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EXHIBIT 4.6
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (the "Agreement") is entered into
as of March 31, 1997, by and among AMRESCO, INC., a Delaware corporation (the
"Company"), on the one hand, and Xxxxxx Xxxxxxxxx, Xxxx Xxxxxxx, Xxxxxxx Xxxxx,
Xxxx Xxxxx, Xxxxx Xxxxxxxx anc CLC IO, Inc. (collectively, the "Stockholders"),
on the other hand.
R E C I T A L S
A. This Agreement is entered into pursuant to the Stock and Asset
Purchase Agreement dated as of March 21, 1997 (the "Stock and Asset
Purchase Agreement"), by and among the Company, Commercial Lending
Corporation, each of the Stockholders and their spouses.
B. The Stock and Asset Purchase Agreement provides for the issuance by
the Company of an aggregate of 1,335,203 shares of its common stock,
par value $0.05 per share (each share of such class being referred to
herein as a share of "Common Stock"), to the respective Stockholders
on the date hereof and 600,336 shares of Common Stock to CLC IO on the
date hereof (the shares issued on such date being referred to herein
as the "Original Shares").
C. The Stock and Asset Purchase Agreement also provides for the issuance
by the Company of an as yet undetermined number of shares of Common
Stock to CLC IO after the first securitization following the date
hereof and to the respective Stockholders (other than CLC IO) on or
before each of March 31, 1998, March 31, 1999 and June 30, 2000 (each
such date being referred to herein as an "Earnout Payment Date" and
the shares of Common Stock (if any) being issued on any Earnout
Payment Date (or to CLC IO after the first securitization following
the date hereof) being referred to herein as "Earnout Shares").
D. The Company and the Stockholders wish to provide for the registration
of the Original Shares and the Earnout Shares on the terms and
conditions set forth herein.
A G R E E M E N T
Based on the recitals set forth above and the promises contained
herein, the parties agree as follows:
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1. Definitions. Any capitalized terms used but not defined
herein shall have the meanings assigned to such terms in the Stock and Asset
Purchase Agreement. As used herein, the following terms shall have the
following meanings:
"Agreement" has the meaning set forth in the preamble.
"Blocking Notice" has the meaning set forth in Section 12.
"Blocking Period" has the meaning set forth in Section 12.
"Blocking Termination Notice" has the meaning set forth in Section 12.
"Closing Date" means the date of this Agreement.
"Company" has the meaning set forth in the preamble.
"Company Shares" has the meaning set forth in Section 13.
"Common Stock" has the meaning set forth in the Recitals.
"Demand Notice" has the meaning set forth in Section 3.
"Demand Registration" means a registration pursuant to Section 3.
"Earnout Payment Date" has the meaning set forth in the Recitals.
"Earnout Shares" has the meaning set forth in the preamble.
"Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time.
"Information" has the meaning set forth in Section 5.
"Majority" means three or more of the Stockholders; provided, however,
that if any Stockholder transfers any Shares (together with the related
registration rights) to a permitted transferee under Section 18(a), then to the
extent such Stockholder retains any Shares, for purposes of this definition
such Stockholder and such permitted transferee shall be deemed to be one
Stockholder.
"Original Shares" has the meaning set forth in the Recitals.
"Other Holders" has the meaning set forth in Section 13.
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"Piggyback Notice" has the meaning set forth in Section 13.
"Piggyback Registration Statement" has the meaning set forth in
Section 13.
"Piggyback Shares" has the meaning set forth in Section 13.
"Prospectus" has the meaning set forth in Section 9(b).
"Registration Expenses" means all costs and expenses of each
Registration Statement, including without limitation printing, legal and
accounting expenses, SEC filing fees and "Blue Sky" fees and expenses relating
to the registration of Shares; provided, however, that "Registration Expenses"
also shall mean the reasonable fees and disbursements of a single special
counsel for the Selling Stockholders (selected by a Majority of the Selling
Stockholders) in connection with (a) a Registration Statement in which the
Company has required that the Selling Stockholders utilize an underwriter or
(b) any sale of Shares pursuant to Rule 144 in connection with which a Selling
Stockholder is required to furnish an opinion of counsel to the effect that the
legend on such Shares may be removed.
"Registration Notice" has the meaning set forth in Section 4(b).
"Registration Statement" means any registration statement under the
Securities Act that is filed by the Company to register sales of Shares by
Selling Stockholders (whether or not such registration statement also registers
the issuance or sale of other securities).
"Rule 144" means Rule 144 (as currently in effect or as amended or any
successor or similar provision) promulgated by the SEC under the Securities
Act.
"Rule 415" means Rule 415 (as currently in effect or as amended or any
successor or similar provision) promulgated by the SEC under the Securities
Act.
"SEC" means the United States Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended from
time to time.
"Selling Expenses" means all underwriters' commissions or discounts,
brokers' fees or commissions, transfer or other taxes attributable to Shares
being offered and sold by any Selling Stockholder, all fees and expenses of
counsel incurred by any Selling Stockholder, other than such fees and expenses
as are defined as
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"Registration Expenses" above, and all fees and expenses of any Stockholder's
accountants.
"Selling Stockholder" means any Stockholder whose Shares (in whole or
in part) are included in a Registration Statement.
