Exhibit 10.2
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EXECUTION COPY
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UNITHOLDER AND WARRANT AGREEMENT
Among
CENTERBROOK HOLDINGS LLC,
IXIS FINANCIAL PRODUCTS INC.
and
CHARTER MAC CORPORATION
Dated as of June 28, 2006
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TABLE OF CONTENTS
Page
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SECTION 1. Definitions; Accounting Terms and Determinations; Terms Generally...............................1
1.01 Definitions.....................................................................................1
1.02 Accounting Terms and Determinations, Etc........................................................7
1.03 Terms Generally.................................................................................7
SECTION 2. Purchase and Sale of Warrants...................................................................8
2.01 Authorization and Issuance of Units and Warrants................................................8
2.02 Issuance of the Warrants........................................................................8
2.03 Acquisition for the Investor's Account..........................................................8
2.04 Securities Act Compliance.......................................................................8
2.05 Exercise of the Warrants........................................................................8
SECTION 3. Restrictions on Transferability.................................................................8
3.01 Transfers Generally.............................................................................8
3.02 Transfers of Securities Pursuant to Registration Statements, Rule 144 and Rule 144A.............9
3.03 Restrictive Legends.............................................................................9
3.04 Termination of Restrictions.....................................................................9
3.05 Cancellation and Issuance.......................................................................9
SECTION 4. Put Rights......................................................................................9
4.01 Put Rights......................................................................................9
4.02 Procedures.....................................................................................10
SECTION 5. Call Rights; Look Back.........................................................................11
5.01 Call Rights....................................................................................11
5.02 Look Back Events...............................................................................11
SECTION 6. Right to Join in Sale..........................................................................12
6.01 Tag-Along Rights...............................................................................12
6.02 Procedures.....................................................................................12
6.03 Issuer's Covenants.............................................................................13
SECTION 7. Obligation to Join in Sale.....................................................................13
7.01 Drag-Along Obligations.........................................................................13
7.02 Procedures.....................................................................................13
7.03 Definitions....................................................................................14
SECTION 8. Holders' Rights................................................................................14
8.01 Delivery Expenses..............................................................................14
8.02 Taxes..........................................................................................14
8.03 Replacement of Instruments.....................................................................14
8.04 Indemnification................................................................................15
SECTION 9. Other Covenants of Issuer......................................................................15
9.01 Accountants; Fiscal Year. .....................................................................15
9.02 Repurchases, Recapitalizations, Etc............................................................15
9.03 Restrictions on Performance....................................................................15
SECTION 10. Miscellaneous..................................................................................15
10.01 Home Office Payment............................................................................15
10.02 Waiver.........................................................................................15
10.03 Notices........................................................................................15
10.04 Expenses, Etc. ................................................................................16
10.05 Amendments, Etc................................................................................16
10.06 Successors and Assigns.........................................................................16
10.07 Survival.......................................................................................16
10.08 Specific Performance...........................................................................17
10.09 Captions.......................................................................................17
10.10 Counterparts...................................................................................17
10.11 Governing Law; Waiver of Jury Trial............................................................17
10.12 Severability...................................................................................17
10.13 Entire Agreement...............................................................................17
Exhibit A - Form of Warrant
Exhibit B - Form of Registration Rights Agreement
Exhibit C - Form of Legal Opinion from Counsel to the Issuer
Exhibit D - Form of Election
UNITHOLDER AND WARRANT AGREEMENT dated as of June 28, 2006 among
CENTERBROOK HOLDINGS LLC, a limited liability company organized under the laws
of the State of Delaware (the "ISSUER"), IXIS FINANCIAL PRODUCTS INC. (the
"INVESTOR") and CHARTER MAC CORPORATION (the "CHARTER MEMBER").
WHEREAS, the Investor and Charter Member are parties to the Amended
and Restated Operating Agreement of the Issuer, dated as of the date hereof (the
"OPERATING AGREEMENT"), pursuant to which on the date hereof the Investor owns
10% of the outstanding ownership interests of the Issuer and the Charter Member
owns the remaining 90% of the outstanding ownership interests of the Issuer.
WHEREAS, to induce the Investor to enter into the Operating Agreement
and to make its initial capital contribution thereunder, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Issuer has agreed to issue the Warrants described below to the
Investor.
NOW, THEREFORE, the parties hereto agree as follows:
SECTION 1. DEFINITIONS; ACCOUNTING TERMS AND DETERMINATIONS; TERMS
GENERALLY DEFINITIONS. As used herein, the following terms shall have the
following meanings:
"ADMINISTRATIVE SERVICES AGREEMENT" shall mean the Administrative
Services Agreement, dated as of the date hereof, between the Issuer and the
Charter Administrator.
"AFFILIATE" shall mean, 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 and, if
such other Person is an individual, any member of the immediate family
(including parents, spouse, children and siblings) of such individual and any
trust whose principal beneficiary is such individual or one or more members of
such immediate family and any Person who is controlled by any such member or
trust.
"BOARD" shall mean the board of managers of the Issuer or any
committee thereof.
"BUSINESS DAY" shall mean any day on which commercial banks are not
authorized or required to close in New York City.
"CALL NOTICE" shall have the meaning assigned to such term in Section
5.01(b) hereof.
"CALL NOTICE DATE" shall mean the date on which a Call Notice shall be
received by the Holders.
"CALL RIGHT" shall mean the right of the Charter Member to purchase
Units, Warrants and Warrant Units pursuant to, and in accordance with, Section
5.01 hereof.
"CENTERBROOK" shall mean Centerbrook Financial LLC, a Delaware limited
liability company and wholly-owned Subsidiary of the Issuer.
"CHANGE OF CONTROL" shall mean the earliest to occur of: (i) the date
on which the Controlling Group ceases to own, directly or indirectly, at least
51% of the outstanding voting Units of the Issuer (as adjusted for unit or stock
splits, stock or unit distributions, recapitalization or other similar
transactions); (ii) the date on which any Person or "group" (within the meaning
of Rules 13d-3 and 13d-5 under the Exchange Act, as in effect on the Closing
Date) other than the Controlling Group shall have acquired a greater beneficial
ownership in the Issuer's Units and/or other equity interests of the Issuer than
that held by the Controlling Group; or (iii) the date on which the Issuer's
Board shall cease to consist of a majority of Continuing Managers.
"CHARTER ADMINISTRATOR" shall mean Charter Capital LLC, as the
Administrator under the Administrative Services Agreement.
"CHARTERMAC" means CharterMac, a Delaware statutory trust.
"CHARTER MEMBER" shall have the meaning assigned to such term in the
preamble of this Agreement.
"COMMISSION" shall mean the Securities and Exchange Commission or any
other similar or successor agency of the Federal government administering the
Securities Act and/or the Exchange Act.
"CONTINUING MANAGERS" shall mean the managers of the Issuer on the
date hereof and each other manager whose nomination for election to the Board is
recommended by at least a majority of the then Continuing Managers or who
receives the vote of the Controlling Group in his or her election by the members
or shareholders of the Issuer.
"CONTROL" shall mean the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of a
Person, whether through the ability to exercise voting power, by contract or
otherwise, PROVIDED that, in any event, any Person that owns directly or
indirectly securities having 5% or more of the voting power for the election of
directors or other governing body of a corporation or 5% or more of the
partnership or other ownership interests of any other Person (other than as a
limited partner of such other Person) will be deemed to control such corporation
or other Person. "CONTROLLING" and "CONTROLLED" have meanings correlative
thereto.
"CONTROLLING GROUP" shall mean, collectively, the Charter Member, its
Subsidiaries and any Affiliate thereof.
"CONVERTIBLE SECURITIES" shall mean evidences of indebtedness, units,
shares of stock or other securities or rights which are exchangeable for or
exercisable or convertible into a specified security of the Issuer either
immediately or upon the arrival of a specified date or the occurrence of a
specified event.
"DRAG-ALONG FMV DETERMINATION AMOUNT" shall mean, for any Holder, an
amount equal to (i) the Fair Market Value as at the Drag-Along Notice Date
DIVIDED BY (y) the total number of Units sold or transferred by such Holder
pursuant to Section 7.02(c) hereof.
"DRAG-ALONG FMV DETERMINATION RIGHT" shall mean the right of the
Majority Unitholders pursuant to Section 7.02(c) hereof to have the Fair Market
Value determined.
"DRAG-ALONG NOTICE DATE" shall mean the date on which the Drag-Along
Notice is given.
"DRAG-ALONG SALE" shall have the meaning assigned to such term in
Section 7.03 hereof.
"DRAG-ALONG SALE CONSIDERATION" shall have the meaning assigned to
such term in Section 7.02(c)(iii) hereof.
"ELECTION PERIOD" shall mean the period from (a) the earlier of (i)
the third anniversary of the date of this Agreement and (ii) the Business Day
immediately prior to the date on which the Issuer shall have received any
capital contribution or other new equity from any Person other than the
Investor, the Charter Member or any Affiliate thereof, up to the and including
(b) the Expiration Date.
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, or any
similar Federal statute, and the rules and regulations of the Commission
thereunder.
"EXERCISE DATE" shall mean the date on which IXIS Financial Products
Inc. shall have delivered a notice to the Issuer pursuant to Section 2.05
hereof.
"EXERCISE PERIOD" shall mean the period from (a) the Exercise Date up
to and including (b) the Expiration Date.
"EXERCISE PRICE" shall mean, with respect to the Unit Exercisable
Amount of any Holder at any time, an amount equal to:
(a) such Unit Exercisable Amount; MULTIPLIED BY
(b) 1.09.
"EXPIRATION DATE" shall mean the later of (a) 5:00 p.m., New York
time, on the sixth anniversary of the date of this Agreement and (b) the date of
exercise in full of all Call Rights and Put Rights pursuant to the terms of this
Agreement.
"FAIR MARKET VALUE" shall mean, as at any Put Notice Date, Call Notice
Date, Subsequent Event Date or Drag-Along Notice Date, as the case may be, the
price for which all the outstanding Units (on a fully diluted basis, assuming
receipt of applicable consideration for any conversion, exchange or exercise of
any Convertible Securities or Options which are exchangeable for or convertible
or exercisable into Units unless they are Out of the Money) could be sold in an
arm's length transaction to a third party which is not an Affiliate, treating
the Issuer and its Subsidiaries as a going concern and without regard to (i) the
lack of liquidity of the Units due to any restrictions or other limitations
contained in this Agreement, the Registration Rights Agreement, the Warrants or
otherwise, (ii) any discount for minority interests, (iii) the fact that some of
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the issued and outstanding Units may not have any voting rights or may not have
full voting rights, (iv) the fact that one or more of the holders of the Units
may be unable to exercise in full any of its voting rights due to regulatory,
contractual or other restrictions, or (v) the fact that contractual or
regulatory approvals, consents, waivers, licenses, permits or notifications may
need to be obtained in connection with such sale and the time required to obtain
the same. For purposes of determining the Fair Market Value, it shall be assumed
that, in such an arm's length transaction, (A) the seller would be a willing
seller and would not be under any compulsion to sell and (B) the purchaser would
be a willing purchaser and would not be under any compulsion to purchase. The
Fair Market Value shall be determined by agreement or appraisal in accordance
with the procedures described below.
If the Fair Market Value is being determined in connection with the
exercise of a Put Right, within 15 days after the Issuer Notice Date, the Issuer
and the Majority Unitholders shall each designate a representative and such
representatives will meet to reach an agreement on the Fair Market Value. If the
Fair Market Value is being determined in connection with the exercise by the
Charter Member of a Call Right, within 15 days after the Call Notice Date, the
Issuer and the Majority Unitholders shall each designate a representative and
such representatives will meet to reach an agreement on the Fair Market Value.
If the Fair Market Value is being determined in connection with the occurrence
of any Subsequent Event, within 15 days after the applicable Subsequent Event
Date, the Issuer and the Majority Unitholders shall each designate a
representative and such representatives will meet to reach an agreement on the
Fair Market Value. If the Fair Market Value is being determined in connection
with the exercise of a Drag-Along FMV Determination Right, within 15 days after
the Drag-Along Notice Date, the Issuer and the Majority Unitholders shall each
designate a representative and such representatives will meet to reach an
agreement on the Fair Market Value.
If the representatives designated by the Issuer and the Majority
Unitholders are unable to reach such agreement within 15 days after the date on
which the later of the two representatives are designated, then (A) the Majority
Unitholders shall immediately designate one Independent Appraiser; (B) the
Issuer shall immediately designate one Independent Appraiser; (C) the two
Independent Appraisers so selected shall, within 15 days after the date on which
the later of the two Independent Appraisers are appointed, determine
independently the Fair Market Value using the parameters established in the
first paragraph of this definition; (D) if the lesser of the two appraised
values (the "LOWER FMV") exceeds or is equal to 90% of the other appraised value
(the "HIGHER FMV"), then the Fair Market Value will be the average of the two,
which average amount shall be conclusive and binding upon all the applicable
parties; (E) if the Lower FMV is less than 90% of the Higher FMV, then the two
appraisers shall, within 15 days of the date of the later of the two appraisals,
appoint a third Independent Appraiser; and (F) the third Independent Appraiser
so selected shall, within 15 days of its appointment, determine independently
the Fair Market Value using the parameters established in the first paragraph of
this definition, which determination shall be conclusive and binding upon all
the applicable parties and shall not be higher than the Higher FMV and shall not
be lower than the Lower FMV.
The Issuer will provide each Independent Appraiser with all
information about the Issuer and its Subsidiaries which such Independent
Appraiser reasonably deems necessary for determining the Fair Market Value. The
Issuer may require that the Independent Appraisers keep confidential any
non-public information received as a result of this paragraph pursuant to
reasonable confidentiality arrangements.
The fees and expenses of the appraisal process in this definition
(including those of the Independent Appraisers) will be paid as follows:
(a) In the event that such appraisal process is the result of a
determination of the "Price Per Unit" pursuant to Section 4.02(a) hereof,
then the fees and expenses thereof shall be paid 50% by the Investor and
50% by the Charter Member.
(b) In the event that such appraisal process is the result of a
determination of the "Price Per Unit" pursuant to Section 5.01(c) hereof,
the determination of the "Fair Market Value" pursuant to the definition of
"Subsequent Unit Value" in Section 5.02(b) hereof or the determination of
the "Fair Market Value" pursuant to Section 7.02(c) hereof, then the fees
and expenses thereof shall be paid 10% by the Investor and 90% by the
Charter Member.
"FORCED SALE" shall have the meaning assigned to such term in the
Operating Agreement.
"FORCED SALE ASSETS" shall have the meaning set forth in Section
4.01(c)(i) hereof.
"FORCED SALE CONSIDERATION" shall have the meaning set forth in
Section 4.01(c)(ii) hereof.
"FORCED SALE FMV" shall mean, with respect to any Forced Sale, the
price for which all the related Forced Sale Assets could be sold in an arm's
length transaction to a third party which is not an Affiliate, without regard to
(i) the lack of liquidity of the Forced Sale Assets due to any restrictions or
other limitations contained in this Agreement, the Registration Rights
Agreement, the Warrants or otherwise, or (ii) the fact that contractual or
regulatory approvals, consents, waivers, licenses, permits or notifications may
need to be obtained in connection with such Forced Sale and the time required to
obtain the same. For purposes of determining the Forced Sale FMV, it shall be
assumed that, in such an arm's length transaction, (A) the seller would be a
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willing seller and would not be under any compulsion to sell and (B) the
purchaser would be a willing purchaser and would not be under any compulsion to
purchase. The Forced Sale FMV shall be determined by agreement or appraisal in
accordance with the procedures described below.
