EXHIBIT 10-9
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "AGREEMENT") is made
and entered into as of September 27TH, 1999 by and between American Real Estate
Investment Corporation, a Maryland corporation (the "COMPANY"), and the holders
of securities listed on SCHEDULE A attached hereto (including their respective
successors, assigns and transferees herein referred to individually as a
"HOLDER" and collectively as the "HOLDERS").
WHEREAS, on the date hereof, pursuant to the Subscription
Agreement (the "SUBSCRIPTION AGREEMENT") made as of September 27, 1999 by and
among each of those Persons set forth in Exhibit A attached thereto, and the
Company, each Holder is receiving such number of shares of Series C Convertible
Preferred Stock, par value $.001 per share (the "PREFERRED STOCK"), of the
Company, which are convertible into shares of common stock, par value $.001 per
share (the "COMMON STOCK"), as set forth opposite such Holder's name on SCHEDULE
A attached hereto (the shares of Common Stock issued upon conversion of the
Preferred Stock are collectively referred to as the "REGISTRABLE SECURITIES;"
PROVIDED, HOWEVER, that any such securities shall cease to be Registrable
Securities when (i) a Shelf Registration Statement (as defined below) covering
such securities has been declared effective and such Registrable Securities have
been disposed of by the Holder thereof pursuant to such effective Shelf
Registration Statement or any other effective registration statement, (ii) such
securities are transferred by the Holder thereof to any person other than a
Holder pursuant to Rule 144 (or any successor rule or similar provision then in
effect, but not Rule 144A) under the Securities Act (as defined below),
including a sale pursuant to the provisions of Rule 144(k), (iii) such
securities shall have ceased to be outstanding or (iv) such securities are
eligible for sale pursuant to Rule 144 under the Securities Act and could be
sold in one transaction in accordance with the volume limitations contained in
Rule 144(e)(1)(i) under the Securities Act).
WHEREAS, in connection therewith, the Company has agreed to
grant to Holders the Registration Rights (as defined in Section 1 hereof);
NOW, THEREFORE, the parties hereto, in consideration of the
foregoing, the mutual covenants and agreements hereinafter set forth, and other
good and valuable consideration, the receipt and sufficiency of which hereby are
acknowledged, hereby agree as follows:
SECTION 1. REGISTRATION RIGHTS
Each Holder shall be entitled to offer for sale from time to
time pursuant to a Shelf Registration Statement (as defined below) the
Registrable Securities, subject to the terms and conditions set forth herein
(the "Registration Rights").
1.1 REGISTRATION RIGHTS.
(a) REGISTRATION PROCEDURE. The Company will cause to
be filed with the Securities and Exchange Commission (the "SEC") within three
(3) months of the date of this Agreement a shelf registration statement and
related prospectus, including any preliminary prospectus and documents
incorporated by reference (the "Shelf Registration Statement") that complies as
to form in all material respects with applicable SEC rules providing for the
sale by each of the Holders of such Holder's Registrable Securities, and agrees
(subject to Section 1.2 hereof) to use its commercially reasonable best efforts
to cause such Shelf Registration Statement to be declared effective by the SEC
as soon as
practicable thereafter; PROVIDED, HOWEVER, that, prior to filing a
Shelf Registration Statement or any amendments or supplements thereto, the
Company shall furnish to the Holders of the Registrable Securities covered by
such Shelf Registration Statement, Holders' counsel and the managing
underwriters, if any, draft copies of all such documents proposed to be filed,
and shall, prior to filing such documents, review any comments which are
submitted by any Holder or its counsel within five days after delivery of such
documents to such Holder by the Company; PROVIDED, FURTHER, that, except to the
extent such comments relate to specific disclosure regarding such Holder or its
proposed method of disposition of the Registrable Securities, the Company shall
not be required to incorporate any such comments into documents.