"Shares" means (a) the Original Shares and the Earnout Shares and (b)
any securities issued or issuable in respect of the Original Shares or the
Earnout Shares by way of stock dividend or stock split or in connection with a
combination of shares, recapitalization, reclassification, merger,
consolidation or similar event, and any other securities issued pursuant to any
other pro rata distribution with respect to such shares of Common Stock. For
purposes hereof, a share of Common Stock ceases to be an Original Share, an
Earnout Share or a Share (each as defined herein) when (i) it has been
effectively registered under the Securities Act and sold or distributed
pursuant to an effective Registration Statement covering it or (ii) it has
become eligible, in the opinion of counsel to the Company, to be sold or
distributed pursuant to Rule 144 (within the then-applicable volume limitation
pursuant to Rule 144(e)) or Rule 144(k).
"Stockholders" has the meaning set forth in the preamble.
"Stock and Asset Purchase Agreement" has the meaning set forth in the
Recitals.
"Violations" has the meaning set forth in Section 14(a).
2. Registration of Original Shares. The Company shall file with
the SEC, on or before the thirtieth day after the Closing Date, a Registration
Statement on a form for which the Company then qualifies and which shall be
available for the sale by the Selling Stockholders (in accordance with the
intended methods of disposition thereof) of any of the Original Shares, the
registration of which is requested in writing by any Stockholder on the Closing
Date. The Company shall use commercially reasonable efforts to cause the
Registration Statement to be declared effective under the Securities Act as
promptly as practicable thereafter.
Subject to Section 4 and Section 12, the Company will not have
exercised "commercially reasonable efforts" hereunder if the Company refuses to
file, delays the filing of or delays the effectiveness of a Registration
Statement based solely on the Company's concern that such filing or
effectiveness could have adverse consequences to the trading price of the
Common Stock or the Company's future financing transactions.
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3. Demand Registration. At any time after the issuance of any
Earnout Shares, a Majority of the Stockholders may require by a written notice
signed by such Stockholders and delivered to the Company (a "Demand Notice")
that the Company prepare and file as soon as practicable (but in any event
within 60 days of receipt of the Demand Notice) a Registration Statement for
the sale by the Selling Stockholders of Shares. The Company then shall use
commercially reasonable efforts to prepare and file a Registration Statement on
a form for which the Company then qualifies and which shall be available for
the sale by the Selling Stockholders (in accordance with the intended methods
of disposition thereof) of any of the Shares, the registration of which is
requested in the Demand Notice. The Company shall use commercially reasonable
efforts to cause such Registration Statement to be declared effective under the
Securities Act as promptly as practicable thereafter. The Stockholders shall
be entitled to one Demand Registration during each twelve-month period after
each Earnout Payment Date on which Shares are issued. On each Earnout Payment
Date on which Shares are issued, any unexercised right to a Demand Registration
during the preceding twelve months shall expire. A Demand Registration may
include any Shares held by any Stockholder on the date the Demand Notice is
delivered.
4. Restrictions on Demand Registration.
(a) Minimum Number of Shares. Notwithstanding anything
in Section 3 hereof to the contrary, the Company shall not be required to
effectuate a Demand Registration of fewer than 100,000 Shares.
(b) Registration Notice. Notwithstanding anything in
Section 3 hereof to the contrary, the Company shall have no obligation under
Section 3 with respect to any Demand Registration if, within 15 days after the
date of the Company's receipt of the Demand Notice, the Company notifies the
Selling Stockholders in writing (a "Registration Notice") that the Company
proposes to file, within 30 days after the date of the Registration Notice, a
registration statement on any form for the general registration of securities
for cash under the Securities Act for the account of the Company (other than in
connection with an offering solely to the Company's employees pursuant to a
registration statement on Form S-8 under the Securities Act or an offering
pursuant to a registration statement on Form S-4 under the Securities Act, or
any successor forms thereto), in which event such Demand Registration shall be
postponed until the conclusion or termination of the transaction described by
the Company in the Registration Notice; provided, however, that the Company
shall not be entitled to deliver a Registration Notice more than once in any 24
month period. To the extent permitted under Section 13, the Selling
Stockholders shall be entitled to include Shares in a registration statement
for Common Stock filed by the Company in connection with a Registration Notice.
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(c) Pending Company Registration. Notwithstanding
anything in Section 3 to the contrary, the Company shall have no obligation
under Section 3 with respect to any Demand Registration during the period
commencing 15 days prior to the filing of, and ending 180 days following the
effectiveness (or upon the withdrawal) of, any registration statement (other
than in connection with an offering solely to the Company's employees pursuant
to a registration statement on Form S-8 under the Securities Act or an offering
pursuant to a registration statement on Form S-4 under the Securities Act, or
any successor forms thereto) filed by the Company with the SEC with respect to
shares of Common Stock or securities convertible into shares of Common Stock;
provided, however, that the provisions of this paragraph shall apply only to
the extent the managing underwriter for such offering advises the Company in
writing that such managing underwriter believes application of this paragraph
(c) to be necessary for the success of such offering; provided, further, that
if this Section 4(c) is operative with respect to any Demand Registration, such
Demand Registration shall be postponed until the conclusion of the 195 day
period described in the first clause of this Section.
(d) Rule 144. Notwithstanding anything in Section 3 to
the contrary, the Company shall have no obligation to file or have declared
effective a Registration Statement for any shares of Common Stock which have
ceased to be Shares because they are eligible to be sold by any Stockholder
pursuant to Rule 144 (within the then-applicable volume limitation pursuant to
Rule 144(e)) or Rule 144(k).