The Issuer and the Majority Unitholders shall each designate a
representative and such representatives will meet to reach an agreement on the
Forced Sale FMV. If the representatives designated by the Issuer and the
Majority Unitholders are unable to reach such agreement within 15 days after the
date on which the later of the two representatives are designated, then (A) the
Majority Unitholders shall immediately designate one Independent Appraiser; (B)
the Issuer shall immediately designate one Independent Appraiser; (C) the two
Independent Appraisers so selected shall, within 15 days after the date on which
the later of the two Independent Appraisers are appointed, determine
independently the Forced Sale FMV using the parameters established in the first
paragraph of this definition; (D) if the lesser of the two appraised values (the
"LOWER FORCED SALE FMV") exceeds or is equal to 90% of the other appraised value
(the "HIGHER FORCED SALE FMV"), then the Forced Sale FMV will be the average of
the two, which average amount shall be conclusive and binding upon all the
applicable parties; (E) if the Lower Forced Sale FMV is less than 90% of the
Higher Forced Sale FMV, then the two appraisers shall, within 15 days of the
date of the later of the two appraisals, appoint a third Independent Appraiser;
and (F) the third Independent Appraiser so selected shall, within 15 days of its
appointment, determine independently the Forced Sale FMV using the parameters
established in the first paragraph of this definition, which determination shall
be conclusive and binding upon all the applicable parties and shall not be
higher than the Higher Forced Sale FMV and shall not be lower than the Lower
Forced Sale FMV.
The Issuer will provide each Independent Appraiser with all
information about the Issuer and its Subsidiaries and the Forced Sale Assets
which such Independent Appraiser reasonably deems necessary for determining the
Forced Sale FMV. The Issuer may require that the Independent Appraisers keep
confidential any non-public information received as a result of this paragraph
pursuant to reasonable confidentiality arrangements.
The fees and expenses of the appraisal process in this definition
(including those of the Independent Appraisers) shall be paid 10% by the
Investor and 90% by the Charter Member.
"FORCED SALE FMV DETERMINATION AMOUNT" shall mean, for any Holder in
connection with any Forced Sale, an amount equal to such Holder's PRO RATA share
of the Forced Sale FMV of such Forced Sale.
"FORCED SALE NOTICE" shall have the meaning set forth in Section
4.01(c) hereof.
"FORCED SALE NOTICE DATE" shall mean the date upon which a Forced Sale
Notice is delivered to the Holders.
"FULLY DILUTED BASIS" shall mean, at any time without duplication, the
number of Units then issued and outstanding, assuming full conversion, exercise
and exchange of all Convertible Securities and Options that are (or may become)
exchangeable for, or exercisable or convertible into, Units, including the
Warrants.
"GAAP" shall mean generally accepted accounting principles,
consistently applied throughout the specified period.
"GOVERNMENTAL AUTHORITY" shall mean any nation or government, any
state or other political subdivision thereof, and any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government, and any corporation or other entity owned or
controlled (whether through ownership of securities or other ownership
interests, by contract or otherwise) by any of the foregoing.
"HOLDER" shall mean any Person who acquires Warrants or Warrant Units
pursuant to the provisions of this Agreement, including any transferees of
Warrants or Warrant Units.
"INDEPENDENT APPRAISER" shall mean an appraiser which is a recognized
independent expert (including any Investment Banking Firm) experienced in
valuing businesses similar or related to the principal business of the Issuer
and its Subsidiaries.
"INTERIM DISTRIBUTIONS" shall have the meaning assigned to such term
in Section 5.02(a)(iii) hereof.
"INVESTMENT BANKING FIRM" shall mean a nationally recognized
investment banking firm.
"INVESTOR" shall have the meaning assigned to such term in the
preamble of this Agreement.
"ISSUER" shall have the meaning assigned to such term in the preamble
of this Agreement.
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"ISSUER NOTICE DATE" shall have the meaning assigned to such term in
Section 4.01(b) hereof.
"LIEN" shall mean, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of such
asset. For purposes of this Agreement, a Person shall be deemed to own subject
to a Lien any asset which it has acquired or holds subject to the interest of a
vendor or lessor under any conditional sale agreement, capital lease or other
title retention agreement relating to such asset.
"LOOK BACK EVENT" shall have the meaning assigned to such term in
Section 5.02(b) hereof.
"LOOK BACK PERIOD" shall have the meaning assigned to such term in
Section 5.02(a) hereof.
"MAJORITY UNITHOLDERS" shall mean, at any time, the Holders of a
majority of the Warrant Units issued or issuable upon exercise of the Warrants
at such time. For purposes of giving notices, waivers and consents hereunder,
Holders shall be deemed holders of Units issued on exercise thereof.
"NASDAQ" shall mean the National Association of Securities Dealers
automated quotation system.
"NET CONSIDERATION" shall have the meaning assigned to such term in
Section 5.02(b) hereof.
"OPERATING AGREEMENT" shall have the meaning assigned to such term in
the recital of this Agreement.
"OPTION" shall mean any warrant, option or other right to subscribe
for or purchase a specified security or unit of the Issuer.
"OUT OF THE MONEY" shall mean (a) in the case of an Option, that the
fair market value of the Units which the holder thereof is entitled to purchase
or subscribe for (taking into effect the proceeds and dilution of any such
purchase or subscription) is less than the exercise price of such Option and (b)
in the case of a Convertible Security, that the quotient resulting from dividing
the then outstanding principal amount of such Convertible Security by the number
of Units into or for which such Convertible Security is exercisable, convertible
or exchangeable (taking into effect such exercise, conversion or exchange) is
greater than the fair market value of a Unit (taking into effect the
contribution to the fair market value of the Issuer and the subsequent dilution
of such exercise, conversion or exchange).
"PERSON" shall mean any natural person, corporation, limited liability
company, trust, joint venture, association, company, partnership, Governmental
Authority or other entity.
"PRICE PER UNIT" shall mean, as at any date, (a) the Fair Market Value
as at such date DIVIDED BY (b) the number of Units then outstanding (on a fully
diluted basis, assuming full conversion, exchange or exercise of any Convertible
Securities or Options which are exchangeable for or convertible or exercisable
into Units unless they are Out of the Money).
"PRIME RATE" shall mean the rate of interest from time to time
announced by Bank of America, N.A. at its principal office in New York, New York
as its prime commercial lending rate.
"PRIOR AMOUNT" shall have the meaning assigned to such term in Section
5.02(a)(i) hereof.
"PRIOR SALE" shall mean a sale of Securities to the Charter Member
pursuant to Section 5.01 hereof.
"PROPOSED PURCHASER" shall have the meaning assigned to such term in
Section 6.02 hereof.
"PUBLICLY TRADED STOCK" shall mean common stock that is publicly
traded on (i) the New York Stock Exchange, the American Stock Exchange or the
NASDAQ National Market or (ii) any other internationally recognized securities
exchange if the average daily volume for the four-week period immediately prior
to any date of determination for such common stock is at least equal to
$100,000,000.
"PUT NOTICE" shall have the meaning assigned to such term in Section
4.01(b) hereof.
"PUT NOTICE DATE" shall mean, with respect to a Put Notice, the date
on which such Put Notice is given or deemed given, as the case may be, to the
Issuer and the Charter Member.
"PUT RIGHT" shall mean the right of the Majority Unitholders to
require the Charter Member to purchase Units, Warrants and Warrant Units
pursuant to, and in accordance with, Section 4 hereof.
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"REGISTRATION RIGHTS AGREEMENT" shall mean the Registration Rights
Agreement, dated the date hereof, between the Issuer and the Investor, relating
to the registration of the Registrable Securities (as defined therein) under and
pursuant to the Securities Act, which shall be in the form attached as Exhibit B
hereto.
"RESTRICTED CERTIFICATE" shall mean a certificate for Units, Warrant
Units or Warrants bearing or required to bear the restrictive legend set forth
in Section 3.03 hereof.
"RESTRICTED SECURITIES" shall mean Restricted Units and Restricted
Warrants.
"RESTRICTED UNITS" shall mean Units and Warrant Units evidenced by a
Restricted Certificate.
"RESTRICTED WARRANTS" shall mean Warrants evidenced by a Restricted
Certificate.
"RULE 144" shall mean Rule 144 promulgated by the Commission under the
Securities Act.
"RULE 144A" shall mean Rule 144A promulgated by the Commission under
the Securities Act.
"SECURITIES" shall have the meaning assigned to such term in Section
3.01(a) hereof.
"SECURITIES ACT" shall mean the Securities Act of 1933, or any similar
Federal statute, and the rules and regulations of the Commission thereunder.
"SUBSEQUENT EVENT" shall have the meaning assigned to such term in
Section 5.02(b) hereof.
"SUBSEQUENT EVENT DATE" shall mean the date upon which a Subsequent
Event shall occur.
"SUBSEQUENT UNIT VALUE" shall have the meaning assigned to such term
in Section 5.02(b) hereof.
"SUBSEQUENT UNIT SALE" shall have the meaning assigned to such term in
Section 5.02(b) hereof.
"SUBSIDIARY" shall mean, with respect to any Person (the "PARENT") at
any date, any corporation, limited liability company, partnership, association
or other entity the accounts of which would be consolidated with those of the
parent in the parent's consolidated financial statements if such financial
statements were prepared in accordance with GAAP as of such date, as well as any
other corporation, limited liability company, partnership, association or other
entity (a) of which securities or other ownership interests representing more
than 50% of the equity or more than 50% of the ordinary voting power or, in the
case of a partnership, more than 50% of the general partnership interests are,
as of such date, owned, controlled or held, or (b) that is, as of such date,
otherwise Controlled, by the parent or one or more subsidiaries of the parent or
by the parent and one or more subsidiaries of the parent. Unless otherwise
specified, "Subsidiary" shall mean a Subsidiary of the Issuer.
"TAG-ALONG PURCHASE OFFER" shall have the meaning assigned to such
term in Section 6.02 hereof.
"TAG-ALONG SALE" shall have the meaning assigned to such term in
Section 6.01 hereof.
"THIRD PARTY" shall have the meaning assigned to such term in Section
7.03 hereof.
"THIRD PARTY PURCHASER" shall have the meaning assigned to such term
in the definition of "Drag-Along Sale" in Section 7.03 hereof.
"TRIGGERING EVENT" shall mean the earliest to occur of any of the
following: (a) the fifth anniversary of the date hereof; (b) the willful
violation or knowing breach by the Issuer, any Subsidiary thereof (including
Centerbrook) or the Charter Administrator of the Administrative Services
Agreement, the Operating Agreement or the Operating Agreement of Centerbrook;
(c) the violation or breach by the Issuer, any Subsidiary thereof (including
Centerbrook) or the Charter Administrator of the Administrative Services
Agreement, the Operating Agreement or the Operating Agreement of Centerbrook, if
such violation or breach is not cured within thirty (30) days of written notice
thereof; (d) any "Bankruptcy Event" (as defined in the Operating Agreement of
Centerbrook as in effect on the date hereof) shall occur with respect to
CharterMac, the Charter Member, the Charter Administrator, the Issuer or
Centerbrook; and (e) the Issuer or the Charter Administrator commits fraud or
criminal activity, or exercises gross negligence that has an adverse affect on
Centerbrook, in the performance of its obligations under this Agreement, the
Administrative Services Agreement, the Warrant Agreement, the Warrants or the
Registration Rights Agreement or the Issuer or the Charter Administrator is
indicted for a criminal offense related to its primary businesses.
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"UNIT EXERCISABLE AMOUNT" shall mean, for any Holder at any time, an
aggregate amount of Warrant Units equal to:
(a) an amount equal to:
(i) the Aggregate Holders' Unit Amount immediately prior to
such time; DIVIDED BY
(ii) one MINUS the Aggregate Holders' Unit Percentage
immediately prior to such time (expressed as a decimal);
MULTIPLIED BY
(b) the aggregate amount of Units owned by such Holder
immediately prior such time DIVIDED BY the Aggregate Holders' Unit
Amount immediately prior to such time;
where:
"AGGREGATE UNIT AMOUNT" shall mean, at any time, the aggregate
amount of Units issued by the Issuer and outstanding at such time;
"AGGREGATE HOLDERS' UNIT AMOUNT" shall mean, at any time, the
aggregate amount of Units owned by all of the Holders at such time;
and
"AGGREGATE HOLDERS' UNIT PERCENTAGE" shall mean, at any time, (x)
the Aggregate Holders' Unit Amount immediately prior to such time
DIVIDED BY (y) the Aggregate Unit Amount immediately prior to such
time, PROVIDED that in no event shall the "Aggregate Holders' Unit
Percentage" be greater than 0.10.
"UNITHOLDER" shall mean any Person who directly or indirectly owns any
Units (including Warrant Units).
"UNITS" shall have the meaning assigned to such term in the Operating
Agreement.
"WARRANT UNITS" shall mean (a) the Units purchased or purchasable by
the Holders of the Warrants upon the exercise thereof, including any Units into
which such Units may thereafter be changed or converted, and (b) any additional
Units issued or distributed by way of a unit split or other distribution in
respect of the Units referred to in clause (a) above, or acquired by way of any
rights offering or similar offering made in respect of the Units referred to in
clause (a) above. Any Warrant Units purchased by the Issuer shall, upon such
purchase, cease to be Warrant Units, cease to be outstanding and the Issuer,
upon such purchase, shall not be deemed a Holder.
"WARRANTS" shall mean all warrant certificates covering the purchase
of Units in the form of Exhibit A hereto, and all warrant certificates covering
units issued upon transfer, division or combination of, or in substitution for,
any thereof. All Warrants shall at all times be identical as to terms and
conditions except as to the number of units for which they may be exercised.
1.02 ACCOUNTING TERMS AND DETERMINATIONS, ETC. (a) Except as otherwise
may be expressly provided herein, all accounting terms used herein shall be
interpreted, and all financial statements and certificates and reports as to
financial matters required to be delivered to the Holders hereunder and under
the Warrants shall be prepared, in accordance with GAAP. All calculations made
for the purposes of determining compliance with the terms of this Agreement and
the Warrants shall (except as otherwise may be expressly provided herein) be
made by application of GAAP.
(b) All references to Units herein shall be subject to appropriate
adjustment by reason of any distribution, unit or stock split, reverse split,
combination, recapitalization or any similar corporate transaction.
1.03 TERMS GENERALLY. The definitions of terms herein shall apply
equally to the singular and plural forms of the terms defined. Whenever the
context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words "include", "includes" and "including" shall
be deemed to be followed by the phrase "without limitation". The word "will"
shall be construed to have the same meaning and effect as the word "shall".
Unless the context requires otherwise (a) any definition of or reference to any
agreement, instrument or other document herein shall be construed as referring
to such agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference
herein to any Person shall be construed to include such Person's successors and
assigns, (c) the words "herein", "hereof" and "hereunder", and words of similar
import, shall be construed to refer to this Agreement in its entirety and not to
any particular provision hereof, (d) all references herein to Articles,
Sections, Exhibits and Schedules shall be construed to refer to Articles and
Sections of, and Exhibits and Schedules to, this Agreement, (e) the words
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"asset" and "property" shall be construed to have the same meaning and effect
and to refer to any and all tangible and intangible assets and properties,
including cash, securities, accounts and contract rights and (f) references to
any law, constitution, statute, treaty, regulation, rule or ordinance, including
any section or other part thereof (each, for purposes of this Section 1.03, a
"law"), shall refer to that law as amended from time to time and shall include
any successor law.
SECTION 2. PURCHASE AND SALE OF XXXXXXXX0.01 AUTHORIZATION AND
ISSUANCE OF UNITS AND WARRANTS. The Issuer has authorized: (a) the issuance of
the Warrants to the Investor pursuant to this Agreement, and (b) the issuance of
such number of Units as shall be necessary to permit the Issuer to comply with
its obligations to issue Units pursuant to the Warrants.
