Exhibit 10.1
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT, dated as of October 3, 1997 (this
"Agreement"), by and between Xxxxxxx X. Xxxxx Residential Realty, Inc., a
Maryland corporation (the "Company"), The Prudential Insurance Company of
America, a New Jersey corporation ("Prudential"), Strategic Value Investors,
LLC, a Delaware limited liability company ("SVI-US") and Strategic Value
Investors International, LLC, a Delaware limited liability company
("SVI-International")(Prudential, SVI-US and SVI-International collectively,
the "Investors").
WHEREAS, pursuant to that certain Purchase Agreement, dated as of
September 17, 1997 (the "Purchase Agreement"), by and between the Company and
Prudential, Prudential has agreed to acquire 1,450,000 shares of the
Company's Common Stock, par value $.01 per share (the "Common Stock"), and
1,216,666 shares of Series B Cumulative Convertible Redeemable Preferred
Stock, par value $.01 per share, of the Company (the "Preferred Stock" and,
together with the Common Stock, the "Shares"), all of which Preferred Stock
may be converted into shares of Common Stock, pursuant to the terms of and
subject to certain limitations set forth in the Articles Supplementary
relating to the Preferred Stock; and
WHEREAS, in connection with the Purchase Agreement, the Company has
agreed to register for sale by Prudential and certain transferees, the shares
of Common Stock purchased by Prudential pursuant to the Purchase Agreement
(the "Initial Common Shares") and the shares of Common Stock received by
Prudential upon conversion of shares of Preferred Stock (the "Underlying
Common Shares");
WHEREAS, pursuant to that certain Assignment and Assumption of
Acquisition Rights dated as of October 2, 1997, Prudential assigned and
SVI-US and SVI-International assumed certain of Prudential's rights and
obligations under the Purchase Agreement and the Company acknowledged and
consented to such assignment and assumption; and
WHEREAS, the parties hereto desire to enter into this Agreement to
evidence the foregoing agreement of the Company and the mutual covenants of
the parties relating thereto.
NOW, THEREFORE, in consideration of the foregoing and the covenants of
the parties set forth herein and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, subject to the
terms and conditions set forth herein, the parties hereby agree as follows:
Section 1. Certain Definitions.
In this Agreement the following terms shall have the following respective
meanings:
"Accredited Investor" shall have the meaning set forth in Rule 501 of the
General Rules and Regulations promulgated under the Securities Act.
"Affiliates" shall mean, when used with respect to a specified Person,
another Person that directly, or indirectly through one or more
intermediaries, controls or is controlled by or is under common control with
the Person specified.
"Articles Supplementary" shall mean the Articles Supplementary
Classifying and Designating the Series B Cumulative Convertible Redeemable
Preferred Stock, as filed with the Department of Assessments and Taxation of
the State of Maryland.
"Commission" shall mean the Securities and Exchange Commission or any
other federal agency at the time administering the Securities Act.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission thereunder, all as
the same shall be in effect at the relevant time.
"Holder" or "Holders" shall mean (i) the Investors and (ii) each Person
holding Registrable Shares as a result of a transfer or assignment to that
Person of Registrable Shares other than pursuant to an effective registration
statement or Rule 144 (or any successor provision) under the Securities Act.
"Indemnified Party" shall have the meaning ascribed to it in Section 4(c)
of this Agreement.
"Indemnifying Party" shall have the meaning ascribed to it in Section 4(c)
of this Agreement.
"Managing Underwriter" shall mean the investment banker or investment
bankers and manager or managers that shall administer an underwritten
offering, if any, as set forth in Section 3 hereof.
"Market Value" shall mean, with respect to the Common Stock on any date
of determination, the average of the closing prices of the Common Stock on
each of the preceding 10 trading days on the New York Stock Exchange.
"Person" shall mean an individual, corporation, partnership, estate,
trust, association, private foundation, joint stock company or other entity.
