EXHIBIT 10.2
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (this "Agreement"), dated as of
August 5, 2003, by and among Homestore, Inc. (formerly known as Xxxxxxxxx.xxx,
Inc.), a Delaware corporation (the "Company"), Cendant Corporation, a Delaware
corporation ("Cendant"), and Cendant Membership Services Holdings, Inc., a
Delaware corporation ("Stockholder") and wholly owned subsidiary of Cendant.
WHEREAS, the Company, Cendant and the Shelf Stockholders (as defined in
the Original Registration Rights Agreement (as defined below)) entered into a
registration rights agreement, dated as of October 26, 2000, which became
effective as of February 14, 2001 (the "Original Registration Rights
Agreement");
WHEREAS, upon the effectiveness of the Original Registration Rights
Agreement, Stockholder became the registered owner of all the Stockholder
Shares;
WHEREAS, Cendant and the Company desire to settle their dispute
relating to the Company restating its financial statements for the year ended
December 31, 2000 and for the quarterly periods ended March 31, 2001, June 31,
2001 and September 30, 2001 pursuant to the terms of the Settlement Agreement,
dated as of August 5, 2003 (the "Settlement Agreement"); and
WHEREAS, the Settlement Agreement provides for (i) termination of the
Original Registration Rights Agreement as between Cendant, on one hand, and the
Company, on the other hand, provided that such termination shall not affect the
rights and obligations between the Company and the Shelf Stockholders (as such
term is defined in the Original Registration Rights Agreement) and (ii) the
Company to grant certain registration rights to Stockholder as set forth herein.
NOW, THEREFORE, in consideration of the promises, mutual covenants and
conditions herein contained, and of other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereby
agree as follows:
1. Definitions. For purposes of this Agreement, the following terms
shall have the following respective meanings:
"1933 Act" means the Securities Act of 1933, as amended.
"1934 Act" means the Securities Exchange Act of 1934, as amended.
"Affiliate" shall have the meaning ascribed to such term in Rule 12b-2
of the General Rules and Regulations under the 1934 Act.
"Business Day" shall mean any day that the Nasdaq SmallCap Market
System is normally open for trading for a full day and that is not a Saturday, a
Sunday or a day on
which banks in the City of New York are authorized or required to close for
regular banking business.
"Existing Registration Rights Agreements" means any written agreement
dated as of a date prior to the date of the Reorganization Agreement obligating
the Company to register shares of any of the Company's securities for its
stockholders, including, without limitation, the Original Registration Rights
Agreement and the Second Amended and Restated Stockholders Agreement, dated
January 28, 1999, by and among the Company and certain of its stockholders, as
amended by Amendment No. 1 thereto dated April 9, 1999.
"Existing Stockholders" shall have the meaning ascribed to the terms
"Stockholders" and "Shelf Stockholders" in the Existing Registration Rights
Agreements, and any other stockholder or holder of any security convertible into
or exchangeable for any of the Company's securities.
"Person" means a corporation, an association, a partnership, a limited
liability company, an organization, a business, an individual, a joint venture,
a trust, other legal or governmental entity or political subdivision thereof.
"Register," "registered," and "registration" refers to a registration
effected by preparing and filing a registration statement or similar document in
compliance with the 1933 Act, and the declaration or ordering of effectiveness
of such registration statement or document.
"Registration Statement" means the registration statement described in
Section 2.1 of this Agreement.
"Reorganization Agreement" means the Agreement and Plan of
Reorganization, dated as of October 26, 2000, by and among the Company, Metal
Acquisition Corp., WW Acquisition Corp., Xxxx.xxx, Inc., Welcome Wagon
International Inc., Stockholder and Cendant Corporation.
"Rule 144" means Rule 144 promulgated under the 1933 Act, or any
successor rule thereto.
"SEC" means the Securities and Exchange Commission.
"Stockholder" shall have the meaning set forth in the preamble hereto.
"Stockholder Shares" means the shares of common stock of the Company
issued to Stockholder in accordance with the terms and conditions of the
Reorganization Agreement, including such shares of common stock of the Company
transferred from Stockholder to The Cendant Charitable Foundation, and any
securities of the Company issued as a dividend on or other distribution with
respect to, or in exchange for or replacement of, such common stock.