2.02 ISSUANCE OF THE WARRANTS.
(a) On the date hereof:
(i) the Issuer shall issue to the Investor Warrants giving each
Holder the right to purchase a number of Units at the time of the
exercise thereof in an amount equal to the Unit Exercisable Amount for
such Holder immediately prior to the beginning of the Exercise Period;
(ii) the Issuer shall deliver to the Investor a single
certificate for the Warrants to be acquired by the Investor hereunder,
registered in the name of the Investor, except that, if the Investor
shall notify the Issuer in writing prior to such issuance that it
desires certificates for Warrants to be registered in the name or
names of any Affiliate, nominee or nominees of the Investor for its or
their benefit, then the certificates for Warrants shall be registered
in the name or names specified in such notice; and
(iii) the Issuer shall deliver to the Investor a legal opinion
from satisfactory counsel to the Issuer in the form attached as
Exhibit C hereto.
(b) On or before the date hereof, each of the members of the Issuer
shall have entered into the Operating Agreement in form and substance
satisfactory to the Investor.
2.03 ACQUISITION FOR THE INVESTOR'S ACCOUNT. The Investor represents
and warrants to the Issuer as follows:
(a) the Investor is acquiring and shall acquire the Warrants for its
own account, without a view to the distribution thereof, all without
prejudice, however, to the right of the Investor at any time, in accordance
with this Agreement or the Registration Rights Agreement, lawfully to sell
or otherwise to dispose of all or any part of the Warrants or the Warrant
Units held by it; and
(b) the Investor is an "accredited investor" within the meaning of
Regulation D under the Securities Act.
2.04 SECURITIES ACT COMPLIANCE. The Investor understands that the
Issuer has not registered the Warrants or the Warrant Units under the Securities
Act, and the Investor agrees that neither the Warrants nor the Warrant Units
shall be sold or transferred or offered for sale or transfer without
registration under the Securities Act or the availability of an exemption
therefrom, all as more fully provided in Section 3 hereof.
2.05 EXERCISE OF THE WARRANTS. At any time during the Election Period,
the Investor shall have the right, upon written notice from IXIS Financial
Products Inc. to the Issuer in the form of Exhibit D hereto, to elect that all
(but not part) of the Warrants shall be exercisable in accordance with their
terms.
SECTION 3. RESTRICTIONS ON TRANSFERABILITY
3.01 TRANSFERS GENERALLY.
(a) The Units, Warrants and Warrant Units held by any Holder
(collectively, the "Securities") shall be transferable only upon the conditions
specified in this Section 3 and in the Registration Rights Agreement, which
conditions are intended to insure compliance with the provisions of the
Securities Act and applicable state securities laws in respect of the transfer
of any Securities.
(b) Subject to compliance with the Securities Act, applicable state
securities laws and the requirement as to placement of a legend on certificates
for Restricted Securities specified in Section 3.03 hereof, any Holder shall
have the right to transfer any or all of its Securities to any Person as
provided in the Operating Agreement, PROVIDED that the ratio of (x) the Warrant
Units owned by such Holder immediately prior to such transfer (assuming that all
Warrants had been exercised immediately prior to such transfer) to (y) the Units
that are not Warrant Units owned by such Holder immediately prior to such
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transfer remains the same after giving effect to such transfer. The Person to
which Securities are transferred pursuant to the immediately preceding sentence
shall be deemed to be a Holder of such Securities and bound by the provisions of
this Agreement applicable to the Holders so long as such Person continues to own
any of the Securities so transferred to such transferee.
3.02 TRANSFERS OF SECURITIES PURSUANT TO REGISTRATION STATEMENTS, RULE
144 AND RULE 144A. The Securities may be offered or sold by the Holder thereof
pursuant to (a) an effective registration statement under the Securities Act,
(b) to the extent applicable, Rule 144 or Rule 144A or (c) any other legally
available means of transfer.
3.03 RESTRICTIVE LEGENDS. Unless and until otherwise permitted by this
Section 3, each certificate for Warrants issued under this Agreement, each
certificate for any Warrants issued to any subsequent transferee of any such
certificate, each certificate for any Warrant Units issued upon exercise of any
Warrant (if any), each certificate for any Warrant Units issued to any
subsequent transferee of any such certificate (if any), and each certificate for
any Units issued pursuant to the Operating Agreement (if any), shall be stamped
or otherwise imprinted with a legend in substantially the following form:
"THE TRANSFER OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE IS
SUBJECT TO THE CONDITIONS SPECIFIED IN THAT CERTAIN UNITHOLDER AND
WARRANT AGREEMENT DATED AS OF JUNE 28, 2006 (THE "UNITHOLDER AND
WARRANT AGREEMENT"), AMONG CENTERBROOK HOLDINGS LLC, A DELAWARE
LIMITED LIABILITY COMPANY (THE "ISSUER"), IXIS FINANCIAL PRODUCTS INC.
AND CHARTER MAC CORPORATION, AS THE UNITHOLDER AND WARRANT AGREEMENT
MAY BE AMENDED, SUPPLEMENTED OR OTHERWISE MODIFIED AND IN EFFECT FROM
TIME TO TIME, AND NO TRANSFER OF THE SECURITIES REPRESENTED BY THIS
CERTIFICATE SHALL BE VALID OR EFFECTIVE UNTIL SUCH CONDITIONS HAVE
BEEN FULFILLED. A COPY OF THE FORM OF THE UNITHOLDER AND WARRANT
AGREEMENT IS ON FILE AND MAY BE INSPECTED AT THE PRINCIPAL EXECUTIVE
OFFICE OF THE ISSUER. THE HOLDER OF THIS CERTIFICATE, BY ACCEPTANCE OF
THIS CERTIFICATE, AGREES TO BE BOUND BY THE PROVISIONS OF THE
UNITHOLDER AND WARRANT AGREEMENT.
THESE SECURITIES AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AND SUCH SECURITIES MAY NOT BE OFFERED, SOLD,
PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (I) PURSUANT TO AN EXEMPTION
FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS UNDER THE SECURITIES ACT OR (II) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES OF AMERICA."
3.04 TERMINATION OF RESTRICTIONS. Whenever any Restricted Security
shall have been effectively registered under the Securities Act and applicable
state securities laws and sold by the Holder thereof in accordance with such
registration or sold under and pursuant to Rule 144 or is eligible to be sold
under and pursuant to paragraph (k) of Rule 144, the Holder thereof shall be
entitled to receive from the Issuer, without expense, a new certificate
evidencing such Restricted Security not bearing the restrictive legend otherwise
required to be borne by a certificate evidencing such Restricted Security.
3.05 CANCELLATION AND ISSUANCE. If any Holder or any of its Affiliates
assigns or otherwise transfers all or any of its Warrants, such Holder may
request (upon 10 days' prior notice to the Issuer) that (a) a number of Warrants
held by such Holder be canceled on the date of such assignment and transfer and
(b) a like number of Warrants be issued by the Issuer to the Person to whom such
Warrants are being assigned or otherwise transferred. Upon the date specified in
such request, the Issuer shall issue, and such Holder shall surrender for
cancellation, such number of Warrants as aforesaid, PROVIDED that such issuance
shall not violate the Securities Act or any applicable state securities laws.
SECTION 4. PUT RIGHTS
4.01 PUT RIGHTS.
(a) At any time on or after the occurrence of the Triggering Event,
the Majority Unitholders will have the right to require the Charter Member to
purchase all (but not less than all) of the Securities owned by the Holders
pursuant to, and in accordance with, this Section 4.
(b) The Majority Unitholders may exercise a Put Right by delivering a
notice to the Issuer and the Charter Member stating that the Majority
Unitholders will require the Charter Member to purchase and the Holders to sell
all (but not less than all) of the Securities owned by the Holders (a "PUT
NOTICE"). Within 5 days after receipt of a Put Notice by the Issuer and the
Charter Member, the Issuer and the Charter Member shall give a notice to all
other Holders advising them of the receipt by the Issuer and the Charter Member
of such Put Notice, together with a copy of such Put Notice. The date upon which
the Issuer and the Charter Member shall so advise the other Holders is herein
called the "ISSUER NOTICE DATE".
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(c) Notwithstanding anything in this Agreement to the contrary, each
of the Charter Member and the Issuer agrees that if at any time the Board shall
notify the Holders (a "FORCED SALE NOTICE") that it intends to consummate a
Forced Sale, then, unless the consideration received in respect thereof consists
solely of any combination of cash and Publicly Traded Stock that is distributed
to the Holders simultaneously with the closing of such Forced Sale, the
following provisions shall apply:
(i) Not later than 10 days following the related Forced Sale Notice
Date, the Majority Unitholders shall have the right to notify each of the
Charter Member and the Issuer that they intend to have the fair market
value of the assets and property to be sold in connection with such Forced
Sale (the "FORCED SALE ASSETS") determined and exercise their rights under
this clause (c), whereupon the Forced Sale FMV for such Forced Sale shall
be determined in accordance with the definition thereof. In the event that
such notice is not given, then the Holders shall receive their PRO RATA
share of the consideration from the Forced Sale, which shall be distributed
to them simultaneously with the closing of such Forced Sale. In the event
that such notice is given, the following provisions of this clause (c)
shall apply.
(ii) At the closing for such Forced Sale, the Charter Member shall
remit to each Holder an amount in cash (such Holder's "FORCED SALE
CONSIDERATION"), which cash amount shall be based on a good faith estimate
by the Charter Member of such Holder's PRO RATA share of the Forced Sale
FMV for such Forced Sale.
(iii) On the later of (x) the date 5 Business Days after the date on
which the Forced Sale FMV for such Forced Sale shall have been determined
and (y) the closing date for such Forced Sale, either:
(1) if the related Forced Sale FMV Determination Amount for any
Holder exceeds the Forced Sale Consideration received by such Holder,
then the Charter Member shall forthwith pay to such Holder, by wire
transfer in immediately available funds, an amount equal to such
excess amount PLUS an amount equal to the product of (x) such excess
amount, (y) the Prime Rate and (z) the quotient determined by dividing
the number of days lapsed from the closing date of such Forced Sale
through and including the date such excess amount is paid BY 360; or
(2) if the Forced Sale Consideration received by any Holder
exceeds the related Forced Sale FMV Determination Amount for such
Holder, then such Holder shall forthwith pay to the Charter Member, by
wire transfer in immediately available funds, an amount equal to such
excess amount PLUS an amount equal to the product of (x) such excess
amount, (y) the Prime Rate and (z) the quotient determined by dividing
the number of days lapsed from the closing date of such Forced Sale
through and including the date such excess amount is paid BY 360;
PROVIDED that if such Forced Sale shall not be completed, then the
foregoing provisions of this clause (iii) shall not apply.
4.02 PROCEDURES.
(a) The purchase and sale of the Securities pursuant to a Put Right
shall be consummated on a date selected by the Charter Member upon at least 5
Business Days' prior written notice to the Holders, which date in no event shall
be later than the date 180 days after the Put Notice Date (the "PUT CLOSING
DATE"), PROVIDED that if on the Put Closing Date the Fair Market Value shall not
have been determined, the Put Closing Date shall be the date 5 Business Day's
after the date on which the Fair Market Value shall have been determined. On the
Put Closing Date, the Charter Member shall purchase from each Holder, and each
Holder shall sell to the Charter Member, all of the Securities owned by such
Holder: (i) in the case of each Unit and Warrant Unit so purchased, at a
purchase price equal to the Price Per Unit as of the Put Notice Date; and (ii)
in the case of any Warrants owned by such Holder, at a purchase price (which
shall not be less than zero) equal to (A) the product of (1) the Price Per Unit
as of the Put Notice Date and (2) the Unit Exercisable Amount for such Holder as
of the Put Notice Date, MINUS (B) an amount equal to the aggregate Exercise
Price as of the Put Notice Date for such Unit Exercisable Amount. Payment of the
purchase price for the Securities so purchased by the Charter Member shall be
made by wire transfer in immediately available funds.
(b) If the Charter Member shall not purchase some or all of the
Securities as required and in accordance with this Section 4 for any reason,
then the Price Per Unit with respect to such unpurchased Securities shall become
an accruing liability of the Charter Member with interest thereon commencing on
the Put Closing Date through the date on which the related Securities are
purchased by the Charter Member at a rate per annum equal to the Prime Rate PLUS
2%, compounded quarterly.
(c) The calculations under this Section 4, other than with respect to
the determination of Fair Market Value, shall be made by the Issuer in good
faith and in a commercially reasonable manner.
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SECTION 5. CALL RIGHTS; LOOK BACK
5.01 CALL RIGHTS.
(a) At any time on or after the fifth anniversary of the date hereof,
the Charter Member shall have the right to purchase all (but not less than all)
of the Securities owned by the Holders.
(b) The Charter Member may exercise a Call Right by delivering an
irrevocable notice to the Holders indicating that the Charter Member wishes to
purchase all (but not less than all) of the Securities of each Holder (a "CALL
NOTICE").
(c) The purchase and sale of the Securities pursuant to a Call Right
shall be consummated on a date selected by the Charter Member by giving the
Holders at least 10 Business Days' prior written notice thereof, which date in
no event shall be earlier than the date 5 Business Days, nor later than the date
10 Business Days, after the determination of the Fair Market Value pursuant to
the procedure described in the definition of such term in Section 1 hereof. The
Charter Member shall purchase from the Holders, and each Holder shall sell to
the Issuer, all of the Securities owned by such Holder: (i) in the case of each
Unit and Warrant Unit so purchased, at a price equal to the Price Per Unit as of
the Call Notice Date; and (ii) in the case of any Warrants owned by such Holder,
at a purchase price (which shall not be less than zero) equal to (A) the product
of (1) the Price Per Unit as of the Call Notice Date and (2) the Unit
Exercisable Amount for such Holder as of the Call Notice Date, MINUS (B) an
amount equal to the aggregate Exercise Price as of the Call Notice Date for such
Unit Exercisable Amount. Payment of the purchase price for the Securities so
purchased by the Charter Member shall be made by wire transfer in immediately
available funds.
(d) The calculations under this Section 5.01, other than with respect
to the determination of Fair Market Value, shall be made by the Issuer in good
faith and in a commercially reasonable manner.
5.02 LOOK BACK EVENTS.
(a) If, within the 12-month period (a "LOOK BACK PERIOD") following
the Call Notice Date, the Charter Member, the Issuer, any of its Subsidiaries,
or any holder of Units or Options or Convertible Securities with respect to such
Units, shall have entered into any contract, arrangement or binding agreement
relating to a Look Back Event or shall have consummated a Look Back Event, then
upon occurrence of such Look Back Event the Charter Member shall forthwith pay
to each Holder, by wire transfer in immediately available funds:
(i) in the case of a Subsequent Event, an amount equal to the
excess (if any) of (A) the product of (1) the Subsequent Unit Value on
the date of such Subsequent Event and (2) the number of Units and
Warrant Units sold in the Prior Sale (assuming that all Warrants sold
in the Prior Sale by such Holder had been exercised immediately prior
to the Prior Sale and were sold in the Prior Sale as Warrant Units),
OVER (B) the aggregate amount received by such Holder in the Prior
Sale (the "PRIOR AMOUNT"); OR
(ii) in the case of a Subsequent Unit Sale, an amount equal to
the excess (if any) of (A) the aggregate amount of consideration that
such Holder would have been entitled to receive in the Subsequent Unit
Sale had the Securities sold in the Prior Sale been held by such
Holder at the time of the Subsequent Unit Sale and sold in the
Subsequent Unit Sale (assuming that all Warrants sold in the Prior
Sale by such Holder had been exercised immediately prior to the Prior
Sale and were sold in the Prior Sale as Warrant Units), OVER (B) the
Prior Amount; AND
(iii) in addition to the amounts paid pursuant to the foregoing
clauses (i) or (ii), an amount equal to the sum of (A) all
distributions paid on any date after the Call Notice Date to and
including the settlement date of the Prior Sale to which such Holder
would have been entitled if such Holder had been a Holder of
Securities during such period (the "INTERIM DISTRIBUTIONS") and (B) an
amount equal to the product of (x) the Interim Distributions, (y) the
Prime Rate and (z) the quotient determined by dividing the number of
days lapsed from the date each such distribution would have been
received through and including the date of the Look Back Event by 360.