(b) AMENDMENTS AND SUPPLEMENTS. The Company shall (i)
prepare and file with the SEC such amendments to such Shelf Registration
statement as may be necessary to keep such Shelf Registration Statement
effective during the Target Effective Period; (ii) cause the Prospectus to be
amended or supplemented as required and to be filed as required by Rule 424 or
any similar rule that may be adopted under the Securities Act of 1933, as
amended (the "Securities Act"), (iii) respond as promptly as practicable to any
comments received from the SEC with respect to the Shelf Registration Statement
or any amendment thereto; and (iv) comply with the provisions of the Securities
Act with respect to the disposition of all securities covered by such
Registration Statement during the applicable period in accordance with the
intended method or methods of distribution by the Holder covered thereby. Each
Holder agrees to provide in a timely manner information regarding the proposed
distribution by such Holder of the Registrable Securities and such other
information reasonably requested by the Company in connection with the
preparation of and for inclusion in the Shelf Registration Statement. The
Company agrees (subject to Section 1.2 hereof) to use its commercially
reasonable best efforts to keep the Shelf Registration Statement effective and
free of material misstatements or omissions (including the preparation and
filing of any amendments and supplements necessary for that purpose) until the
earlier of (i) the first date on which all Holders have consummated the sale of
all of such Holders' Registrable Securities registered under the Shelf
Registration Statement or (ii) the date on which all of the Registrable
Securities are eligible for sale pursuant to Rule 144(k) (or any successor
provision) or in a single transaction pursuant to Rule 144(e) (or any successor
provision) under the Securities Act (the "Target Effective Period"). The Company
agrees to provide, without charge, to each Holder a reasonable number of copies
of the final Shelf Registration Statement and the related prospectus (including
any preliminary prospectus) and any amendments or supplements thereto. The
Company further agrees that it will use commercially reasonable efforts to
obtain the withdrawal of any order suspending the effectiveness of the Shelf
Registration Statement at the earliest possible moment.
(c) OFFERS AND SALES. All offers and sales by each
Holder under the Shelf Registration Statement referred to in this Section 1.1,
if any, shall be completed within the period during which the Shelf Registration
Statement is required to remain effective pursuant to Section 1.1(a), and, upon
expiration of such period, no Holder will offer or sell any Registrable
Securities under the Shelf Registration Statement. If directed by the Company,
each Holder will return all undistributed copies of the Prospectus in its
possession upon the expiration of such period. Each Holder shall promptly, but
in any event no later than two (2) business days after a sale by such Holder of
Registrable Securities, notify the Company of any sale or other transfer by such
Holder of Registrable Securities and include in such notice the number of
Registrable Securities sold or transferred by such Holder.
(d) LIMITATIONS ON UNDERWRITERS. Each Holder agrees
not to make any offers or sales through any underwriter until the earlier to
occur of (i) the consummation by the Company of a Qualifying Offering (as
defined below) or (ii) the second anniversary of the date hereof. For the
purposes of this Agreement, a "QUALIFYING OFFERING" shall mean the sale of
shares of Common Stock in an underwritten public offering (in which no person
acquires more than 10% of the shares of Common Stock
2
to be sold) at a price of at least $16.50 per share which results in net
proceeds to the Company of at least $150 million.
1.2 SUSPENSION OF OFFERING.
(a) If the Company determines in its good faith
judgment that the filing of the Shelf Registration Statement under SECTION 1.1
hereof or the use of any prospectus would materially impede, delay or interfere
with any pending material financing, acquisition or corporate reorganization or
other material corporate development involving the Company or any of its
subsidiaries, or require the disclosure of important information which the
Company has a material business purpose for preserving as confidential or the
disclosure of which would materially impede the Company's ability to consummate
a significant transaction, upon written notice of such determination by the
Company, the rights of each Holder to offer, sell or distribute any Registrable
Securities pursuant to the Shelf Registration Statement or to require the
Company to take action with respect to the registration or sale of any
Registrable Securities pursuant to the Shelf Registration Statement (including
any action contemplated by SECTION 1.1 hereof) will be suspended until the date
upon which the Company notifies the Holders in writing that suspension of such
rights for the grounds set forth in this SECTION 1.2(A) is no longer necessary,
but, in any event, no such period shall extend for longer than 45 days; PROVIDED
the Company may deliver only two such notices in any twelve month period.