5. Selling Stockholder Information. Each Selling Stockholder
shall, not later than the tenth day after the Closing Date or the tenth day
after the date on which a Demand Notice is delivered to the Company (as
applicable), furnish the Company with such information (the "Information")
regarding such Selling Stockholder, the Shares, the Selling Stockholder's
intended method of distribution of the Shares and such other information as may
be required under the Securities Act for preparation of the Registration
Statement. Each Selling Stockholder thereafter promptly shall furnish to the
Company all Information as may be requested in writing by the Company from time
to time to maintain the effectiveness of any Registration Statement.
If, within five days, a Selling Stockholder has not complied with a
written request from the Company for Information, then the Company's obligation
to register Shares on behalf of all Selling Stockholders shall be suspended
until the delinquent Selling Stockholder has complied with such request.
6. Other Securities. The Company may, in its sole discretion,
include in any Registration Statement the issuance of securities by the Company
and the sale or distribution of securities previously issued to, or securities
issuable upon exercise of options or warrants previously issued to, other
persons; provided, however, that if
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a Demand Registration Statement involves an underwritten distribution, the
Company may not include any other securities other than the Shares in such
Demand Registration Statement if, in the reasonable opinion of the managing
underwriter of such offering, the distribution of all or a portion of such
other securities would materially interfere with the registration and sale of
the Shares.
7. Means of Distribution. If any proposed distribution of Shares
by one or more Selling Stockholders pursuant to a Registration Statement is
proposed to include in the aggregate 750,000 or more Shares, then the Company
may require in the Company's sole discretion that such Shares to be distributed
by the Selling Stockholders through one or more underwriters selected by the
Company. In any proposed distribution of Shares by one or more Selling
Stockholders pursuant to a Registration Statement, the Company may require in
the Company's sole discretion that such Shares to be distributed by the Selling
Stockholders through (a) routine brokerage transactions or (b) directly
negotiated transactions (to one or more purchasers identified by the Company
who will agree to purchase the applicable Shares at a price not less than the
net price the Selling Stockholders would have received if the applicable Shares
were sold on a firm underwriting basis in a public distribution).
8. Underwritten Distributions. In any underwritten distribution
of Shares, each Selling Stockholder shall, if requested by the Company or the
underwriter or underwriters in connection with such distribution, (a) agree to
sell all or the applicable portion of such Selling Stockholder's Shares on the
basis provided in any underwriting arrangements entered into in connection
therewith and (b) complete and execute all questionnaires, powers of attorney,
indemnities, underwriting agreements and other documents that are required
under the terms of such underwriting arrangements.
9. Registration Procedures. In connection with the registration
of Shares pursuant hereto.
(a) Registration Statement Content. The Company shall
have the sole right to determine the content of any Registration Statement,
Prospectus, supplement thereto or amendment thereof; provided, however, that if
any Registration Statement refers to any Stockholder by name as the holder of
shares of Common Stock, then such Stockholder shall have the right to require
(i) the insertion in such Registration Statement of language, in form and
substance reasonably satisfactory to such Stockholder to the effect that such
Stockholder's ownership of shares of Common Stock should not be construed as a
recommendation by such Stockholder of the investment quality of the Company's
securities and that such ownership does not imply that such Stockholder will
assist in meeting any future financial requirements of the Company or (ii) the
deletion of such reference, unless counsel to the Company
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advises the Company that such reference is required by the Securities Act or
any similar federal statute then in effect.
(b) Amendments and Supplements. The Company shall use
commercially reasonable efforts to prepare and file with the SEC such
amendments and supplements to any Registration Statement and the final
prospectus (a "Prospectus") used in connection therewith, as the Company deems
necessary to keep the Registration Statement or Prospectus in effect for a
period of 120 days from the effective date of such Registration Statement and
comply with the provisions of the Securities Act with respect to the
disposition of all Shares covered by the Registration Statement until the
earlier of such time (i) as all of such Shares have been disposed of in
accordance with the intended methods of disposition by the Stockholders as set
forth in the Registration Statement, (ii) the expiration of such 120 day period
or (iii) the deregistration of unsold Shares remaining under the Registration
Statement, pursuant to a written agreement among the Company and the holder or
holders of such unsold Shares.
(c) Exchange Listing. The Company shall use commercially
reasonable efforts to cause the Shares to be listed on the Nasdaq National
Market or such other securities exchange or national market system on which
shares of the Common Stock are principally traded at the time of such listing,
in accordance with the rules and practices of the Nasdaq National Market, such
other securities exchange or national market system and the SEC.
(d) Blue Sky Laws. The Company shall use commercially
reasonable efforts to register or qualify (to the extent required by law) the
Shares covered by any Registration Statement under the applicable securities or
"Blue Sky" laws of such jurisdictions as the Stockholders reasonably request;
provided, however, that the Company shall not be obligated so to register or
qualify any the Shares in any jurisdiction (i) if the Company would be required
to qualify to do business in any jurisdiction where it is not now so qualified,
(ii) if the Company would be required to take any action which would subject it
to the service of process in suits other than those arising out of the offer or
sale of the securities covered by the Registration Statement or subject it to
taxation in any jurisdiction where it is not now so subject or (iii) if the
Company would be required to conform its capitalization or the composition of
its assets at the time to the securities or "Blue Sky" laws of such
jurisdiction.