For purposes of this Section 5.02, it shall be assumed that (x) all
adjustments required by the provisions of Section 4 of the Warrants will have
been made in respect of Warrants (whether or not outstanding) through and
including the date of the relevant Look Back Event, (y) appropriate adjustments
will have been made in respect of the number of Units and Warrant Units (and
their character and terms) through and including the date of the relevant Look
Back Event by reason of any stock or unit distribution, subdivision,
combination, consolidation, merger, sale, lease, transfer or recapitalization,
any amendment to the Operating Agreement or other organizational documents of
the Issuer or any similar event effected on or after the Call Notice Date; and
(z) the Issuer was in compliance through the Look Back Event with the covenants
set forth in this Agreement and the Operating Agreement. If the Issuer would
have been in default of any such covenants in such a way as to adversely affect
the rights of the Holders then, in each such case, the computations and
adjustments provided for in this Section 5.02 shall be made as nearly as
11
possible in the manner so provided except that any additional adjustments
required to protect the Holders against such adverse effects in accordance with
the intent and principles of this Agreement shall be made.
(b) As used in this Section 5.02, the following terms shall have the
following respective meanings:
"AGGREGATE CALLED AMOUNT" shall mean the aggregate number of Units and
Warrant Units sold in the Prior Sale (assuming that all Warrants sold in the
Prior Sale by each Holder had been exercised immediately prior to the Prior Sale
and were sold in the Prior Sale as Warrant Units).
"LOOK BACK EVENT" shall mean the occurrence (whether in one
transaction or in a series of related transactions) of any Subsequent Event or
Subsequent Unit Sale.
"SUBSEQUENT EVENT" shall mean: (a) any merger or consolidation of the
Issuer with any other Person (whether or not the Issuer is the surviving entity)
in which any Unitholder receives any distribution in respect of its Units; (b)
any share or unit exchange of the Issuer with any other Person (whether or not
the Issuer is the surviving entity) involving a number of Units which equals or
exceeds the Aggregate Called Amount and in which any Unitholder receives any
distribution in respect of its Units; or (c) any sale, lease or other
disposition of all or a substantial portion of the assets of the Issuer
(including by or through the issuance, sale, lease or other disposition of the
Units or other equity interests or assets of, or a merger or consolidation
involving, any Subsidiary of the Issuer) or any liquidation.
"SUBSEQUENT UNIT VALUE" shall mean, with respect to each Unit and
Warrant Unit on any Subsequent Event Date, an amount equal to the result
obtained by dividing (a) the sum of (i) the aggregate fair market value of all
consideration (less assumed liabilities) received by the Issuer and its
Subsidiaries and Unitholders in connection with the related Subsequent Event,
net of ordinary and customary transaction expenses (including taxes) in
connection with such Subsequent Event and liabilities required to be paid by the
Issuer from the proceeds of such transactions (the "NET CONSIDERATION"), PLUS
(ii) the Fair Market Value as at such Subsequent Event Date (after giving effect
to the related Subsequent Event and excluding the Net Consideration) by (b) the
total number of Units (determined on a Fully Diluted Basis) outstanding on such
Subsequent Event Date (after giving effect to the related Subsequent Event).
"SUBSEQUENT UNIT SALE" shall mean: (a) any repurchase, redemption or
other direct or indirect acquisition by the Issuer of any Units or Options or
Convertible Securities exercisable for or convertible or exchangeable into Units
which equals or exceeds the Aggregate Called Amount; (b) any sale, disposition
or other transfer of any Units or other equity interests of the Issuer or any
Subsidiary thereof of any class through a public offering involving the Issuer
or such Subsidiary; or (c) any sale, disposition or other transfer of any
outstanding Units owned by any of the Controlling Group or Options or
Convertible Securities held by any of the Controlling Group exercisable for or
convertible or exchangeable into Units which equals or exceeds the Aggregate
Called Amount.
(c) Promptly following its execution (or the execution by one of its
Affiliates or a Subsidiary) of an agreement pursuant to which, if the
transaction contemplated thereby is consummated, a Look Back Event would occur,
and, if different, the date of occurrence of a Look Back Event, the Issuer or
the Charter Member, as applicable, shall deliver a notice to the Holders of the
execution of such agreement (describing in reasonable detail the contents
thereof and the contemplated schedule for its consummation) and of the
occurrence of such Look Back Event.
(d) The calculations under this Section 5.02, other than with respect
to the determination of Fair Market Value, shall be made by the Issuer in good
faith and in a commercially reasonable manner.
SECTION 6. RIGHT TO JOIN IN SALE6.01 TAG-ALONG RIGHTS. Notwithstanding
anything herein to the contrary, if the Charter Member proposes, in a single
transaction or a series of related transactions, to sell, dispose of or
otherwise transfer, directly or indirectly, any of its Units then outstanding in
any manner (each, a "TAG-ALONG SALE"), then the Holders shall be afforded the
opportunity to join in such transfer as provided in Section 6.02 hereof.
6.02 PROCEDURES. Prior to the consummation of any transaction subject
to Section 6.01 hereof, the Person or group of Persons that proposes to acquire
Units in a Tag-Along Sale (the "PROPOSED PURCHASER") shall make a written offer
to the Holders (the "TAG-ALONG PURCHASE OFFER") which offer shall describe in
reasonable detail the Securities proposed to be purchased, the price to be paid
and all other material terms of the Tag-Along Sale. The Holders shall have 15
days after the making of the Tag-Along Purchase Offer in which to accept the
Tag-Along Purchase Offer. If any Holder accepts the Tag Along Purchase Offer
("PARTICIPATING HOLDER"), such Participating Holder shall be entitled to sell in
the Tag-Along Sale a number of Units and Warrant Units (including Warrant Units
issuable upon the exercise of Warrants) equal to the product of (i) the quotient
determined by dividing (x) the number of Units and Warrant Units owned by such
Participating Holder (including Warrant Units issuable upon the exercise of
Warrants) BY (y) the aggregate number of Units (on a Fully Diluted Basis) owned
by the Charter Member and all Participating Holders, and (ii) the aggregate
number of Units and Warrants proposed to be purchased by the Proposed Purchaser
in the Tag-Along Sale; PROVIDED that if the Tag-Along Sale would cause a Change
of Control, then the Participating Holders shall be entitled to sell 100% of
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their respective Units and Warrant Units (but not exceeding the aggregate amount
of Units proposed to be acquired in the Tag-Along Sale). The Tag-Along Purchase
Offer shall be at the same price and on the same terms and conditions as the
offer by the Proposed Purchaser to the Charter Member, except that no
Participating Holder shall be required to make representations and warranties to
or agreements with the Proposed Purchaser other than representations, warranties
and agreements regarding such Participating Holder and its ownership of the
Securities to be sold in the Tag-Along Sale.
6.03 ISSUER'S COVENANTS. The Issuer will not, on or after the date
hereof, deliver to the Charter Member a certificate evidencing any Units being
sold in a transaction requiring that a Tag-Along Purchase Offer be made unless
the Proposed Purchaser shall have in fact made a Tag-Along Purchase Offer in
accordance with the provisions of Section 6.02 hereof.
SECTION 7. OBLIGATION TO JOIN IN SALE7.01 DRAG-ALONG OBLIGATIONS. In
the event of a Drag-Along Sale at any time after the fifth anniversary of the
date hereof, each Holder shall be obligated to, if so requested by the Charter
Member, sell, transfer and deliver, or cause to be sold, transferred and
delivered to the Third Party Purchaser, all (but not less than all) Securities
owned by it at the same price per unit and consideration, and on the same terms
and conditions (except as expressly permitted below), as are applicable to the
Charter Member, except that no Holders shall be required to make representations
and warranties to or agreements with the Third Party Purchaser other than
representations, warranties and agreements regarding such Holder and its
ownership of the Securities to be sold in the Drag-Along Sale (it being
understood that such Holders shall not be obligated to pay their PRO RATA
portion of the transaction costs associated with the sale, transfer or
delivery).
7.02 PROCEDURES.
(a) The Charter Member shall deliver a written notice ("DRAG-ALONG
NOTICE") to each of the Holders setting forth the consideration per Unit to be
paid by the Third Party Purchaser and the other terms and conditions of the
Drag-Along Sale.
(b) If the consideration received in respect of the Drag-Along Sale
consists solely of any combination of cash and Publicly Traded Stock, or if the
Majority Unitholders elect not to exercise their rights under clause (c) of this
Section 7.02, then the following provisions shall apply:
(i) Not later than 20 days following the Drag-Along Notice Date,
each of the Holders shall deliver to the Charter Member the Warrants
and certificates (if any) representing Securities of such Holder,
accompanied by duly executed unit powers.
(ii) At the closing for the Drag-Along Sale, the Charter Member
shall remit to each Holder the consideration to which such Holder is
entitled for its Securities in accordance with Section 7.01 hereof.
(c) If the consideration received in respect of the Drag-Along Sale
consists of any property other than Publicly Traded Stock and cash, then the
following provisions shall apply:
(i) Not later than 10 days following the Drag-Along Notice Date,
the Majority Unitholders shall have the right to notify each of the
Charter Member and the Issuer that they intend to have the fair market
value of their Units determined and exercise their rights under this
clause (c), whereupon the Fair Market Value shall be determined in
accordance with the definition thereof. In the event that no such
notice is given, the provisions set forth under clause (b) of this
Section 7.02 shall apply and the following provisions of this clause
(c) shall not apply.
(ii) Not later than 20 days following the Drag-Along Notice Date,
each of the Holders shall deliver to the Charter Member the Warrants
and certificates (if any) representing Securities of such Holder,
accompanied by duly executed unit powers.
(iii) At the closing for the Drag-Along Sale, the Charter Member
shall remit to each Holder an amount in cash for its Securities (such
Holder's "DRAG-ALONG SALE CONSIDERATION"), which cash amount shall be
based on a good faith estimate by the Charter Member of the fair
market value of such Securities, determined in a commercially
reasonable manner.
(iv) On the later of (x) the date 5 Business Days after the date
on which the Fair Market Value pursuant to this clause (c) shall have
been determined and (y) the closing date for the Drag-Along Sale,
either:
13
(1) if the Drag-Along FMV Determination Amount for any
Holder exceeds the Drag-Along Sale Consideration received by such
Holder, then the Charter Member shall forthwith pay to such
Holder, by wire transfer in immediately available funds, an
amount equal to such excess amount PLUS an amount equal to the
product of (x) such excess amount, (y) the Prime Rate and (z) the
quotient determined by dividing the number of days lapsed from
the closing date of the Drag-Along Sale through and including the
date such excess amount is paid BY 360; or
(2) if the Drag-Along Sale Consideration received by any
Holder exceeds the Drag-Along FMV Determination Amount for such
Holder, then such Holder shall forthwith pay to the Charter
Member, by wire transfer in immediately available funds, an
amount equal to such excess amount PLUS an amount equal to the
product of (x) such excess amount, (y) the Prime Rate and (z) the
quotient determined by dividing the number of days lapsed from
the closing date of the Drag-Along Sale through and including the
date such excess amount is paid BY 360;
PROVIDED that if the Drag-Along Sale shall not be completed, then the
foregoing provisions of this clause (iv) shall not apply.
(d) If any Holder should fail to deliver its Warrants or certificates
(if any) representing Securities, the Issuer shall cause the books and records
of the Issuer to show that such Warrants and Securities are bound by the
provisions of this Section 7 and that such Warrants and Securities shall be
transferred only to the Third Party Purchaser upon surrender for transfer by the
Holder thereof.
(e) If, within 120 days after the Charter Member delivers a Drag-Along
Notice, the Drag-Along Sale is not completed, the Charter Member shall return to
each Holder all Warrants and certificates (if any) representing Securities that
such Holder delivered for sale pursuant hereto.
7.03 DEFINITIONS. As used herein the following terms shall have the
following respective meanings:
"DRAG-ALONG SALE" shall mean (a) the sale by the Charter Member of
Units beneficially owned by it in a private offering that results in a Change of
Control or (b) a merger or consolidation involving the Issuer, wherein the
Holders will receive consideration for their Units, in each case in a bona fide
arm's length transaction to or with a Third Party (the "THIRD PARTY PURCHASER")
and in each case occurring after the fifth anniversary of the date hereof.
"THIRD PARTY" shall mean a Person or entity not otherwise an Affiliate
of the Issuer or the Charter Member or a Subsidiary thereof or any of the
Issuer's Unitholders.
SECTION 8. HOLDERS' RIGHTS8.01 DELIVERY EXPENSES. If any Holder
surrenders any certificate for Warrants or Warrant Units to the Issuer or a
transfer agent of the Issuer for exchange for instruments of other denominations
or registered in another name or names, the Issuer shall cause such new
instruments to be issued and shall pay the costs associated therewith, including
the costs of delivering to or from the office of such Holder from or to the
Issuer or its transfer agent, duly insured, the surrendered instrument and any
new instruments issued in substitution or replacement for the surrendered
instrument.
8.02 TAXES. The Issuer shall pay all taxes (other than Federal, state
or local income taxes) which may be payable in connection with the execution and
delivery of this Agreement or the Registration Rights Agreement or the issuance
of the Warrants and Warrant Units hereunder or in connection with any
modification of this Agreement, the Registration Rights Agreement or the
Warrants and shall hold each Holder harmless without limitation as to time
against any and all liabilities with respect to all such taxes. The obligations
of the Issuer under this Section 8.02 shall survive any redemption, repurchase
or acquisition of Warrants or Warrant Units by the Issuer, any termination of
this Agreement or the Registration Rights Agreement, and any cancellation or
termination of the Warrants.
8.03 REPLACEMENT OF INSTRUMENTS. Upon receipt by the Issuer of
evidence reasonably satisfactory to it of the ownership of and the loss, theft,
destruction or mutilation of any certificate or instrument evidencing any
Warrants or Warrant Units, and
(i) in the case of loss, theft or destruction, of indemnity reasonably
satisfactory to it, PROVIDED that, if the owner of the same is the Investor
or an institutional lender or investor, its own agreement of indemnity
shall be deemed to be satisfactory, or
(ii) in the case of mutilation, upon surrender or cancellation
thereof,
the Issuer, at its expense, shall execute, register and deliver, in lieu
thereof, a new certificate or instrument for (or covering the purchase of) an
equal number of Warrants or Warrant Units.
14
8.04 INDEMNIFICATION. The Issuer shall indemnify and hold harmless
each of the Investor and the Holders and each of their respective managers,
directors, officers, employees, unitholders, Affiliates and agents (each, an
"INDEMNIFIED PERSON") on demand from and against any and all losses, claims,
damages, liabilities (or actions or other proceedings commenced or threatened in
respect thereof) and expenses that arise out of, result from, or in any way
relate to, this Agreement, the Warrants or the Registration Rights Agreement, or
in connection with the other transactions contemplated hereby and thereby, and
to reimburse each indemnified person, upon its demand, for any legal or other
expenses incurred in connection with investigating, defending or participating
in the defense of any such loss, claim, damage, liability, action or other
proceeding (whether or not such indemnified person is a party to any action or
proceeding out of which any such expenses arise), other than any of the
foregoing claimed by any indemnified person to the extent incurred by reason of
the gross negligence or willful misconduct of such indemnified person. No
indemnified person shall be responsible or liable to either the Issuer or any
other Person for any damages which may be alleged as a result of or relating to
this Agreement, the Warrants or the Registration Rights Agreement, or in
connection with the other transactions contemplated hereby and thereby.