(b) In the case of the registration of any
underwritten public offering proposed by the Company (other than any
registration by the Company on Form S-3 or S-8, as the case may be, or a
successor or substantially similar form, of (A) an employee stock option, stock
purchase or compensation plan or of securities issued or issuable pursuant to
any such plan or (B) a dividend reinvestment plan), each Holder agrees, if
requested in writing by the managing underwriter or underwriters administering
such offering, not to effect any underwritten offering for the resale of
Registrable Securities (or any option or right to acquire Registrable
Securities) during the period commencing on the 7th day prior to the expected
effective date of the Shelf Registration Statement covering such underwritten
public offering or the date on which the proposed offering is expected to
commence (which date shall be stated in such notice) and ending on the date
specified by such managing underwriter in such written request to such Holder,
which date shall not be later than 90 days after such expected date of
effectiveness or the commencement of the offering, as the case may be.
1.3 EXPENSES. The Company shall pay all expenses incident
to the performance by it of its registration obligations under this Section 1,
including (i) all stock exchange, SEC and state securities registration, listing
and filing fees, (ii) all expenses incurred in connection with the preparation,
printing and distributing of the Shelf Registration Statement and prospectus
(including all expenses incurred in connection with the delivery to any Holder
of such number of copies of any prospectus as such Holder may reasonably
request), and (iii) fees and disbursements of counsel for the Company and of the
independent public accountants of the Company. Each Holder shall be responsible
for the payment of any underwriting fees (to the extent permitted by Section
1.1(c), brokerage and sales commissions, fees and disbursements of such Holder's
counsel, and any transfer taxes relating to the sale or disposition of the
Registrable Securities by such Holder.
1.4 QUALIFICATION. The Company agrees, if necessary, to
use its commercially reasonable best efforts to register or qualify for offer
and sale the Registrable Securities by the time the Shelf Registration Statement
is declared effective by the SEC under all applicable state securities or "blue
sky" laws of the 50 states of the United States or obtain appropriate exemptions
therefrom, to keep each such registration or qualification effective during the
period the Shelf Registration Statement is required to be kept effective, and to
do any and all other acts and things which may be reasonably necessary or
advisable to enable each Holder to consummate the disposition in each such
jurisdiction of the
3
Registrable Securities owned by such Holder; PROVIDED, HOWEVER, that the Company
shall not be required to (x) qualify generally to do business in any
jurisdiction or to register as a broker or dealer in such jurisdiction where it
would not otherwise be required to qualify but for this Section 1.4, (y) subject
itself to taxation in any such jurisdiction, or (z) submit to the general
service of process in any such jurisdiction.
1.5 NOTICES TO HOLDERS. Subject to Section 1.1(a) hereof,
during the period that the Company is required to keep the Shelf Registration
Statement effective, the Company will advise the Holders within a reasonable
time (i) when the prospectus or any prospectus supplement or post-effective
amendment thereto has been filed, and when the same has become effective, (ii)
of any request by the SEC for any amendments to, or issuance by the SEC of any
stop order with respect to the Shelf Registration Statement or any prospectus or
amendment thereto, (iii) of the issuance by any state securities commission or
other regulatory authority of any order suspending the registration or
qualification or exemption from registration or qualification of any proceedings
for that purpose or (iv) that an amendment or supplement to the most recent
Prospectus or prospectus supplement, as the case may be, is necessary in order
to make the statements therein, in the light of the circumstances under which
they were made, not misleading.
1.6 LISTING. The Company agrees to use its reasonable
efforts to cause all Registrable Securities to be listed on any securities
exchange on which similar securities issued by the Company are listed.
1.7 INCLUSION OF INFORMATION. The Company shall, if
reasonably requested by Holders' counsel or any Holder, incorporate as promptly
as practicable in a prospectus supplement or post-effective amendment such
information as such Holder or Holders' counsel requests to be included therein,
including, without limitation, with respect to the Registrable Securities being
sold by such Holder to any underwriter or underwriters, the purchase price being
paid therefor by such underwriter or underwriters and any other terms of any
underwritten offering of the Registrable Securities to be sold in such offering,
and the Company shall promptly make all required filings of such prospectus
supplement or post-effective amendment.
