4 0189544.01
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement') is
made and entered into this 18th day of February, 1999, by and
between ELMER'S RESTAURANTS, INC., an Oregon corporation (the
"Company"), and Xxxxx X. Xxxxx, Xxxxxxx X. Service, Xxxxxxx X.
Xxxxx, Xxxxxx X. Xxxxxxx, Xxxxxx X. Xxxxxx, Xxxxx Xxxxxx, Xxxxx
Xxxxxx, Xxx X. Xxxxxxxxx and Xxxxx Xxxxxx, shareholders
(collectively referred to herein as 'Holders') of CBW Inc.
('CBW').
Recitals:
A. The Company, CBW, and Holders are the parties to a
Merger Agreement, of even date herewith (the "Merger Agreement").
B. Pursuant to the Merger Agreement, the Company is
obligated to issue restricted shares ('Shares' or 'Registrable
Securities') of the Company's common stock to the Holders and
therefore desires to grant Holders certain registration rights
pursuant to this Agreement.
Agreements:
NOW, THEREFORE, in consideration of the foregoing and
the covenants of the parties contained in this Agreement, the
parties hereby agree as follows:
SECTION 1
Definitions
The following terms shall have the meanings indicated:
"Common Stock" means the Common Stock of the Company.
'Company' means the issuer and its successors and assigns.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, or any similar federal statute, and the rules and
regulations of the SEC thereunder, all as the same shall be in
effect from time to time.
"Initial Public Offering" means an initial public offering
of shares of Common Stock by the Company registered under the
Securities Act.
"Losses" means all losses, claims, damages or liabilities
and reasonable expenses related thereto.
Page 1 of 14
'Registrable Securities' shall mean each of the Shares,
until, in the case of any such Share, (i) it is effectively
registered under the Securities Act and disposed of in accordance
with the Registration Statement covering it, (ii) it is saleable
by the holder thereof pursuant to Rule 144(k), or (iii) it is
distributed to the public by the holder thereof pursuant to Rule
144; provided, however, that Registrable Shares shall not include
any Shares that are subject to a lockup agreement during the
period in which disposition of such Shares would violate the
terms of such lockup agreement.
'Registration', 'register' and like words mean compliance
with all of the laws, rules, regulations and provisions of
agreements and corporate documents pertaining to lawful and
unrestricted transfer of securities by way of a public offering
or distribution.
'Registration Statement' shall mean any Registration
Statement of the Company under the Securities Act that covers any
of the Registrable Securities pursuant to the provisions of this
Agreement, including the related Prospectus, all amendments and
supplements to such Registration Statement (including post-
effective amendments), all exhibits and all material incorporated
by reference or deemed to be incorporated by reference in such
Registration Statement.
"SEC" means the Securities and Exchange Commission, or any
other federal agency then administering the Securities Act.
"Securities Act" means the Securities Act of 1933, as
amended, or any similar federal statute, and the rules and
regulations of the SEC thereunder, all as the same shall be in
effect from time to time.
"Shares" means all shares of the Company's Common Stock,
restricted or otherwise, that will be issued to, and held by, the
Holders as a result of the merger.
'Underwritten registration' or 'underwritten offering'
shall
mean a sale of securities of the Company to an underwriter for
reoffering to the public pursuant to a Registration Statement.
SECTION 2
Acknowledgment of Rights
The Company will, upon request of Holders, acknowledge in
writing the Company's obligation in respect of the rights to
which Holders shall be entitled under this Agreement, provided,
that the failure of Holders to make any such request shall not
affect the continuing obligation of the Company to Holders in
respect of such rights.