(e) Removal of Legend. When any Shares become eligible
under Rule 144(k) (as currently in effect or as amended or any successor or
similar provision) under the Securities Act to be sold by the applicable
Stockholder without restriction, upon the written request either of the Company
or such Stockholder, such Shares will be returned to the Company's transfer
agent in exchange for appropriate
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new share certificates reflecting the removal of the private placement legend,
unless otherwise required by the Securities Act.
10. Stockholder Undertakings. Each Stockholder covenants with the
Company as follows:
(a) No Stabilization. No Stockholder shall effect any
stabilization transactions or engage in any stabilization activity proscribed
by Rule 10b-7 under the Exchange Act in connection with any securities of the
Company during the period of any distribution of the Shares by Selling
Stockholders pursuant to any Registration Statement.
(b) Brokers. Each Selling Stockholder (i) shall furnish
each broker through whom such Selling Stockholder offers the Shares such number
of copies of any Prospectus and any supplements thereto or amendments thereof
which such broker may require (provided that the Company has provided such
Selling Stockholder with such Prospectus, supplements and amendments), (ii)
shall inform such broker as to the number of Shares offered through such
broker, that such Shares are part of a distribution and that such broker is
subject to the provisions of Rule 10b-6 under the Exchange Act until such time
as such broker has completed the sale of all such Shares, and (iii) shall
notify such broker when distribution of the Shares by such Selling Stockholder
pursuant to any Registration Statement has been completed or any Registration
Statement is no longer effective or is withdrawn.
(c) Amendments and Supplements. Each Selling Stockholder
shall promptly furnish to each person (including each broker) to whom such
Selling Stockholder has delivered copies of the Prospectus an equivalent number
of copies of any amendment thereof or supplement thereto (provided that the
Company has provided such Selling Stockholder with such amendment or
supplement).
(d) Transaction Information. Each Stockholder shall
report promptly to the Company upon any disposition of Shares by such
Stockholder and upon completion of the distribution of such Selling
Stockholder's Shares pursuant to any Registration Statement.
(e) Exchange Act Compliance. Each Selling Stockholder
shall, at any time such Selling Stockholder is engaged in a distribution of the
Shares under any Registration Statement, comply to the extent required with
Rules 10b-5, 10b-6 and 10b-7 (as currently in effect or as amended or any
successor or similar provisions) promulgated under the Exchange Act and shall
distribute the Shares solely in the manner described in any Registration
Statement, and shall not do any of the following during the period from the
effective date of any Registration Statement
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until the completion of any offering of the Shares by such Selling Stockholder
pursuant to such Registration Statement:
(i) Bid for or purchase, for any account in which
such Selling Stockholder or any affiliate of such Selling Stockholder has a
beneficial interest, any securities of the Company other than in transactions
permitted by Rule 10b-6 under the Exchange Act;
(ii) Attempt to induce any person to purchase any
securities of the Company other than in transactions permitted by Rule 10b-6
under the Exchange Act; and
(iii) Pay or offer or agree to pay to anyone,
directly or indirectly, any compensation for soliciting another to purchase any
securities of the Company on a national securities exchange or pay or offer or
agree to pay to anyone any compensation for purchasing securities of the
Company on a national securities exchange other than those securities offered
by such Selling Stockholder.
(f) Publicity; Selling Efforts. Each Selling Stockholder
shall not, during the period of any offering by such Selling Stockholder of any
Shares under any Registration Statement, use or disseminate any information
concerning the Company other than the Prospectus (or any amendment thereof or
supplement thereto furnished by the Company) and may not undertake any form of
publicity with respect to the Company or engage in any similar activities that
may be deemed to be an unlawful selling effort within the meaning of Section 10
of the Exchange Act.
(g) Material Nonpublic Information. A Stockholder shall
not offer to sell, sell or otherwise enter into any transaction in connection
with any Shares if the Stockholder is aware of material nonpublic information
regarding the Company or its subsidiaries.
(h) Brokerage Commissions. Except as disclosed in the
Prospectus, a Selling Stockholder will not pay unusual or special brokerage
commissions (other than ordinary brokerage arrangements) on any sales effected
through a broker, and no selling arrangement will have been entered into
between a Selling Stockholder and any securities dealer or broker.
(i) Method of Disposition. In any distribution of Shares
pursuant to Rule 415, at least five business days prior to any disposition of
the Shares, the applicable Selling Stockholder shall advise the Company of the
dates on which such disposition is expected to commence and terminate, the
number of such Selling Stockholder's Shares expected to be sold, the method of
disposition and such other
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information as the Company may reasonably request in order to supplement the
Prospectus in accordance with the rules and regulations of the SEC.
11. Company Undertakings. The Company covenants with the
Stockholders as follows:
(a) Furnish Information. Before filing a Registration
Statement, a preliminary prospectus or a Prospectus, the Company will furnish
each Selling Stockholder copies of such documents. The Company also will
furnish to each Selling Stockholder such copies of each preliminary prospectus
and Prospectus as each Selling Stockholder may reasonably request. The Company
will furnish to each Selling Stockholder a copy of all documents filed with and
all correspondence from or to the SEC in connection with the offering covered
by any Registration Statement. Notwithstanding any of the obligations of the
Company set forth herein, the Company shall only be required to furnish such
audited annual or unaudited quarterly or monthly financial statements required
to keep the Registration Statement effective under the Securities Act.