1.8 TIMELY PREPARATION AND DELIVERY OF CERTIFICATES. The
Company shall cooperate with the Holders to facilitate the timely preparation
and delivery of certificates (which shall not bear any restrictive legends
unless required under applicable law) representing Registrable Securities sold
under a Shelf Registration Statement to the purchasers thereof, and enable such
Registrable Securities to be in such denominations and registered in such names
as the managing underwriter or underwriters, if any, or such Holders may request
and keep available and make available to the Company's transfer agent prior to
the effectiveness of such Shelf Registration Statement a supply of such
certificates.
1.9 CUSTOMARY AGREEMENTS. The Company shall enter into
such customary agreements (including, if applicable, an underwriting agreement
in customary form) and take such other actions as the Holders or the
underwriters retained by the Holders participating in an underwritten public
offering, if any, may reasonably request in order to expedite or facilitate the
disposition of Registrable Securities; provided, however, that such underwriters
are reasonably acceptable to the Company. (The Holders may, at their option,
require that any or all of the representations, warranties and covenants of the
Company to or for the benefit of any underwriters also be made to and for the
benefit of the Holders.)
1.10 OPINION LETTERS; COMFORT LETTERS. The Company shall
furnish to each Holder of Registrable Securities included in such offering and
to each underwriter, if any, if requested by such Holder or underwriter, a
signed counterpart, addressed to such Holder or underwriter, of (i) an opinion
or opinions of counsel to the Company and (ii) a comfort letter or comfort
letters from the Company's
4
independent public accountants, each in customary form and covering matters of
the type customarily covered by opinions or comfort letters, as the case may be.
1.11 TIMELY FILINGS. The Company shall, during the period
when the prospectus is required to be delivered under the Securities Act, file
in a timely fashion all documents required to be filed with the Commission
pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act.
SECTION 2. INDEMNIFICATION
2.1 INDEMNIFICATION BY THE COMPANY. The Company agrees to
indemnify and hold harmless each Holder, its partners, officers, directors,
trustees, stockholders, employees, agents and investment advisers, and each
person, if any, who controls any Holder within the meaning of Section 15 of the
Securities Act or Section 20 of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), together with the partners, officers, directors, trustees,
stockholders, employees, agents and investment advisors of such controlling
person as follows:
(a) against any and all loss, liability, claim,
damage and expense whatsoever, as incurred, arising out of or based upon any
untrue statement or alleged untrue statement of a material fact contained in any
Shelf Registration Statement (or any amendment thereto) pursuant to which the
Registrable Securities were registered under the Securities Act, 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 or based upon any untrue
statement or alleged untrue statement of a material fact contained in any
prospectus (or any amendment or supplement thereto), including all documents
incorporated therein by reference, 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;
(b) against any and all loss, liability, claim,
damage and expense whatsoever, as incurred, to the extent of the aggregate
amount paid in settlement of any litigation, or investigation or proceeding by
any governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such alleged
untrue statement or omission, if such settlement is effected with the written
consent of the Company, which consent shall not be unreasonably withheld; and
(c) against any and all expense whatsoever, as
incurred (including reasonable fees and disbursements of counsel), reasonably
incurred in investigating, preparing or defending against any litigation, or
investigation or proceeding by any governmental agency or body, commenced or
threatened, in each case whether or not a party, or any claim whatsoever based
upon any such untrue statement or omission, or any such alleged untrue statement
or omission, to the extent that any such expense is not paid under subparagraph
(a) or (b) above;
PROVIDED, HOWEVER, that the indemnity provided pursuant to this Section
2.1 does not apply to any Holder with respect to any loss, liability,
claim, damage or expense to the extent arising out of (i) any untrue
statement or omission or alleged untrue statement or omission made in
reliance upon and in conformity with written information furnished to
the Company by or on behalf of such Holder expressly for use in the
Shelf Registration Statement (or any amendment thereto) or the related
prospectus (or any amendment or supplement thereto), or (ii) such
Holder's failure to deliver an amended or supplemental Prospectus
(provided such Holder was notified in writing pursuant to Section 1.5,
or otherwise, of the need for an amended or supplemental Prospectus) if
such loss, liability, claim, damage or expense would not have arisen
had such delivery occurred.