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SECTION 3
Piggyback Registration
3.1 If at any time the Company proposes to register any
offering of shares of its capital stock under the Securities Act,
and if such registration is to be on a form of the SEC that may
include, or is at any time amended or changed to such a form that
may include the Shares (other than a registration solely to
implement an employee benefit plan or a transaction to which Rule
145, as promulgated under the Securities Act, is applicable), the
Company will at any such time give written notice to Holders of
its intention to do so at least thirty (30) days prior to the
filing of such Registration Statement. The Company will include
in any such Registration Statement any of the Registrable
Securities held by any Holder who within 20 days after receipt of
such notice shall request inclusion. Notwithstanding any other
provision of this Section 3, if the offering of shares by the
Company is underwritten and the representative of the
underwriters participating in the sale and distribution of the
Company's securities covered by such Registration Statement
advises the Company in writing that marketing factors require a
limitation on the number of shares to be underwritten, the
representative may exclude all Registrable Securities from, or
(subject to the limitations set forth below) limit the number of
Registrable Securities to be included in, the registration and
underwriting.
3.2 If the offering of shares by the Company is
underwritten and the representative of the underwriters
participating in the sale and distribution of the Company's
securities covered by such Registration Statement agrees that a
number of (but not all) the Registrable Securities (the
"Permissible Secondary Shares") may be included in the offering
covered by the Registration Statement, the Company's notice shall
afford Holders an opportunity to elect to include in such
registration the Permissible Secondary Shares owned by it.
Holders shall have twenty (20) days after receipt of the
Company's notice to notify the Company in writing of the number
of Registrable Securities (the "Elected Shares") which Holders
elect to include in the offering and the Elected Shares shall be
included in the offering. If the aggregate number of Elected
Shares that Holders of Registrable Securities desire to include
in such filing exceeds the number of Permissible Secondary
Shares, then Holders shall be entitled to include that number of
Elected Shares that bears the same ratio to the number of
Permissible Secondary Shares as the number of Elected Shares
Holders desires to include bears to the number of Elected Shares
Holders and all such other Holders desire to include.
3.3 The inclusion in such registration of Elected Shares
shall be upon the condition that Holders sell its Elected Shares
to the underwriters at the same price and on substantially the
same terms and conditions as the Company and any other selling
shareholders.
SECTION 4
Holders Requirements
To include any Registrable Securities in any registration,
Holders shall:
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4.1 Cooperate with the Company in preparing each such
registration and execute all such instruments and agreements
(including, without limitation, questionnaires, powers of
attorney, indemnities, and underwriting agreements) as the
underwriter may deem reasonably necessary in favor of such
underwriter;
4.2 Promptly supply the Company with all information,
documents, representations and agreements as the underwriter may
deem reasonably necessary in connection with such registration;
4.3 Agree in writing not to sell or transfer any share of
the capital stock of the Company not included in such
registration for a period of fifteen (15) days prior to and one
hundred eighty (180) days after the effective date of such
registration without the underwriter's consent;
4.4 Not (until further notice) effect sales of Shares after
receipt of written notice from the Company to suspend sales to
permit the Company to correct or update any Registration
Statement or prospectus; and
4.5 At the end of any period during which the Company is
obligated to keep any Registration Statement current and
effective, discontinue sales of Shares pursuant to such
Registration Statement upon receipt of notice from the Company of
its intention to remove from registration Shares covered by such
Registration Statement which remain unsold and shall notify the
Company of the number of Shares registered which remain unsold
promptly after receipt of such notice from the Company.
SECTION 5
Other Registration Rights
The Company will not grant to any persons the right to
request the Company to register any equity securities of the
Company, or any securities convertible or exchangeable into or
exercisable for such securities, unless such rights of other
persons are pari passu with the rights of Holders hereunder, or
subordinate and subsequent to such rights, without the written
consent of Holders.
SECTION 6
Registration Procedures
If and whenever the Company is obligated by the provisions
of this Agreement to effect the registration of any offering of
Registrable Securities under the Securities Act, as expeditiously
as reasonably possible the Company will, or will use its best
efforts to, as the case may be:
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6.1 Prepare and file with the SEC a Registration Statement
with respect to such Registrable Securities and, if the Board of
Directors of the Company shall so direct, cause such Registration
Statement to become effective; provided, however, that the
Company may, in exercising reasonable discretion, discontinue any
registration of its securities which is being effected pursuant
hereto at any time prior to the effective date of the
Registration Statement relating thereto.