(b) Material Developments. The Company will notify each
Selling Stockholder of the happening of any event as a result of which a
Prospectus being used by such Selling Stockholder to sell Shares pursuant to a
Registration Statement contains an untrue statement of a material fact or omits
to state any material fact required to be stated therein or necessary to make
the statements therein, in the light of the circumstances under which they were
made, not misleading. Following such notice and upon the Company's written
request, each Selling Stockholder shall deliver to the Company all copies
(other than permanent file copies then in any Stockholder's possession) of the
Prospectus that was in effect prior to such written notice. Subject to Section
12, the Company thereafter will use commercially reasonable efforts to prepare
promptly a supplement or amendment of such Prospectus so that, as thereafter
delivered to the purchaser of the Shares, the Prospectus will not contain 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 the light
of the circumstances under which they were made, not misleading.
(c) Underwriting Agreements. In any underwritten
distribution of Shares, the Company shall, to the extent required by the
managing underwriter of such distribution (i) enter into and perform the
Company's obligations under the applicable underwriting agreement, (ii) furnish
to the managing underwriter an opinion of counsel to the Company (which may be
the Company's in-house counsel) addressing customary legal issues reasonably
requested by the managing underwriter and (iii) furnish to the managing
underwriter a customary "comfort letter" addressed
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to the managing underwriter from the Company's independent certified public
accountants.
12. Blocking Periods. Each Selling Stockholder shall cease any
distribution of the Shares under any Registration Statement upon receipt of a
Blocking Notice (defined below) from the Company. The period of time during
which a Selling Stockholder shall cease distribution of the Shares (the
"Blocking Period") shall be the earlier of 60 days from the receipt of such
Blocking Notice by the Selling Stockholder or the date upon which such
transaction, proposed transaction or negotiations have been publicly disclosed
or terminated. The Company promptly shall send each Selling Stockholder
written notice (the "Blocking Termination Notice") at the earliest of such
times as (a) such transaction, proposed transaction or negotiations have been
publicly disclosed or terminated, (b) such non-public information has been
publicly disclosed, or (c) counsel to the Company has determined that such
disclosure is not required due to subsequent events. If any Blocking Period
occurs after the effective date of a Registration Statement, then the period
during which the Company is obligated to use commercially reasonable efforts to
keep such Registration Statement effective and from time to time to amend such
Registration Statement shall be extended by a number of days equal to the
length in days of the Blocking Period.
Any sale, offer to sell or other transaction involving Shares by any
Selling Stockholder during a Blocking Period shall constitute a material breach
by such Selling Stockholder of its obligations hereunder. Blocking Notices for
the reasons and for the periods of time set forth in this Section shall not
constitute a breach hereof by the Company.
The Company also may delay the filing of any Registration Statement,
Prospectus, amendment or supplement, or the effectiveness of any Registration
Statement, Prospectus, amendment or supplement, filed pursuant hereto upon
delivery of a Blocking Notice to the Selling Stockholders. The Company's delay
in filing or pursuing the effectiveness of a Registration Statement,
Prospectus, amendment or supplement during a Blocking Period shall not
constitute a breach hereof. At the conclusion of the Blocking Period, the
Company shall resume its efforts in connection with any such Registration
Statement, Prospectus, amendment or supplement and shall send a Blocking
Termination Notice to each Selling Stockholder.
"Blocking Notice" shall mean a written notice to the effect that (i) a
distribution of Shares or the filing or effectiveness of a Registration
Statement, Prospectus, amendment or supplement, at such time would require the
public disclosure of material nonpublic information concerning a transaction,
proposed transaction or negotiations involving the Company or any of its
affiliates that, in the Company's reasonable judgment, could materially
interfere with such transaction,
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proposed transaction or negotiations or (ii) such distribution of Shares or the
filing or effectiveness of a Registration Statement, Prospectus, amendment or
supplement at such time otherwise would require premature disclosure of
nonpublic information that, in the Company's reasonable judgment, could
adversely affect or otherwise be detrimental to the Company.
13. Piggyback Registration.
(a) Procedure. Subject to the terms and conditions set
forth herein, if the Company proposes at any time to register any shares of
Common Stock (the "Company Shares") under the Securities Act for sale for the
Company's account in a primary underwritten offering, the Company will promptly
(but in no event less than 15 days prior to the anticipated filing date of the
Company's registration statement (the "Piggyback Registration Statement")
pursuant to the Securities Act) give written notice (the "Piggyback Notice") to
the Stockholders of the Company's intention to effect such registration (such
notice to specify, to the extent known, the anticipated filing date, the number
of shares of Common Stock proposed to be registered and the general
distribution arrangements), and the Stockholders shall be entitled to include
in such Piggyback Registration Statement, as a part of such underwritten
offering, such number of Shares (the "Piggyback Shares") to be sold for the
account of Selling Stockholders (on the same terms and conditions as the
Company Shares) as shall be specified in written requests signed by the
applicable Stockholder and delivered to the Company not less than 10 days
before the later of (i) the anticipated filing date specified in the Piggyback
Notice or (ii) the actual filing date.