5
In connection with an underwritten offering, the Company will indemnify the
underwriters thereof, their officers and directors and each Person who controls
such underwriters (within the meaning of either Section 15 of the Securities Act
or Section 20 of the Exchange Act) to the same extent as provided above with
respect to the indemnification of the Holders except with respect to (i)
information provided by the underwriter specifically for inclusion therein or
(ii) such underwriter's failure to deliver an amended or supplemental Prospectus
(provided such underwriter was notified in writing pursuant to Section 1.5, or
otherwise, of the need for an amended or supplemental Prospectus) if such loss,
liability, claim, damage or expense would not have arisen had such delivery
occurred.
2.2 INDEMNIFICATION BY HOLDER. Each Holder (on a several
and not joint basis) agrees to indemnify and hold harmless the Company, and each
of its directors and officers (including each director and officer of the
Company who signed a Shelf Registration Statement), and each person, if any, who
controls the Company within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act, as follows:
(a) against any and all loss, liability, claim,
damage and expense whatsoever, as incurred, arising out of or based upon any
untrue statement or alleged untrue statement of a material fact contained in any
Shelf Registration Statement (or any amendment thereto) pursuant to which the
Registrable Securities were registered under the Securities Act, 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 or based upon any untrue
statement or alleged untrue statement of a material fact contained in any
prospectus (or any amendment or supplement thereto), including all documents
incorporated therein by reference, 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;
(b) against any and all loss, liability, claim,
damage and expense whatsoever, as incurred, to the extent of the aggregate
amount paid in settlement of any litigation, or investigation or proceeding by
any governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such alleged
untrue statement or omission, if such settlement is effected with the written
consent of Holder, which consent shall not be unreasonably withheld; and
(c) against any and all expense whatsoever, as
incurred (including reasonable fees and disbursements of counsel), reasonably
incurred in investigating, preparing or defending against any litigation, or
investigation or proceeding by any governmental agency or body, commenced or
threatened, in each case whether or not a party, or any claim whatsoever based
upon any such untrue statement or omission, or any such alleged untrue statement
or omission, to the extent that any such expense is not paid under subparagraph
(a) or (b) above;
PROVIDED, HOWEVER, that the indemnity provided pursuant to this Section
2.2 shall only apply with respect to any loss, liability, claim, damage
or expense to the extent arising out of (i) any untrue statement or
omission or alleged untrue statement or omission made in reliance upon
and in conformity with written information furnished to the Company by
or on behalf of such Holder expressly for use in the Shelf Registration
Statement (or any amendment thereto) or the related prospectus (or any
amendment or supplement thereto), or (ii) such Holder's failure to
deliver an amended or supplemental prospectus (provided such Holder was
notified in writing pursuant to Section 1.5, or otherwise, of the need
for an amended or supplemental Prospectus) if such loss, liability,
claim, damage or expense would not have arisen had such delivery
occurred. Notwithstanding the provisions of this Section 2.2, no Holder
shall be required to indemnify the Company, its officers, directors or
control persons with respect to any amount in excess of the
6
amount of the total proceeds to such Holder from sales of the
Registrable Securities of such Holder under the Shelf Registration
Statement (after deducting the amounts already paid to the Company by
such Holder or any person, if any, who controls such Holder pursuant to
this Section 2.2), and no Holder shall be liable under this Section 2.2
for any statements or omissions of any other Holder.
