1
Exhibit 10
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT, dated as of December 29, 1995 (this
"Agreement"), between WEN9Y'S INTERNATIONAL, INC., an Ohio corporation
("Wendy's"), and XXXXXX X. XXXXX ("Shareholder").
W I T N E S S E T H
WHEREAS, pursuant to a Stock Purchase Agreement entered into among
Wendy's, 1149658 Ontario Inc., an Ontario corporation and a subsidiary of
Wendy's (1149658 Ontario Inc. and its successors being referred to herein as
"Newco"), 632687 Alberta Ltd., an Alberta corporation, continued as 1052106
Ontario Inc., an Ontario corporation (the "Company"), and Shareholder, dated as
of October 31, 1995, as amended (the "Purchase Agreement"), the parties thereto
have agreed, subject to the terms and conditions set forth therein, that Newco
shall acquire from Shareholder all of the issued and outstanding shares of the
Company, and Shareholder shall receive Non-Voting Exchangeable Shares of Newco
(such shares, and shares of any successor corporation having terms substantially
equivalent to those of the Non-Voting Exchangeable Shares of Newco, being
referred to herein as the "Newco Exchangeable Shares");
WHEREAS, pursuant to certain agreements (the "Ancillary Agreements")
entered into in connection with the Purchase Agreement, Shareholder may from
time to time receive common shares, without par value, of Wendy's (the "Wendy's
Common Shares") in exchange for his Newco Exchangeable Shares; and
WHEREAS, the parties hereto desire to provide certain registration
rights with respect to Wendy's Common Shares which may be acquired by
Shareholder pursuant to the Ancillary Agreements;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements herein contained, the parties agree as follows:
1. Certain Definitions. As used in this Agreement, the following
terms shall have the following meanings:
1.1. "Registrable Securities": Any Wendy's Common Shares (or
any shares of capital stock issued in exchange therefor or
reclassification thereof) issued to Shareholder pursuant to the
Ancillary Agreements, except that particular Registrable Securities
shall cease to be Registrable Securities if and at such time as
2
(i) a registration statement with respect to the sale of such
securities shall have been declared effective under the 1933 Act and
such securities shall have been disposed of in accordance with such
registration statement or (ii) such securities shall have been sold or
otherwise transferred in a privately negotiated transaction, pursuant
to Rule 144 under the 1933 Act, or otherwise, to a party other than
Xxxxxx X. Xxxxx or his legal representatives.
1.2. "SEC": The U.S. Securities and Exchange Commission, or
any successor thereto.
1.3. "Share Exchange Agreement": The Share Exchange
Agreement, dated as of the date hereof, among Wendy's, Newco and
Shareholder.
1.4. "1933 Act": The U.S. Securities Act of 1933, as amended.
2. Demand Registrations.
2.1. At any time, and from time to time, after Wendy's shall
have filed with the SEC financial statements including at least 30 days
of combined operating results of Wendy's and Newco, upon written
request of Shareholder or his legal representatives, Wendy's shall use
its best efforts to file with the SEC as promptly as practicable (and
in any event within 90 days after receiving such request) a
registration statement under the 1933 Act covering the Registrable
Securities included in such request, and Wendy's shall use its best
efforts to cause such registration statement to become effective as
expeditiously as practicable; provided, however, that if Wendy's, in
its sole good faith judgment, determines that filing or maintaining the
effectiveness of a registration statement covering Registrable
Securities (or any disclosure which may be reasonably required to be
contained therein) is reasonably likely to materially interfere with
any financing, acquisition, corporate reorganization, merger or other
transaction, or require premature disclosure of any material
circumstance, relating to Wendy's, Wendy's may postpone such filing or
terminate the effectiveness thereof for a period not to exceed 135
days. Wendy's shall not be obligated (i) to file more than eight
registration statements pursuant to this Section 2, (ii) to file more
than one registration statement (including any registration statement
filed by Wendy's other than pursuant to this Section 2) during any
consecutive 180-day period, or (iii) to file a registration statement
covering Registrable Securities in an amount representing less than
7.5% of the total number of Wendy's Common Shares which are
exchangeable for the total number of Newco Exchangeable Shares
purchased by Shareholder under the Purchase Agreement (as adjusted to
give effect to any subsequent changes in the Wendy's Common Shares).