(b) Limitations. The Company's obligation to include
Piggyback Shares in a Piggyback Registration Statement is subject to each of
the following:
(i) Abandoned Registration. If, at any time
after giving the Piggyback Notice and prior to the effective date of the
Piggyback Registration Statement, the Company shall determine for any reason
not to register the Company Shares, then the Company may, at its election, give
written notice of such determination to the Selling Stockholders, and thereupon
the Company shall be relieved of its obligation to use any efforts to register
any Piggyback Shares in connection with such abandoned registration. The
Company's election not to register the Company Shares pursuant to this Section
shall not constitute a breach hereof.
(ii) Cutback. If, in the reasonable opinion of
the managing underwriter of such offering, the distribution of all or a
specified portion of the Piggyback Shares would materially interfere with the
registration and sale of the Company Shares, then the number of each Selling
Stockholder's Piggyback Shares, and the number of shares of Common Stock to be
registered on behalf of any person other than the Company ("Other Holders"), to
be included in the Piggyback
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Registration Statement shall be reduced (pro rata among all Selling
Stockholders and Other Holders on the basis of the number of shares that each
Selling Stockholder and each Other Holder requested be included) to such
number, if any, that can be included without such interference. If, as a
result of the cutback provisions of the preceding sentence, any Selling
Stockholder is not entitled to include all of his or its requested Shares in
such registration, then such Selling Stockholder may elect to withdraw his or
its request to include any or all of his or its Shares in such registration.
(c) Conditions to Inclusion. As a condition to each
Selling Stockholder's right to include Piggyback Shares in a registration
pursuant to this Section, such Selling Stockholder shall, if requested by the
Company or the managing underwriter in connection with such registration and
distribution (i) agree to sell such Selling Stockholder's Piggyback Shares on
the basis provided in any underwriting arrangements entered into in connection
therewith, (ii) complete and execute all questionnaires, powers of attorney,
indemnities, underwriting agreements and other documents that are required
under the terms of such underwriting arrangements and (iii) promptly provide
any Information requested, in writing, by the Company or the managing
underwriter.
(d) Continuing Rights of Stockholders. If a Stockholder
decides not to include all of its Shares in any Piggyback Registration
Statement filed by the Company pursuant to this Section 13, such Stockholder
shall nevertheless continue to have the right to include any Shares in any
subsequent Piggyback Registration Statement(s) as may be filed by the Company
with respect to offerings of shares of Common Stock, all upon the terms and
conditions set forth herein.
14. Indemnification; Contribution.
(a) Indemnification by Company. The Company shall
indemnify and hold harmless, to the extent permitted by law, each Selling
Stockholder, its officers and directors and each person, if any, who controls
such Selling Stockholder (within the meaning of the Securities Act) against all
losses, claims, damages, liabilities and expenses (including without limitation
reasonable attorneys' fees) insofar as such losses, claims, damages,
liabilities and expenses arise out of or are based on (i) any untrue or alleged
untrue statement of a material fact contained in any Registration Statement
under which Shares owned by such Selling Stockholder were registered under the
Securities Act, any Prospectus or preliminary prospectus or any amendment
thereof or supplement thereto or any documents filed under state securities or
"Blue Sky" laws in connection therewith, (ii) any omission or alleged omission
to state therein a material fact required to be stated therein or necessary to
make the statements therein (in the case of a Prospectus, in the light of the
circumstances under which they were made) not misleading or (iii) any
violations or
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alleged violation of the Securities Act, the Exchange Act, any applicable state
securities law or any rule or regulation promulgated under the Securities Act,
the Exchange Act or any applicable state securities law in connection with the
offering covered by such Registration Statement (items (i), (ii) and (iii) are
collectively referred to herein as "Violations"); and the Company will
reimburse each such Selling Stockholder, its officers and directors and each
person, if any, who controls such Selling Stockholder for reasonable legal or
other expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action; provided, however,
that the indemnity agreement contained in this Section 14(a) shall not apply to
amounts paid in settlement of any such loss, claim, damage, liability or action
if such settlement is effected without the consent of the Company, which
consent shall not be unreasonably withheld, nor shall the Company be liable in
any such case for any loss, claim, damage, liability or action to the extent
that it arises out of or is based on a Violation that occurs in reliance upon
and in conformity with written information furnished expressly for use in
connection with such registration by such Selling Stockholder, officer,
director, or controlling person of such Selling Stockholder. In connection
with an underwritten offering, the Company also will indemnify the
underwriter(s) thereof, their officers and directors and each person who
controls (within the meaning of the Securities Act) such underwriter(s) to the
same extent as provided above with respect to the indemnification of the
Selling Stockholders.
(b) Indemnification by Each Selling Stockholder. In
connection with any Registration Statement in which a Selling Stockholder is
participating, each such Selling Stockholder shall, severally and not jointly,
indemnify and hold harmless, to the extent permitted by law, the Company, the
Company's directors and officers and each person, if any, who controls (within
the meaning of the Securities Act) the Company against any losses, claims,
damages, liabilities and expenses (including without limitation reasonable
attorneys' fees) insofar as such losses, claims, damages, liabilities and
expenses arise out of or are based on a Violation which occurs in reliance upon
and in conformity with written information furnished expressly for use in
connection with such registration by such Selling Stockholder, officer,
director, or controlling person of such Selling Stockholder; and each such
Selling Stockholder will reimburse the Company, its officers and directors and
each person, if any, who controls the Company for reasonable legal or other
expenses reasonably incurred by the Company in connection with investigating or
defending any such loss, claim, damage, liability or action.