2.3 CONDUCT OF INDEMNIFICATION PROCEEDINGS. The
indemnified party shall give reasonably prompt notice to the indemnifying party
of any action or proceeding commenced against it in respect of which indemnity
may be sought hereunder, but failure to so notify the indemnifying party (i)
shall not relieve it from any liability which it may have under the indemnity
agreement provided in Section 2.1 or 2.2 above, unless and to the extent it did
not otherwise learn of such action and the lack of notice by the indemnified
party results in the forfeiture by the indemnifying party of substantial rights
or defenses, and (ii) shall not, in any event, relieve the indemnifying party
from any obligations to the indemnified party other than the indemnification
obligation provided under Section 2.1 or 2.2 above. If the indemnifying party so
elects within a reasonable time after receipt of such notice, the indemnifying
party may assume the defense of such action or proceeding at such indemnifying
party's own expense with counsel chosen by the indemnifying party and approved
by the indemnified party, which approval shall not be unreasonably withheld;
PROVIDED, HOWEVER, that the indemnifying party will not settle any such action
or proceeding without the written consent of the indemnified party unless, as a
condition to such settlement, the indemnifying party secures the unconditional
release of the indemnified party; and PROVIDED FURTHER, that if the indemnified
party reasonably determines that a conflict of interest exists where it is
advisable for the indemnified party to be represented by separate counsel or
that, upon advice of counsel, there may be legal defenses available to it which
are different from or in addition to those available to the indemnifying party,
then the indemnifying party shall not be entitled to assume such defense and the
indemnified party shall be entitled to separate counsel at the indemnifying
party's expense. If the indemnifying party is not entitled to assume the defense
of such action or proceeding as a result of the proviso to the preceding
sentence, the indemnifying party's counsel shall be entitled to conduct the
indemnifying party's defense and counsel for the indemnified party shall be
entitled to conduct the defense of the indemnified party, it being understood
that both such counsel will cooperate with each other to conduct the defense of
such action or proceeding as efficiently as possible. If the indemnifying party
(i) is not so entitled to assume the defense of such action, (ii) does not
assume such defense, after having received the notice referred to in the first
sentence of this paragraph, or (iii) fails to employ counsel that is reasonably
satisfactory to the indemnified party, after having received the notice referred
to in the first sentence of this paragraph, the indemnifying party will pay the
reasonable fees and expenses of counsel for the indemnified party. In such
event, however, the indemnifying party will not be liable for any settlement
effected without the written consent of the indemnifying party, which consent
shall not be unreasonably withheld. If an indemnifying party is entitled to
assume, and assumes, the defense of such action or proceeding in accordance with
this paragraph, the indemnifying party shall not be liable for any fees and
expenses of counsel for the indemnified party incurred thereafter in connection
with such action or proceeding.
2.4 CONTRIBUTION. In order to provide for just and
equitable contribution in circumstances in which the indemnity agreement
provided for in this Section 2 is for any reason held to be unenforceable by the
indemnified party although applicable in accordance with its terms, the Company
and the applicable Holder shall contribute to the aggregate losses, liabilities,
claims, damages and expenses of the nature contemplated by such indemnity
agreement incurred by the Company and such Holder, (i) in such proportion as is
appropriate to reflect the relative fault of the Company on the one hand and
such Holder on the other hand, in connection with the statements or omissions
which resulted in such losses, claims, damages, liabilities or expenses, or (ii)
if the allocation provided by clause (i) above is not permitted by applicable
law, in such proportion as is appropriate to reflect not only the relative fault
of but also the relative benefits to the Company on the one hand and such Holder
on the other hand, from the
7
purchase and sale of the Registrable Securities, in connection with the
statements or omissions which resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable considerations.
The relative benefits to the indemnifying party and indemnified party shall be
determined by reference to, among other things, the total proceeds received by
the indemnifying party and indemnified party in connection with the offering to
which such losses, claims, damages, liabilities or expenses relate. The relative
fault of the indemnifying party and indemnified party shall be determined by
reference to, among other things, whether the action in question, including any
untrue or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact, has been made by, or relates to information
supplied by, the indemnifying party or the indemnified party, and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such action. The obligations of each Holder under this Section 2.4 are
several and not joint.