- 2 -
3
2.2. Any request by Shareholder or his legal representatives
pursuant to this Section 2 shall (1) express Shareholder's present
intent to offer a specified number of Registrable Securities for
distribution; (2) describe in reasonable detail the nature or method of
the proposed offer and sale thereof; and (3) contain an undertaking to
furnish all such information and materials and take all such action as
may be required in order to permit Wendy's to comply with all
applicable requirements of the SEC, to obtain acceleration of the
effective date of the registration statement and to comply with all
reasonable requests of the underwriters, if any.
2.3. Shareholder agrees that, prior to any sale of its
Registrable Securities pursuant to a registration statement, he will
have exchanged Newco Exchangeable Shares for Wendy's Common Shares in
an amount necessary to effect such sale.
2.4. If an offering pursuant to this Section 2 shall be
effected through underwriters, the managing underwriters therefor shall
be jointly selected by Wendy's and Shareholder. Such underwriters shall
agree to be bound by the provisions of Section 5.6(b) of the Share
Exchange Agreement.
2.5. Wendy's shall not be required to effect a registration
pursuant to this Section 2 if at the time Wendy's receives
Shareholder's request to effect a registration, Wendy's is not eligible
to use Form S-3 or any successor form thereto.
3. Expenses. Wendy's shall pay all costs and expenses incurred by
Wendy's in connection with any registration of Registrable Securities pursuant
to Section 2, including, without limitation, all SEC and blue sky registration
and filing fees, printing expenses, fees and disbursements of legal counsel and
accountants for Wendy's and transfer agents' and registrar's fees, fees and
disbursements of experts used by Wendy's in connection with such registration,
and expenses incidental to any post-effective amendment to any such registration
statement; provided, however, Wendy's shall not be required to bear, and
Shareholder hereby agrees to bear, such costs and expenses attributed to the
registration which consist of underwriters' commissions, brokerage fees, or
transfer taxes, or fees and disbursements of counsel and accountants of the
parties (other than Wendy's) whose shares are covered by the registration
statement. Notwithstanding the foregoing, the provisions of this Section 3 shall
be deemed automatically amended to the extent necessary to cause these expense
provisions to comply with the "blue sky" or similar securities laws of each
jurisdiction in which an offering of Registrable Securities is made.
- 3 -
4
4. Requirements with Respect to Registration. If and whenever
Wendy's is required by the provisions hereof to register Registrable Shares,
Wendy's will, as expeditiously as possible:
(a) Prepare and file with the SEC a registration statement
and 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 1933 Act with respect to the disposition of all Registrable
Securities covered by such registration statement for the period
required to effect the distribution of such shares, but in no event
shall Wendy's be required to do so for a period of more than 120 days
following the effective date of such registration statement.
(b) Furnish at its expense to Shareholder such number of
copies of a preliminary, final, supplemental or amended prospectus, or
other prospectus, in conformity with the requirements of the 1933 Act
as Shareholder may reasonably request in order to facilitate the
disposition of its Registrable Securities, but only while Wendy's is
required, under the provisions hereof, to cause the registration
statement to remain current.
(c) Use its best efforts to register or qualify the
Registrable Securities covered by such registration statement under
such other securities or blue sky laws of such jurisdictions in the
U.S. as Shareholder shall reasonably request, and do any and all other
acts and things which may be necessary or advisable to enable
Shareholder to consummate the disposition of the Registrable Securities
owned by him in such jurisdiction; provided, however, that Wendy's
shall in no event be required to qualify to do business as a foreign
corporation or as a dealer in any jurisdiction where it is not so
qualified, to conform the composition of its assets at the time to the
securities or blue sky laws of such jurisdiction, to execute or file
any general consent to service of process under the laws of any
jurisdiction, to take any action that would subject it to service of
process in suits other than those arising out of the offer and sale of
the Registrable Securities covered by such registration statement or to
subject itself to taxation in any jurisdiction where it has not
theretofore done so.
(d) As soon as reasonably practicable after the effective
date of any such registration statement, and in any event, within 16
months thereafter, make generally available to its shareholders an
earnings statement (which need not be audited) complying with Section
11(a) of the 1933 Act and covering a period of at least twelve
consecutive months beginning after the effective date of any such
registration statement.