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2. Registration Rights
2.1 Shelf Registration.
(a) Following the date hereof, the Company shall
promptly file with the SEC a registration statement under the 1933 Act to
provide for a public offering and sale of all of the Stockholder Shares from
time to time. The Company shall use its reasonable best efforts to cause the
Registration Statement to be declared effective as soon thereafter as reasonably
practicable and in any event, on or before October 14, 2003 (the "Effectiveness
Target Date"). The Company shall use its reasonable best efforts to keep the
Registration Statement continuously effective until the earlier of (i) the date
on which Stockholder notifies the Company in writing that the Company is no
longer required to keep the Registration Statement effective, (ii) the date on
which all of the Stockholder Shares are disposed of in accordance with the
Registration Statement or (iii) the date on which Stockholder receives an
opinion of counsel of national repute and experience in securities law matters
(which opinion and counsel shall be satisfactory to Stockholder) to the effect
that all the Stockholder Shares may be sold immediately in the public market
without registration under the 1933 Act.
(b) The Company shall be deemed not to have used
its reasonable best efforts to cause the Registration Statement to become, or to
remain, effective if it voluntarily takes any action that would result in the
Registration Statement not being declared effective unless (i) such action is
required by applicable law, including, but not limited to, reasonable periods
necessary to prepare appropriate disclosure, or (ii) such action is taken by the
Company in good faith and for business reasons, including, without limitation,
the acquisition or divestiture of assets or the offering or sale of securities,
so long as the Company promptly thereafter prepares a pre- or post-effective
amendment, as applicable, to the Registration Statement or an amendment or a
supplement to the related prospectus so that the prospectus will not contain an
untrue statement of a material fact necessary to make the statements therein not
misleading; it being understood that in any event the Company shall be subject
to the provisions of Section 3.5 whether or not in compliance with this Section
2.1(b).
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2.2 Underwriting; Requirements. Following the effectiveness of
the Registration Statement, Stockholder may elect to conduct an underwritten
takedown under the Registration Statement to sell the Stockholder Shares covered
by such Registration Statement. In any such underwritten offering, the
underwriter or underwriters and manager or managers that will administer the
offering will be investment bankers of recognized national standing, selected by
Stockholder and reasonably acceptable to the Company. In conjunction with any
underwritten public offering pursuant to this Section 2.2, the Company shall not
be required to include any of the Stockholder Shares in such underwriting unless
Stockholder agrees to execute and deliver an underwriting agreement containing
terms and provisions that are (a) customary for similar transactions and (b)
consistent with prevailing market practices at the time of such offering and the
terms of Section 3.6 hereof. Neither the Company nor any of the Existing
Stockholders shall be permitted to include any securities of the Company in any
underwritten offering pursuant to this Section 2.2, except to the extent any
Existing Stockholders have as set forth on Schedule 2.2 hereof contractual
rights existing as of December 31, 2002 to include shares in such an
underwritten offering.
3. Further Obligations of the Company After Registration.
3.1 Blue Sky Compliance. The Company shall, in connection
with a Registration Statement covering Stockholder Shares, use its reasonable
best efforts to register and qualify the Stockholder Shares covered by the
Registration Statement under such other securities or "blue sky" laws of such
jurisdictions as shall be reasonably requested by the Stockholder, provided that
the Company shall not be required in connection therewith or as a condition
thereto to qualify to do business or to file a general consent to service of
process in any such states or jurisdictions unless the Company is already
subject to service in such jurisdiction and except as may be required by the
1933 Act.
3.2 Furnishing of Prospectus. With respect to a
Registration Statement filed pursuant to Section 2.1, the Company shall use
reasonable best efforts to furnish to Stockholder copies of any preliminary
prospectus and, as expeditiously as reasonably possible after the effectiveness
of the Registration Statement, furnish to Stockholder such numbers of copies of
a final prospectus in conformity with the requirements of the 1933 Act, and such
other documents as Stockholder may reasonably request, in order to facilitate
the resale or other disposition of Stockholder Shares owned by the Stockholder.
3.3 Amendments. With respect to the Registration
Statement filed pursuant to Section 2.1 of this Agreement, the Company shall
prepare and file with the SEC such amendments to the Registration Statement and
amendments or supplements to the prospectus contained therein as may be
necessary to keep the Registration Statement effective and the Registration
Statement and prospectus free from material misstatements or omissions for the
entire period for which the Registration Statement remains effective.