"Preferred Stock" shall have the meaning ascribed to it in the recitals
to this Agreement.
"Prospectus" shall mean the prospectus included in any Shelf Registration
Statement (including, without limitation, a prospectus that discloses
information previously omitted from a prospectus filed as part of an
effective registration statement in reliance upon Rule 430A under the
Securities Act), as amended or supplemented by any prospectus supplement,
with respect to the terms of the offering of any portion of the Registrable
Shares.
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The terms "Register," "Registered" and "Registration" refer to a
registration effected by preparing and filing a Shelf Registration Statement
(and Prospectus) in compliance with the Securities Act providing for the sale
by the Holders in accordance with the method or methods of distribution
designated by the Holders, and the declaration or ordering of the
effectiveness of such registration statement by the Commission.
"Registrable Shares" shall mean (i) the Initial Common Shares, (ii) the
Underlying Common Shares, and (iii) the shares of Common Stock issued upon
redemption of shares of Preferred Stock in accordance with Section 5(a) of
the Articles Supplementary classifying and designating the Preferred Stock;
provided, however, that any such shares of Common Stock shall cease to be
Registrable Shares when (A) a shelf registration statement with respect to
the sale of such shares shall have become effective under the Securities Act
and all such shares shall have been disposed of in accordance with such shelf
registration statement; (B) such shares shall have been resold by the Holder
thereof in accordance with Rule 144; (C) such shares shall have been
otherwise transferred and new certificates not subject to transfer
restrictions under the Securities Act and not bearing any legend restricting
further transfer shall have been delivered by the Company, and no other
applicable and legally binding restriction on transfer under the federal
securities laws shall exist; or (D) such shares may be sold in accordance
with Rule 144(k) under the Securities Act.
"Registration Expenses" shall mean all out-of-pocket expenses (excluding
Selling Expenses) incurred by the Company in complying with Section 2 hereof,
including, without limitation, the following: (a) all registration and filing
fees; (b) fees and expenses of compliance with federal and state securities
or real estate syndication laws (including, without limitation, reasonable
fees and disbursements of counsel in connection with state securities and
real estate syndication qualifications of the Registrable Shares under the
laws of such jurisdictions as the Holders may reasonably designate); (c)
printing (including, without limitation, expenses of printing or engraving
certificates representing the Registrable Shares in a form eligible for
deposit with The Depository Trust Company and otherwise meeting the
requirements of any securities exchange on which they are listed and of
printing registration statements and prospectuses), messenger, telephone,
shipping and delivery expenses; (d) fees and disbursements of counsel for the
Company; (e) fees and disbursements of all independent public accountants of
the Company; (f) Securities Act liability insurance if the Company so
desires; (g) fees and expenses of other Persons reasonably necessary in
connection with the registration, including any experts, retained by the
Company; and (h) fees and expenses incurred in connection with the listing of
the Registrable Shares on each securities exchange on which securities of the
same class are then listed.
"Rule 144" shall mean Rule 144 promulgated by the Commission under the
Securities Act.
"Securities Act" shall mean the Securities Act of 1933, as amended, and
the rules and regulations of the Commission thereunder, all as the same shall
be in effect at the relevant time.
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"Selling Expenses" shall mean all underwriting discounts, selling
commissions and stock transfer taxes applicable to any sale of Registrable
Shares.
"Shelf Registration" shall mean a registration effected pursuant to
Section 2 hereof.
"Shelf Registration Statement" means a "shelf" registration statement of
the Company pursuant to the provisions of Section 2 hereof filed with the
Commission which covers some or all of the Registrable Shares, as applicable,
on an appropriate form under Rule 415 under the Securities Act, or any
similar rule that may be adopted by the Commission, amendments and
supplements to such registration statement, including post-effective
amendments, in each case including the Prospectus contained therein, all
exhibits thereto and all material incorporated by reference therein.
Section 2. Shelf Registration.