6.2 Prepare and file with the SEC 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 until the earlier of the sale of
all shares of Common Stock covered thereby and the expiration of
a period of two hundred seventy (270) days after its effective
date, and comply with the provisions of the Securities Act with
respect to the disposition of all shares of Common Stock covered
by such Registration Statement; provided, however, that if
maintaining the effectiveness of the Registration Statement would
require the filing of a post-effective amendment including new
financial statements (other than financial statements which the
Company would be required to include in a current report on Form
10-Q under Section 13 or 15(d) of the Exchange Act), the Company
shall be obligated hereunder to use its best efforts to maintain
the effectiveness of the Registration Statement for only six (6)
months in the case of the first registration filed hereunder, and
ninety (90) days in the case of any other registration filed
hereunder. In the event that any shares of Common Stock included
in a Registration Statement subject to, or required by, this
Agreement remain unsold at the end of the period during which the
Company is obligated to use its best efforts to maintain the
effectiveness of such Registration Statement, the Company, if and
when a further amendment or supplement would be required to
comply with Section 10 of the Securities Act, may file a post-
effective amendment to the Registration Statement for the purpose
of removing such shares from registered status.
6.3 Furnish to Holders so many copies of a prospectus,
including a preliminary prospectus, in conformity with the
requirements of the Securities Act, and such other documents, as
Holders may reasonably request.
6.4 Register or qualify the securities covered by such
Registration Statement under such other securities or blue sky
laws of such jurisdictions as Holders may reasonably request, and
do any and all other acts and things that may be reasonably
necessary or advisable to enable Holders to consummate the
disposition in such jurisdictions of such Shares; provided,
however, that the Company shall not be obligated, by reason
thereof, to qualify as a foreign corporation or file any general
consent to service of process under the laws of any such
jurisdiction or subject itself to taxation as doing business in
any such jurisdiction.
6.5 Furnish to Holders, at the time of disposition, an
opinion of counsel for the Company to the effect that a
Registration Statement covering the offering of its Shares has
been filed with the SEC under the Securities Act and has been
made effective by order of the SEC, that a prospectus complying
as to form with the requirements of the Securities Act is
available for delivery, that no stop order has been issued by the
SEC suspending the effectiveness of such Registration Statement
and that, to the best of such counsel's knowledge,
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no proceedings for the issuance of such a stop order are
threatened or contemplated, and that the securities included in
the offering covered by such Registration Statement have been
registered or qualified, or exempted from such registration or
qualification, under the securities or blue sky laws of each
state in which the Company has been required to register or
qualify such shares as contemplated in this Section 6. In giving
such opinion, counsel for the Company shall be entitled to rely
upon the opinion of counsel for the underwriters.
6.6 Notify Holders and its counsel promptly after the
Company shall receive notice that any Registration Statement,
supplement or amendment has become effective, any Registration
Statement is required to be amended or supplemented, or any stop
order with respect thereto has been issued.
6.7 Enter into such agreements (including an underwriting
agreement in form, scope and substance as is customary in
underwritten offerings) and take all such other actions in
connection therewith (including those reasonably requested by the
representative of the underwriters or the Holders of a majority
of the Registrable Securities subject to the Registration
Statement) in order reasonably to expedite or facilitate the
disposition of the Registrable Securities.