SECTION 9. OTHER COVENANTS OF ISSUERThe Issuer agrees with each Holder
that, so long as any of the Warrants and/or Warrant Units shall be outstanding:
9.01 ACCOUNTANTS; FISCAL YEAR. THE ISSUER SHALL RETAIN A NATIONALLY
RECOGNIZED INDEPENDENT ACCOUNTING FIRM AS ITS AUDITORS. TO ENABLE THE READY AND
CONSISTENT DETERMINATION OF THE PRICE PER UNIT AND COMPLIANCE WITH THE COVENANTS
SET FORTH HEREIN, NEITHER THE ISSUER NOR ANY OF ITS SUBSIDIARIES WILL CHANGE THE
LAST DAY OF ITS FISCAL YEAR FROM DECEMBER 31 OF EACH YEAR, OR THE LAST DAYS OF
THE FIRST THREE FISCAL QUARTERS IN EACH OF ITS FISCAL YEARS FROM MARCH 31, JUNE
30 AND SEPTEMBER 30 OF EACH YEAR, RESPECTIVELY.
9.02 REPURCHASES, RECAPITALIZATIONS, ETC.
(a) Except as otherwise specifically provided herein or contemplated
by the Operating Agreement, the Issuer shall not effect any repurchase,
recapitalization, reorganization, reclassification, merger, consolidation, share
or unit exchange, liquidation, spin-off, stock or unit split, distribution or
stock or unit consolidation, subdivision or combination that would not afford to
each Unitholder and the Holder the same type and amount of consideration.
(b) Except as otherwise specifically provided herein or contemplated
by the Operating Agreement, the Issuer shall not effect any repurchase or
redemption of Units and shall cause its Subsidiaries not to effect any
repurchase or redemption of Units from any Unitholder. Any repurchase or
redemption of Units shall include Warrant Units.
9.03 RESTRICTIONS ON PERFORMANCE. The Issuer shall not at any time
enter into an agreement or other instrument limiting in any manner its ability
to perform its obligations under this Agreement, the Registration Rights
Agreement or the Warrants, or making such performance or the issuance of Units
upon the exercise of any Warrant a default under any such agreement or
instrument.
SECTION 10. MISCELLANEOUS10.01 HOME OFFICE PAYMENT. Notwithstanding
anything to the contrary in this Agreement or the Warrants, so long as the
Investor or any nominee designated by the Investor shall be a Holder, the Issuer
shall punctually pay all amounts which become due and payable with respect to
any Warrant or Warrant Units to the Investor at the address registered on the
books of the Issuer maintained for such purpose, or at such other place and in
such manner as the Investor may designate by notice to the Issuer, without
presentation or surrender of such Warrant or the making of any notation thereon.
The Investor agrees that prior to the sale, transfer or other disposition of a
part of any Warrant, it will make notation thereon of the number of Units
covered by the part of the Warrant sold, transferred or disposed, or surrender
the same in exchange for a Warrant covering the number of Units remaining on the
Warrant so surrendered. The Issuer agrees that the provisions of this Section
10.01 shall inure to the benefit of any other Holder registered on the books of
the Issuer.
10.02 WAIVER. No failure on the part of any Holder to exercise and no
delay in exercising, and no course of dealing with respect to, any right, power
or privilege under this Agreement, the Warrants or the Registration Rights
Agreement shall operate as a waiver thereof, nor shall any single or partial
exercise of any right, power or privilege under this Agreement, the Warrant or
the Registration Rights Agreement preclude any other or further exercise thereof
or the exercise of any other right, power or privilege. The remedies provided
herein are cumulative and not exclusive of any remedies provided by law.
10.03 NOTICES.
(a) All notices, requests and other communications provided for herein
and the Warrants (including any waivers or consents under this Agreement and the
Warrants) shall be given or made in writing,
15
(i) if to the Issuer:
Centerbrook Holdings LLC
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxxx
Telecopy: 000-000-0000
(ii) if to the Investor:
IXIS Financial Products Inc.
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx Xxxxxxx
(iii) if to the Investor:
Charter Mac Corporation
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxxxxx
with a copy to:
Proskauer Rose LLP
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxxxx X. Xxxxxxx, Esq.
(iv) if to any other Person who is the registered Holder of any
Warrants or Warrant Units, to the address for such Holder as it
appears in the unit or warrant ledger of the Issuer;
or, in the case of any Holder, at such other address as shall be designated by
such party in a notice to the Issuer; or, in the case of the Issuer, at such
other address as the Issuer may designate in a notice to the Investor and all
other Holders.
(b) All such notices, requests and other communications shall be: (i)
personally delivered, sent by courier guaranteeing overnight delivery or sent by
registered or certified mail, return receipt requested, postage prepaid, in each
case given or addressed as aforesaid; and (ii) effective upon receipt.
10.04 EXPENSES, ETC. EACH OF THE PARTIES HERETO SHALL BEAR ITS OWN
COSTS AND EXPENSES OF LEGAL COUNSEL, ACCOUNTANTS, FINANCIAL ADVISORS AND OTHER
CONSULTANTS AND ADVISORS INCURRED BY IT IN CONNECTION WITH THE NEGOTIATION,
PREPARATION, EXECUTION AND DELIVERY OF THIS AGREEMENT AND THE CONSUMMATION OF
THE TRANSACTIONS CONTEMPLATED HEREBY.
10.05 AMENDMENTS, ETC. Except as otherwise expressly provided in this
Agreement, any provision of this Agreement may be amended or modified only by an
instrument in writing signed by the Issuer, the Charter Member, the Investor (so
long as the Investor is a Holder) and the Majority Unitholders. No waiver by any
party of any term or condition of this Agreement, in any one or more instances,
shall be deemed to be or construed as a waiver of the same term or condition of
this Agreement on any future occasion.
10.06 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
permitted assigns.
10.07 SURVIVAL. All representations and warranties made by the Issuer
herein or in any certificate or other instrument delivered by it or on its
behalf under this Agreement or the Registration Rights Agreement shall be
considered to have been relied upon by the Investor and shall survive the
issuance of the Warrants or the Warrant Units regardless of any investigation
made by or on behalf of the Investor. All statements in any such certificate or
other instrument so delivered shall constitute representations and warranties by
the Issuer hereunder. All representations and warranties made by the Investor
herein shall be considered to have been relied upon by the Issuer and the
Charter Member and shall survive the issuance to the Investor of the Warrants or
the Warrant Units regardless of any investigation made by either of the Issuer
or the Charter Member or on its behalf.
16
10.08 SPECIFIC PERFORMANCE. Damages in the event of breach of this
Agreement by a Holder, the Issuer or the Charter Member would be difficult, if
not impossible, to ascertain, and it is therefore agreed that each Holder, the
Issuer and the Charter Member, in addition to and without limiting any other
remedy or right it may have, will have the right to an injunction or other
equitable relief in any court of competent jurisdiction, enjoining any such
breach, and enforcing specifically the terms and provisions hereof, and each
Holder, the Issuer and the Charter Member hereby waives any and all defenses it
may have on the ground of lack of jurisdiction or competence of the court to
grant such an injunction or other equitable relief. The existence of this right
will not preclude the Holders, the Issuer or the Charter Member from pursuing
any other rights and remedies at law or in equity which the Holders, the Issuer
or the Charter Member may have.
10.09 CAPTIONS. The captions and section headings appearing herein are
included solely for convenience of reference and are not intended to affect the
interpretation of any provision of this Agreement.
10.10 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument and any of the parties hereto may execute this Agreement by signing
any such counterpart signature page or counterpart.
10.11 GOVERNING LAW; WAIVER OF JURY TRIAL. This Agreement shall be
governed by, and construed in accordance with, the law of the State of New York.
EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY.
10.12 SEVERABILITY. If any provision of this Agreement is held to be
illegal, invalid or unenforceable under any present or future law, and if the
rights or obligations of any party hereto under this Agreement will not be
materially and adversely affected thereby, (a) such provision will be fully
severable, (b) this Agreement will be construed and enforced as if such illegal,
invalid or unenforceable provision had never comprised a part hereof, (c) the
remaining provisions of this Agreement will remain in full force and effect and
will not be affected by the illegal, invalid or unenforceable provision or by
its severance herefrom and (d) in lieu of such illegal, invalid or unenforceable
provision, there will be added automatically as a part of this Agreement a
legal, valid and enforceable provision as similar in terms to such illegal,
invalid or unenforceable provision as may be possible.
10.13 ENTIRE AGREEMENT. This Agreement supersedes all prior
discussions and agreements between the parties with respect to the subject
matter hereof, and together with the Warrant, the Registration Rights Agreement
and the Operating Agreement contains the sole and entire agreement between the
parties hereto with respect to the subject matter hereof.
17
IN WITNESS WHEREOF, the parties hereto have duly executed this
Unitholder and Warrant Agreement as of the date first above written.
CENTERBROOK HOLDINGS LLC
By: /S/ XXXXXX X. XXXX
------------------
Name: Xxxxxx X. Xxxx
Title: Chief Executive Officer
IXIS FINANCIAL PRODUCTS INC.
By: /S/ X. XXXXXXX
--------------
Name: X. Xxxxxxx
Title: Managing Director
By: /S/ XXXXXXXXXXX XXXXXX
----------------------
Name: Xxxxxxxxxxx Xxxxxx
Title: Managing Director
CHARTER MAC CORPORATION
By: /S/ XXXX X. XXXXXXXXX
---------------------
Name: Xxxx X. Xxxxxxxxx
Title: Chief Executive Officer
18
Exhibit A
to
Unitholder and Warrant Agreement
[Form of Warrant]
WARRANT
THE TRANSFER OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE IS
SUBJECT TO THE CONDITIONS SPECIFIED IN THAT CERTAIN UNITHOLDER AND WARRANT
AGREEMENT DATED AS OF JUNE 28, 2006 (THE "UNITHOLDER AND WARRANT AGREEMENT"),
AMONG CENTERBROOK HOLDINGS LLC, A DELAWARE LIMITED LIABILITY COMPANY (THE
"ISSUER"), IXIS FINANCIAL PRODUCTS INC. AND CHARTER MAC CORPORATION, AS THE
UNITHOLDER AND WARRANT AGREEMENT MAY BE AMENDED, SUPPLEMENTED OR OTHERWISE
MODIFIED AND IN EFFECT FROM TIME TO TIME, AND NO TRANSFER OF THE SECURITIES
REPRESENTED BY THIS CERTIFICATE SHALL BE VALID OR EFFECTIVE UNTIL SUCH
CONDITIONS HAVE BEEN FULFILLED. A COPY OF THE FORM OF THE UNITHOLDER AND WARRANT
AGREEMENT IS ON FILE AND MAY BE INSPECTED AT THE PRINCIPAL EXECUTIVE OFFICE OF
THE ISSUER. THE HOLDER OF THIS CERTIFICATE, BY ACCEPTANCE OF THIS CERTIFICATE,
AGREES TO BE BOUND BY THE PROVISIONS OF THE UNITHOLDER AND WARRANT AGREEMENT.
THESE SECURITIES AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AND SUCH SECURITIES MAY NOT BE OFFERED, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED EXCEPT (I) PURSUANT TO AN EXEMPTION FROM, OR IN A
TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS UNDER THE SECURITIES
ACT OR (II) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT, IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE
OF THE UNITED STATES OF AMERICA.
Warrant No. ________
Dated: ________ __, 20__
WARRANT
to Purchase Units of
CENTERBROOK HOLDINGS LLC
THIS IS TO CERTIFY THAT [NAME OF WARRANT HOLDER], or its registered
assigns, is entitled to purchase in whole (but not in part) from CENTERBROOK
HOLDINGS LLC, a Delaware limited liability company (together with any successor
thereto, the "ISSUER"), at any time during the Exercise Period (as defined
below), a number of Units (as defined in the Unitholder and Warrant Agreement
referenced below) in an amount equal to the Unit Exercisable Amount (as defined
in said Unitholder and Warrant Agreement) for such Holder immediately prior to
the beginning of the Exercise Period at a purchase price equal to the Exercise
Price (as defined in said Unitholder and Warrant Agreement) for such Unit
Exercisable Amount, subject to the terms and conditions hereinbelow provided.
This Warrant is one of the Warrants originally issued pursuant to the
Unitholder and Warrant Agreement dated as of June 28, 2006 among the Issuer,
IXIS Financial Products Inc. and Charter Mac Corporation (as amended, supplement
and otherwise modified and in effect from time to time, the "UNITHOLDER AND
WARRANT AGREEMENT").
SECTION 1. CERTAIN DEFINITIONS. Each capitalized term used herein
without definition shall have the meaning assigned thereto (or incorporated by
reference) in the Unitholder and Warrant Agreement (as hereinafter defined). The
provisions of Section 1.03 of the Unitholder and Warrant Agreement shall also
apply to this Warrant. As used herein, the following terms shall have the
following meanings:
"ADDITIONAL UNITS" shall mean all Units issued or sold by the Issuer
on or after the date hereof, other than Excluded Securities.
"CURRENT MARKET PRICE", per any Unit, for the purposes of any
provision of this Warrant at the date herein specified, shall be deemed to be
the fair market value per such Unit, as reasonably determined by the Board, or
if there shall be a public market for Units, the average of the daily market
prices for each day during the 30 consecutive trading days commencing 45
Business Days before such date as of which such a price can be established in
the manner set forth below. The market price for each such Business Day shall be
the last sale price on such day as reported in the Consolidated Last Sale
Reporting System or as quoted in the National Association of Securities Dealers
Automated Quotation System, or if such last sale price is not available, the
average of the closing bid and asked prices as reported in either such system,
or in any other case the higher bid price quoted for such day as reported by The
Wall Street Journal and the National Quotation Bureau pink sheets.
"EXCLUDED SECURITIES" shall mean (a) the shares or Units issued in an
issuance in respect of which the Holder has exercised preemptive rights pursuant
to Section 8.05 of the Unitholder and Warrant Agreement, (b) the Units issued
and outstanding on the date hereof as described in Section 3.07 of the
Unitholder and Warrant Agreement and (c) the Units issued upon exercise of the
Warrants.
"EXERCISE NOTICE" shall have the meaning assigned to such term in
Section 2 hereof.
"HOLDER" shall mean the registered holder of this Warrant.
"ISSUER" shall have the meaning assigned to such term in the first
paragraph of this Warrant.
"WARRANT HOLDER" shall mean any Person who acquires Warrants or
Warrant Units pursuant to the provisions of the Unitholder and Warrant
Agreement, including any transferees of Warrants or Warrant Units.
SECTION 2. EXERCISE OF WARRANT. At any time during the Exercise
Period, the Holder may exercise this Warrant, on one occasion, on any Business
Day, in whole (but not in part), by delivering to the Issuer, at its office
maintained for such purpose pursuant to Section 9.01 hereof, (i) a written
notice substantially in the form of Annex 1 hereto (the "EXERCISE NOTICE") of
the Holder's election to exercise this Warrant, which notice shall specify the
number of Units to be purchased (which shall be in an amount equal to the Unit
Exercisable Amount for such Holder immediately prior to the beginning of the
Exercise Period) and the Exercise Price thereof and (ii) a certified or bank
check or checks payable to the Issuer in an aggregate amount equal to such
Exercise Price. Upon receipt of an Exercise Notice, the Issuer shall, as
promptly as practicable and in any event within 5 Business Days thereafter,
issue the aggregate number of Units and other securities issuable upon such
exercise and any other property to which such Holder is entitled.
The Warrant Units so issued shall be in such denominations as may be
specified in the Exercise Notice and shall be registered in the name of the
Holder or such other name or names as shall be designated in such Exercise
Notice. Such Warrant Units shall be deemed to have been issued and the Holder or
any other Person so designated to be named therein shall be deemed to have
become a holder of record of such Units, including, to the extent permitted by
law, the right to vote such Units or to consent or to receive notice as a
Unitholder, as of the date on which the later of the Exercise Notice and the
payment of the Exercise Price is received by the Issuer as aforesaid, and all
taxes required to be paid by the Holder, if any, pursuant to Section 7 hereof,
prior to the issuance of such Units have been paid.
All Units issuable upon the exercise of this Warrant shall be duly and
validly issued, fully paid and nonassessable and free and clear of any Liens.