3.4 Notices. The Company shall provide written
notification to the Stockholder:
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(a) promptly after it shall receive notice, of
the date and time when the Registration Statement and each post-effective
amendment thereto has become effective covering the Stockholder Shares;
(b) promptly of any request by the SEC for the
amending the Registration Statement or amending or supplementing the related
prospectus or for additional information covering Stockholder Shares held by the
Stockholder;
(c) at any time when a prospectus relating to
Stockholder Shares is required to be delivered under the 1933 Act, of any event
which would cause any such prospectus to include an untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, and promptly prepare and file with the
SEC, and promptly notify Stockholder of the filing of, such amendments to any
Registration Statement or amendments or supplements to any prospectus as may be
necessary to correct any such statements or omissions;
(d) promptly after it shall receive notice of
the issuance of any stop order by the SEC suspending the effectiveness of any
Registration Statement covering Stockholder Shares or the initiation or
threatening of any proceeding for that purpose and promptly use reasonable best
efforts to prevent the issuance of any stop order or to obtain its withdrawal if
such stop order should be issued; or
(e) promptly after it shall receive notice that
shares of the common stock of the Company have been delisted from the Nasdaq
SmallCap Market System.
3.5 Liquidated Damages.
(a) In the event that (i) the Registration
Statement is not declared effective by the SEC on or prior to the Effectiveness
Target Date, (ii) a filed and effective Registration Statement ceases to be
effective at any time after having been declared effective by the SEC or (iii)
the Company provides Stockholder with the written notification pursuant to
Sections 3.4(c) or 3.4(e), the Company shall pay liquidated damages (the
"Liquidated Damages") to Stockholder as follows:
(A) if the Registration Statement
is not declared effective by the SEC on or prior to the
Effectiveness Target Date, then commencing on the day after
such Effectiveness Target Date and accruing each day
thereafter, additional Liquidated Damages shall be payable in
an amount equal to the product of (x) $0.001 per Business Day
multiplied by (y) the number of Stockholder Shares that have
not been sold, transferred or otherwise disposed of, by
Stockholder or The Cendant Charitable Foundation, as the case
may be; or
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(B) if the Registration Statement
has been declared effective and such Registration Statement
ceases to be effective at any time (other than after such time
as all Stockholder Shares have been disposed of thereunder),
then additional Liquidated Damages shall be payable in an
amount equal to the product of (x) $0.001 per Business Day
multiplied by (y) the number of Stockholder Shares that have
not been sold, transferred or otherwise disposed of, by
Stockholder or The Cendant Charitable Foundation, as the case
may be, commencing on the date such Registration Statement
ceases to be effective and accruing each Business Day
thereafter; or
(C) if the Company has provided
written notification to Stockholder pursuant to Section 3.4(c)
or exceeded the thirty (30) day threshold specified in Section
8 hereof, additional Liquidated Damages shall be payable in an
amount equal to the product of (x) $0.001 per Business Day
multiplied by (y) the number of Stockholder Shares that have
not been sold, transferred or otherwise disposed of by
Stockholder or The Cendant Charitable Foundation, as the case
may be, commencing on the date the Company provides such
written notification and accruing each Business Day
thereafter; or
(D) if the Company has provided
written notification to Stockholder pursuant to Section
3.4(e), additional Liquidated Damages shall be payable in an
amount equal to the product of (x) $0.001 per Business Day
multiplied by (y) the number of Stockholder Shares that have
not been sold, transferred or otherwise disposed of by
Stockholder or The Cendant Charitable Foundation, as the case
may be, commencing on the date the shares of common stock of
the Company were delisted from the Nasdaq SmallCap Market
System and accruing each Business Day thereafter;
provided, however, that (1) upon effectiveness of the Registration Statement (in
the case of clause (A) above), (2) upon the effectiveness of the Registration
Statement which had ceased to remain effective (in the case of clause (B)
above), (3) upon receipt (or notification of the filing) of an amended or
supplemented Registration Statement or prospectus that corrects any untrue
statement of a material fact or omission (in the case of clause C above) or (4)
following notification that shares of common stock of the Company have been
relisted on the Nasdaq SmallCap Market System (in the case of clause D above),
the obligation to pay Liquidated Damages as a result of such clause, as
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the case may be, shall cease to accrue upon payment of the Liquidated Damages
accrued to date. The obligation of the Company to pay Liquidated Damages to
Stockholder shall terminate (i) once all outstanding Liquidated Damage payments
have been paid to Stockholder and (ii) in the event the Registration Statement
remains effective for a period of six consecutive months and during such six
month period the Company has not provided Stockholder with any of the written
notices contemplated in Sections 3.4(c), 3.4(d) or 3.4(e) or suspended or
delayed effectiveness of the Registration Statement pursuant to Section 8 for
more than thirty (30) days; provided, however, that the six month period shall
be extended for the same amount of time that the Registration Statement was
suspended or delayed pursuant to Section 8.