- 4 -
5
(e) Deliver promptly to Shareholder copies of all
correspondence between the SEC and Wendy's, its counsel or auditors,
and permit Shareholder to do such reasonable investigation upon
reasonable advance notice with respect to information contained in the
registration statement as it deems reasonably necessary and to supply
such additional information concerning Wendy's or the registration
statement as shall be reasonably necessary to enable it to fulfill its
responsibilities under the 1933 Act.
(f) Obtain a "comfort letter" from Wendy's independent public
accountants, in customary form and covering such matters of the type
customarily covered by "comfort letters" as Shareholder shall
reasonably request.
(g) Deliver an opinion of counsel (who may be an employee of
Wendy's) for Wendy's, addressed to Shareholder, and any underwriter, in
the form usual and customary in connection with secondary public
offerings of securities.
(h) Enter into such customary agreements (including an
underwriting agreement containing such representations and warranties
by Wendy's and such other terms and provisions as are customarily
contained in underwriting agreements for comparable offerings) as the
Seller or the underwriters participating in such offering may
reasonably request.
(i) Use its best efforts to list all the Registrable
Securities covered by the registration statement on the same securities
exchange or inter dealer quotation systems as the voting common equity
securities of Wendy's are then listed or quoted, and to pay all fees
and expenses in connection therewith.
(j) Furnish unlegended certificates representing ownership of
the Registrable Securities being sold in such denominations as shall be
requested by the holders thereof, or the underwriters in the case of an
underwritten offering, in connection with any sale pursuant to a
registration statement.
5. Indemnification by Wendy's. In the event of any registration of
Registrable Securities under the 1933 Act pursuant to Section 2 above, Wendy's
shall indemnify and hold harmless to the fullest extent permitted by law
Shareholder, any other person whose shares are included in such registration
statement (for the purposes of this Section, Shareholder and such persons shall
be referred to individually as a "Seller" and collectively as "Sellers"), any
underwriter and each other person, if any, who controls such Seller or
underwriter within the meaning of the 1933 Act, against any losses, claims,
damages, expenses or liabilities, joint or several, to which each such Seller or
underwriter
- 5 -
6
or controlling person may become subject, under the 1933 Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in such registration statement or
preliminary prospectus (if used prior to the effective date of such registration
statement) or final or summary prospectus contained therein (if used during the
period Wendy's is required to keep the registration statement effective), or 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 made therein, in light of the
circumstances under which they were made, not misleading, and will reimburse
each such Seller, underwriter and controlling person for any legal or any other
out of pocket expenses reasonably incurred by them in connection with
investigating or defending any such action or claim, excluding any amounts paid
in settlement of any litigation, commenced or threatened, if such settlement is
effected without the prior written consent of Wendy's; provided, however, that
Wendy's will not be liable to a particular Seller or underwriter in any such
case to the extent that any such loss, claim, damage, liability or expense
arises out of or is based upon an untrue statement or alleged untrue statement
or omission or alleged omission made in said registration statement, said
preliminary prospectus or said final or summary prospectus or any amendment or
supplement thereto, in reliance upon and in conformity with written information
furnished to Wendy's by Seller or its affiliates, or by that underwriter, as the
case may be, specifically for use in the preparation thereof. In addition,
Wendy's will not be liable for legal expenses of more than one law firm
representing Seller, any underwriters and controlling persons and will not
indemnify any underwriter or any person who controls such underwriter if such
underwriter failed to send or to give a copy of the final prospectus to the
person asserting the claim at or prior to the written confirmation of the sale
of such shares to such person and if the untrue statement or omission concerned
had been corrected in such final prospectus and if Wendy's advises the
underwriter in writing of such correction at or before the time such final
prospectus becomes available.