The Issuer shall not be required to issue a fractional Unit upon
exercise of this Warrant. As to any fraction of a Unit which the Holder would
otherwise be entitled to purchase upon such exercise, the Issuer shall pay a
cash adjustment in respect of such final fraction in an amount equal to the same
fraction of the Current Market Price per Unit on the date of exercise.
SECTION 3. TRANSFER, DIVISION AND COMBINATION. Subject to Section 9.03
hereof, transfer of this Warrant and all rights hereunder, in whole or in part,
shall be registered on the books of the Issuer to be maintained for such
purpose, upon presentment of this Warrant at the office of the Issuer maintained
for such purpose pursuant to Section 9.01 hereof, together with a written
assignment of this Warrant duly executed by the Holder or its agent or attorney
and payment of funds sufficient to pay any transfer taxes payable upon the
making of such transfer. Upon such presentment and, if required, such payment,
the Issuer shall, subject to Section 9.03 hereof and the immediately following
sentence, (a) execute and deliver a new Warrant in the name of the assignee or
assignees specified in such instrument of assignment, (b) register such transfer
on its books and (c) if such assignment was an assignment in whole, promptly
cancel this Warrant. This Warrant, if properly assigned in compliance with this
Section 3 and Section 9.03 hereof, may be exercised by an assignee for the
purchase of Units without having a new Warrant or Warrants issued.
Notwithstanding any provision herein to the contrary, the Issuer shall not be
required to register the transfer of Warrants or Warrant Units in the name of
any Person who acquired this Warrant (or part hereof) or any Warrant Units
otherwise than in accordance with this Warrant and the Unitholder and Warrant
Agreement. The Issuer shall maintain at its aforesaid office books for the
registration and transfer of the Warrants.
2
SECTION 4. ADJUSTMENT OF UNITS. The Issuer shall not take any action
with respect to its Units of any class without at the same time taking like
action with respect to its Units of each other class. In case a consolidation,
merger or share or unit exchange of the Issuer shall be effected with another
Person on or after the date hereof, or the sale, lease or transfer of all or a
majority of its assets to another Person shall be effected on or after the date
hereof, then, as a condition of such consolidation, merger, share or unit
exchange, sale, lease or transfer, lawful and adequate provision shall be made
whereby the Holder shall thereafter have the right to purchase and receive upon
the basis and upon the terms and conditions specified herein and in lieu of each
Unit immediately theretofore purchasable and receivable upon the exercise of
each of the Warrants, such units, shares of stock or other equity interests,
securities, cash or other property receivable upon such consolidation, merger,
share or unit exchange, sale, lease or transfer by the holder of the number of
Units for which this Warrant is exercisable immediately prior to such event. In
any such case, appropriate and equitable provision also shall be made with
respect to the rights and interests of the Holder to the end that the provisions
hereof and of the Unitholder and Warrant Agreement and the Registration Rights
Agreement shall thereafter be applicable, as nearly as may be, in relation to
any Units, securities, cash or other property thereafter deliverable upon the
exercise of any Warrants. The Issuer shall not effect any such consolidation,
merger, share or unit exchange, sale, lease or transfer unless prior to or
simultaneously with the consummation thereof the successor Person (if other than
the Issuer) resulting from such consolidation, merger or share or unit exchange
or the Person purchasing, leasing or otherwise acquiring such assets shall
assume, by written instrument mailed to the Holder at its last address appearing
on the books of the Issuer, the obligation to deliver to the Holder such units,
shares of stock, securities, cash or other property as, in accordance with the
foregoing provisions, the Holder may be entitled to purchase. The above
provisions of this Section 4 shall similarly apply to successive consolidations,
mergers, share or unit exchanges, sales, leases or transfers.
SECTION 5. RESERVATION AND AUTHORIZATION OF UNITS. The Issuer shall at
all times reserve and keep available for issue upon the exercise or conversion
of Warrants such number of its authorized but unissued Units and of such classes
as will be sufficient to permit the exercise in full of all outstanding
Warrants. All Units which shall be so issuable, when issued upon exercise of any
Warrant and payment of the applicable Exercise Price therefor in accordance with
the terms of this Warrant, shall be duly and validly issued, fully paid and
nonassessable and free and clear of any Liens.
Before taking any action which would result in an adjustment in the
number of Units for which this Warrant is exercisable, the Issuer shall (i) take
any corporate action which is necessary in order that the Issuer may validly and
legally issue fully paid and nonassessable Units free and clear of any Liens
upon the exercise of all the Warrants immediately after the taking of such
action and (ii) obtain all such authorizations or exemptions thereof, or
consents thereto, as may be necessary from any public regulatory body or bodies
having jurisdiction thereof.
SECTION 6. TAKING OF RECORD; UNIT AND WARRANT TRANSFER BOOKS. The
Issuer shall not at any time, except upon complete dissolution, liquidation or
winding up, close its Unit transfer books or Warrant transfer books so as to
result in preventing or delaying the exercise, conversion or transfer of any
Warrant, unless otherwise required by any applicable federal, state or local
law.
SECTION 7. EXPENSES, TRANSFER TAXES AND OTHER CHARGES. The Issuer
shall pay any and all expenses, transfer taxes and other charges, including all
costs associated with the preparation, issue and delivery of unit or warrant
certificates, that are incurred in respect of the issuance or delivery of Units
upon exercise or conversion of this Warrant pursuant to Section 2 hereof, or in
connection with any transfer, division or combination of Warrants pursuant to
Section 3 or 4 hereof. The Issuer shall not, however, be required to pay any tax
which may be payable in respect of any transfer involved in the issue and
delivery of Units in a name other than that in which this Warrant is registered,
and no such issue or delivery shall be made unless and until the Person
requesting such issue has paid to the Issuer the amount of any such tax, or has
established, to the satisfaction of the Issuer, that such tax has been paid.
SECTION 8. NO VOTING RIGHTS. Prior to the exercise of this Warrant, no
Holder shall be entitled to any voting or other rights as a member of the Issuer
except as expressly provided in this Warrant or in the Operating Agreement.
SECTION 9. MISCELLANEOUS.
9.01 OFFICE OF ISSUER. So long as any of the Warrants remains
outstanding, the Issuer shall maintain an office in the continental United
States of America where the Warrants may be presented for exercise, transfer,
division or combination as in this Warrant provided. Such office shall be such
office as the Issuer shall designate and maintain for such purposes and give
notice thereof to all Warrant Holders.
9.02 NOTICES GENERALLY. Any notices and other communications pursuant
to the provisions hereof shall be sent in accordance with Section 10.03 of the
Unitholder and Warrant Agreement.
9.03 RESTRICTIONS ON TRANSFERABILITY. The Warrants and the Warrant
Units shall be transferable only upon compliance with the conditions specified
in Section 3 of the Unitholder and Warrant Agreement , the Registration Rights
Agreement and Article 11 of the Operating Agreement, which conditions are
intended to ensure compliance with the provisions of the Securities Act in
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respect of the transfer of any Warrant or any Warrant Units, and any Holder
shall be bound by the provisions of (and entitled to the benefits of) Section 3
of the Unitholder and Warrant Agreement , the Registration Rights Agreement and
Article 11 of the Operating Agreement.
9.04 GOVERNING LAW. This Warrant shall be governed by, and construed
in accordance with, the law of the State of New York without giving effect to
the conflicts of law principles thereof, except to the extent that New York
conflicts of laws principles would apply the Delaware Limited Liability Company
Act to matters relating to limited liability companies organized thereunder.
9.05 LIMITATION OF LIABILITY. No provision hereof, in the absence of
affirmative action by the Holder to purchase Units, and no mere enumeration
herein of the rights or privileges of the Holder, shall give rise to any
liability of the Holder for the Exercise Price or as a Unitholder of the Issuer,
whether such liability is asserted by the Issuer, by any creditor of the Issuer
or any other Person.
9.06 VALUE DETERMINATIONS BY THE BOARD, ETC. Whenever the Board
determines fair market value or Current Market Price pursuant to this Warrant or
the Unitholder and Warrant Agreement, any such determination or opinion shall be
made by the Board in good faith and in a commercially reasonable manner.
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IN WITNESS WHEREOF, the Issuer has duly executed this Warrant as of
the date first above written.
CENTERBROOK HOLDINGS LLC
By:______________________________
Name:
Title:
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Annex 1
to
Warrant
FORM OF EXERCISE
----------------
(To be executed by the registered holder hereof)
The undersigned registered owner of this Warrant irrevocably exercises
this Warrant for the purchase of Units of CENTERBROOK HOLDINGS LLC, a Delaware
limited liability company, and herewith makes payment therefor, all at the price
and on the terms and conditions specified in this Warrant and set forth below,
and requests that such Units be issued in accordance with the instructions given
below.
Dated: ________ __, 20__
--------------------------------
(Signature of Registered Holder)
Exercise Price: _______________
Unit Exercisable Amount: ________________
Instructions for issuance and registration of Units:
-------------------------------
Name of Registered Holder
(please print)
Social Security or Other Identifying
Number: _________________________
Please deliver evidence of the issuance to the following address:
------------------------------------
Xxxxxx
------------------------------------
Xxxx, Xxxxx and Zip Code
Exhibit B to
Unitholder and Warrant Agreement
[Form of Registration Rights Agreement]
REGISTRATION RIGHTS AGREEMENT dated as of [________ __], 2006 between
CENTERBROOK HOLDINGS LLC, a Delaware limited liability company (the "ISSUER")
and IXIS FINANCIAL PRODUCTS INC. (the "INVESTOR"). Capitalized terms not
otherwise defined herein have the meanings set forth in Section 1 hereof.
WHEREAS, the Issuer, the Investor and Charter Mac Corporation are
parties to a Unitholder and Warrant Agreement dated as of even date herewith (as
amended, supplement and otherwise modified and in effect from time to time, the
"UNITHOLDER AND WARRANT AGREEMENT"), providing for the issuance by the Issuer of
Warrants (as defined in the Unitholder and Warrant Agreement) which entitle the
Investor to purchase, from and after the date of its issuance, from the Issuer
at any time on or prior to the date specified in Unitholder and Warrant
Agreement, Units (as therein defined) of the Issuer;
WHEREAS, the Investor and Charter Mac Corporation are parties to the
Amended and Restated Operating Agreement of the Issuer, dated as of the date
hereof (the "OPERATING AGREEMENT"); and
WHEREAS, in order to induce the Investor to purchase the Warrants and
to enter into the Operating Agreement, and as a condition precedent to such
actions, the Investor requires that the Issuer enter into this Agreement
simultaneously with the Investor's execution of the Unitholder and Warrant
Agreement and the Operating Agreement;
NOW, THEREFORE, in consideration of the mutual covenants and
agreements set forth in this Agreement, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:
SECTION 1. DEFINITIONSSECTION 1. DEFINITIONSSECTION 1. DEFINITIONS.
Each capitalized term used herein without definition shall have the meaning
assigned thereto (or incorporated by reference) in the Unitholder and Warrant
Agreement. The provisions of Section 1.03 of the Unitholder and Warrant
Agreement shall also apply to this Agreement. As used herein, the following
terms shall have the following meanings:
"CUTBACK REGISTRATION" shall mean any Piggyback Registration to be
effected as an underwritten Public Offering in which the Managing Underwriter
with respect thereto advises the Issuer and the Requesting Holders in writing
that, in its opinion, the number of securities requested to be included in such
registration (including securities of the Issuer which are not Registrable
Securities) exceed the number which can be sold in such offering without a
material reduction in the selling price anticipated to be received for the
securities to be sold in such Public Offering.
"FORM S-2" shall mean Form S-2 promulgated by the Commission under the
Securities Act, or any successor or similar short-form registration statement.
"FORM S-3" shall mean Form S-3 promulgated by the Commission under the
Securities Act, or any successor or similar short-form registration statement.
"INDEMNIFIED PARTY" shall mean a party entitled to indemnity in
accordance with Section 6 hereof.
"INDEMNIFYING PARTY" shall mean a party obligated to provide indemnity
in accordance with Section 6 hereof.
"INSPECTORS" shall have the meaning assigned to such term in Section
3(i) hereof.
"INVESTOR" shall have the meaning assigned to such term in the
preamble of this Agreement.
"ISSUER" shall have the meaning assigned to such term in the preamble
of this Agreement.
"LOSSES" shall have the meaning assigned to such term in Section 6.01
hereof.
"MANAGING UNDERWRITER" shall mean, with respect to any Public
Offering, the underwriter or underwriters managing such Public Offering.
"NASD" shall mean the National Association of Securities Dealers.
"NOTICE OF PIGGYBACK REGISTRATION" shall have the meaning assigned to
such term in Section 2.01 hereof.
"PIGGYBACK REGISTRATION" shall mean any registration of Units or other
equity securities of the Issuer under the Securities Act (other than a
registration in respect of a distribution reinvestment or similar plan for
unitholders of the Issuer or on Form S-4 or Form S-8 promulgated by the
Commission, or any successor or similar forms thereto), whether for sale for the
account of the Issuer or for the account of any holder of Units of the Issuer
(other than Registrable Securities).
"PUBLIC OFFERING" shall mean any offering of Units to the public,
either on behalf of the Issuer or any of its Unitholders, pursuant to an
effective registration statement under the Securities Act.
"REGISTRABLE SECURITIES" shall mean (a) Units and (b) Units issued or
issuable upon exercise of the Warrants. As to any particular Registrable
Securities, once issued such Units shall cease to be Registrable Securities when
(i) a registration statement with respect to the sale of such Units shall have
become effective under the Securities Act and such Units shall have been
disposed of in accordance with such registration statement, (ii) such Units
shall have been distributed to the public pursuant to Rule 144, or (iii) such
Units shall have ceased to be outstanding. Units beneficially owned by the
Issuer or any Affiliate (other than an institutional investor) shall not be
deemed Registrable Securities.
"REGISTRATION EXPENSES" shall mean all expenses incident to the
Issuer's performance of or compliance with its obligations under this Agreement
to effect the registration of Registrable Securities in a Piggyback
Registration, including all registration, filing, securities exchange listing
and NASD fees, all registration, filing, qualification and other fees and
expenses of complying with securities or blue sky laws, all word processing,
duplicating and printing expenses, messenger and delivery expenses, the fees and
disbursements of counsel for the Issuer and of its independent public
accountants, including the expenses of any special audits or "cold comfort"
letters required by or incident to such performance and compliance, the
reasonable fees and disbursements of counsel retained by the holders of a
majority of the Registrable Securities being registered, premiums and other
costs of policies of insurance against liabilities arising out of the Public
Offering of the Registrable Securities being registered and any fees and
disbursements of underwriters customarily paid by issuers or sellers of
securities, but excluding underwriting discounts and commissions and transfer
taxes, if any, in respect of Registrable Securities, which shall be payable by
each holder thereof.
"REQUESTING HOLDERS" shall mean, with respect to any Piggyback
Registration, the holders of Registrable Securities requesting to have
Registrable Securities included in such registration in accordance with this
Agreement.
"SHORT-FORM REGISTRATION" shall mean a Piggyback Registration effected
by the filing of a registration statement on Form S-2 or Form S-3 with the
Commission.
"UNITHOLDER AND WARRANT AGREEMENT" shall have the meaning assigned in
the preamble of this Agreement.
SECTION 2. PIGGYBACK REGISTRATIONSSECTION 3. Piggyback
RegistrationsSECTION 3. Piggyback Registrations.