(b) Payment of Liquidated Damages. Any amounts
of Liquidated Damages due pursuant to Section 3.5(a) (A), (B), (C) or (D) above
shall be payable in cash to Stockholder on the last day of each month in which
Liquidated Damages are incurred by the Company. The aggregate amount of
Liquidated Damages payable to the Stockholder by the Company pursuant to this
Agreement shall not exceed $7.5 million. Liquidated Damages shall not accrue
pursuant to Section 3.5(a) (A), (B), (C) or (D) during any period of suspended
or delayed effectiveness of the Registration Statement pursuant to Section 8,
provided that Liquidated Damages shall accrue for any suspension or delay of the
effectiveness of the Registration Statement that exceeds the thirty (30) day
period provided for in Section 8. Liquidated Damages shall not accrue pursuant
to more than one of Section 3.5(a) (A), (B), (C) or (D) in respect of the same
Business Day nor shall Liquidated Damages accrue with respect to any Business
Day after the period set forth in Section 10 hereof for providing information
following a request for information made by the Company to the Stockholder
pursuant to Section 10 hereof and ending on the date that the Stockholder
provides such information to the Company.
(c) Acceleration of Liquidated Damages. In the
event (i) the Registration Statement has not been declared effective by the SEC
as of the first anniversary of the date hereof, or (ii) shares of common stock
of the Company cease to be listed on the Nasdaq SmallCap Market System at any
time prior to the date on which any Registration Statement has been continuously
effective for six (6) months and during such six month period, the Company has
not provided Stockholder with any of the written notices contemplated in
Sections 3.4(c), 3.4(d) or 3.4(e) or suspended or delayed effectiveness of the
Registration Statement pursuant to Section 8 for more than thirty (30) days
(provided, however, that the consecutive six month period shall be extended for
the same amount of time that the Registration Statement was suspended or delayed
pursuant to Section 8), the Company shall pay to Stockholder an amount equal to
(x)(A) the quotient of the number of Stockholder Shares held by Stockholder on
the first anniversary of the date hereof divided by the number of Stockholder
Shares held by Stockholder as of the date hereof multiplied by (B) $7.5 million
minus (y) the aggregate amount of any Liquidated Damages paid to Stockholder
pursuant to Section 3.5 during such one year period.
(d) Stock Split, Reclassification, etc. In the
event of any stock split, stock dividend, reverse stock split, reclassification,
share exchange or similar
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transaction with respect to the Stockholder Shares such that an adjustment to
the amount of Liquidated Damages payable in respect of each Stockholder Shares
is appropriate as an equitable matter, then the Company shall in good faith make
such equitable adjustment to the amount of Liquidated Damages per share as it
deems necessary or appropriate to achieve such equitable result.
(e) Specific Enforcement. Without limiting the
remedies available to Stockholder, the Company acknowledges that any failure by
the Company to comply with its obligations under Section 3.5 hereof may result
in material irreparable injury to Stockholder for which there is no adequate
remedy at law, that it would not be possible to measure damages for such
injuries precisely and that, in the event of any such failure, Stockholder may
obtain such relief as may be required to specifically enforce the company's
obligations under Section 2.1(a) hereof.
3.6 Cooperation by the Company. The Company shall, in the
case of a secondary underwritten public offering, enter into such customary
agreements (including underwriting agreements in customary form) and take all
such other actions as Stockholder or the underwriters, if any, reasonably
request in order to expedite or facilitate the disposition of the Stockholder
Shares (including, without limitation, making members of senior management of
the Company available to participate in, and cause them to cooperate with the
underwriters in connection with, "road-show" and other customary marketing
activities (including one-on-one meetings with prospective purchasers of the
Stockholder Shares)) and cause to be delivered to the underwriters and the
Stockholder, if any, opinions of counsel to the Company in customary form,
covering such matters as are customarily covered by opinions for an underwritten
public offering as the underwriters may request and addressed to the
underwriters and the Stockholder.
3.7 Inspection of Books and Records. The Company shall
make available, for inspection by any underwriter participating in any
disposition pursuant to the Registration Statement, and any attorney, accountant
or other agent retained by Stockholder 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 the Stockholder, underwriter,
attorney, accountant or agent in connection with the Registration Statement.
3.8 Accountant Letters. In the case of a secondary public
underwritten offering pursuant to Section 2.2, the Company shall cause to be
delivered, at the time of delivery of the Stockholder Shares sold pursuant
thereto, letters from the Company's independent certified public accountants
addressed to Stockholder (unless such Stockholder does not provide to such
accountants the appropriate representation letter required by rules governing
the accounting profession) and each underwriter stating that such accountants
are independent public accountants within the meaning of the 1933 Act and the
applicable rules and regulations adopted by the SEC thereunder, and otherwise in
customary form and covering such financial and accounting matters as are
customarily covered by letters of the independent certified public accountants
delivered in connection with secondary underwritten public offerings.