(a) The Company shall, within 45 days following the date of initial
issuance (the "Issue Date") of the Shares, file with the Commission a Shelf
Registration Statement relating to the offer and sale of the Registrable
Shares by the Holders from time to time in accordance with the methods of
distribution elected by such Holders and set forth in such Shelf Registration
Statement and, thereafter, shall use its reasonable best efforts to cause
such Shelf Registration Statement to be declared effective under the
Securities Act as soon as practicable and in no event later than 90 days
after the Issue Date (including, without limitation, the execution of an
undertaking to file post-effective amendments and appropriate qualification
under applicable state securities and real estate syndication laws);
provided, however that no Holder shall be entitled to have the Registrable
Shares held by it covered by such Shelf Registration unless such Holder is in
compliance with Section 3(k) hereof.
(b) The Company shall (i) use its reasonable best efforts to keep such
Shelf Registration continuously effective in order to permit the Prospectus
forming part thereof to be usable by the Holders for so long as the aggregate
Market Value of the Registrable Shares is at least $10 million or such
shorter period that will terminate upon the earlier of the following: (A) the
date when all the Registrable Shares have been sold pursuant to such shelf
registration statement or Rule 144 and (B) the date on which, in the
reasonable, written opinion of counsel to the Holders and/or to the Company,
all outstanding Registrable Shares held by persons that are not affiliates of
the Company may be resold without registration under the Securities Act in
accordance with Rule 144(k) or any successor provision thereto (in any such
case, such period being called the "Effectiveness Period") and (ii) after the
effectiveness of the Shelf Registration Statement, promptly upon the request
of any Holder to take any action reasonably necessary to register the sale of
any Registrable Shares of such Holder and to identify such Holder as a
selling securityholder. The Company shall be deemed not to have used their
reasonable best efforts to keep the Shelf Registration Statement effective
during the requisite period if the Company voluntarily takes any action that
would result in Holders covered thereby not being able to offer and sell any
such Registrable Shares during that period, unless (x) such action is
required by applicable law or the rules of any national securities
exchange or
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other market on which any of the Registrable Shares are then listed or
quoted, or (y) any event contemplated by paragraph 3(c)(2)(iii) below occurs
and the Company acts promptly in good faith and for valid business reasons in
suspending use of the Prospectus until the requisite changes have been made
and the Company thereafter promptly (and in no event longer than 30 days)
complies with the requirements of paragraph 3(i) below.
Notwithstanding the foregoing, the Company shall have the right (the
"Suspension Right") to defer such filing (or suspend sales under any filed
registration thereunder) for a period of not more than 90 days during any
12-month period, if the Company shall furnish to the Holders a certificate
signed by the President or any other executive officer of the Company stating
that, either (i) in the good faith judgment of the Company, the continued
effectiveness of the Shelf Registration Statement would require the Company
to disclose a material financing, acquisition or other corporate transaction,
and the Board of Directors shall have determined in good faith that it would
be detrimental to the Company and its shareholders to file such registration
statement or amendment thereto at such time (or continue sales under a filed
registration statement) or (ii) the Company plans to conduct an underwritten
offering of its equity securities during such 90-day period and, in each
case, therefore, the Company has elected to defer the filing of such
registration statement (or suspend sales under a filed registration
statement); provided that, in the case of clause (ii), the Company shall
terminate such deferral or suspension, prior to the end of such 90-day period
and following the thirtieth day following the initial closing of any such
underwritten offering, in the event that during such period the average of
the closing prices of the class of equity securities sold by the Company in
such offering during a period of 20 consecutive trading days is at least 110%
of the initial public offering price of such security in such offering.
Section 3. Registration Procedures.
(a) The Company shall furnish to the Holders, prior to the filing
thereof with the Commission, a copy of any Shelf Registration Statement, and
each amendment thereof or supplement, if any, to the Prospectus included
therein and shall use its reasonable efforts to reflect in each such
document, when so filed with the Commission, such comments that the Holders
reasonably may propose.
