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EXHIBIT III
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 Series B Cumulative Convertible
Redeemable Preferred Share Purchase Agreement, dated as of the date hereof (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.
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"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.
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.
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"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.
"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.
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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 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
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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 at 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.
(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).
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(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
(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.
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(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 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
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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 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 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
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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 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
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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 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.
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(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]
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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. XXXXXXX
-------------------------------------
Name: Xxxxxx X. Xxxxxxx
-----------------------------------
Title: Vice President
----------------------------------
0 Xxxxxx Xxxxx
Xxxxx Xxxxxx Xxxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000-0000
Attention: Xxxxxxx X. Xxxxxx
Facsimile: (000) 000-0000
12
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
13