6. Indemnification by Shareholder. In the event of any registration
of shares under the 1933 Act pursuant to Section 2 above, Shareholder shall
indemnify and hold harmless to the fullest extent permitted by law Wendy's, each
of its directors, each of its officers who have signed such registration
statement and each other person, if any, who controls Wendy's within the meaning
of the 1933 Act, against any losses, claims, damages, expenses or liabilities,
joint or several, to which Wendy's or any such director, officer or controlling
person may become subject under the 1933 Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon any untrue statement or alleged untrue statement of any
material fact contained in such registration statement, or preliminary
prospectus or final or summary prospectus contained therein, or any amendment or
supplement thereto, or arise
- 6 -
7
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
made therein, in light of the circumstances under which they were made, not
misleading, and will reimburse Wendy's, such directors, officers and controlling
persons for all legal or other out of pocket expenses reasonably incurred by
them in connection with investigating or defending any such action or claim,
excluding any amounts paid in settlement of any litigation, commenced or
threatened, if such settlement is effected without the prior written consent of
Shareholder; but in all such cases only if, and to the extent that, any such
loss, claim, damage, liability or expense arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged omission
therein made in reliance upon and in conformity with written information
furnished to Wendy's by Shareholder or its affiliates specifically for use in
the preparation thereof. In no event shall the liability of Shareholder under
this Section 6 be greater in amount than the U.S. dollar amount of the proceeds
(net of any underwriting discount) received by Shareholder and its affiliates
upon the sale of Registrable Securities pursuant to the registration statement;
provided, however, that if, at the time a claim is made against Shareholder
under this Section 6, all of the Registrable Securities included in the
registration statement have not been sold, then the limit on Shareholder's
liability set forth herein shall be increased by the U.S. dollar amount
Shareholder and its affiliates would have received for such unsold Registrable
Securities had they been sold on the day the registration statement was first
declared effective, calculated, in the case of an underwritten offering, using
the amount (net of underwriting discounts) Shareholder and its affiliates would
have received from the underwriter and in the case of an offering that is not
underwritten, using the price that Wendy's Common Shares last traded on such
date.
7. Actions Commenced. Promptly after receipt by an indemnified party
under Sections 5 or 6 above of notice of the commencement of any action
involving any claim, loss, damage or liability referred to in such Sections,
such indemnified party shall, if a claim in respect thereof is to be made
against the indemnifying party under any of such Sections, notify the
indemnifying party in writing of the commencement of such action. The failure of
an indemnified party to provide such notice shall not relieve the indemnifying
party of its indemnity obligations, except to the extent the indemnifying party
is materially prejudiced thereby. In case any such action is brought against an
indemnified party, the indemnifying party shall be entitled to participate in,
and, to the extent that it so chooses, to assume the defense thereof with
counsel reasonably satisfactory to such indemnified party, and, after notice
from the indemnifying party to such indemnified party that it so chooses, such
indemnifying party shall not be liable for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof; provided, however, that if either (i) the indemnifying party fails to
take reasonable steps necessary to diligently defend such claim within 30 days
after receiving notice from the indemnified party that the indemnified party
believes
- 7 -
8
it has failed to do so, or (ii) if such indemnified party who is a defendant in
any action or proceeding which is also brought against the indemnifying party
reasonably shall have concluded that there may be one or more legal defenses
available to such indemnified party which are not available to the indemnifying
party, then in either such case the indemnified party may assume its own defense
and the indemnifying party shall be liable for any expenses therefor (but not of
more than one counsel). No indemnified party shall consent to entry of any
judgment or settle any claim without the prior written consent of the
indemnifying party.
8. Contribution.
8.1. If for any reason the indemnity set forth in Sections 5
or 6 above is unavailable or is insufficient to hold harmless an
indemnified party thereunder, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party in
such proportion as is appropriate to reflect the relative benefits
received by the indemnifying party on the one hand and the indemnified
party on the other from such offering of securities. If, however, the
allocation provided in the immediately preceding sentence is not
permitted by applicable law, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party in
such proportion as is appropriate to reflect not only such relative
benefits but also the relative fault of the indemnifying party, on the
one hand, and the indemnified party, on the other hand, as well as any
other relevant equitable considerations. The relative fault shall be
determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by
the indemnifying party or the indemnified party and the parties'
relative intent, knowledge, access to information and opportunity to
correct or prevent such untrue statement or omission. The parties
hereto agree that it would not be just and equitable if contributions
pursuant to this Section 8.1 were to be 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 preceding
sentences of this Section 8.1. The amount paid or payable shall be
deemed to include any legal or other expenses reasonably incurred by
such indemnified party in connection with investigating or defending
any such claim. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the 0000 Xxx) shall be entitled
to contribution from any person who was not guilty of such fraudulent
misrepresentation.
