EXHIBIT 99.1
REGISTRATION RIGHTS AGREEMENT
__________________________________________
REGISTRATION RIGHTS AGREEMENT
BETWEEN
ATRIA COMMUNITIES, INC.
AND
XXXX X. XXXXXXX
__________________________________________
April 1, 1997
TABLE OF CONTENTS
SECTION PAGE
1. Certain Definitions.................................................... 1
1.1 Affiliates........................................................ 1
1.2 Commission........................................................ 1
1.3 Common Shares..................................................... 1
1.4 Common Shares..................................................... 1
1.5 Exchange Act...................................................... 1
1.6 Person............................................................ 2
1.7 Register; Registered; Registration................................ 2
1.8 Registrable Shares................................................ 2
1.9 Registration Expenses............................................. 2
1.10 Securities Act.................................................... 2
1.11 Selling Expenses.................................................. 2
2. Restrictions on Transferability........................................ 2
2.1 Restrictions on Transferability................................... 2
2.2 Restrictive Legend................................................ 2
2.3 Notice of Proposed Transfers...................................... 3
2.4 Limited Right to Transfer......................................... 3
3. Registration Rights.................................................... 3
3.1 Requested Registration............................................ 3
3.2 Company Registrations............................................. 5
3.3 Holdback Agreement................................................ 7
3.4 Expenses of Registration.......................................... 7
3.5 Registration Procedures........................................... 7
3.6 Atria's Right to Abandon Registration............................. 8
3.7 Amendments to Registration Statements............................. 8
4. Indemnification........................................................ 9
4.1 Atria's Indemnity................................................. 9
4.2 Limitation on Indemnification Obligation.......................... 9
4.3 Indemnity by Shareholder.......................................... 9
4.4 Procedure for Indemnification..................................... 10
4.5 Conflicts with Underwriting Agreement............................. 11
5. Termination of Atria's Obligations..................................... 11
6. Miscellaneous Provisions............................................... 11
6.1 Information From Shareholder...................................... 11
6.2 No Transfer of Registration Rights................................ 11
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TABLE OF CONTENTS
SECTION PAGE
6.2 Governing Law.................................................... 11
6.4 Counsel.......................................................... 11
6.5 Delays or Omissions.............................................. 11
6.6 Entire Agreement................................................. 12
6.7 Binding Effect................................................... 12
6.8 Notices.......................................................... 12
6.9 Headings......................................................... 13
6.10 Counterparts.................................................... 13
6.11 Severability of Provisions...................................... 13
6.12 Exhibits........................................................ 13
6.13 Number; Gender.................................................. 13
6.14 Amendment....................................................... 13
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REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT is made this 1st day of April, 1997,
by and between ATRIA COMMUNITIES, INC., a Delaware corporation ("Atria"), and
XXXX X. XXXXXXX, a resident in Georgia ("Shareholder").
RECITALS:
A. On the date hereof, Atria issued 636,487 shares of its Common Stock to
Shareholder pursuant to the terms of that certain Agreement and Plan of Merger
dated as of March 3, 1997 (the "Merger Agreement"). The shares of Common Stock
were issued privately pursuant to an exemption from registration under Section
4(2) of the Securities Act and under exemptions from applicable state securities
laws.
B. Atria and Shareholder desire to set forth the registration rights to
be granted to Shareholder incident to his acquiring shares of Atria's Common
Stock.
AGREEMENT:
NOW, THEREFORE, the parties hereby agree as follows:
1. CERTAIN DEFINITIONS. As used in this Agreement, the terms set forth
below shall have the following respective meanings:
1.1 AFFILIATES. "Affiliate" shall mean any person that, directly or
indirectly, through one or more intermediaries, controls or is controlled by, or
is under common control with, any party specified in this Agreement.
1.2 COMMISSION. "Commission" shall mean the United States Securities
Exchange Commission or any other federal agency at the time administering the
Securities Act.
1.3 COMMON SHARES. "Common Shares" shall mean the shares of Atria's
Common Stock issued to Shareholder pursuant to the Merger Agreement.
1.4 COMMON STOCK. "Common Stock" shall mean the common stock, having
a par value of $0.10 per share, of Atria.
1.5 EXCHANGE ACT. "Exchange Act" shall mean the Securities Exchange
Act of 1934, as amended, or similar Federal statute, and the rules and
regulations of the Commission thereunder, all as the same shall be in effect
from time to time.