(b) The Company shall take such action as may be necessary so that (i) any
Shelf Registration Statement and any amendment thereto and any Prospectus
forming part thereof and any amendment or supplement thereto (and each report or
other document incorporated therein by reference in each case) complies in all
material respects with the applicable provisions of the Securities Act and the
Exchange Act and the respective rules and regulations thereunder, (ii) any Shelf
Registration Statement and any amendment thereto does not, when it becomes
effective, 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 and (iii) any Prospectus forming part of any Shelf
Registration Statement, and any amendment or supplement to such Prospectus, does
not include an untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements, in the light of the
circumstances under which they were made, not misleading.
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(c) (1) The Company shall advise the Holders: (i) when a Shelf
Registration Statement and any amendment thereto has been filed with the
Commission and when the Shelf Registration Statement or any post-effective
amendment thereto has become effective; and (ii) of any request by the
Commission for amendments or supplements to the Shelf Registration Statement
or the Prospectus included therein or for additional information.
(2) The Company shall advise the Holders of: (i) the issuance by
the Commission of any stop order suspending effectiveness of the Shelf
Registration Statement or the initiation of any proceedings for that purpose;
(ii) the receipt by the Company of any notification with respect to the
suspension of the qualification of the securities included therein for sale
in any jurisdiction or the initiation of any proceeding for such purpose; and
(iii) the happening of any event that requires the making of any changes in
the Shelf Registration Statement or the Prospectus so that, as of such date,
the Shelf Registration Statement and the Prospectus do not contain an untrue
statement of a material fact and do not omit to state a material fact
required to be stated therein or necessary to make the statements therein (in
the case of the Prospectus, in light of the circumstances under which they
were made) not misleading (which advice shall be accompanied by an
instruction to suspend the use of the Prospectus until the requisite changes
have been made).
(d) The Company shall use its reasonable best efforts to prevent the
issuance, and if issued to obtain the withdrawal, of any order suspending the
effectiveness of any Shelf Registration Statement at the earliest possible
time.
(e) The Company shall furnish to each Holder, without charge, at least
one copy of such Shelf Registration Statement and any post-effective
amendment thereto, including financial statements and schedules, and, if the
Holder so requests in writing, all reports, other documents and exhibits
(including those incorporated by reference).
(f) The Company shall, during the Effectiveness Period, deliver to each
Holder, without charge, as many copies of the Prospectus (including each
preliminary Prospectus) included in such Shelf Registration Statement and any
amendment or supplement thereto as such Holder may reasonably request; and
the Company consents (except upon and during the continuance of any event
described in paragraph 3(c)(2)(iii) above) to the use of the Prospectus or
any amendment or supplement thereto by each of the selling Holders in
connection with the offering and sale of the Registrable Shares covered by
the Prospectus or any amendment or supplement thereto during the Shelf
Registration Period.
(g) Prior to any offering of Registrable Shares pursuant to any Shelf
Registration Statement, the Company shall register or qualify or cooperate
with the Holders included therein and their respective counsel in connection
with the registration or qualification of such Registrable Shares for offer
and sale under the securities or blue sky laws of such jurisdictions as any
such Holders reasonably request in writing and do any and all other acts or
things necessary or advisable to enable the offer and sale in such United
States jurisdictions of the Registrable Shares covered by such Shelf
Registration Statement; provided, however, that in no event shall the Company
be obligated to
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(i) qualify as a foreign corporation or as a dealer in securities in any
jurisdiction where it would not otherwise be required to so qualify but for
this Section 3(g), (ii) file any general consent to service of process in any
jurisdiction where it is not as of the date hereof then so subject or (iii)
subject itself to taxation in any such jurisdiction if it is not so subject.
(h) Unless any Registrable Shares shall be in book-entry only form, the
Company shall cooperate with the Holders to facilitate the timely preparation
and delivery of certificates representing Registrable Shares to be sold
pursuant to any Shelf Registration Statement free of any restrictive legends
and in such permitted denominations and registered in such names as Holders
may request in connection with the sale of Registrable Shares pursuant to
such Shelf Registration Statement.