SECTION 7
Registration Expenses
The costs and expenses (other than underwriting discounts or
commissions, stock transfer taxes and such fees for counsel,
printing, registration and other fees as state securities
officials may require that the Holders of Registrable Securities
pay) of all registrations and qualifications under the Securities
Act contemplated by this Agreement, and of all other actions that
the Company is required to take or effect pursuant to this
Agreement, shall be paid by the Company (including, without
limitation, all registration and filing fees, printing expenses,
costs of special audits incident to or required by any such
registration, fees and disbursements of counsel for the Company
and reasonable fees and disbursements of one special counsel
acting for the Holders of Registrable Securities being included
in any registration), except that all such expenses in connection
with any amendment or supplement to the Registration Statement or
the prospectus used in connection therewith required to be filed
more than two hundred seventy (270) days after the date on which
such Registration Statement becomes effective under the
Securities Act because any Holders has not effected the
disposition of Registrable Securities covered by such
Registration Statement shall be borne pro rata by such Holders.
SECTION 8
Indemnification by Company
In the event of any registration under the Securities Act of
any offering of Registrable Securities, the Company hereby agrees
to indemnify and hold harmless Holders, its officers
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and directors, if any, and each other person, if any, who
controls Holders (within the meaning of 'control person' as
defined in the Securities Act) and each other person (including
each underwriter, and each other person, if any, who controls
such underwriter) who participates in the offering of such
Registrable Securities against any Losses, joint or several, to
which Holders or such controlling person or participating person
may become subject under the Securities Act or otherwise, insofar
as such Losses (or proceedings in respect thereof) arise out of
or are based upon any untrue statement or alleged untrue
statement of any material fact contained, on the effective date
thereof, in any Registration Statement under which Registrable
Securities were registered under the Securities Act, in any
preliminary prospectus or final prospectus contained therein, or
in any amendment or supplement thereto, or arise out of or are
based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make
the statements therein not misleading, and will reimburse Holders
and each such controlling person or participating person for any
legal or other expenses reasonably incurred by Holders or such
controlling person or participating person in connection with
investigating or defending any such Loss; provided, that the
Company will not be liable in any such case to the extent that
any such Loss arises out of or is based upon an untrue statement
or alleged untrue statement or omission or alleged omission made
in such Registration Statement, such preliminary or final
prospectus or such amendment or supplement in reliance upon and
in conformity with written information furnished by Holders or
such controlling or participating person, as the case may be,
specifically for use in the preparation thereof. The Company
shall also indemnify underwriters, selling brokers, dealer
managers and similar securities industry professionals
participating in the distribution, their officers, directors,
agents and employees and each person who controls such persons
(within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act) to the same extent as provided
above with respect to the indemnification of Holders.
SECTION 9
Indemnification by Holders of Registrable Securities
In the event of any registration under the Securities Act of
any offering of Registrable Securities, Holders hereby agree to
indemnify and hold harmless the Company, each other Holders of
Registrable Securities and each other person, if any, who
controls the Company within the meaning of the Securities Act and
each other person (including each underwriter, and each other
person, if any, who controls such underwriter) who participates
in the offering of such Registrable Securities against any
Losses, joint or several, to which the Company, such Holders or
controlling person or
Page 7 of 14
participating person may become subject under the Securities Act
or otherwise, insofar as such Losses (or proceedings in respect
thereof) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained, on the
effective date thereof, in any Registration Statement under which
an offering of such Registrable Securities was registered under
the Securities Act, in any preliminary prospectus or final
prospectus contained therein, or in any amendment or supplement
thereto, or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not
misleading, and will reimburse the Company, such other Holders
and each such controlling person or participating person for any
legal or other expenses reasonably incurred by the Company, such
other Holders or such controlling person or participating person
in connection with investigating or defending any such Loss or
proceeding; provided, that Holders will be liable in any such
case to the extent, and only to the extent, that any such Loss
arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in such
Registration Statement, such preliminary or final prospectus or
such amendment or supplement in reliance upon and in conformity
with written information furnished by Holders specifically for
use in the preparation thereof. The Company shall be entitled to
receive indemnities from underwriters, selling brokers, dealer
managers and similar securities industry professionals
participating in the distribution to the same extent as provided
above with respect to information so furnished in writing by such
persons specifically for inclusion in any Registration Statement
or prospectus.