1.6 PERSON. "Person" shall mean any individual, partnership, limited
liability company, corporation, trust or other entity.
1.7 REGISTER; REGISTERED; REGISTRATION. "Register," "registered" and
"registration" shall refer to a registration effected by preparing and filing a
registration statement in compliance with the Securities Act, and the
declaration or ordering of the effectiveness of such registration statement by
the Commission.
1.8 REGISTRABLE SHARES. "Registrable Shares" shall mean (a) the Common
Shares, and (b) all shares of Atria's Common Stock issued as a dividend on, or
other distribution with respect to, or in exchange or in replacement of, the
Common Shares, but shall not include any Common Shares that were sold, conveyed,
transferred by gift or otherwise transferred by Shareholder to any other Person,
including sales under a Registration Statement, Section 4(1) or Rule 144 under
the Securities Act.
1.9 REGISTRATION EXPENSES. "Registration Expenses" shall mean all expenses
incurred by Atria in complying with Section 3, including all registration and
filing fees, exchange listing fees, printing expenses, fees and disbursements of
counsel for Atria, state securities' law fees and expenses, and the expense of
any special consents, advice or similar audit services of independent auditors
incident to or required by any such registration (but excluding the Selling
Expenses).
1.10 SECURITIES ACT. "Securities Act" shall mean the Securities Act of
1933, as amended, or any similar Federal statute, and the rules and regulations
of the Commission thereunder, all as the same shall be in effect from time to
time.
1.11 SELLING EXPENSES. "Selling Expenses" shall mean all underwriting
discounts and selling commissions applicable to the sale of shares of Atria's
Common Stock, including Registrable Shares, in any sale pursuant to a
registration by Atria pursuant to this Agreement, and the fees and expenses of
counsel selected by Shareholder to represent them in the registration.
2. RESTRICTIONS ON TRANSFERABILITY.
2.1 RESTRICTIONS ON TRANSFERABILITY. Shareholder shall not transfer
any of the Common Shares unless such transfer is in compliance with the terms of
this Agreement, which conditions are intended to ensure compliance with the
provisions of the Securities Act.
2.2 RESTRICTIVE LEGEND. Each certificate representing the Common
Shares or securities issued in respect of the Common Shares, shall (unless
otherwise permitted by the provisions of Section 2.3 below) be stamped or
otherwise imprinted with a legend in the following form (in addition to any
legend required under applicable state securities laws):
The securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended (the
"Act"), or any applicable state securities laws. These
securities are "Restricted Securities" as defined in the
Rule 144 promulgated under the Act and may not be sold or
offered for sale or otherwise distributed except (a) in
conjunction with an effective registration statement for the
shares under the Act and applicable state securities laws,
(b) in compliance with Rule 144 and an exemption under
applicable state securities laws, or (c) pursuant
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to an opinion of counsel satisfactory to the Issuer that such
registration or compliance is not required as to such sale, offer
or distribution.
2.3 NOTICE OF PROPOSED TRANSFERS. Unless there is an effective registration
statement under the Securities Act covering a proposed transfer, Shareholder
shall notify Atria of his intention to effect a transfer of any of his Common
Shares. Such notice shall describe the manner and circumstances of the proposed
transfer in sufficient detail, and shall be accompanied (except that the
requirements set forth in the balance of this sentence need not be complied with
where the proposed transaction complies with Rule 144 as long as Atria is
furnished with evidence of compliance with such rule) be either:
(A) an unqualified written opinion of legal counsel which is
reasonably satisfactory to Atria addressed to Atria's counsel, to the effect
that the proposed transfer of the Common Shares may be effected without
registration of the Securities Act;
(B) a "no action" letter from the Commission to the effect that the
distribution of such securities without registration will not result in a
recommendation by the staff of the Commission that action be taken with respect
thereto; or
(C) such other showing that may be reasonably satisfactory to legal
counsel to Atria.
2.4 LIMITED RIGHT TO TRANSFER. If Atria fails to object as to adequacy of
the notice within three days of its delivery to Atria, Shareholder shall be
entitled to transfer such Common Shares in accordance with the terms of the
notice delivered to Atria. Each certificate evidencing the Common Shares
transferred as above provided shall bear the appropriate restrictive legend set
forth in Section 2.2, except that such certificate shall not bear such
restrictive legend if in the opinion of counsel for Atria such legend is not
required in order to establish compliance with any provisions of the Securities
Act or applicable state securities laws.