8.2. The indemnity agreements contained herein shall be in
addition to any other rights to indemnification or contribution which
any indemnified party may have pursuant to law or contract and shall
remain operative and in full force
- 8 -
9
and effect regardless of any investigation made or omitted by or on
behalf of any indemnified party.
9. Miscellaneous.
9.1. Amendments, Modifications, etc. This Agreement may not
be amended, modified or supplemented by the parties hereto in any
manner, except by an instrument in writing signed by duly authorized
officers or representatives of Wendy's and Shareholder.
9.2. No Waiver. The failure of any party hereto to enforce at
any time any of the provisions of this agreement shall in no way be
construed to be a waiver of any such provision, nor in any way to
effect the validity of this Agreement or any party hereof or the right
of such party thereafter to enforce each and every such provision. No
waiver of any breach of or non-compliance with this Agreement shall be
held to be a waiver of any other or subsequent breach or
non-compliance.
9.3. Governing Law. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the State of
Ohio, without regard to its conflict of law rules.
9.4. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed given if delivered in person or
sent by facsimile or via a reputable international overnight courier
service to the parties at the following addresses (or at such other
address for a party as shall be specified by like notice), and shall be
deemed given on the date on which delivered by hand or otherwise on the
date of receipt:
If to Wendy's:
Wendy's International, Inc.
X.X. Xxx 000
0000 Xxxx Xxxxxx-Xxxxxxxxx Xxxx
Xxxxxx, Xxxx 00000
Attention: Xxxxxxxx X. Xxxxxx, Esq.
Facsimile No.: (000) 000-0000
- 9 -
10
With a copy to:
Lang Xxxxxxxx
XXX Xxxxx, Xxxxx 0000
X.X. Xxx 000
000 Xxx Xxxxxx
Xxxxxxx, Xxxxxxx X0X 0X0
Attention: Xxxxxx X. Xxxxx, Esq.
Facsimile No.: (000) 000-0000
and
Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx
Xxx Xxx Xxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxxx, Esq.
Facsimile No.: (000) 000-0000
If to Shareholder:
Xx. Xxxxxx X. Xxxxx
00 Xxxx Xxxxx Xxxxxxxx Xxxxxxx
Xxxxxxx, Xxxxxxx X0X 0X0
Facsimile No.: (000) 000-0000
With a copy to:
Tory Xxxx XxxXxxxxxxx & Binnington
Suite 3000 Aetna Tower
X.X. Xxx 000
Xxxxxxx-Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx X0X 0X0
Attention: Xxxxxx Xxxxxxx, Esq. Q.C.
Facsimile No.: 000-000-0000
9.5. Construction of Agreement. A reference to an Article or
Section shall mean an Article of or a Section in this Agreement unless
otherwise expressly
- 10 -
11
stated. The titles and headings herein are for reference purposes only
and shall not in any manner limit the construction of this Agreement
which shall be considered as a whole. The words "include," "includes"
and "including" when used herein shall be deemed in each case to be
followed by the words, "without limitation."
9.6. Entire Agreement, Assignability, etc. This Agreement (a)
constitutes the entire agreement, and supersedes all other prior
agreements and understandings, both written and oral between the
parties with respect to the subject matter hereof, and (b) is not
intended to confer upon any person other than the parties hereto any
rights or remedies hereunder, except as otherwise expressly provided
herein, and (c) shall not be assignable by operation of law or
otherwise, except as otherwise expressly provided herein.
9.7. Validity. The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity of any other
provision of this Agreement, each of which shall remain in full force
and effect.
9.8. Currency. Except where otherwise expressly provided, all
amounts in this Agreement are stated in U.S. currency.
9.9. Counterparts. This Agreement may be executed in one or
more counterparts, all of which together shall constitute one and the
same Agreement.
- 11 -
12
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the date first above written.
WENDY'S INTERNATIONAL, INC.
By: /s/ Xxxxxx X. Xxxxx
-------------------------------------
Title: President, Chief Executive Officer
and Chief Operating Officer
/s/ Xxxxxx Xxxxx /s/ Xxxxxx X. Xxxxx
----------------------------------- ------------------------------------------
Witness to the signature of XXXXXX X. XXXXX
Xxxxxx X. Xxxxx
- 12 -