(c) Indemnification Procedures. Any person entitled to
indemnification hereunder shall give prompt written notice to the indemnifying
party after the receipt by such person of any written notice of the
commencement of any action, suit, proceeding or investigation or threat thereof
made in writing for which such person will claim indemnification or
contribution pursuant hereto and permit
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the indemnifying party to participate therein and, to the extent that it
desires, jointly with any other indemnifying party similarly situated, to
assume the defense of such claim with counsel reasonably satisfactory to such
indemnified party. If the indemnifying party elects to assume the defense of a
claim, it shall not be liable to such indemnified party for legal expenses
subsequently incurred by such indemnified party in connection with the defense
thereof other than reasonable costs of investigation and except as otherwise
provided below; provided, however, that such indemnified party shall, at all
times, cooperate in the defense of the indemnified party. The indemnifying
party shall be liable to the indemnified party for legal or other expenses
incurred by the indemnified party even if the indemnifying party has offered to
assume the defense thereof if (i) the employment of counsel by the indemnified
party has been authorized in writing by the indemnifying party, (ii) the
indemnified party shall have reasonably concluded that there may be a conflict
of interest between the indemnified party and the indemnifying party in conduct
of the defense of such action or (iii) the indemnifying party shall not in fact
have employed counsel to assume the defense of such action. If the
indemnifying party is not entitled to, or elects not to, assume the defense of
a claim, then it will not be obligated to pay the fees and expenses of more
than one counsel with respect to such claim. The indemnifying party will not
be subject to any liability for any settlement made without its consent. If
the failure of any person to give prompt notice to the indemnifying party of
any claim with respect to which it seeks indemnification prejudices such
indemnifying party, such indemnifying party shall be relieved of its obligation
to indemnify such person to the extent that such indemnifying party has been
prejudiced; provided, however, that the indemnifying party shall not be so
relieved if the failure to give prompt notice to the indemnifying party was
beyond the control of the indemnified party. No indemnifying party will
consent to entry of any judgment or enter into any settlement agreement 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.
(d) Contribution. If the indemnification provided for in
this Section from the indemnifying party is unavailable to an indemnified party
hereunder in respect of any losses, claims, damages, liabilities or expenses
(including without limitation reasonable attorneys' fees) referred to therein,
then the indemnifying party, in lieu of indemnifying such indemnified party,
shall contribute to the amount paid or payable by such indemnified party as a
result of such losses, claims, damages, liabilities or expenses (including
without limitation reasonable attorneys' fees) in such proportion as is
appropriate to reflect not only the relative benefits received by the
indemnifying party on the one hand and the indemnified party on the other, but
also the relative fault of the indemnifying party and the indemnified party as
well as any other relevant equitable considerations. The relative fault of
such indemnifying party and indemnified parties shall be determined by
reference to, among other things, whether any action in question, including any
untrue or alleged untrue statements
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of a material fact or omission or alleged omission to state a material fact,
has been made by, or relates to information supplied by, such indemnifying
party or indemnified parties, and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such action. The
amount paid or payable by a party as a result of the losses, claims, damages,
liabilities and expenses (including without limitation reasonable attorneys'
fees) referred to above shall be deemed to include, subject to the limitations
set forth in Section 7(c), any legal or other fees or expenses reasonably
incurred by such party in connection with any investigation or proceeding.
The parties hereto acknowledge that it would not be just and
equitable if contribution pursuant to this Section 7(d) were determined by pro
rata allocation or by any other method of allocation which does not take into
account the equitable considerations referred to in the immediately-preceding
paragraph. No person guilty of fraudulent misrepresentation (within the
meaning of Paragraph 11(f) of the Securities Act) shall be entitled to
contribution from any person who is not guilty of such fraudulent
misrepresentation.
15. Expenses. The Company shall bear all Registration Expenses;
provided, however, that the Company shall have no obligation to pay or
otherwise bear the Selling Expenses of any Stockholder.
16. Termination. This Agreement and the obligations of the
Company hereunder shall terminate on the earliest of (a) the first date on
which no shares of Common Stock held by any Stockholder constitute Shares
hereunder, (b) the date on which each party hereto agrees in writing to such
termination and (c) the fourth anniversary of the Closing Date; provided,
however, solely with respect to item (c) of this Section, such termination date
shall be extended in the event any Demand Registration is postponed pursuant to
the provisions of Section 4 hereof for a time period equal to the period of
such delay or postponement.
17. Rule 144 Reporting. With a view to making available to the
Stockholders the benefits of certain rules and regulations of the SEC that may
permit the sale of the Shares to the public without registration, the Company
agrees to use commercially reasonable efforts during the term of this Agreement
to (a) make and keep public information available, as those terms are
understood and defined in Rule 144, (b) file with the SEC, in a timely manner,
all reports and other documents required of the Company under the Exchange Act
and (c) so long as any Stockholder owns any Shares, furnish to such Stockholder
upon written request a written statement by the Company as to the Company's
compliance with the reporting requirements of Rule 144, a copy of the most
recent annual or quarterly report of the Company and such other reports,
documents and information as a Stockholder may
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reasonably request in availing himself or itself of any rule or regulation of
the SEC allowing it to sell any such securities without registration.