(i) Upon the occurrence of any event contemplated by paragraph
3(c)(2)(iii) above, the Company shall promptly, and in any event within 30
days, prepare a post-effective amendment to any Shelf Registration Statement
or an amendment or supplement to the related Prospectus or file any other
required document so that, as thereafter delivered to purchasers of the
Registrable Shares included therein, the Prospectus will not include an
untrue statement of a material fact or omit to state any material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading. If the Company notifies the
Holders of the occurrence of any event contemplated by paragraph 3(c)(2)(iii)
above, the Holders shall suspend the use of the Prospectus until the
requisite changes to the Prospectus have been made.
(j) The Company shall use its best efforts to comply with all applicable
rules and regulations of the Commission and shall make generally available to
their security holders or otherwise provide in accordance with Section 11(a)
of the Securities Act as soon as practicable after the effective date of the
applicable Shelf Registration Statement an earnings statement satisfying the
provisions of Section 11(a) of the Securities Act.
(k) The Company may require each Holder to be sold pursuant to any Shelf
Registration Statement to furnish to the Company such information regarding
the Holder and the distribution of such Registrable Shares as the Company may
from time to time reasonably request for inclusion in such Shelf Registration
Statement and the Company may exclude from such registration the Registrable
Shares of any Holder that fails to furnish such information within a
reasonable time after receiving such request.
(l) The Company agrees to use its reasonable best efforts (including the
payment of any listing fees) to obtain the listing of all Registrable Shares
covered by the registration statement on each securities exchange on which
securities of the same class are then listed.
(m) If the Holders of at least 800,000 Registrable Shares (or such fewer
number as remain outstanding) shall propose to sell such Registrable Shares
in an underwritten public offering, such Holders shall be entitled to select
the underwriters for such offering, subject to the approval of the Company,
not to be unreasonably withheld (provided that the Holders shall not require
consent of the Company in order for
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Prudential Securities Incorporated to be an underwriter) and the Company
shall make available members of the management of the Company and its
Affiliates for reasonable assistance in selling efforts relating to such
offering for a public offering of such size (including, without limitation,
senior management attendance at due diligence meetings with underwriters and
their counsel and road shows) and shall enter into underwriting agreements
containing usual and customary terms and conditions for such types of
offerings (including "blackout" periods following consummation of any such
offering, to the extent reasonably requested by the Managing Underwriter in
the circumstances and not inconsistent with the needs of the Company to raise
additional equity capital at such time); provided that (i) the Company shall
not be required to assist in an underwritten offering more than once in any
12-month period or more than three times during the term of this Agreement;
(ii) the Company shall pay the Registration Expenses for one underwritten
offering; and (iii) upon request by an underwriter, the Company shall waive
the common stock ownership limitation contained in its Articles of
Incorporation to the extent necessary to permit such underwriter to purchase
the securities for the purpose of the distribution.
Section 4. Expenses of Registration.
The Company shall pay all Registration Expenses incurred in connection
with the registration of the Registrable Shares in accordance with Sections 2
and 3 hereof. All Selling Expenses incurred in connection with the offer and
sale of Registrable Shares by any of the Holders shall be borne by the Holder
offering or selling such Registrable Shares pursuant to Section 7 of this
Agreement. Each Holder shall pay the expenses of its own counsel.
Section 5. Indemnification.
