not include
as an unconditional term thereof the giving by the claimant or plaintiff to such
Indemnified Party of a release from all liability in respect to such claim or
litigation, or (y) which requires action other than the payment of money by the
Indemnifying Party. Each Indemnified Party shall cooperate to the extent
reasonably required and furnish such information regarding itself or the claim
in question as an Indemnifying Party may reasonably request in writing and as
shall be reasonably required in connection with defense of such claim and
litigation resulting therefrom.
6.4 CONTRIBUTION. If the indemnification provided for in this
Section 6 shall for any reason be held by a court to be unavailable to an
Indemnified Party under Section 6.1 or 6.2 hereof in respect of any loss, claim,
damage or liability, or any action in respect thereof, then, in lieu of the
amount paid or payable under Section 6.1 or 6.2, the Indemnified Party and the
Indemnifying Party under Section 6.1 or 6.2 shall contribute to the aggregate
losses, claims, damages and liabilities (including legal or other expenses
reasonably incurred in connection with
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investigating the same), (i) in such proportion as is appropriate to reflect the
relative fault of the Company and the prospective sellers of Registrable
Securities covered by the registration statement which resulted in such loss,
claim, damage or liability, or action or proceeding in respect thereof, with
respect to the statements or omissions which resulted in such loss, claim,
damage or liability, or action or proceeding in respect thereof, as well as any
other relevant equitable considerations or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such proportion as shall
be appropriate to reflect the relative benefits received by the Company and such
prospective sellers from the offering of the securities covered by such
registration statement; PROVIDED, that for purposes of this clause (ii), the
relative benefits received by the prospective sellers shall be deemed not to
exceed the amount of proceeds received by such prospective sellers. 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. Such prospective sellers'
obligations to contribute as provided in this Section 6.4 are several in
proportion to the relative value of their respective Registrable Securities
covered by such registration statement and not joint. In addition, no Person
shall be obligated to contribute hereunder any amounts in payment for any
settlement of any action or claim effected without such Person's consent, which
consent shall not be unreasonably withheld.
7. INFORMATION BY HOLDER. Each Holder of Registrable Securities shall
furnish to the Company such information regarding such Holder and the
distribution proposed by such Holder as the Company may reasonably request in
writing and as shall be reasonably required in connection with any registration,
qualification or compliance referred to in this Agreement.
8. TRANSFER OR ASSIGNMENT OF REGISTRATION RIGHTS. The rights with
respect to any Registrable Securities to cause the Company to register such
securities granted to a Holder by the Company under this Agreement may be
transferred or assigned by a Holder, in whole or in part, to a transferee or
assignee of any Registrable Securities or any Xxxx Units, Preferred Units, Unit
Warrants or Stock Warrants which are convertible, exercisable or redeemable,
directly or indirectly, for Registrable Securities and, in such case, the
Company shall be given written notice stating the name and address of said
transferee or assignee and identifying the securities with respect to which such
registration rights are being transferred or assigned.
9. RULE 144 AND RULE 144A. The Company shall file the reports required
to be filed by it under the Securities Act and the Exchange Act and the rules
and regulations adopted by the Commission thereunder, and will take all actions
reasonably necessary to enable holders of Registrable Securities to sell such
securities without registration under the Securities Act within the limitation
of the provisions of (a) Rule 144 under the Securities Act, as such Rule may be
amended from time to time, (b) Rule 144A under the Securities Act, as such Rule
may be amended from time to time, if applicable or (c) any similar rules or
regulations hereafter adopted by the Commission. Upon the request of any holder
of Registrable Securities, the Company will deliver to such holder a written
statement as to whether it has complied with such requirements.
10. SPECIFIC PERFORMANCE. Each holder of Registrable Securities, in
addition to being entitled to exercise all rights granted by law, including
recovery of damages, will 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
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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.
11. NO INCONSISTENT AGREEMENTS. The Company will not hereafter enter into
any agreement with respect to its securities which is inconsistent with the
rights granted to the holders of Registrable Securities in this Agreement.
Without limiting the generality of the foregoing, the Company will not hereafter
enter into any agreement with respect to its securities which grants, or modify
any existing agreement with respect to its securities to grant, to the holder of
its securities in connection with an incidental registration of such securities
higher priority to the rights granted to the Holder under Section 2 of this
Agreement; PROVIDED, HOWEVER, the Company shall be entitled to enter into an
agreement which grants, or modify any existing agreement with respect to its
securities to grant, to the holder of its securities in connection with an
incidental registration of such securities equal priority to the rights granted
to the Holders under Section 2 of this Agreement.
12. BENEFITS OF AGREEMENT: SUCCESSORS AND ASSIGNS. This Agreement shall
be binding upon and inure to the benefit of the parties and their respective
successors and permitted assigns, legal representatives and heirs; this
Agreement does not create, and shall not be construed as creating, any rights
enforceable by any other Person.
13. COMPLETE AGREEMENT. This Agreement constitutes the complete
understanding among the parties with respect to its subject matter and
supersedes all existing agreements and understandings, whether oral or written,
among them. No alteration or modification of any provisions of this Agreement
shall be valid unless made in writing and signed by a majority in interest of
the Holders.
14. SECTION HEADINGS. The section headings contained in this Agreement
are for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
15. NOTICES. All notices, offers, acceptances and other communications
required or permitted to be given or to otherwise be made to any party to this
Agreement shall be deemed to be sufficient if contained in a written instrument
delivered by hand, first class mail (registered or certified, return receipt
requested), telex, telecopier or overnight air courier guaranteeing next day
delivery, if to the Corporation, to it at Cali Realty Corporation, 00 Xxxxxxxx
Xxxxx, Xxxxxxxx, Xxx Xxxxxx 00000, Attention: Xxxxxx X. Xxxx, Esq., with a copy
to Pryor, Cashman, Xxxxxxx & Xxxxx, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Xxxxxxxx X. Xxxxxxxxx, Esq., and if to any Holder, to the address of
such Holder as set forth in the stock transfer books of the Corporation.
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five business
days after being deposited in the mail, postage prepaid, if mailed; when
answered back, if telexed; when receipt acknowledged, if telecopied; and the
next business day after timely delivery to the courier, if sent by overnight air
courier guaranteeing next day delivery. Any party may change the address to
which each such notice or communication shall be sent by giving written notice
to tie other parties of such new address in the manner provided herein for
giving notice.
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16. GOVERNING LAW. This Agreement shall be governed by, and construed and
enforced in accordance with, the laws of the State of New York without giving
effect to the provisions, policies or principles thereof respecting conflict or
choice of laws.
17. COUNTERPARTS. This Agreement may be executed in one or more
counterparts each of which shall be deemed an original but all of which taken
together shall constitute one and the same agreement.
18. SEVERABILITY. Any provision of this Agreement which is determined to
be illegal, prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such illegality, prohibition or
unenforceability without invalidating the remaining provisions hereof which
shall be severable and enforceable according to their terms and any such
prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
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IN WITNESS WHEREOF, the parties have signed this Agreement as of the date
first set forth above.
XXXX-XXXX REALTY CORPORATION
By:
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Name:
Title:
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By:
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Name:
Title:
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