The parties hereto agree that it would not be just or
equitable if contribution pursuant to this Section 2.4 were determined by pro
rata allocation or by any other method of allocation which does not take account
of the equitable considerations referred to in the immediately preceding
paragraph. Notwithstanding the provisions of this Section 2.4, no Holder shall
be required to contribute any amount in excess of the amount of the total
proceeds to that Holder from sales of the Registrable Securities of such Holder
under the Shelf Registration Statement.
Notwithstanding the foregoing, 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. For purposes of this Section 2.4, each person, if
any, who controls any Holder within the meaning of Section 15 of the Securities
Act shall have the same rights to contribution as such Holder, and each director
of the Company, each officer of the Company who signed a Shelf Registration
Statement and each person, if any, who controls the Company within the meaning
of Section 15 of the Securities Act shall have the same rights to contribution
as the Company.
SECTION 3. RULE 144 COMPLIANCE
The Company covenants that it will file any reports required
to be filed by it under the Securities Act and the Exchange Act, and the rules
and regulations adopted by the Commission thereunder (or, if the Company is not
required to file such reports, it will, upon the request of any Holder, make
publicly available other information so long as necessary to permit sales of the
Registrable Securities under Rule 144 under the Securities Act), and it will
take such further action as any Holder may request, all to the extent required
from time to time to enable such Holder to sell Registrable Securities without
registration under the Securities Act within the limitation of the exemptions
provided by (a) Rule 144 under the Securities Act, as such Rule may be amended
from time to time, or (b) any successor rule or similar provision or regulation
hereafter adopted by the Commission. Upon the request of any Holder, the Company
will deliver to such Holder a written statement as to whether it has complied
with such requirements.
SECTION 4. RULE 144A COMPLIANCE
The Company covenants that it will file all reports required
to be filed by it under the Securities Act and the Exchange Act, and the rules
and regulations adopted by the Commission thereunder (or if the Company is not
required to file such reports, it will, upon the request of any Holder, make
available other information so long as necessary to permit sales of the
Registrable Securities pursuant to Rule 144A under the Securities Act), and it
will take such further action as any Holder may request, all to the extent
required from time to time to enable such Holder to sell Registrable Securities
without registration under the Securities Act within the limitation of the
exemptions provided by (a) Rule
8
144A, as such rule may be amended from time to time, or (b) any successor rule
or similar provision or regulation hereafter adopted by the Commission.
SECTION 5. MISCELLANEOUS
5.1 INTEGRATION; AMENDMENT. This Agreement constitutes
the entire agreement among the parties hereto with respect to the matters set
forth herein and supersedes and renders of no force and effect all prior oral or
written agreements, commitments and understandings among the parties with
respect to the matters set forth herein. Except as otherwise expressly provided
in this Agreement, no amendment, modification or discharge of this Agreement
shall be valid or binding unless set forth in writing and duly executed by the
Company and the applicable Holder.
5.2 WAIVERS. No waiver by a party hereto shall be
effective unless made in a written instrument duly executed by the party against
whom such waiver is sought to be enforced, and only to the extent set forth in
such instrument. Neither the waiver by any of the parties hereto of a breach or
a default under any of the provisions of this Agreement, nor the failure of any
of the parties, on one or more occasions, to enforce any of the provisions of
this Agreement or to exercise any right or privilege hereunder shall thereafter
be construed as a waiver of any subsequent breach or default of a similar
nature, or as a waiver of any such provisions, rights or privileges hereunder.
5.3 ASSIGNMENT. This Agreement shall inure to the benefit
of and be binding on the successors, assigns and transferees of each of the
parties, including, without limitation and without the need for an express
assignment, subsequent Holders. If any successor, assignee or transferee of any
Holder shall acquire Registrable Securities, in any manner, whether by operation
of law or otherwise, such Registrable Securities shall be held subject to all of
the terms of this Agreement, and by taking and holding Registrable Securities
such Person shall be conclusively deemed to have agreed to be bound by all of
the terms and provisions hereof.