3.REGISTRATION RIGHTS.
3.1 REQUESTED REGISTRATION.
(A) At such time as when Atria can register its Common Stock on Form
S-3 or any successor form or registration statement, Shareholder may make one
request to Atria to register all or any portion of Shareholder's Registrable
Shares under the Securities Act in accordance with this Section 3.1. Atria
shall use its reasonable best efforts to cause the prompt registration of all
Registrable Shares requested to be registered, and in connection therewith shall
prepare and file on such appropriate form as Atria, in its reasonable
discretion, shall determine, a registration statement under the Securities Act
to effect such registration (including the execution of an under-taking to file
post-effective amendments, appropriate qualification under applicable Blue Sky
or other state securities laws and appropriate compliance with applicable
regulations issued under the Securities Act).
(b) Notwithstanding anything in Section 3.1 to the contrary, Atria
shall not be obligated to effect any such registration, or take other specified
actions with respect to, or coope-
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rate in any offering of, Registrable Shares upon the request of Shareholder
pursuant to Section 3.1:
(1) in any particular jurisdiction in which Atria would be required
to execute a general consent to service of process in effecting such
registration, qualification or compliance unless Atria is already subject to
service in such jurisdiction and except as may be required by the Securities
Act;
(2) within 180 days immediately following the effective date of any
registration of Atria's Common Stock;
(3) after Atria has effected one registration pursuant to this
Section 3.1 that have been declared or ordered effective; or
(4) unless the number of Registrable Shares included in Shareholder's
request is for at least 300,000 Registrable Shares or has an aggregate "Value"
(as defined herein) of the Registrable Shares of at least $3,600,000.
(c) For purposes hereof, the term "value" shall mean, as applicable, (a)
the average of the closing prices for the Common Stock of Atria as listed on the
NASDAQ system or such other system on which the Common Stock of Atria is traded
for the five trading days immediately preceding the date of Shareholders's
request.
(d) The request by Shareholder for registration of Registrable Shares
pursuant to Section 3.1 shall (1) specify the number of Registrable Shares which
Shareholder intends to offer and sell, (2) express the intention of Shareholder
to offer or cause the offering of such Registrable Shares, (3) describe the
nature or method of the proposed offer and sale thereof, (4) contain the
undertaking of Shareholder to provide all such information regarding his
holdings and the proposed manner of distribution thereof as may be required (A)
to permit Atria to comply with all applicable laws and regulations, all
requirements of the Commission and any other regulatory or self-regulatory body,
any other body having jurisdiction, and any securities exchange on which the
Registrable Shares are to be listed, and (B) to obtain acceleration of the
effective date of any registration statement filed in connection therewith, and
(5) in the case of an underwritten public offering, specify the managing
underwriter or underwriters of such Registrable Shares, which shall be selected
by Atria.
(e) If at the time of the request to register the Registrable Shares Atria
notifies Shareholder, within five days of Shareholder's request, that Atria is
engaged or has fixed plans to engage within 30 days of the time of the request
in an underwritten public offering of securities for Atria's own account and
Atria determines in good faith that such offering would be materially adversely
affected by the registration so requested, Atria may delay filing a registration
statement and may withhold efforts to cause the registration statement to become
effective; provided, however, that Atria shall only be entitled to postpone for
a reasonable period of time, not to exceed 90 days, the filing of any
registration statement otherwise required to be prepared and filed by Atria
pursuant to Section 3.1. In addition, notwithstanding anything herein to the
contrary, Atria may delay filing a registration statement and may withhold
efforts to cause the registration statement
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to become effective, if Atria determines in good faith that such registration
might (1) interfere with or affect the negotiation or completion of any
transaction that is being contemplated by Atria at the time the right to delay
is exercised, or (2) involve initial or continuing disclosure obligations that
might not be in the best interests of Atria stockholders.
(F) If, after a registration statement becomes effective, Atria
advises Shareholder that Atria considers it appropriate for the registration
statement to be amended, Shareholder shall suspend any further sales of his
registered shares until Atria advises it that the registration statement has
been amended. Atria shall keep the Registration Statement issued pursuant to
this Section 3.1 effective until the earlier of (1) two years from the date of
issuance of the Registrable Shares to Shareholder or (2) the date on which the
Shareholder no longer owns any of the Registrable Shares he requested to be
registered pursuant to this Section 3.1. Shareholder shall have no obligation to
sell any of the Registrable Shares he requested to be registered pursuant to
this Section 3.1.
(G) If Shareholder intends to distribute the Registrable Shares, which
are covered by his request for registration pursuant to Section 3.1, by means of
an underwriting, Shareholder shall so advise Atria as a part of his request.
Atria shall, together with Shareholder, enter into an underwriting agreement in
customary form with the underwriter or underwriters selected for such
underwriting by Atria. Notwithstanding any other provision of this Section
3.1(g), if the managing underwriter or underwriters determine that the
underwriting would be materially adversely affected by inclusion in such
underwriting of all of the Registrable Shares requested by Shareholder and so
advises Shareholder in writing, then Shareholder shall reduce accordingly the
number of Registrable Shares that will be included in the registration and
underwriting. No Registrable Shares excluded from the underwriting by reason of
the managing underwriter's or underwriters' marketing or other limitations shall
be included in such registration. Should Shareholder disapprove of the terms of
the underwriting, Shareholder may elect to withdraw therefrom by written notice
to Atria and the managing underwriter or underwriters.
(H) If the managing underwriter or underwriters have not limited the
number of Registrable Shares to be underwritten, Atria may include securities
for its own account in such registration if the managing underwriter or
underwriters so agree and if the number of Registrable Shares which would
otherwise have been included in such registration and underwriting will not
thereby be limited.
3.2 COMPANY REGISTRATIONS.
(A) If, at any time, and from time to time, Atria proposes to register
any of its Common Stock for its own account, in connection with an underwritten
public offering of Common Stock solely for cash (other than a registration
statement filed on Form S-4 or any other form filed in connection with any
acquisition, merger, consolidation or stock exchange, or a registration
statement filed solely in connection with director or employee benefit plans of
Atria) Atria shall:
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(1) promptly notify Shareholder of the proposed registration
(which shall include a list of the jurisdictions in which Atria intends to
attempt to qualify such Common Stock under the applicable state securities
laws); and
(2) include in such registration (and any related qualification
under state securities laws or other compliance), and in any underwriting
involved therein, all of the Registrable Shares specified in a request or
requests by Shareholder, made within 10 days after delivery of the notice from
Atria.
(B) If the registration to be effected under to this Section 3.2 is
for a registered public offering involving an underwriting, Atria shall so
advise Shareholder as a part of the notice given pursuant to Section 3.2(a)(1).
In such a case the right of Shareholder to register his Registrable Shares
pursuant to Section 3.2(a)(2) shall be conditioned upon Shareholder's
participation in such underwriting and the inclusion of his Registrable Shares
in the underwriting to the extent provided herein. Shareholder (together with
Atria and any other stockholders proposing to offer and sell their shares of
Common Stock through such underwriting (hereinafter, the "Additional Selling
Stockholders")), shall enter into an underwriting agreement in customary form
with the underwriter or underwriters selected for such underwriting by Atria and
perform his obligations under such an agreement.
(C) Notwithstanding any other provision of Section 3.2(b) to the
contrary, if the managing underwriter or underwriters determine that such
offering would be materially adversely affected by inclusion in such
underwriting of all of the Registrable Shares requested by Shareholder, the
managing underwriter or underwriters may exclude a portion of such Registrable
Shares from such registration and underwriting. In such a case, Atria shall
advise Shareholder of the managing underwriter's determination to exclude a
portion of the Registrable Shares from such registration and underwriting. The
number of shares of Common Stock of Shareholder and the Additional Selling
Stockholders that may be included in the registration and underwriting shall be
allocated among Shareholder and the Additional Selling Stockholders in
proportion, as nearly as practicable, to the respective amounts of shares of
Common Stock owned by Shareholder and each of the Additional Selling
Stockholders at the time of filing the registration statement. No Registrable
Shares excluded from the underwriting by reason of the managing underwriter's -
determination shall be included in such registration.
(D) If Shareholder disapproves of the terms of any such underwriting,
Shareholder may elect to withdraw therefrom all of the Registrable Shares
included in his request for registration by notice to Atria and the managing
underwriter or underwriters, and the Registrable Shares so withdrawn from the
underwriting shall also be withdraw from such registration. If one or more
Additional Selling Stockholders withdrawn shares of Common Stock from the
underwriting and registration, and by virtue of such withdrawal, a greater
number of shares of Common Stock of Shareholder and Additional Selling
Shareholders who have not withdrawn may be included in such registration (up to
the maximum of any limitation imposed by the managing underwriter), then Atria
shall offer to Shareholder and the Additional Selling Stockholders who have
elected to participate in the registration the right to include (additional)
shares of Common Stock, as applicable, in the registration in the same
proportions as were used above in determining the underwriter limitation.
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3.3 HOLDBACK AGREEMENT. Upon request of Atria or the managing underwriter
in any underwritten offering, of Registrable Securities, Shareholder shall not
make or cause any offering, sale or other disposition, directly or indirectly,
of any Common Shares (or any other securities of Atria) without the prior
approval of the underwriter for such period of time (not to exceed 180 days)
from the effective date of such registration as may be requested by Atria or the
managing underwriter. In addition, Shareholder agrees, that upon request of
Atria or the managing underwriter in any underwritten offering and registration
of Shares of Common Stock (or other securities of Atria) in which Shareholder
(having been given notice and the opportunity as required by Section 3.2(a)(1)
declines to participate, not to make or cause any offering, sale or other
disposition, directly or indirectly, of any Common Shares (or other securities
of Atria) held by him (other than any such Common Shares sold or otherwise
disposed of pursuant to a previously registered and underwritten offering)
without the prior approval of the managing underwriter (but not to exceed a
period of time from the effective date of such registration as the managing
underwriter shall have requested of all officers and directions of Atria and all
other persons with registration rights holding no fewer than the number of
shares of Common Stock held by Shareholder). Atria, in enforcing the provisions
of this Section 3.3, may impose stop-transfer instructions with respect to the
Registrable Shares of Shareholder until the end of such period.
3.4 EXPENSES OF REGISTRATION. Atria shall pay all Registration Expenses
incurred in connection with all registrations under this Agreement. If
Shareholder participates in a registration, Shareholder shall pay the Selling
Expenses incurred in connection with each registration under this Agreement, pro
rata in the same proportion as the number of shares of Registrable Share
registered and sold by Shareholder bears to the total number of shares of Common
Stock being registered and sold under such registration statement.
3.5 REGISTRATION PROCEDURES. In each registration affected by Atria
pursuant to this Section 3, Atria will keep Shareholder advised as to the
initiation of each such registration and as to the completion thereof. At its
expense, Atria shall:
(A) prepare and file with the Commission a registration statement for
the Registrable Shares and shall use its commercially reasonable efforts to
cause the registration statement to become effective;
(B) upon the request of the holders of a majority of the shares of
Common Stock registered thereunder, keep such registration statement effective
for a period ending at the earlier of 120 days following the effective date of
the Registration Statement or the date that the distribution contemplated in the
registration statement has been completed;
(C) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in connection
with such registration statement as may be necessary to comply with the
provisions of the Securities Act regarding the disposition of all securities
covered by such registration statement;
(D) furnish to Shareholder such number of copies of a prospectus,
including a preliminary prospectus, in conformity with the Securities Act, and
such other documents (in-
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cluding any exhibits thereto or documents referred to therein) as Shareholder
may reasonably request in order to facilitate the disposition of the
Registrable Shares owned by him;
(E) use its commercially reasonable efforts to register and qualify
the securities covered by such registration statement under such other
securities laws of such jurisdictions as shall be reasonably requested by
Shareholder, provided, that Atria shall not be required in connection therewith
or as a condition thereto to qualify to do business, subject itself to taxation,
or to file a general consent to service of process in any such states or
jurisdictions;
(F) in the event of any underwritten public offering, enter into and
perform its obligations under an underwriting agreement, in usual and customary
form, with the managing underwriter of such offering, provided, that the form of
underwriting agreement must be reasonably acceptable to Atria and Shareholder
with respect to secondary distributions;
(G) notify Shareholder, if he has Registrable Shares covered by the
registration statement, of the happening of any event as a result of which the
prospectus included in such registration statement, as then in effect, or any
other offering document, includes an untrue statement of a material fact or
omits to state a material fact required to be stated therein or necessary to
make the statements therein not misleading in light of the circumstances then
existing, and prepare and furnish to Shareholder as many copies of a supplement
to or an amendment of such offering document which shall correct such untrue
statement or eliminate such omission, as Shareholder shall request;
(H) cause all such Registrable Shares registered pursuant hereunder
to be listed on each securities exchange on which similar securities issued by
Atria are then listed; and
(I) provide a transfer agent and registrar for all Registrable Shares
registered pursuant hereunder and a CUSIP number for all such Registrable
Shares, in each case not later than the effective date of such registration.
3.6 ATRIA'S RIGHT TO ABANDON REGISTRATION. Notwithstanding anything
herein to the contrary, Atria may at any time prior to the effectiveness of any
such registration statement, in its sole discretion and without the consent of
or other obligation to Shareholder, abandon or postpone the proposed
registration in which Shareholder had requested to participate.
3.7 AMENDMENTS TO REGISTRATION STATEMENTS. If Atria has delivered copies
of the preliminary or final prospectus to Shareholder and after having done so
the prospectus is amended to comply with requirements of the Securities Act,
Atria shall promptly notify Shareholder and, if requested, Shareholder shall
immediately cease making offers of Registrable Shares and return all copies of
the prospectus to Atria. Atria shall promptly provide Shareholder with copies of
the revised prospectus and, following receipt of the revised prospectus,
Shareholder shall be free to resume making offers of the Registrable Shares.
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4. INDEMNIFICATION.
4.1 ATRIA'S INDEMNIFY. In the case of each registration of Registrable
Securities of Shareholder, Atria will indemnify Shareholder and his Affiliates,
against all claims, losses, damages and liabilities (or actions in respect
thereof), including any of the foregoing incurred in settlement of any
litigation, commenced or threatened, to which any of them may become subject
under the Securities Act or other federal or state law, arising out of or based
on the following:
(A) any untrue statement or alleged untrue statement of a material
fact contained in any such registration statement, prospectus, offering circular
or other similar document (including any related registration statement,
notification or the like) incident to any such registration, or based on any
omission or alleged omission to state therein a material fact required to be
stated herein or necessary to make the statements therein not misleading in the
light of the circumstances under which they were made;
(B) any violation by Atria of any federal, state or common law rule
or regulation applicable to Atria in connection with any such registration,
qualification or compliance; and
(C) any legal and any other expenses reasonably incurred in
connection with investigation or defending any such claim, loss, damage,
liability or action, as incurred related to the foregoing.
4.2 LIMITATION ON INDEMNIFICATION OBLIGATION. Atria shall not be liable,
and shall have no indemnification obligation hereunder, for any amounts paid in
settlement of any such loss, claim, damage, liability or action if such
settlement is effected without the consent of Atria (which consent shall not be
unreasonably withheld), nor shall Atria be liable in any such case for any such
claim, loss, damage, liability or expense to the extent it arises out of or is
based on any untrue statement or omission, made in reliance on and in conformity
with written information furnished to Atria by an instrument duly executed by
Shareholder, underwriter or controlling person and stated to be specifically for
use therein.
4.3 INDEMNIFY BY SHAREHOLDER. If Registrable Securities held by
Shareholder are included in the securities as to which registration is being
effected, Shareholder shall indemnify Atria, each of its officers and directors,
each underwriter and each person who controls any underwriter, and each person,
if any, who controls Atria or any such underwriter within the meaning of Section
15 of the Securities Act, and each person affiliated with or retained by Atria
and who may be subject to liability under any applicable securities laws,
against all claims, losses, damages and liabilities (or actions in respect
thereof), including any of the foregoing incurred in settlement of any
litigation, commenced or threatened, to which they may become subject under the
Securities Act or other federal or state law, arising out of or based on:
(A) any untrue statement or alleged untrue statement of a material
fact contained in any such registration statement, prospectus, offering circular
or other similar document, or any omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances under which
they were made, in each case to the extent, but only to the extent, that such
untrue statement or
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alleged untrue statement or omission or alleged omission is made in such
registration statement, prospectus, offering circular or other document in
reliance upon and in conformity with written information furnished to Atria by
an instrument duly executed by Shareholder and stated to be specifically for use
therein; and
(B) any legal and other expenses reasonably incurred in connection
with investigating or defending any such claim, loss, damage, liability or
action, as incurred.
4.4 PROCEDURE FOR INDEMNIFICATION.
(A) The party seeking indemnification ("Indemnitee") shall promptly
(within 10 days if a third party has commenced actual litigation against the
Indemnitee) notify the party from which indemnification is sought ("Indemnitor")
promptly after the Indemnitee has actual knowledge of any claim for which
recovery may be sought against the Indemnitor pursuant to this Section 4.
Indemnitee shall permit the Indemnitor, at its cost, to assume the defense of
any such claim or any litigation resulting from such claim; provided, Indemnitee
shall have the right to consent to the counsel selected by Indemnitor to defend
any such claim (which consent shall not be unreasonably withheld). The notice
shall specify in reasonable detail the facts known to the Indemnitee giving rise
to such indemnification rights and, if possible, an estimate of the amount of
liability which could result therefrom. Indemnitor shall be bound to indemnify
Indemnitee unless, within ten days after the delivery of such notice, Indemnitor
shall notify Indemnitee that Indemnitor disputes the right to indemnification as
set forth in such notice.
(B) The failure of the Indemnitee to give notice as provided herein
shall relieve the Indemnitor of its obligations under this Section 4 only to the
extent that such failure to give notice materially adversely prejudices the
Indemnitor in the defense of any such claim or any such litigation, but in no
event shall such failure relieve the Indemnitor from any other liability which
the Indemnitor may then have or may subsequently have to the Indemnitee. The
Indemnitor shall not in the defense of such claim or any litigation resulting
therefrom, except with the consent of the Indemnitee, 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 the plaintiff to the Indemnitee of a
release from all liability in respect of such claim or litigation.
(C) If the Indemnitor does not assume the defense of any such claim
or litigation resulting therefrom, the Indemnitee may defend against such claim
or litigation in such manner as the Indemnitee may deem appropriate. The
Indemnitee may settle such claim or litigation on such terms as it may deem
appropriate and the Indemnitor shall promptly reimburse the Indemnitee for the
amount of such settlement, and all expenses, legal or otherwise, incurred by the
Indemnitee in connection with the defense against, or settlement of, such claim
or litigation. If no settlement of such claim or litigation is made, the
Indemnitor shall promptly reimburse the Indemnitee for the amount of any
judgment rendered for such claim or in such litigation, and of all expenses,
legal or otherwise, incurred by the Indemnitee in the defense against such claim
or litigation. Notwithstanding anything in the foregoing to the contrary, if the
Indemnitor has disputed the Indemnitee's right to indemnification in accordance
with the provisions of Section 4.4(a), the Indemnitor shall not be obligated to
pay the Indemnitee the amounts provided
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for in this Section 4.4(c) until such dispute has been resolved and it has been
determined by a court of competent jurisdiction that the Indemnitor is required
to make such indemnification.
4.5 CONFLICTS WITH UNDERWRITING AGREEMENT. Notwithstanding anything in
this Section 4 to the contrary, to the extent that the provisions on
indemnification and contribution contained in the underwriting agreement entered
into in connection with the underwritten public offering are in conflict with
the foregoing provisions, the provisions in the underwriting agreement shall
control.
5. TERMINATION OF ATRIA'S OBLIGATIONS. The obligation of Atria to register any
of Shareholder's Registrable Shares pursuant to this Agreement shall expire on
the earlier of (a) the date when Shareholder ceases beneficially to own any
Registrable Shares, (b) the date when the Registrable Shares held by Shareholder
may be sold under Rule 144, or (c) the date which is the second anniversary of
the date of this Agreement.
6. MISCELLANEOUS PROVISIONS.
6.1 INFORMATION FROM SHAREHOLDER. Shareholder shall furnish to Atria such
information regarding Shareholder as Atria may request in writing and as shall
be required in connection with any registration, qualification or compliance
referred to in this Agreement.
6.2 NO TRANSFER OF REGISTRATION RIGHTS. The registration rights granted
under of this Agreement may not be assigned or otherwise conveyed by
Shareholder.
6.3 GOVERNING LAW. This Agreement shall be governed by, and construed and
enforced in accordance with, the laws of the Commonwealth of Kentucky, without
giving effect to conflict of laws or any other rules or principles which may
require the application of the laws of any other jurisdiction.
6.4 COUNSEL. Atria shall select and employ legal counsel to represent the
parties in the registration of shares of Common Stock under this Agreement. If,
in the judgment of Shareholder, it would be appropriate to do so, Shareholder
may select counsel to represent him in connection with the registration;
provided, that Shareholder shall be solely responsible for the fees and expenses
of any separate counsel so selected, and Atria shall have no responsibility or
liability whatsoever with respect thereto.