(a) In connection with any Shelf Registration Statement, the Company
shall indemnify and hold harmless each Holder and each of their respective
directors and officers and each person controlling such Holder within the
meaning of Section 15 of the Securities Act as follows:
(i) from and against any loss, liability, claim, damage and
expense whatsoever, including any amounts paid in settlement of any
investigation, litigation, proceeding or claim, joint or several, as
incurred, arising out of any untrue statement or alleged untrue statement of
a material fact contained in any Shelf Registration Statement (or any
amendment thereto) covering Registrable Shares, including all documents
incorporated therein by reference, or the omission or alleged omission
therefrom of a material fact required to be stated therein or necessary to
make the statements therein not misleading, or arising out of any untrue
statement or alleged untrue statement of a material fact contained in any
Prospectus (or any amendment or supplement thereto) or the omission or
alleged omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided, that the Company shall not be liable under
this clause (i) for any settlement of any action effected without its written
consent, which consent shall not be unreasonably withheld; and (ii) against
any and all expenses (including reasonable fees
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and disbursements of counsel chosen by any such Holder (except to the extent
otherwise expressly provided in Section 5(c) hereof)), reasonably incurred in
investigating, preparing or defending against any litigation, or any
investigation or proceeding by any court or governmental agency or body,
commenced or threatened, or any claim whatsoever based upon any such untrue
statement or omission, or any such alleged untrue statement or omission, as
such expenses are incurred to the extent that any such expense is not paid
under subparagraph (i) of this Section 5(a); provided further, that the
indemnity provided for in this Section 5(a) shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of an untrue
statement or omission or alleged untrue statement or omission (i) made in
reliance upon and in conformity with written information furnished to the
Company by such Holder in writing expressly stating that such information is
being provided by such Holder for use in the Shelf Registration Statement (or
any amendment thereto) or any Prospectus (or any amendment or supplement
thereto) or (ii) contained in any preliminary prospectus or the Prospectus if
such Holder failed to send or deliver a copy of the Prospectus (or any
amendment or supplement thereto) to the Person asserting such losses, claims,
damages or liabilities on or prior to the delivery of written confirmation of
any sale of securities covered thereby to such Person in any case where such
Prospectus (or any amendment or supplement thereto) corrected such untrue
statement or omission. Any amounts advanced by the Company to an indemnified
party pursuant to this Section 5 as a result of such losses shall be returned
to the Company if it shall be finally determined by such a court in a
judgment not subject to appeal or final review that such indemnified party
was not entitled to indemnification by the Company.
(b) Each Holder, severally and not jointly, shall indemnify and hold
harmless the Company and the other selling Holders and each of their
respective directors and officers (including each officer of the Company who
signed the Shelf Registration Statement) and each Person, if any, who
controls the Company or other selling Holder within the meaning of Section 15
of the Securities Act, from and against any loss, liability, claim, damage
and expense whatsoever described in the indemnity contained in Section 5(a)
hereof, as incurred, but only with respect to untrue statements or omissions,
or alleged untrue statements or omissions, made in the Shelf Registration
Statement (or any amendment thereto) or any Prospectus (or any amendment or
supplement thereto) in reliance upon and in conformity with written
information furnished to the Company by such selling Holder in writing
expressly stating that such information is being provided by such Holder for
use in the Shelf Registration Statement (or any amendment thereto) or any
Prospectus (or any amendment or supplement thereto); provided, however, that
no such Holder shall be liable for any claims hereunder in excess of the
amount of net proceeds received by such Holder from the sale of Registrable
Shares pursuant to the Shelf Registration Statement.
(c) Each party entitled to indemnification under this Section 5 (the
"Indemnified Party") shall give notice to the party required to provide
indemnification (the "Indemnifying Party") promptly after such Indemnified Party
has actual knowledge of any claim as to which indemnity may be sought, but the
omission to so notify the Indemnifying Party shall not relieve it from any
liability which it may have to the Indemnified Party pursuant to the provisions
of this Section 5 except to the extent of the actual damages suffered by such
delay in notification. The Indemnifying Party shall
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assume the defense of such action, including the employment of counsel to be
chosen by the Indemnifying Party to be reasonably satisfactory to the
Indemnified Party, and payment of expenses. The Indemnified Party shall have
the right to employ its own counsel in any such case, but the legal fees and
expenses of such counsel shall be at the expense of the Indemnified Party,
unless the employment of such counsel shall have been authorized in writing
by the Indemnifying Party in connection with the defense of such action,
or the Indemnifying Party shall not have employed counsel to take charge of
the defense of such action or the Indemnified Party shall have reasonably
concluded that there may be defenses available to it or them which are
different from or additional to those available to the Indemnifying Party
(in which case the Indemnifying Party shall not have the right to direct
the defense of such action on behalf of the Indemnified Party), in any of
which events such fees and expenses shall be borne by the Indemnifying Party.