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3.9 SEC Filings. At all times after the Company has filed
a registration statement with the SEC pursuant to the requirements of either the
1933 Act or the 1934 Act, the Company shall file all reports required to be
filed by it under the 1933 Act and the 1934 Act and the rules and regulations
adopted by the SEC thereunder, and take such further action as Stockholder may
reasonably request, all to the extent required to enable Stockholder to be
eligible to sell the Stockholder Shares pursuant to Rule 144.
4. Amended or Supplemented Prospectus. The Stockholder agrees
that upon receipt of any written notice from the Company contemplated by Section
3.4(c) Stockholder shall forthwith discontinue disposition of Stockholder Shares
until Stockholder receives copies of a supplemented or amended prospectus from
the Company, or until it is advised in writing by the Company that the use of
the prospectus may be resumed, and has received copies of any additional or
supplemental filings which are incorporated by reference in the prospectus;
provided that the Company shall pay any Liquidated Damages set forth in Section
3.5 above. If so directed by the Company, Stockholder will deliver to the
Company all copies of the prospectus covering such Stockholder Shares at the
time of receipt of such notice of suspension.
5. Indemnification.
5.1 Indemnification by the Company. The Company will, and
hereby does, indemnify and hold harmless, Stockholder and its directors,
officers, partners, agents and Affiliates and each other Person who participates
as an underwriter in the offering or sale of the Stockholder Shares and each
other Person, if any, who controls Stockholder or any such underwriter within
the meaning of the 1933 Act, insofar as losses, claims, damages or liabilities
(or actions or proceedings, whether commenced or threatened, in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue statement
of any material fact contained in any registration statement under which
Stockholder Shares held by Stockholder were registered under the 1933 Act, any
preliminary prospectus, final prospectus or summary prospectus contained
therein, or any amendment or supplement thereto, or any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein in light of the circumstances in which
they were made not misleading, and the Company will reimburse Stockholder and
each such director, officer, partner, agent or Affiliate, underwriter and
controlling Person for any legal or any other expenses reasonably incurred by
them in connection with investigating or defending any such loss, claim,
liability, action or proceeding; provided, that the Company shall not be liable
in any such case to the extent that any such loss, claim, damage, liability (or
action or proceeding in respect thereof) or expense arises out of or is based
upon an untrue statement or alleged untrue statement or omission or alleged
omission made in such registration statement, any such preliminary prospectus,
final prospectus, summary prospectus, amendment or supplement in reliance upon
and in conformity with written information famished to the Company through an
instrument executed by or on behalf of Stockholder or such underwriter, as the
case may be, specifically stating that it is for use in the preparation thereof;
and provided, further, that the Company shall not be liable to any Person who
participates as an underwriter in the offering or sale of Stockholder Shares or
any other Person, if any, who controls such underwriter within the meaning of
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the 1933 Act, in any such case to the extent that any such loss, claim, damage,
liability (or action or proceeding in respect thereof) or expense arises out of
such Person's failure to send or give a copy of the final prospectus, as the
same may be then supplemented or amended, to the Person asserting an untrue
statement or alleged untrue statement or omission or alleged omission at or
prior to the written confirmation of the sale of Stockholder Shares to such
Person if such statement or omission was corrected in such final prospectus so
long as such final prospectus, and any amendments or supplements thereto, have
been furnished to such underwriter. Such indemnity shall remain in full force
and effect regardless of any investigation made by or on behalf of Stockholder
or any such underwriter, director, officer, partner, agent or Affiliate or
controlling Person and shall survive the transfer of such securities by
Stockholder.
5.2 Indemnification by Stockholders. Stockholder will,
and hereby does, severally indemnify and hold harmless (in the same manner and
to the same extent as set forth in Section 5.1) the Company, and each director,
officer, agent and Affiliate of the Company and each other Person, if any, who
controls the Company within the meaning of the 1933 Act, with respect to any
statement or alleged statement in or omission or alleged omission from such
registration statement, any preliminary prospectus, final prospectus or summary
prospectus contained therein, or any amendment or supplement thereto, if such
statement or alleged statement or omission or alleged omission was made in
reliance upon and in conformity with written information furnished to the
Company through an instrument duly executed by Stockholder specifically stating
that it is for use in the preparation of such registration statement,
preliminary prospectus, final prospectus, summary prospectus, amendment or
supplement; provided, however that the liability of any stockholder under this
Section 5.2 shall be limited to the amount of proceeds received by such
stockholder in the offering giving rise to such liability. Such indemnity shall
remain in full force and effect, regardless of any investigation made by or on
behalf of the Company or any such director, officer or controlling Person and
shall survive the transfer of such securities by such stockholder, agent,
Affiliate.