5.4 NOTICES. All notices, payments, demands or other
communications given hereunder shall be deemed to have been duly given and
received (i) upon personal delivery, (ii) in the case of notices sent within,
and for delivery within, the United States, as of the date shown on the return
receipt after mailing by registered or certified mail, return receipt requested,
postage prepaid, or (iii) the second succeeding business day after deposit with
Federal Express or other equivalent air courier delivery service, unless the
notice is held or retained by the customs service, in which case the date shall
be the fifth succeeding business day after such deposit.
5.5 SPECIFIC PERFORMANCE. The parties hereto acknowledge
that the obligations undertaken by them hereunder are unique and that there
would be no adequate remedy at law if any party fails to perform any of its
obligations hereunder, and accordingly agree that each party, in addition to any
other remedy to which it may be entitled at law or in equity, shall be entitled
to (i) compel specific performance of the obligations, covenants and agreements
of any other party under this Agreement in accordance with the terms and
conditions of this Agreement and (ii) obtain preliminary injunctive relief to
secure specific performance and to prevent a breach or contemplated breach of
this Agreement in any court of the United States or any State thereof having
jurisdiction.
5.6 GOVERNING LAW. This Agreement, the rights and
obligations of the parties hereto, and any claims or disputes relating thereto,
shall be governed by and construed in accordance with the laws of the State of
New York, without giving effect to the choice of law rules thereof. The parties
agree that all disputes between any of them arising out of, connected with,
related to, or incidental to the relationship established between them in
connection with this Agreement, and whether arising in law or in equity or
otherwise, shall be resolved by the federal or state courts located in New York,
New York.
9
Nothing herein shall affect the right of any party to serve process in
any other manner permitted by law or to commence legal proceedings or otherwise
proceed against the other in any other jurisdiction. In addition, each of the
parties hereto consents to submit to the personal jurisdiction of any federal or
state court located in the state of New York in the event that any dispute
arises out of this Agreement. The parties, for themselves and their respective
affiliates, hereby irrevocably waive all right to a trial by jury in any action,
proceeding or counterclaim (whether based on contract, tort or otherwise)
arising out of or relating to the actions of the parties or their respective
affiliates pursuant to this Agreement in the negotiation, administration,
performance or enforcement thereof.
5.7 HEADINGS. Section and subsection headings contained
in this Agreement are inserted for convenience of reference only, shall not be
deemed to be a part of this Agreement for any purpose, and shall not in any way
define or affect the meaning, construction or scope of any of the provisions
hereof.
5.8 PRONOUNS. All pronouns and any variations thereof
shall be deemed to refer to the masculine, feminine, neuter, singular or plural,
as the identity of the person or entity may require.
5.9 EXECUTION IN COUNTERPARTS. To facilitate execution,
this Agreement may be executed in as many counterparts as may be required. It
shall not be necessary that the signature of or on behalf of each party appears
on each counterpart, but it shall be sufficient that the signature of or on
behalf of each party appears on one or more of the counterparts. All
counterparts shall collectively constitute a single agreement. It shall not be
necessary in any proof of this Agreement to produce or account for more than a
number of counterparts containing the respective signatures of or on behalf of
all of the parties hereto.
5.10 SEVERABILITY. If fulfillment of any provision of this
Agreement, at the time such fulfillment shall be due, shall transcend the limit
of validity prescribed by law, then the obligation to be fulfilled shall be
reduced to the limit of such validity; and if any clause or provision contained
in this Agreement operates or would operate to invalidate this Agreement, in
whole or in part, then such clause or provision only shall be held ineffective,
as though not herein contained, and the remainder of this Agreement shall remain
operative and in full force and effect.
10
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be duly executed on its behalf as of the date first hereinabove set
forth.
COMPANY:
Address: AMERICAN REAL ESTATE INVESTMENT
Plymouth Meeting Executive Campus CORPORATION
000 X. Xxxxxxxxxx Xxxx, Xxxxx 000
Xxxxxxxx Xxxxxxx, XX 00000
By: /s/ Xxxxxxx X. Butte
-------------------------------
Name: Xxxxxxx X. Butte
Title: Vice President
HOLDER
By: /s/ Xxxxxx Xxxxxxx
-------------------------------
Name: Xxxxxx Xxxxxxx
Title: President, AEW TSF Inc.