6.5 DELAYS OR OMISSIONS. No delay or omission to exercise any right, power
or remedy accruing to Shareholder, upon any breach or default by Atria under
this Agreement, shall impair any such right, power or remedy of Shareholder nor
shall it be construed to be a waiver of any such breach or default, or an
acquiescence therein, or of or in any similar breach or default thereunder
occurring; nor shall any waiver of any single breach or default be deemed a
waiver of any other breach or default theretofore or thereafter occurring. Any
waiver, permit, consent or approval of any kind or character on the part of
Shareholder or any breach or default under this Agreement, or any waiver on the
part of Shareholder of any provisions or conditions of this Agreement, must be
in writing and shall be effective only to the extent specifically set forth in
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such writing. All remedies, either under this Agreement, or by law or otherwise
afforded to Shareholder, shall be cumulative and not alternative.
6.6 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement and
understanding of the parties hereto with respect to the subject matter hereof,
and supersedes all prior agreements, correspondence, arrangements and
understandings relating to the subject matter hereof.
6.7 BINDING EFFECT. All of the terms, provisions and conditions hereof
shall be binding upon and shall inure to the benefit of and be enforceable by
the parties hereto, and their respective heirs, personal representatives,
successors and assigns. Nothing in this Agreement shall entitle any person to
any claim, cause of action, remedy or right of any kind.
6.8 NOTICES. All notices, requests, demands and other communications
required or permitted to be given or made under this Agreement shall be in
writing and shall be deemed delivered (a) on the date of personal delivery or
transmission by telegram or facsimile transmission, or (b) on the date after the
date of (1) deposit in the United States mail, postage prepaid, by registered or
certified mail, return receipt requested, or (2) delivery to a nationally
recognized overnight courier service, in each case, addressed as follows, or to
such other address, person or entity as either party shall designate by notice
to the other in accordance herewith:
If to Atria: Atria Communities, Inc.
000 Xxxx Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxxx 00000
Attn: J. Xxxxxxx Xxxxxx,
Chief Financial Officer
FAX:(000) 000-0000
With copy to: Xxxxxx X. Xxxxxxxxxxx
Xxxxxxxxxx Xxxx & XxXxxxxx, PLLC
0000 Xxxxxxxx Xxxx Xxxxx
Xxxxxxxxxx, Xxxxxxxx 00000-0000
FAX: (000) 000-0000
If to the Shareholders: Xxxxxx Xxxxxxx
5907 Basswood Cove
-------------------------
Xxxxxx, Xxxxxxx 00000
-------------------------
FAX:(___) ____-____
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With copy to: Xxxxxxx Xxxxx, Esq.
Xxxxxxxx & Xxxxx, L.L.P.
Suite 4300, One Peachtree Center
000 Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
FAX:(000) 000-0000
6.9 HEADINGS. The headings in this Agreement are included for purposes of
convenience only and shall not be considered a part of the Agreement in
construing or interpreting any provision hereof.
6.10 COUNTERPARTS. This Agreement may be executed in counterparts and each
such executed counterpart shall be deemed an original instrument. It shall not
be necessary in making proof of this Agreement or the terms of this Agreement to
produce or account for more than one of such counterparts.
6.11 SEVERABILITY OF PROVISIONS. If any provision of this Agreement or the
application thereof to any person or entity or circumstance shall to any extent
be held in any proceeding to be invalid or unenforceable, the remainder of this
Agreement, or the application of such provision to persons or entities or
circumstances other than those to which it was held to be invalid or
unenforceable, shall not be affected thereby, and shall be valid and enforceable
to the fullest extent permitted by law, but only if and to the extent such
enforcement would not materially and adversely frustrate the parties' essential
objectives as expressed herein.
6.12 EXHIBITS. All Exhibits to this Agreement shall be deemed to be
incorporated herein by reference and made a part hereof as if set out in full
herein.
6.13 NUMBER; GENDER. Unless the context clearly states otherwise, the use
of the singular or plural in this Agreement shall include the other and the use
of any gender shall include all others.
6.14 AMENDMENT. This Agreement may be amended, modified, superseded, or
canceled only by a written instrument signed by all of the parties hereto and
any of the terms, provisions and conditions hereof may be waived, only by a
written instrument signed by the waiving party.
IN WITNESS WHEREOF, the parties have entered into this Agreement as of the
date first written above.
ATRIA COMMUNITIES, INC.
By: /s/ W. Xxxxxxx Xxxxxx, XX /s/ Xxxx X.Xxxxxxx
------------------------- ------------------
Title: President and CEO XXXX X. XXXXXXX
---------------------- ("Shareholder")
("Atria")
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