SECTION 10
Conduct of Indemnification Proceedings
If any action or proceeding (including any governmental
investigation or inquiry) shall be brought or any claim shall be
asserted against any person entitled to indemnity hereunder (an
"indemnified party"), such indemnified party shall promptly
notify the party from which such indemnity is sought (the
"indemnifying party") in writing, and the indemnifying party
shall assume the defense thereof, including the employment of
counsel reasonably satisfactory to the indemnified party and the
payment of all fees and expenses reasonably incurred in
connection with the defense thereof. Any such fees and expenses
borne by the indemnified party (including any fees and expenses
reasonably incurred in connection with investigating or preparing
to defend such action or proceeding) shall be paid to the
indemnified party, as incurred, within fifteen (15) days of
written notice thereof to the indemnifying party (regardless of
whether it is ultimately determined that an indemnified party is
not entitled to indemnification hereunder). Any such indemnified
party shall have the right to employ separate counsel in any such
action, claim or proceeding and to participate in the defense
thereof, but the fees and expenses of such counsel shall be the
expenses of such indemnified party unless (i) the indemnifying
party has agreed to pay such fees and expenses or (ii) the
indemnifying party shall have failed to promptly assume the
defense of such action, claim or proceeding or (iii) the named
parties to any such action, claim or proceeding (including any
impleaded parties) include both such indemnified party and the
indemnifying party, and such indemnified party shall have been
advised by counsel in writing that there may be one or more legal
defenses available to it which are different from or in addition
to those available to the indemnifying party and that the
assertion of such defenses would create a conflict of interest
such that counsel employed by the indemnifying party could not
faithfully represent the indemnified party (in which case, if
such indemnified party notifies the indemnifying party in writing
that it elects to employ separate counsel at the expense of the
indemnifying party, the indemnifying party shall not have the
right to assume the defense of such action, claim or proceeding
on behalf of such indemnified party, it being understood,
however, that the indemnifying party shall not, in connection
with any one such action, claim or proceeding or separate but
substantially similar or related actions, claims or proceedings
in the same
Page 8 of 14
jurisdiction arising out of the same general allegations or
circumstances, be liable for the reasonable fees and expenses of
more than one separate firm of attorneys (together with
appropriate local counsel) at any time for all such indemnified
parties, unless such indemnified party shall have been advised by
counsel in writing that a conflict of interest may exist between
such indemnified party and any other of such indemnified parties
with respect to such action, claim or proceeding, in which event
the indemnifying party shall be obligated to pay the fees and
expenses of such additional counsel or counsels). The
indemnifying party shall not be liable for any settlement of any
such action or proceeding effected without its written consent.
SECTION 11
Contribution
If the indemnification provided for in this Agreement is
unavailable to an indemnified party under Section 8 or 9 hereof
(other than by reason of exceptions provided in those Sections)
in respect of any Losses, then each applicable indemnifying party
in lieu of indemnifying such indemnified party shall contribute
to the amount paid or payable by such indemnified party as a
result of such Losses, in such proportion as is appropriate to
reflect the relative fault of the indemnifying party and
indemnified parties in connection with the actions, statements or
omissions which resulted in such Losses as well as any other
relevant equitable considerations. The relative fault of such
indemnifying party and the indemnified party shall be determined
by reference to, among other things, whether any action in
question, including any untrue statement or alleged untrue
statement of a material fact or omission or alleged omission of a
material fact, has been taken or made by, or relates to
information supplied by, such indemnifying party or indemnified
party, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such action,
statement or omission. The amount paid or payable by a party as
a result of any Losses shall be deemed to include, subject to the
limitations set forth in Section 10, any legal or other fees or
expenses reasonably incurred by such party in connection with any
action, suit, claim, investigation or proceeding.
The parties hereto agree that it would not be just and
equitable if contribution pursuant to this Section 11 were
determined by pro rata allocation or by any other method of
allocation which does not take into account the equitable
considerations referred to in the immediately preceding
paragraph. Notwithstanding the provisions of this Section 11, an
indemnifying party which is a selling Holders of Registrable
Securities shall not be required to contribute any amount in
excess of the amount by which the total price at which the
Registrable Securities sold by such indemnifying party and
distributed to the public were offered to the public exceeds the
amount of any damages which such indemnifying party 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.
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SECTION 12
General Provisions
12.1 With a view to making available to each Holder where
applicable the benefit of Rule 144 promulgated under the Act
(which term as used herein includes the present Rule 144 and any
other, additional, substitute, supplemental, or analogous rule or
regulation of the SEC which may at any time permit a Holder to
sell securities to the public exempt from registration), the
Company agrees (i) if the Company's securities have been
registered under Section 12 or Section 15 of the Securities
Exchange Act of 1934, as amended, and such registration is not
then withdrawn or suspended, to file with the SEC in a timely
manner all reports and other documents required to be filed by an
issuer of securities registered under the Securities Exchange Act
of 1934, as amended, so as to maintain the availability of
Rule 144 to the Holders; (ii) at its expense, forthwith upon any
Holder's request, to deliver to any Holder a certificate, signed
by one of the Company's principal officers, stating (A) the
Company's name, address and telephone number (including area
code), (B) the Company's Internal Revenue Service identification
number, (C) the Company's Securities and Exchange Commission file
number, (D) the number of shares of Common Stock outstanding as
shown by the most recent report or statement published by the
Company, (E) whether the Company has filed the reports required
to be filed under the Securities Exchange Act of 1934, as
amended, for a period of at least 90 days prior to the date of
such certificate and in addition has filed the most recent annual
report required to be filed thereunder and (F) such other or
additional information as shall be necessary to make available to
the Holder the ability to offer and sell the maximum number of
shares under Rule 144; and (iii) when Rule 144 is being complied
with or the holding period for unaffiliated security holders
shall have expired, to deliver securities not bearing any legend
restricting transfer of such securities (to the extent then
permitted by rules or interpretations of the staff of the SEC),
as may be requested from time to time by any Holder.
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12.2 The Shares shall not be transferred, and the Company
shall not be required to register any transfer of the Shares on
the books of the Company, unless the Company shall have been
provided with an opinion of counsel satisfactory to it prior to
such transfer that registration under the Securities Act and
applicable state securities laws is not required in connection
with the transaction resulting in such transfer; provided,
however, that no such opinion of counsel shall be required in
order to effectuate a transfer pursuant to an effective
registration of the Shares. Each certificate issued upon any
transfer of the Shares transferred as above provided shall bear
an appropriate investment legend, except that such certificate
shall not bear such restrictive legend if the opinion of counsel
referred to above is to the further effect that such legend is
not required in order to establish compliance with the provisions
of the Securities Act or if such transfer is made in accordance
with the provisions of Rule 144 promulgated under the Securities
Act. The registration rights described in this Agreement shall
immediately terminate as to those Shares which are transferred by
the Holder except for transfers (i) to immediate family members,
which shall mean lineal descendants of the Holder, (ii) to other
Holders or their permitted transferees, or (iii) of more than
50,000 Shares to any transferee.
12.3 Except to the extent expressly provided in this
Agreement, notices under this Agreement shall be in writing and
shall be effective when actually delivered or three business days
after being deposited in the United States Mails, certified,
return receipt requested, directed to the other party at the
address set forth below, or to such other address as either party
may indicate by written notice to the other party:
If to the Company:
Elmer's Restaurants, Inc.
00000 XX Xxxxx Xx.
Xxxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxx
[This space intentionally left blank]
Page 11 of 14
If to Holders:
Xxxxx X. Xxxxx
Xxxxxxx X. Service
000 X. 0xx Xxxxxx, Xxxxx X
Xxxxxx, Xxxxxx 00000
Xxxxx Xxxxxx
00 Xxxx Xxxxx
Xxxxxx, Xxxxxx 00000
Xxxxxxx X. Xxxxx
0000 Xxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Xxxxx Xxxxxx
00000 Xxxxxxx Xxxxx
Xxxxxxxxxxx, Xxxxxx 00000
Xxxxx Xxxxxx
0000 Xxxxxx Xxxx, #000
Xxxxxx Xxxxxx 00000
Xxx X. Xxxxxxxxx
000 Xxxx Xxxxxxx
Xxxxxx, Xxxxxx 00000
Xxxxxx X. Xxxxxxx
0000 Xxxxxx Xxxxx
Xxxxxx, Xxxxxx 00000
Xxxxxx X. Xxxxxx
4040 Xxxxxxxx
Xxxxxx, Xxxxxx 00000
12.4 This Agreement constitutes the entire agreement between
the parties pertaining to the subject matter hereof, supersedes
any and all prior or contemporaneous agreements or undertakings
of the parties pertaining to the subject matter hereof. Neither
this Agreement, nor any term hereof, may be amended, waived,
discharged, or terminated, except by written instrument signed by
the Company and the Holders of at least 50 percent (50%) of the
Registrable Securities and any such amendment, waiver, discharge,
or termination shall be binding on all the Holders, but in no
event shall the obligation of any Holder hereunder by materially
increased, except upon the written consent of such Holder.
12.5 If any term or provision of this Agreement or the
application thereof to any party or circumstance shall to any
extent be invalid or unenforceable, the remainder of this
Agreement and the application of such term or provision to such
parties or circumstances other than those as to which it is held
invalid or unenforceable shall not be affected thereby, and
Page 12 of 14
each term or provision of this Agreement shall be valid and
enforceable to the fullest extent permitted by law.
12.6 Failure of either party at any time to require
performance of any provision of this Agreement shall not limit
such party's right to enforce such provision, nor shall any
waiver of any breach of any provision of this Agreement
constitute a waiver of such provision itself. Any waiver of any
provision of this Agreement shall be effective only if set forth
in writing and signed by the party to be bound.
12.7 The headings in this Agreement are for convenience of
reference only and shall have no effect whatsoever on the
construction or interpretation of any provision of this
Agreement. All provisions of this Agreement have been negotiated
at arms length and this Agreement shall not be construed for or
against any party by reason of the authorship or alleged
authorship of any provision hereof.
12.8 This Agreement may be executed in counterparts, all of
which shall constitute one and the same agreement.
12.9 This Agreement shall be governed by and construed in
accordance with the laws of the State of Oregon.
IN WITNESS WHEREOF, the parties hereto have executed this
Registration Rights Agreement as of the day and year first above
written.
The Company: ELMER'S RESTAURANTS, INC., an
Oregon corporation
By:_/s/__Bruce N. Davis_____
Xxxxx X. Xxxxx
President
Holders:
_/s/__Bruce N. Davis______________
Xxxxx X. Xxxxx
_/s/_Cordy Jensen_________________
Xxxxx Xxxxxx
_/s/_William W. Service___________
Xxxxxxx X. Service
Page 13 of 14
_/s/_Gregory W. Wendt_____________
Xxxxxxx X. Xxxxx
_/s/_Karen K. Brooks______________
Xxxxx Xxxxxx
_/s/_Donald W. Woolley____________
Xxxxxx X. Xxxxxxx
_/s/_Thomas C. Connor_____________
Xxxxxx X. Xxxxxx
_/s/_Linda E. Bolton______________
Xxxxx Xxxxxx
_/s/_Ken N. Boettcher_____________
Xxx X. Xxxxxxxxx
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