No Indemnifying Party, in the defense of any such claim or litigation, shall,
except with the consent of each Indemnified Party, consent to entry of any
judgment or enter into any settlement which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
Indemnified Party of a release from all liability in respect to such claim
or litigation.
(d) If the indemnification provided for in this Section 5 is unavailable
to a party that would have been an Indemnified Party under this Section 5 in
respect of any expenses, claims, losses, damages and liabilities referred to
herein, then each party that would have been an Indemnifying Party hereunder
shall, in lieu of indemnifying such Indemnified Party, contribute to the
amount paid or payable by such Indemnified Party as a result of such
expenses, claims, losses, damages and liabilities in such proportion as is
appropriate to reflect the relative fault of the Indemnifying Party on the
one hand and such Indemnified Party on the other in connection with the
statement or omission which resulted in such expenses, claims, losses,
damages and liabilities, 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 such Indemnified Party and
the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Company and
each Holder agrees that it would not be just and equitable if contribution
pursuant to this Section were determined by pro rata allocation or by any
other method of allocation which does not take account of the equitable
considerations referred to above in this Section 5(d).
(e) 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.
Section 6. Information to be Furnished by Holders.
Each Holder shall furnish to the Company such information as the Company
may reasonably request and as shall be required in connection with the
Registration and related proceedings referred to in Sections 2 and 3 hereof.
If any Holder fails to provide the Company with such information within 15
business days of the Company's request, the Company's obligations under
Sections 2 and 3 hereof with respect to such Holder or the
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Registrable Shares owned by such Holder shall be suspended until such Holder
provides such information.
Section 7. Rule 144 Sales.
(a) The Company covenants that it will file the reports required to be
filed by the Company under the Exchange Act, so as to enable any Holder to
sell Registrable Shares pursuant to Rule 144 under the Securities Act.
(b) In connection with any sale, transfer or other disposition by any
Holder of any Registrable Shares pursuant to Rule 144 under the Securities
Act, the Company shall cooperate with such Holder to facilitate the timely
preparation and delivery of certificates representing Registrable Shares to
be sold and not bearing any Securities Act legend, if deemed appropriate, and
enable certificates for such Registrable Shares to be for such number of
shares and registered in such names as the selling Holder may reasonably
request, provided that such request is made at least two business days prior
to any sale of Registrable Shares.
Section 8. Miscellaneous.
(a) Governing Law. This Agreement shall he governed in all respects by
the laws of the State of Maryland (other than the choice of law rules
thereof).
(b) Entire Agreement. This Agreement constitutes the full and entire
understanding and agreement between the parties with regard to the subject
matter hereof.
(c) Amendment. No supplement, modification, waiver or termination of
this Agreement shall be binding unless executed in writing by the party to be
bound thereby.
(d) Notices, etc. Each notice, demand, request, request for approval,
consent, approval, disapproval, designation or other communication (each of
the foregoing being referred to herein as a notice) required or desired to be
given or made under this Agreement shall be in writing (except as otherwise
provided in this Agreement), and shall be effective and deemed to have been
received (i) when delivered in person, (ii) when sent by facsimile with
receipt acknowledged, (iii) five (5) days after having been mailed by
certified or registered United States mail, postage prepaid, return receipt
requested, or (iv) the next business day after having been sent by a
nationally recognized overnight mail or courier service, receipt requested.
Notices shall be addressed as follows: (a) if to the Investors, at the
Investor's address or fax number set forth below its signature hereon, or at
such other address or fax number as the Investors shall have furnished to the
Company in writing, or (b) if to any assignee or transferee of the Investors,
at such address or fax number as such assignee or transferee shall have
furnished the Company in writing, or (c) if to the Company, at the address or
fax number of its principal executive offices set forth below its signature
hereon or at such other address or fax number as the Company shall have
furnished to the Investors or any assignee or transferee. Any notice or other
11
communication required to be given hereunder to a Holder in connection with a
registration may instead be given to the designated representative of such
Holder.
(e) Counterparts. This Agreement may be executed in any number of
counterparts, each of which may be executed by fewer than all of the parties
hereto (provided that each party executes one or more counterparts), each of
which shall be enforceable against the parties actually executing such
counterparts, and all of which together shall constitute one instrument.
(f) Severability. In the event that any provision of this Agreement
becomes or is declared by a court of competent jurisdiction to be illegal,
unenforceable or void, this Agreement shall continue in full force and effect
without said provision.
(g) Section Titles. Section titles are for descriptive purposes only and
shall not control or alter the meaning of this Agreement as set forth in the
text.
(h) Successors and Assigns. This Agreement shall inure to the benefit of
and be binding upon the parties hereto and their respective successors and
assigns including, without the need for an express assignment or any consent
by the Company thereto, subsequent Holders. The Company hereby agrees to
extend the benefits of this Agreement to any Holder and any such Holder may
specifically enforce the provisions of this Agreement as if an original party
hereto.
(i) Remedies. The Company and the Investors acknowledge that there would
be no adequate remedy at law if any party fails to perform any of its
obligations hereunder, and accordingly agree that the Company and each
Holder, in addition to any other remedy to which it may be entitled at law or
in equity, shall be entitled to compel specific performance of the
obligations of another party under this Agreement in accordance with the
terms and conditions of this Agreement in any court of the United States or
any State thereof having jurisdiction.
(j) Attorneys' Fees. If the Company or any Holder brings an action to
enforce its rights under this Agreement, the prevailing party in the action
shall be entitled to recover its costs and expenses, including, without
limitation, reasonable attorneys' fees, incurred in connection with such
action, including any appeal of such action.
[Page Break Intentionally Inserted]
12
IN WITNESS WHEREOF, the parties hereto have executed this Registration
Rights Agreement as of the date first above written.
XXXXXXX X. XXXXX RESIDENTIAL
REALTY, INC.
By: /s/ Xxxxxx X. Xxxxxxx, Xx.
----------------------------
Name: Xxxxxx X. Xxxxxxx, Xx.
Title: President
0000 Xxxxxxx Xxxxx
Xxxxxxx Xxxx
Xxxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxx
Facsimile: (000) 000-0000
THE PRUDENTIAL INSURANCE
COMPANY OF AMERICA
By: /s/ Xxxxxx X. Xxxxxx
----------------------------
Name: Xxxxxx X. Gasdsen
Title: Vice President
0 Xxxxxx Xxxxx
Xxxxx Xxxxxx Xxxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000-0000
Attention: Xxxxxxx X. Xxxxxx
Facsimile: (000) 000-0000
13
STRATEGIC VALUE INVESTORS, LLC
By: The Prudential Investment
Corporation, Its Attorney-In-Fact
By: /s/ Xxxx X. Xxxxxx
----------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
0 Xxxxxx Xxxxx
Xxxxx Xxxxxx Xxxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000-0000
Attention: SVI Portfolio Manager
Facsimile: (000) 000-0000
STRATEGIC VALUE INVESTORS
INTERNATIONAL, LLC
By: Strategic Value Investors
International Ltd., Its Manager
By: /s/ Xxxx X. Xxxxxx
----------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
0 Xxxxxx Xxxxx
Xxxxx Xxxxxx Xxxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000-0000
Attention: SVI Portfolio Manager
Facsimile: (000) 000-0000
14