2.01 RIGHT TO INCLUDE REGISTRABLE SECURITIES3.01 RIGHT TO INCLUDE
REGISTRABLE Securities3.01 RIGHT TO INCLUDE REGISTRABLE SECURITIES. If the
Issuer at any time proposes after the date hereof to effect a Piggyback
Registration, it will each such time give prompt written notice (a "NOTICE OF
PIGGYBACK REGISTRATION") at least 30 days (or 20 days in the case of a
Short-Form Registration) prior to the anticipated filing date to all holders of
Registrable Securities of its intention to do so and of such holders' rights
under this Section 2, which Notice of Piggyback Registration shall include a
description of the intended method of disposition of such Units. Upon the
written request of any such holder made within 30 days (or 20 days in the case
of a Short-Form Registration) after receipt of a Notice of Piggyback
Registration (which request shall specify the Registrable Securities intended to
be disposed of by such holder and the intended method of disposition thereof),
the Issuer will use its best efforts to include in the registration statement
relating to such Piggyback Registration all Registrable Securities which the
Issuer has been so requested to register. Notwithstanding the foregoing, if, at
any time after giving a Notice of Piggyback Registration and prior to the
effective date of the registration statement filed in connection with such
registration, the Issuer shall determine for any reason not to register or to
delay registration of such Units, the Issuer may, at its election, give written
notice of such determination to each holder of Registrable Securities and,
thereupon, (i) in the case of a determination not to register, shall be relieved
of its obligation to register any Registrable Securities in connection with such
registration (but not from its obligation to pay the Registration Expenses in
connection therewith), and (ii) in the case of a determination to delay
registering, shall be permitted to delay registering any Registrable Securities
for the same period as the delay in registering such other Units.
2.02 REGISTRATION STATEMENT FORM2.03 REGISTRATION STATEMENT FORM2.03
REGISTRATION STATEMENT FORM. Piggyback Registrations shall be on such
appropriate registration form promulgated by the Commission as shall be selected
by the Issuer.
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2.03 REGISTRATION EXPENSES3.02 REGISTRATION EXPENSES3.02 REGISTRATION
EXPENSES. The Issuer will pay all Registration Expenses incurred in connection
with each Piggyback Registration.
2.04 PRIORITY IN CUTBACK REGISTRATIONS3.03 PRIORITY IN CUTBACK
REGISTRATIONS3.03 PRIORITY IN CUTBACK REGISTRATIONS. If a Piggyback Registration
becomes a Cutback Registration, the Issuer will include in such registration to
the extent of the amount of the Units which the Managing Underwriter advises the
Issuer can be sold in such offering:
(a) if such registration involves a primary offering of the Issuer's
Units, (i) FIRST, the Units proposed by the Issuer to be sold for its own
account, and (ii) SECOND, other Units of the Issuer proposed to be included
in such registration by the Requesting Holders and any Person who is a
party to a registration rights agreement referred to in Section 8.02
hereof, allocated among the holders thereof PRO RATA on the basis of the
number of Units requested to be included by such holders; and
(b) if such registration does not involve a primary offering of the
Issuer's Units, all Units requested to be included in such registration by
the Requesting Holders and any Person who is a party to a registration
rights agreement referred to in Section 8.02 hereof, PRO RATA on the basis
of the number of Units requested to be included by such holders;
and any Units so excluded shall be withdrawn from and shall not be included in
such Piggyback Registration.
SECTION 3. REGISTRATION PROCEDURES. If and whenever the Issuer is
required to include any Registrable Securities under the Securities Act pursuant
to Section 2 hereof, the Issuer will use its best efforts to effect the
registration and sale of such Registrable Securities in accordance with the
intended methods of disposition thereof specified by the Requesting Holders in a
manner consistent with such proposed offering. Without limiting the foregoing,
the Issuer in each such case will, as expeditiously as possible:
(a) prepare and file with the Commission the requisite registration
statement (and any amendments, supplements and prospectuses with respect
thereto) to effect such registration, PROVIDED that as far in advance as
practical before filing such registration statement or any amendment or
supplement thereto, the Issuer will furnish to the Requesting Holders
copies of reasonably complete drafts of all such documents proposed to be
filed (including exhibits), and any such holder shall have the opportunity
to object to any information pertaining solely to such holder and its plan
of distribution that is contained therein and the Issuer will make the
corrections reasonably requested by such holder with respect to such
information prior to filing any such registration statement or amendment;
(b) comply with the provisions of the Securities Act with respect to
the disposition of all Registrable Securities covered by such registration
statement, in accordance with the intended methods of disposition thereof,
until the earlier of (i) such time as all of such Units have been disposed
of in accordance with the intended methods of disposition by the seller or
sellers thereof set forth in such registration statement and (ii) 270 days
after such registration statement becomes effective;
(c) promptly notify each Requesting Holder and the relevant
underwriter or underwriters, if any:
(i) when such registration statement or any prospectus used in
connection therewith, or any amendment or supplement thereto, has been
filed and, with respect to such registration statement or any
posteffective amendment thereto, when the same has become effective;
(ii) of any written request by the Commission for amendments or
supplements to such registration statement or prospectus;
(iii) of the notification to the Issuer by the Commission of its
initiation of any proceeding with respect to the issuance by the
Commission of, or of the issuance by the Commission of, any stop order
suspending the effectiveness of such registration statement (and the
Issuer shall promptly attempt to have such order withdrawn); and
(iv) of the receipt by the Issuer of any notification with
respect to the suspension of the qualification of any Registrable
Securities for sale under the applicable securities or blue sky laws
of any jurisdiction;
(d) furnish to each seller of Registrable Securities covered by such
registration statement such number of conformed copies of such registration
statement and of each amendment and supplement thereto (in each case
including all exhibits and documents incorporated by reference), such
number of copies of the prospectus contained in such registration statement
(including each preliminary prospectus and any summary prospectus) and any
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other prospectus filed under Rule 424 promulgated under the Securities Act
relating to such holder's Registrable Securities, and such other documents,
as such seller may reasonably request to facilitate the disposition of its
Registrable Securities;
(e) use its best efforts to register or qualify all Registrable
Securities covered by such registration statement under such other
securities or blue sky laws of such jurisdictions as each holder thereof
shall reasonably request, to keep such registration or a qualification in
effect for so long as such registration statement remains in effect, and
take any other action which may be reasonably necessary or advisable to
enable such holder to consummate the disposition in such jurisdictions of
the Registrable Securities owned by such holder, except that the Issuer
shall not for any such purpose be required (i) to qualify generally to do
business as a foreign corporation in any jurisdiction wherein it would not
but for the requirements of this paragraph (e) be obligated to be so
qualified, (ii) to subject itself to taxation in any such jurisdiction or
(iii) to consent to general service of process in any jurisdiction;
(f) furnish to each Requesting Holder a signed counterpart, addressed
to such holder (and the underwriters, if any), of
(i) an opinion of counsel for the Issuer, dated the effective
date of such registration statement (or, if such registration includes
an underwritten Public Offering, dated the date of any closing under
the underwriting agreement), customary for transactions of this type
and reasonably satisfactory in form and substance to such holder, and
(ii) a "comfort" letter, dated the effective date of such
registration statement (and, if such registration includes an
underwritten Public Offering, dated the date of any closing under the
underwriting agreement), signed by the independent public accountants
who have certified the Issuer's financial statements included in such
registration statement, in each case covering substantially the same
matters with respect to such registration statement (and the
prospectus included therein) and, in the case of the accountants'
letter, with respect to events subsequent to the date of such
financial statements, as are customarily covered in opinions of
issuer's counsel and in accountants' letters delivered to the
underwriters in underwritten Public Offerings of securities and, in
the case of the accountants' letter, such other financial matters, as
such holder (or the underwriters, if any) may reasonably request,
which letter may be limited to the extent required under the
accounting guidelines and policies of such independent public
accounts;
(g) notify each holder of Registrable Securities covered by such
registration statement, at any time when a prospectus relating thereto is
required to be delivered under the Securities Act, of the happening of any
event as a result of which any prospectus included in such registration
statement, as then in effect, includes an untrue statement of a material
fact or omits to state any material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, and at the request of any such
holder promptly prepare and furnish to such holder a reasonable number of
copies of a supplement to or an amendment of such prospectus as may be
necessary so that, as thereafter delivered to the purchasers of such
securities, such prospectus shall not include 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, in the light of the
circumstances under which they were made, not misleading;
(h) otherwise use its best efforts to comply with all applicable rules
and regulations of the Commission, and make available to its Unitholders,
as soon as reasonably practicable, an earnings statement covering the
period of at least 12 months, but not more than 18 months, beginning with
the first full calendar month after the effective date of such registration
statement, which earnings statement shall satisfy the provisions of Section
11(a) of the Securities Act and Rule 158 promulgated thereunder;
(i) make available for inspection by any Requesting Holder, any
underwriter participating in any disposition pursuant to such registration
statement and any attorney, accountant or other agent retained by any such
seller or underwriter (collectively, the "INSPECTORS"), all financial and
other records, pertinent corporate documents and properties of the Issuer
as shall be reasonably necessary to enable them to exercise any due
diligence responsibility, and cause the Issuer's officers, managers,
directors and employees to supply all information reasonably requested by
any such Inspector in connection with such registration statement, and
permit the Inspectors to participate in the preparation of such
registration statement and any prospectus contained therein and any
amendment or supplement thereto;
(j) use its best efforts to cause all Registrable Securities covered
by such registration statement to be listed, upon official notice of
issuance, on any securities exchange on which any of the Units of the same
class as the Registrable Securities are then listed.
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The Issuer may require each holder of Registrable Securities as to
which any registration is being effected to, and each such holder, as a
condition to including Registrable Securities in such registration, shall,
furnish the Issuer with such information regarding such holder and the
distribution of such Units as the Issuer may from time to time reasonably
request in writing in connection with such registration; PROVIDED that the
Issuer will not file any registration statement under the Securities Act which
refers to any holder of any Registrable Securities by name or otherwise as the
holder of any Units of the Issuer, unless it shall first have given to such
holder the right to require (a) the insertion therein of language, in form and
substance satisfactory to such holder, to the effect that the holding by such
holder of such Units does not make such holder a "controlling person" of the
Issuer within the meaning of the Securities Act and is not to be construed as a
recommendation by such holder of the investment quality of the Issuer's debt or
equity securities or Units covered thereby and that such holding does not imply
that such holder will assist in meeting any future financial requirements of the
Issuer, or (b) in the event that such reference to such holder by name or
otherwise is not required by the Securities Act or any rules and regulations
promulgated thereunder, the deletion of the reference to such holder.
Each holder of Registrable Securities agrees by acquisition of such
Registrable Securities that upon receipt of any notice from the Issuer of the
happening of any event of the kind described in paragraph (i) above, such holder
will forthwith discontinue such holder's disposition of Registrable Securities
pursuant to the registration statement relating to such Registrable Securities
until such holder's receipt of the copies of the supplemented or amended
prospectus contemplated by said paragraph (i) and, if so directed by the Issuer,
will deliver to the Issuer (at the Issuer's expense) all copies, other than
permanent file copies, then in such holder's possession of the prospectus
relating to such Registrable Securities current at the time of receipt of such
notice. In the event the Issuer shall give any such notice, the period referred
to in paragraph (b) above shall be extended by a number of days equal to the
number of days during the period from and including the giving of notice
pursuant to said paragraph (i) and to and including the date when each holder of
any Registrable Securities covered by such registration statement shall receive
the copies of the supplemented or amended prospectus contemplated by said
paragraph (i).
SECTION 4. UNDERWRITTEN PIGGYBACK OFFERINGS. If the Issuer at any time
proposes to register any of its securities in a Piggyback Registration and such
securities are to be distributed by or through one or more underwriters, the
Issuer will use its best efforts to arrange for such underwriters to include the
Registrable Securities to be offered and sold by Requesting Holders among the
securities to be distributed by such underwriters, and such holders shall be
obligated to sell their Registrable Securities in such Piggyback Registration
through such underwriters on the same terms and conditions as apply to the other
Units to be sold by such underwriters in connection with such Piggyback
Registration. The holders of Registrable Securities to be distributed by such
underwriters shall be parties to the underwriting agreement between the Issuer
and such underwriter or underwriters and may, at their option, require that any
or all of the representations and warranties by, and the other agreements on the
part of, the Issuer to and for the benefit of such underwriters also be made to
and for their benefit. No holder of Registrable Securities shall be required to
make any representations or warranties to or agreements with the Issuer or the
underwriters other than representations, warranties or agreements regarding such
holder and its ownership of the securities being registered on its behalf and
such holder's intended method of distribution and any other representation
required by law. No Requesting Holder may participate in such underwritten
offering unless such holder agrees to sell its Registrable Securities on the
basis provided in such underwriting agreement and completes and executes all
questionnaires, powers of attorney, indemnities and other documents reasonably
required under the terms of such underwriting agreement. If any Requesting
Holder disapproves of the terms of an underwriting, such holder may elect to
withdraw therefrom and from such registration by notice to the Issuer and the
Managing Underwriter, and each of the remaining Requesting Holders shall be
entitled to increase the number of Registrable Securities being registered to
the extent of the Registrable Securities so withdrawn in the proportion which
the number of Registrable Securities being registered by such remaining
Requesting Holder bears to the total number of Registrable Securities being
registered by all such remaining Requesting Holders.
SECTION 5. HOLDBACK AGREEMENTS BY ISSUER AND OTHER UNITHOLDERS. Unless
the Managing Underwriter otherwise agrees, the Issuer and each holder of
Registrable Securities agrees not to effect any public sale or distribution of
its Units, or any securities convertible into or exchangeable or exercisable for
such Units, during the 14 days prior to and the 180 days after the effective
date of the registration statement filed in connection with an underwritten
offering made pursuant to a Piggyback Registration (or for such shorter period
of time as is sufficient and appropriate, in the opinion of the Managing
Underwriter, in order to complete the sale and distribution of the Units
included in such registration), except as part of such underwritten registration
and except pursuant to registrations on Form S-4 or Form S-8 promulgated by the
Commission or any successor or similar forms thereto. The Issuer also agrees,
unless the Managing Underwriter otherwise agrees, to cause each Unitholder which
is a party to a registration rights agreement with the Issuer entered into on or
after the date hereof, and each holder of its Units, or of any securities
convertible into or exchangeable or exercisable for such Units, in each case
purchased from the Issuer, at any time after the date of this Agreement (other
than in a Public Offering), to agree, to the extent permitted by law, not to
effect any such public sale or distribution of such Units (including a sale
under Rule 144), during such period, except as part of such underwritten
registration.
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SECTION 6. INDEMNIFICATION
6.01 INDEMNIFICATION BY ISSUER. The Issuer shall, to the full extent
permitted by law, indemnify and hold harmless each seller of Registrable
Securities included in any registration statement filed in connection with a
Piggyback Registration, its managers and officers, and each other Person, if
any, who controls any such seller within the meaning of the Securities Act,
against any losses, claims, damages, expenses or liabilities, joint or several
(together, "Losses"), to which such seller or any such manager or officer or
controlling Person may become subject under the Securities Act or otherwise,
insofar as such Losses (or actions or proceedings, whether commenced or
threatened, in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact contained in any such
registration statement, any preliminary prospectus, final prospectus or summary
prospectus contained therein, or any amendment or supplement thereto, or any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein (in the case of a
prospectus, in the light of the circumstances under which they were made) not
misleading, and the Issuer will reimburse such seller and each such manager,
officer and controlling Person for any legal or any other expenses reasonably
incurred by them in connection with investigating or defending any such Loss (or
action or proceeding in respect thereof), PROVIDED that the Issuer shall not be
liable in any such case to the extent that any such Loss (or action or
proceeding in respect thereof) arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission made in
any such registration statement, preliminary prospectus, final prospectus,
summary prospectus, amendment or supplement in reliance upon and in conformity
with written information furnished to the Issuer through an instrument duly
executed by such seller specifically stating that it is for use in the
preparation thereof. Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of such seller or any such
manager, officer or controlling Person, and shall survive the transfer of such
Units by such seller. The Issuer shall also indemnify each other Person who
participates (including as an underwriter) in the offering or sale of
Registrable Securities, their officers and managers and each other Person, if
any, who controls any such participating Person within the meaning of the
Securities Act to the same extent as provided above with respect to sellers of
Registrable Securities.