5.3 Notices of Claims, etc. Promptly after receipt by an
indemnified party of notice of the commencement of any action or proceeding
involving a claim referred to in the preceding subdivisions of this Section 5
such indemnified party will, if a claim in respect thereof is to be made against
an indemnifying party, give written notice to the latter of the commencement of
such action; provided, however, that the failure of any indemnified party to
give notice as provided herein shall not relieve the indemnifying party of its
obligations under the preceding subdivisions of this Section 5, except to the
extent that the indemnifying party is actually prejudiced by such failure to
give notice. In case any such action is brought against an indemnified party,
unless in such indemnified party's reasonable judgment a conflict of interest
between such indemnified and indemnifying parties is reasonably likely to exist
in respect of such claim (in which case the indemnified party shall notify in
writing the indemnifying party of such indemnified party's judgment and the
basis therefor), the indemnifying party shall be entitled to participate in and,
to assume the defense thereof, jointly with any other indemnifying party
similarly notified to the extent that it may wish, with counsel reasonably
satisfactory to such indemnified party, and after notice from the indemnifying
party to
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such indemnified party of its election so to assume the defense thereof, the
indemnifying party shall not be liable to such indemnified party for any legal
or other expenses subsequently incurred by the latter in connection with the
defense thereof unless in such indemnified party's reasonable judgment a
conflict of interest between such indemnified and indemnifying parties arises in
respect of such claim after the assumption of the defense thereof and the
indemnified party notifies the indemnifying party in writing of such indemnified
party's judgment and the basis therefor. No indemnifying party shall be liable
for any settlement of any action or proceeding effected without its written
consent, which consent shall not be unreasonably withheld or delayed. No
indemnifying party shall, without the written consent of the indemnified party,
consent to entry of any judgment or enter into any settlement 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 of such
claim or litigation.
5.4 Contribution. If the indemnification provided for in
this Section 5 shall be judicially determined (by the entry of final judgment or
decree by a court of competent jurisdiction and the expiration of time to appeal
or the denial of the last right of appeal) to be unavailable to a party seeking
indemnification under Section 5.1 or 5.2 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 5.1 or Section 5.2 hereof, the indemnified
party and the indemnifying party under Section 5.1 or Section 5.2 hereof shall
contribute to the aggregate losses, claims, damages and liabilities (including
legal or other expenses reasonably incurred in connection with investigating the
same), (i) in such proportion as is appropriate to reflect the relative fault of
the Company, on the one hand, and Stockholder, on the other hand, with respect
to the statements or omissions which resulted in such loss, claim, damage or
liability, or action 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, on the one hand, and
Stockholder, on the other hand, from the offering of the securities covered by
such registration statement. 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. 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 or delayed.
5.5 Other Indemnification. Indemnification and
contribution similar to that specified in the preceding subdivisions of this
Section 5 (with appropriate modifications) shall be given by the Company, on the
one hand, and Stockholder, on the other hand, with respect to any required
registration or other qualification of securities under any federal or state law
or regulation of any governmental authority other than the 1933 Act.
6. Expenses of Registration. The Company shall pay all
registration, filing and qualification fees (including SEC filing fees and, if
applicable, the listing fees of the Nasdaq SmallCap Market System or any stock
exchange on which the Company
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securities are traded) attributable to the Stockholder Shares registered under
this Agreement, and any legal, accounting or other professional fees or expenses
incurred by the Company or the Stockholder (collectively, "Registration
Expenses"). Stockholder shall pay all underwriting discounts, selling
commissions and stock transfer taxes, if any, attributable to the sale of such
Stockholder Shares registered by the Stockholder.
7. Representations and Warranties. The Company hereby represents
and warrants to Stockholder as follows:
7.1 SEC Documents.
(a) The Company has filed all required forms,
reports and documents with the SEC since March 31, 2002 (the "Prior SEC
Documents"), each of which has complied in all material respects with all
applicable requirements of the 1934 Act, and the rules and regulations of the
SEC thereunder. None of the Prior SEC Documents (or any documents, forms or
reports incorporated therein) contained when filed an untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading.
(b) The Registration Statement and any
prospectus contained therein, when it becomes effective or is filed with the
SEC, as the case may be, will conform in all material respects to the applicable
requirements of the 1933 Act and the rules and regulations of the SEC
thereunder. The Registration Statement and any prospectus contained therein
(including all materials incorporated therein by reference) will not contain 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; at
all times subsequent to the date when the Registration Statement is declared
effective when a prospectus would be required to be delivered under the 1933
Act.
(c) Any documents incorporated by reference in
any prospectus when it becomes or became effective or are or were filed with the
SEC, as the case may be, will conform or conformed in all material respects to
the requirements of the 1933 Act or the 1934 Act, as applicable, and none of
such documents will contain or contained an untrue statement of a material fact
or will omit or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading.
7.2 Financial Statements. The consolidated financial
statements of the Company included or incorporated by reference in the
Registration Statement and any prospectus contained therein, together with the
related schedules and notes thereto, do and will fairly present the financial
position of the Company and its consolidated subsidiaries as at the dates
indicated and the results of their operations for the periods specified. The
consolidated financial statements included or incorporated by reference in the
Prior SEC Documents fairly presented the financial position of the Company and
its consolidated subsidiaries as at the dates indicated and the results of their
operations for the periods specified. Except as otherwise stated therein, all of
the foregoing financial statements have been and will be prepared in conformity
with generally accepted accounting principles ("GAAP") applied on a consistent
basis throughout the periods
12
involved. The supporting schedules, if any, included or incorporated by
reference in the Prior SEC Documents and the Registration Statement and the
prospectus fairly present and will when filed fairly present in accordance with
GAAP the information required to be stated therein.
7.3 Consents and Notices. The Company has secured all
permits, consents, authorizations and notices that are necessary or required to
consummate the transaction contemplated by this Agreement, including any
consents, authorization or notices in connection with filing of the Registration
Statement with the SEC.
7.4 Survival. All of the foregoing representations and
warranties shall survive the completion of the transactions contemplated hereby.
It is understood and agreed that Stockholder is entering into this Agreement and
the Settlement Agreement and performing its obligations hereunder in reliance
upon the foregoing representations and warranties and subject to the accuracy
thereof and subject thereto and Stockholder would not enter into this Agreement
or the Settlement Agreement but for the truth and accuracy of such
representations and warranties.
8. Delays and Suspensions. The Company may suspend or delay the
effectiveness of the Registration Statement for one or more reasonable periods
of time (but not exceeding thirty (30) days in the aggregate during any twelve
(12) month period), if (a) the Company determines, in its reasonable judgment,
that such registration or offering would interfere with any financing,
acquisition, corporate reorganization or other material transaction involving
the Company or any of its Affiliates or would require premature disclosure
thereof and (b) gives Stockholder at least two (2) Business Days prior written
notice of such delay or suspension. Nothing contained in this Section 8,
however, affects the Company's obligations under Section 3.5, except as provided
herein.
9. Rule 144. In the event Stockholder receives an opinion of
counsel of national repute and experience in securities law matters (which
opinion and counsel shall be satisfactory to Stockholder) to the effect that all
the Stockholder Shares may be sold immediately in the public market without
registration under the 1933 Act, the registration rights granted under this
Agreement to Stockholder and the obligations of the Company under Section 2 to
the Stockholder, shall be of no further force and effect whatsoever without any
further action on the part of the Company or the Stockholder.
10. Information from Stockholder. Upon the request of the Company,
the Stockholder shall, within three (3) Business Days, provide the Company with
such information regarding the Stockholder, the Stockholder Shares, and the
intended method of disposition of such securities as may be required pursuant to
the 1933 Act to effect the registration of the Stockholder Shares. Until the
Stockholder has furnished such information to the Company, the Company shall not
be obligated to request the SEC to declare the Registration Statement effective.
13
11. Miscellaneous.
11.1 Notices. All notices and other communications
required or permitted hereunder shall be made in the manner and to addresses set
forth below.
if to Stockholder or Cendant:
Cendant Corporation
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx X. Xxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
Xxxx Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx Xxx, Esq.
Xxxxxxx X. Xxxxxxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
if to the Company:
Homestore, Inc.
00000 Xxxxxxx Xxxxx Xxxx
Xxxxxxxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
Xxxxxx & Bird LLP
000 Xxxxx Xxxxx Xxxxxx
Xxxxx 0000
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000
Attention: H. Xxxxx Xxxx III, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
11.2 Interpretation. The words "include," "includes" and
"including" when used herein shall be deemed in each case to be followed by the
words "without
14
limitation." The headings contained in this Agreement are for reference purposes
only and shall not affect in any way the meaning or interpretation of this
Agreement.
11.3 Counterparts. This Agreement may be executed in one
or more counterparts, all of which shall be considered one and the same
agreement and shall become effective when one or more counterparts have been
signed by each of the parties and delivered to the other party, it being
understood that all parties need not sign the same counterpart.
11.4 Entire Agreement. This Agreement and the documents
and instruments and other agreements among the parties hereto referenced herein:
(a) constitute the entire agreement among the parties with respect to the
subject matter hereof and supersede all prior agreements and understandings,
both written and oral, among the parties with respect to the subject matter
hereof and (b) are not intended to confer upon any other Person any rights,
remedies, obligations or liabilities hereunder.
11.5 Assignment. Except as set forth herein, neither this
Agreement, nor any of the rights and obligations hereunder, may be assigned by
Stockholder without the prior written consent of the Company, which consent
shall not be unreasonably withheld, provided that Stockholder may, without the
consent of the Company, assign its rights under this Agreement, in whole or in
part, to (a) any direct or indirect subsidiary of Stockholder, (b) any Person to
whom Stockholder sells, transfers, assigns or pledges Stockholder Shares,
provided that in the event of such sale, transfer, assignment or pledge,
Stockholder shall be appointed as representative of any such assignees for the
purpose of exercising the registration rights provided herein and the Company
shall not be required to give any Person, other than Stockholder, any notice
pursuant to this Agreement or be obligated to take instruction from any Person
other than Stockholder, or (c) any Person to whom Stockholder sells, transfers,
assigns or pledges an amount of Stockholder Shares exceeding three (3) percent
of the outstanding shares of the Company's common stock This Agreement shall be
binding upon and inure to the benefit of the Company and its respective
successors and assigns.
11.6 Severability. In the event that any provision of this
Agreement or the application thereof, becomes or is declared by a court of
competent jurisdiction to be illegal, void or unenforceable, the remainder of
this Agreement will continue in full force and effect and the application of
such provision to other persons or circumstances will be interpreted so as
reasonably to effect the intent of the parties hereto. The parties further agree
to replace such void or unenforceable provision of this Agreement with a valid
and enforceable provision that will achieve, to the extent possible, the
economic, business and other purposes of such void or unenforceable provision.
11.7 Attorneys' Fees. In any action at law or suit in
equity in relation to this Agreement, the prevailing party in such action or
suit shall be entitled to receive a reasonable sum for its attorneys' fees and
all other reasonable costs and expenses incurred in such action or suit.
15
11.8 Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of Delaware, regardless
of the laws that might otherwise govern under applicable principles of conflicts
of laws thereof. Each of the parties hereto agrees that process may be served
upon them in any manner authorized by the laws of the State of Delaware for such
persons and waives and covenants not to assert or plead any objection which they
might otherwise have to such jurisdiction and such process.
11.9 Term. Except as expressly provided herein, the rights
and obligations hereunder shall terminate ten (10) years from the date of this
Agreement.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
16
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date first above written.
HOMESTORE, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
_____________________________________
Name: Xxxxxxx X. Xxxxxxx
Title: EVP, General Counsel
CENDANT CORPORATION
By: /s/ X. Xxxxxxxx Xxxxxxxx, IV
_____________________________________
Name: X. Xxxxxxxx Xxxxxxxx, IV
Title: Senior Vice President, Legal
CENDANT MEMBERSHIP
SERVICES HOLDINGS, INC.
By: /s/ Xxxxxxx Xxxxxxx
_____________________________________
Name: Xxxxxxx Xxxxxxx
Title: Executive Vice President-Tax
[SIGNATURE PAGE TO REGISTRATION RIGHTS AGREEMENT]
SCHEDULE 2.2
Pursuant to that certain Second Amended and Restated NetSelect, Inc.
Stockholders' Agreement among the Company (successor in interest to NetSelect,
Inc. and InfoTouch Corporation) and the other parties thereto dated as of
January 28, 1999, as amended by Amendment No.1, dated as of April 9, 1999 (as
amended, the "Stockholders' Agreement"), each of National Association of
REALTORS(R) and Xxxxxxx Xxxxxxx Xxxxxxxx & Xxxxx, and legal persons affiliated
with such entities (the "Piggyback Holders"), has the right to request the
registration of all Registrable Securities (as defined in the Stockholders'
Agreement) held by the Piggyback Holders, and the Company must use its best
efforts to effect the registration under the 1933 Act of all Registrable
Securities that the Company has been so requested to register by the Piggyback
Holders. Subject to the terms and conditions of the Stockholders' Agreement, the
Piggyback Holders have contractual rights to include their shares in an
underwritten offering effected pursuant to Section 2.2 hereunder.