18. Miscellaneous.
(a) Successors and Assigns. The registration rights
provided hereunder are not transferable and shall not inure to the benefit of
any persons other than the respective Stockholders; provided, however, each
Stockholder may transfer such Stockholder's registration rights hereunder to a
charitable remainder trust as defined in Section 664 of the Internal Revenue
Code, the Treasury Regulations promulgated thereunder, and the revenue
procedures and revenue rulings relating thereto; provided, further, that CLC IO
may assign its rights hereunder to any of the Stockholders to whom CLC IO's
Shares are transferred, whether by dividend or otherwise. Any such permitted
transferee shall succeed to a Stockholder's registration rights hereunder only
if the permitted transferee agrees in writing to perform all the obligations of
a Stockholder hereunder. Thereafter, all references herein to a "Stockholder"
or "Stockholders" shall be deemed to include such permitted transferee. Any
transfer or assignment in contravention of this Section shall be null and void.
(b) Entire Agreement; Amendment. This Agreement and the
other documents delivered pursuant hereto and referenced herein constitute the
full and entire understanding and agreement between the parties and supersede
any other agreement, written or oral, with regard to the subject matter hereof.
Except as expressly provided herein, neither this Agreement nor any term hereof
may be amended, waived, discharged or terminated, except by a written
instrument signed by the parties hereto.
(c) Notices, Etc. All notices and other communications
required or permitted hereunder shall be in writing and shall be mailed by
certified or registered mail, postage prepaid with return receipt requested,
telecopy (with hardcopy delivered by overnight courier service), or delivered
by hand, messenger or overnight courier service, and shall be deemed given when
received at the addresses of the parties set forth below, or at such other
address furnished in writing to the other parties hereto.
If to the Company: AMRESCO, INC.
Suite 2400
000 Xxxxx Xxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: General Counsel
(000) 000-0000 (fax)
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with a copy to: Xxxxxx and Xxxxx, LLP
Suite 3100
000 Xxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Attention: Xxx X. Xxxxxx
(000) 000-0000 (fax)
If to the Stockholders: 000 X. Xxxxxx, Xxxxx 000
Xxxxx, Xxxxx 00000
Attention: (Applicable Stockholder)
(000) 000-0000 (fax)
with a copy to: Xxxxxx Xxxxxxx Xxxxx & Xxxxxx
First Interstate Center
000 Xxxx Xxxxxx, Xxxxx 0000
X.X. Xxx 0000
Xxxxx, Xxxxx 00000
Attention: Xxxx Xxxx
(000) 000-0000 (fax)
(d) No Third Party Beneficiary, Etc. There shall be no
third party beneficiary hereof. Neither the availability of, nor any limit on,
any remedy hereunder shall limit the remedies of any party hereto against third
parties.
(e) Reformation; Severability. In case any provision
hereof shall be invalid, illegal or unenforceable, such provision shall be
reformed to best effectuate the intent of the parties and permit enforcement
thereof, and the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby. If such
provision is not capable of reformation, it shall be severed from this
agreement and enforceability of the remaining provisions shall not in any way
be affected or impaired thereby
(f) Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be an original, but all of which
together shall constitute one and the same instrument. Any counterpart may be
delivered by facsimile; provided, however, that attachment thereof shall
constitute the representation and warranty of the person delivering such
signature that such person has full power and authority to attach such
signature and to deliver this Agreement. Any facsimile signature shall be
replaced with an original signature as promptly as practicable.
(g) Titles and Subtitles. The titles of the paragraphs
and subparagraphs hereof are for convenience of reference only and are not to
be
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considered in construing this Agreement. References to "Sections" herein are
references to sections of this Agreement. The words "herein," "hereof,"
"hereto" and "hereunder" and other words of similar import refer to this
Agreement as a whole and not to any particular Article, Section or other
subdivision.
(h) Governing Law; Attorneys' Fees. This Agreement shall
be governed by, construed, interpreted and applied in accordance with the laws
of the State of Texas, without giving effect to any conflict of laws rules that
would refer the matter to the laws of another jurisdiction.
Each party hereto hereby irrevocably submits to the exclusive
jurisdiction of the United States District Court for the Northern District of
Texas and, if such court does not have jurisdiction, of the courts of the State
of Texas in Dallas County, for the purposes of any action arising out of this
Agreement, or the subject matter hereof, brought by any other party.
To the extent permitted by applicable law, each Stockholder
hereby waives and agrees not to assert, by way of motion, as a defense or
otherwise in any such action, any claim (i) that it is not subject to the
jurisdiction of the above-named courts, (ii) that the action is brought in an
inconvenient forum, (iii) that it is immune from any legal process with respect
to itself or its property, (iv) that the venue of the suit, action or
proceeding is improper or (v) that this Agreement, or the subject matter
hereof, may not be enforced in or by such courts.
The prevailing party in any action or proceeding relating to this
Agreement shall be entitled to recover reasonable attorneys' fees and other
costs from the non-prevailing parties, in addition to any other relief to which
such prevailing party may be entitled.
* * * * *
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This Agreement has been executed and delivered as of the date first
written above.
The Company:
AMRESCO, INC.
By:
-------------------------------------
Printed Name:
---------------------------
Title:
----------------------------------
The Stockholders:
----------------------------------------
Xxxxxx Xxxxxxxxx
----------------------------------------
Xxxx Xxxxxxx
----------------------------------------
Xxxxxxx Xxxxx
----------------------------------------
Xxxx Xxxxx
----------------------------------------
Xxxxx Xxxxxxxx
CLC IO, INC.
By:
-------------------------------------
Printed Name:
---------------------------
Title:
----------------------------------
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