6.02 INDEMNIFICATION BY THE SELLERS. Each holder of Registrable
Securities which are included or are to be included in any registration
statement filed in connection with a Piggyback Registration, as a condition to
including Registrable Securities in such registration statement, shall, to the
full extent permitted by law, indemnify and hold harmless the Issuer, its
managers and officers, and each other Person, if any, who controls the Issuer
within the meaning of the Securities Act, against any Losses to which the Issuer
or any such manager or officer or controlling Person may become subject under
the Securities Act or otherwise, insofar as such Losses (or actions or
proceedings, whether commenced or threatened, in respect thereof) arise out of
or are based upon any untrue statement or alleged untrue statement of any
material fact contained in any such registration statement, any preliminary
prospectus, final prospectus or summary prospectus contained therein, or any
amendment or supplement thereto, or any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein (in the case of a prospectus, in the light of the
circumstances under which they were made) not misleading, if such untrue
statement or alleged untrue statement or omission or alleged omission was made
in reliance upon and in conformity with written information furnished to the
Issuer through an instrument duly executed by such seller specifically stating
that it is for use in the preparation of such registration statement,
preliminary prospectus, final prospectus, summary prospectus, amendment or
supplement; PROVIDED that the obligation to provide indemnification pursuant to
this Section 6.02 shall be several, and not joint and several, among such
Indemnifying Parties and the aggregate amount which may be recovered from any
holder of Registrable Securities pursuant to the indemnification provided for in
this Section 6.02 in connection with any registration and sale of Registrable
Securities shall be limited to the total proceeds received by such holder from
the sale of such Registrable Securities. Such indemnity shall remain in full
force and effect regardless of any investigation made by or on behalf of the
Issuer or any such manager, officer or controlling Person and shall survive the
transfer of such securities by such seller. Such holders shall also indemnify
each other Person who participates (including as an underwriter) in the offering
or sale of Registrable Securities, their officers and managers and each other
Person, if any, who controls any such participating Person within the meaning of
the Securities Act to the same extent as provided above with respect to the
Issuer.
6.03 NOTICES OF CLAIMS, ETC. Promptly after receipt by an Indemnified
Party of notice of the commencement of any action or proceeding involving a
claim referred to in Section 6.01 or 6.02 hereof, such Indemnified Party will,
if a claim in respect thereof is to be made against an Indemnifying Party
pursuant to such paragraphs, give written notice to the latter of the
commencement of such action, PROVIDED that the failure of any Indemnified Party
to give notice as provided herein shall not relieve the Indemnifying Party of
its obligations under the preceding paragraphs of this Section 6. In case any
such action is brought against an Indemnified Party, the Indemnifying Party
shall be entitled to participate in and, unless, in the reasonable judgment of
any Indemnified Party, a conflict of interest between such Indemnified Party and
any Indemnifying Party exists or such Indemnified Party has additional defenses
available to it with respect to such claim, to assume the defense thereof,
jointly with any other Indemnifying Party similarly notified to the extent that
it may wish, with counsel reasonably satisfactory to such Indemnified Party, and
after notice from the Indemnifying Party to such Indemnified Party of its
election so to assume the defense thereof, the Indemnifying Party shall not be
liable to such Indemnified Party for any legal or other expenses subsequently
incurred by the latter in connection with the defense thereof other than
reasonable costs of investigation; PROVIDED that (i) the Indemnified Party may
participate in such defense at the Indemnified Party's expense, and (ii) the
Indemnified Party or Indemnified Parties shall have the right to employ one
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counsel to represent it or them if, in the reasonable judgment of the
Indemnified Party or Indemnified Parties, it is advisable for it or them to be
represented by separate counsel by reason of having legal defenses which are
different from or in addition to those available to the Indemnifying Party, and
in that event the reasonable fees and expenses of such one counsel shall be paid
by the Indemnifying Party. If the Indemnifying Party is not entitled to, or
elects not to, assume the defense of a claim, it will not be obligated to pay
the fees and expenses of more than one counsel (in addition to appropriate local
counsel) for the Indemnified Parties with respect to such claim, unless in the
reasonable judgment of any Indemnified Party a conflict of interest may exist
between such Indemnified Party and any other Indemnified Parties with respect to
such claim, in which event the Indemnifying Party shall be obligated to pay the
fees and expenses of such additional counsel for the Indemnified Parties or
counsels. No Indemnifying Party shall consent to entry of any judgment or enter
into any settlement without the consent of the Indemnified Party 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. No Indemnifying Party shall be subject to any liability for
any settlement made without its consent, which consent shall not be unreasonably
withheld.
6.04 CONTRIBUTION. If the indemnity and reimbursement obligation
provided for in any paragraph of this Section 6 is unavailable or insufficient
to hold harmless an Indemnified Party in respect of any Losses (or actions or
proceedings in respect thereof) referred to therein, then the Indemnifying Party
shall contribute to the amount paid or payable by the Indemnified Party as a
result of such Losses (or actions or proceedings in respect thereof) in such
proportion as is appropriate to reflect the relative fault of the Indemnifying
Party on the one hand and the Indemnified Party on the other hand in connection
with statements or omissions which resulted in such Losses, 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 the Indemnified
Party and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such untrue statement or omission. The parties
hereto agree that it would not be just and equitable if contributions pursuant
to this paragraph were to be 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 first sentence of this paragraph. The amount paid by an
Indemnified Party as a result of the Losses referred to in the first sentence of
this Section 6.04 shall be deemed to include any legal and other expenses
reasonably incurred by such Indemnified Party in connection with investigating
or defending any Loss which is the subject of this paragraph.
No Indemnified Party guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from the Indemnifying Party if the Indemnifying Party was not
guilty of such fraudulent misrepresentation.
6.05 OTHER INDEMNIFICATION. Indemnification similar to that specified
in the preceding paragraphs of this Section 6 (with appropriate modifications)
shall be given by the Issuer and each seller of Registrable Securities with
respect to any required registration or other qualification of securities under
any federal or state law or regulation of any governmental authority other than
the Securities Act. The provisions of this Section 6 shall be in addition to any
other rights to indemnification or contribution which an Indemnified Party may
have pursuant to law, equity, contract or otherwise.
6.06 INDEMNIFICATION PAYMENTS. The indemnification required by this
Section 6 shall be made by periodic payments of the amount thereof during the
course of the investigation or defense, as and when bills are received or losses
are incurred.
SECTION 7. COVENANTS RELATING TO RULES 144 AND 144A. COVENANTS
RELATING TO RULES 144 AND 144A. If at any time the Issuer is required to file
reports in compliance with either Section 13 or Section 15(d) of the Exchange
Act, the Issuer shall (i) file reports in compliance with the Exchange Act, (ii)
comply with all rules and regulations of the Commission applicable in connection
with the use of Rule 144 and (iii) take such other actions and furnish each
holder of Registrable Securities with such other information as such holder may
request in order to avail itself of such rule or any other rule or regulation of
the Commission allowing such holder to sell any Registrable Securities without
registration, and will, at its expense, forthwith upon the request of any holder
of Registrable Securities, deliver to such holder a certificate, signed by the
Issuer's principal financial officer, stating (a) the Issuer's name, address and
telephone number (including area code), (b) the Issuer's Internal Revenue
Service identification number, (c) the Issuer's Commission file number, (d) the
number of Units outstanding as shown by the most recent report or statement
published by the Issuer, and (e) whether the Issuer has filed the reports
required to be filed under the Exchange Act for a period of at least 90 days
prior to the date of such certificate and in addition has filed the most recent
annual report required to be filed thereunder.
With a view to making available to each holder of Registrable
Securities the benefits of certain rules and regulations of the Commission which
may permit the sale of the Registrable Securities to the public without
registration, the Issuer agrees that (at any time the Issuer is required to file
reports in compliance with either Section 13 or Section 15(d) of the Exchange
Act) so long as a holder owns any Registrable Securities, each holder of
Registrable Securities and each prospective holder of Registrable Securities who
may consider acquiring Registrable Securities in reliance upon Rule 144A shall
have the right to request from the Issuer, and the Issuer will provide, upon
request, such information regarding the Issuer and its business, assets and
7
properties, if any, as is at the time required to be made available by the user
under Rule 144A so as to enable such holder to transfer Registrable Securities
to such prospective holder in reliance upon Rule 144A.
Each holder of Registrable Securities agrees (on behalf of itself and
each of its Affiliates, directors, managers, officers, employees and
representatives) to use reasonable precautions to keep confidential, in
accordance with their customary procedures for handling confidential information
of this nature and in accordance with safe and sound practices, any non-public
information supplied to it by the Issuer pursuant to this Agreement which is
identified by the Issuer as being confidential at the time the same is delivered
to such holder of Registrable Securities, PROVIDED that nothing herein shall
limit the disclosure of any such information (i) to the extent required by
statute, rule, regulation or judicial process, (ii) to counsel for any of the
holders of Registrable Securities, (iii) to regulatory personnel, auditors or
accountants, (iv) in connection with any litigation to which any one or more of
the holders of Registrable Securities is a party, (v) to a Subsidiary or
Affiliate of such holder of Registrable Securities as provided in clause (a)
above or (vi) to any prospective holder of Registrable Securities so long as
such prospective holder of Registrable Securities first executes and delivers to
the respective holder of Registrable Securities a confidentiality containing
undertakings substantially the same as those set forth in this paragraph.
SECTION 8. OTHER REGISTRATION RIGHTS.
8.01 NO EXISTING AGREEMENTS. The Issuer represents and warrants to the
Investor that there is not in effect on the date hereof any agreement by the
Issuer (other than this Agreement) pursuant to which any holders of Units of the
Issuer have a right to cause the Issuer to register or qualify such Units under
the Securities Act or any securities or blue sky laws of any jurisdiction other
than the Unitholders Registration Rights Agreement.
8.02 FUTURE AGREEMENTS. The Issuer shall not hereafter agree with or
amend an existing agreement with the holders of any Units issued or to be issued
by the Issuer to register or qualify such Units under the Securities Act or any
securities or blue sky laws of any jurisdiction unless such agreement
specifically provides that (a) such holder of such Units may not participate in
any Piggyback Registration except as provided in Section 2 hereof, and (b) such
Units may not be publicly offered or sold for the period specified in Section 5
hereof under the circumstances described therein.
SECTION 9. MISCELLANEOUS.
9.01 WAIVER. No failure on the part of the Investor to exercise and no
delay in exercising, and no course of dealing with respect to, any right, power
or privilege under this Agreement shall operate as a waiver thereof, nor shall
any single or partial exercise of any right, power or privilege under this
Agreement preclude any other or further exercise thereof or the exercise of any
other right, power or privilege. The remedies provided herein are cumulative and
not exclusive of any remedies provided by law.
9.02 NOTICES. All notices, requests and other communications provided
for herein (including any waivers or consents under this Agreement) shall be
given or made to the address and in the manner set forth in Section 10.03 of the
Unitholder and Warrant Agreement.
9.03 AMENDMENT. This Agreement may be amended, supplemented or
modified only by a written instrument (which may be executed in any number of
counterparts) duly executed by or on behalf of each of the Issuer, the Investor
(so long as the Investor is a Holder) and the Majority Unitholders. No waiver by
any party of any term or condition of this Agreement, in any one or more
instances, shall be deemed to be or construed as a waiver of the same term or
condition of this Agreement on any future occasion.
9.04 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
permitted assigns.
9.05 REMEDIES; SPECIFIC PERFORMANCE. Except as otherwise expressly
provided for herein, no remedy conferred by any of the specific provisions of
this Agreement is intended to be exclusive of any other remedy, and each and
every remedy shall be cumulative and shall be in addition to every other remedy
given hereunder or now or hereafter existing at law or in equity or by statute
or otherwise. The election of any one or more remedies by any party hereto shall
not constitute a waiver by any such party of the right to pursue any other
available remedies. As between the parties to this Agreement, in any action or
proceeding brought to enforce any provision of this Agreement, or where any
provision hereof is validly asserted as a defense, the successful party shall be
entitled to recover reasonable attorneys' fees in addition to its costs and
expenses and any other available remedy.
8
Damages in the event of breach of this Agreement by a party hereto or
any other holder of Registrable Securities would be difficult, if not
impossible, to ascertain, and it is therefore agreed that each such Person, in
addition to and without limiting any other remedy or right it may have, will
have the right to an injunction or other equitable relief in any court of
competent jurisdiction, enjoining any such breach, and enforcing specifically
the terms and provisions hereof and the Issuer and each holder of Registrable
Securities, by its acquisition of such Registrable Securities, hereby waives any
and all defenses it may have on the ground of lack of jurisdiction or competence
of the court to grant such an injunction or other equitable relief. The
existence of this right will not preclude any such Person from pursuing any
other rights and remedies at law or in equity which such Person may have.
9.06 CAPTIONS. The captions and section headings appearing herein are
included solely for convenience of reference and are not intended to affect the
interpretation of any provision of this Agreement.
9.07 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument and any of the parties hereto may execute this Agreement by signing
any such counterpart signature page or counterpart.
9.08 GOVERNING LAW; WAIVER OF JURY TRIAL. This Agreement shall be
governed by, and construed in accordance with, the law of the State of New York
without giving effect to the conflicts of law principles thereof. EACH OF THE
PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.
9.09 SEVERABILITY. If any provision of this Agreement is held to be
illegal, invalid or unenforceable under any present or future law, and if the
rights or obligations of any party hereto under this Agreement will not be
materially and adversely affected thereby, (a) such provision will be fully
severable, (b) this Agreement will be construed and enforced as if such illegal,
invalid or unenforceable provision had never comprised a part hereof, (c) the
remaining provisions of this Agreement will remain in full force and effect and
will not be affected by the illegal, invalid or unenforceable provision or by
its severance herefrom and (d) in lieu of such illegal, invalid or unenforceable
provision, there will be added automatically as a part of this Agreement a
legal, valid and enforceable provision as similar in terms to such illegal,
invalid or unenforceable provision as may be possible.
9.10 ENTIRE AGREEMENT. This Agreement supersedes all prior discussions
and agreements between the parties with respect to the subject matter hereof,
and together with the Warrant and the Unitholder and Warrant Agreement contains
the sole and entire agreement between the parties hereto with respect to the
subject matter hereof.
9.11 THIRD PARTY BENEFICIARY. The terms and provisions of this
Agreement are intended solely for the benefit of each party hereto, their
respective successors or permitted assigns and any other holder of Registrable
Securities, and it is not the intention of the parties to confer third-party
beneficiary rights upon any other Person other than any Person entitled to
indemnity under Section 6 hereof.
9
IN WITNESS WHEREOF, this Agreement has been duly executed and
delivered by the duly authorized officer of each party hereto as of the date
first above written.
CENTERBROOK HOLDINGS LLC
By:____________________________________
Name:
Title:
IXIS FINANCIAL PRODUCTS INC.
By:____________________________________
Name:
Title:
By:____________________________________
Name:
Title:
10
Exhibit C to
Unitholder and Warrant Agreement
[TO BE INSERTED]
Exhibit D to
Unitholder and Warrant Agreement
FORM OF ELECTION
----------------
(To be executed by IXIS Financial Products Inc.)
Pursuant to Section 2.05 of the Unitholder and Warrant Agreement dated
as of June 28, 2006 among the Centerbrook Holdings LLC, IXIS Financial Products
Inc. and Charter Mac Corporation (as amended, supplement and otherwise modified
and in effect from time to time, the "UNITHOLDER AND WARRANT AGREEMENT"), the
undersigned hereby elects that all of the Warrants issued pursuant to the
Unitholder and Warrant Agreement shall be exercisable in accordance with their
terms.
Dated: ________ __, 20__
IXIS FINANCIAL PRODUCTS INC.
By:___________________________
Name:
Title:
By:___________________________
Name:
Title:
