Exhibit 10.2
Execution Copy
EXCHANGE RIGHTS AGREEMENT
This EXCHANGE RIGHTS AGREEMENT (this "Agreement"), is entered into as
of August 15, 2006, by and among ARCap Investors, L.L.C., a Delaware limited
liability company (the "Company"), CM ARCap Investors LLC, a Delaware limited
liability company ("CM ARCap Investors"), Xxxxxxx X. Xxxxxx and Xxxxx X. Xxxxxxx
(collectively, the "SCI Members").
R E C I T A L S:
WHEREAS, the Company was formed under the Delaware Limited Liability
Company Act (6 Del. C. ss. 18-101, et seq.) (as amended from time to time, the
"Act"), by the filing of a Certificate of Formation with the Delaware Secretary
of State on January 13, 1999 (as amended from time to time, the "Certificate")
and is governed by the Second Amended and Restated Limited Liability Company
Agreement of the Company dated as of August 15, 2006 (as it may be further
amended from time to time, the "Operating Agreement");
WHEREAS, pursuant to (i) the Operating Agreement and (ii) that certain
Securities Purchase Agreement (the "SPA"), dated as of August 15, 2006, by and
among the Sellers (as defined therein), the Sellers' Representative (as defined
therein), the Company, CharterMac, a Delaware statutory trust ("CharterMac") and
the Purchasers (as defined therein), the SCI Members agreed to retain their
limited liability company interests in the Company ("Common Units") which would
be re-designated pursuant to the Operating Agreement as special common interests
("Special Common Interests");
WHEREAS, the Company has agreed to provide the SCI Members with certain
rights to exchange all or a portion of their Special Common Interests for cash
or, at the election of CM ARCap Investors, for common shares of beneficial
interest (the "CharterMac Common Shares") of CharterMac; and
WHEREAS, CharterMac has agreed to reserve the number of CharterMac
Common Shares necessary to permit the exercise of the Exchange Right (as defined
below).
NOW, THEREFORE, the parties hereto, in consideration of the foregoing,
the mutual covenants and agreements hereinafter set forth and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, do hereby agree as follows:
ARTICLE 1
DEFINED TERMS
The following definitions shall be for all purposes, unless otherwise
clearly indicated to the contrary, applied to the terms used in this Agreement:
"Assignee" means a Person to whom one or more Special Common Interests
have been transferred in a manner permitted under the Operating Agreement, but
who has not become a Substituted SCI Member (as defined in the Operating
Agreement) in accordance therewith.
"Business Day" means any day except a Saturday, Sunday or other day on
which commercial banks in New York, New York are authorized or required by law
to close.
"Cash Amount" means an amount of cash equal to the Value on the
Valuation Date of the Common Share Amount.
"Code" means the Internal Revenue Code of 1986, as amended.
"Common Share Amount" means that number of CharterMac Common Shares
equal to the sum of (i) the product of the number of Special Common Interests
offered for exchange by an Exchanging Member, multiplied by the Exchange Factor
as of the Valuation Date and (ii) the result obtained by dividing the amount of
any then accrued but unpaid distributions per Special Common Interest (other
than the current accrued but unpaid distributions, if any, for the quarterly
period in which the Specified Exchange Date occurs), plus interest on the amount
of each such unpaid distribution from the date as of which it was to be paid at
the rate per annum equal to the Prime Rate (as defined herein) by the Value on
the Valuation Date, provided, that in the event CharterMac issues to all holders
of CharterMac Common Shares rights, options, warrants or convertible or
exchangeable securities entitling the stockholders to subscribe for or purchase
CharterMac Common Shares, distributes to all holders of CharterMac Common Shares
any other securities or property or becomes entitled to other securities and
property under Section 2.1.E. (collectively, the "rights"), then the Common
Share Amount shall also include such rights that a holder of that number of
CharterMac Common Shares would be or since the date hereof would have been
entitled to receive.
"Exchange Factor" means 1.0; provided, that in the event that
CharterMac (i) pays a dividend on its outstanding CharterMac Common Shares in
CharterMac Common Shares or makes a distribution to all holders of its
outstanding CharterMac Common Shares in CharterMac Common Shares; (ii)
subdivides its outstanding CharterMac Common Shares; or (iii) combines its
outstanding CharterMac Common Shares into a smaller number of CharterMac Common
Shares (collectively, an "Exchange Factor Event"), the Exchange Factor shall be
adjusted by multiplying the Exchange Factor then in effect by a fraction, the
numerator of which shall be the number of CharterMac Common Shares issued and
outstanding on the record date for such dividend, distribution, subdivision or
combination assuming for such purpose that such dividend, distribution,
subdivision or combination has occurred as of such time, and the denominator of
which shall be the actual number of CharterMac Common Shares (determined without
the above assumption) issued and outstanding on the record date for such
dividend, distribution, subdivision or combination. Any adjustment to the
Exchange Factor shall become effective immediately after the effective date of
such Exchange Factor Event with all such adjustments being reflected in the
final Exchange Factor as of the Valuation Date.
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"Exchange Right" has the meaning set forth in Section 2.1 hereof.
"Exchanging Member" has the meaning set forth in Section 2.1 hereof.
"Notice of Exchange" means the Notice of Exchange substantially in the
form of Exhibit A to this Agreement.
"Notice of Surrender" means the Notice of Surrender substantially in
the form of Exhibit B to this Agreement.
"Person" means an individual, partnership, limited partnership, limited
liability company, corporation, association, trust, unincorporated organization
or any other entity or organization, including a government or agency or
political subdivision thereof.
"Prime Rate" means a rate of interest equal to the rate per annum
announced by The Wall Street Journal from time to time as the Prime Rate or
equivalent with any change in such rate resulting from a change in such
corporate base or equivalent rate to be effective on the date of such change.
"Registration Rights Agreement" has the meaning set forth in Section
3.3(i)(v).
"SCI Member(s)" means each Person named as an SCI Member in Schedule A,
as such Schedule may be amended from time to time, including any Substituted SCI
Member, in such Person's capacity as a member of the Company.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended from time
to time, and any successor act.
"Specified Exchange Date" means the third (3rd) Business Day after
receipt by the Company and CM ARCap Investors of a Notice of Exchange.
"Valuation Date" means the date of receipt by the Company and CM ARCap
Investors of a Notice of Exchange or, if such date is not a Business Day, the
first Business Day thereafter.
"Value" means, with respect to a Valuation Date, the average of the
closing market price of CharterMac Common Shares for the five (5) consecutive
trading days immediately preceding such Valuation Date. The closing market price
for each such trading day shall be: (i) if the CharterMac Common Shares are
listed or admitted to trading on the New York Stock Exchange, the American Stock
Exchange, any national securities exchange or the Nasdaq Stock Market, the
closing price on such day, or if no such sale takes place on such day,
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the average of the closing bid and asked prices on such day; (ii) if the
CharterMac Common Shares are not listed or admitted to trading on the New York
Stock Exchange, the American Stock Exchange, any national securities exchange or
the Nasdaq Stock Market, the last reported sale price on such day or, if no sale
takes place on such day, the average of the closing bid and asked prices on such
day, as reported by a reliable quotation source designated by CharterMac; or
(iii) if the CharterMac Common Shares are not listed or admitted to trading on
the New York Stock Exchange, the American Stock Exchange, any national
securities exchange or the Nasdaq Stock Market and no such last reported sale
price or closing bid and asked prices are available, the average of the reported
high bid and low asked prices on such day, as reported by a reliable quotation
source designated by CharterMac, or if there shall be no bid and asked prices on
such day, the average of the high bid and low asked prices, as so reported, on
the most recent day (not more than five (5) days prior to the date in question)
for which prices have been so reported; provided, that if (i) there are no bid
and asked prices reported during the five (5) days prior to the date in question
or (ii) the Common Share Amount includes rights that a holder of Common Shares
would be or since the date hereof would have been entitled to receive, then in
either case the Company and the SCI Members shall together within ten (10)
Business Days thereafter appoint a third party appraiser mutually acceptable to
each party to appraise the Value of the CharterMac Common Shares, whose decision
with respect to such Value shall be final and binding.
ARTICLE 2
EXCHANGE RIGHT
Section 2.1. Exchange Right.
A. Subject to Sections 2.1.B, 2.1.C, 2.1.D and 2.1.F hereof, and
subject to any limitations under applicable law, the Company hereby grants to
each SCI Member and each SCI Member hereby accepts the right (the "Exchange
Right"), exercisable with respect to the Special Common Interests to exchange on
a Specified Exchange Date all or a portion of the Special Common Interests
acquired pursuant to the Operating Agreement and the SPA held by such SCI Member
at an exchange price in cash equal to the Cash Amount. The Exchange Right shall
be exercised pursuant to a Notice of Exchange delivered to the Company, with a
copy delivered to CM ARCap Investors, by the SCI Member who is exercising the
Exchange Right (the "Exchanging Member"); provided, however, that CM ARCap
Investors, on behalf of the Company, may elect, after a Notice of Exchange is
delivered, to satisfy the Exchange Right which is the subject of such notice in
accordance with Section 2.1.B. An SCI Member may not exercise the Exchange Right
for less than one thousand (1,000) Special Common Interests unless such SCI
Member holds less than one thousand (1,000) Special Common Interests, in which
event the SCI Member must exercise the Exchange Right for all of the Special
Common Interests held by such SCI Member. Any Assignee of an SCI Member may
exercise the rights of such SCI Member pursuant to this Section 2.1, and such
SCI Member shall be deemed to have assigned such rights to such Assignee insofar
as it relates to the Special Common Interests assigned and shall be bound by the
exercise of such rights by such Assignee. In connection with any exercise of
such rights by an Assignee on behalf of an SCI Member, the Assignee shall be
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deemed to be the Exchanging Member for purposes of this Agreement and the Cash
Amount or the Common Share Amount, as the case may be, shall be satisfied by the
Company or CM ARCap Investors, as the case may be, directly to such Assignee and
not to such SCI Member.
B. Notwithstanding the provisions of Section 2.1.A, CM ARCap Investors
LLC may, in its sole and absolute discretion, elect to satisfy an Exchanging
Member's Exchange Right by exchanging CharterMac Common Shares and rights equal
to the Common Share Amount on the Specified Exchange Date for the Special Common
Interests offered for exchange by the Exchanging Member. In the event CM ARCap
Investors LLC shall elect to satisfy, on behalf of the Company, an Exchanging
Member's Exchange Right by exchanging CharterMac Common Shares and rights for
the Special Common Interests offered for exchange, (i) CM ARCap Investors LLC
hereby agrees to notify the Exchanging Member within two (2) Business Days after
the receipt by CM ARCap Investors LLC of such Notice of Exchange, (ii) each
Exchanging Member shall execute such documents and instruments as CM ARCap
Investors LLC and CharterMac may reasonably require in connection with the
issuance of the CharterMac Common Shares upon exercise of the Exchange Right and
(iii) CM ARCap Investors LLC shall deliver on the Specified Exchange Date to
such Exchanging Member share certificates representing fully paid and
non-assessable shares and such other certificates or instruments as may be
required in respect of rights, in the aggregate representing such number of
CharterMac Common Shares and rights equal to the Common Share Amount. If CM
ARCap Investors LLC makes such an election, CharterMac shall timely issue and
deliver to CM ARCap Investors LLC such CharterMac Common Shares to be delivered
to the Exchanging Member. To the extent that any Special Common Interests
exchanged pursuant to the Exchange Right are, at the time of such exchange,
subject to restrictions on transfer under the Securities Act, all CharterMac
Common Shares issued in exchange for such Special Common Interests shall remain
subject to the same restrictions on transfer under the Securities Act for the
remaining term of such restrictions, and the certificate(s) representing such
CharterMac Common Shares shall bear an appropriate legend reflecting such
restrictions under the Securities Act.
C. Any Cash Amount to be paid to an Exchanging Member shall be paid on
the Specified Exchange Date.
D. Any exchange of Special Common Interests pursuant to this Article 2
shall be deemed to have occurred as of the Specified Exchange Date for all
purposes, including without limitation the payment of distributions or dividends
in respect of Special Common Interests or CharterMac Common Shares, as
applicable. Any Special Common Interests acquired by CM ARCap Investors LLC
pursuant to an exercise by any SCI Member of an Exchange Right shall be
cancelled. CM ARCap Investors LLC shall amend the Operating Agreement to reflect
each such exchange and cancellation of Special Common Interests and each
corresponding recalculation of the Special Common Interests of the SCI Members.
E. In case there occurs any reclassification or change of the
outstanding CharterMac Common Shares of CharterMac or any reorganization of
CharterMac (or any other corporation the stock or securities of which are at the
time receivable upon the exercise of the
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Exchange Right), including any issuance of securities other than CharterMac
Common Shares or payment of other property as a distribution with respect to the
CharterMac Common Shares and including pursuant to a merger or consolidation, on
or after the date hereof, then and in each such case the SCI Member, upon the
exercise of the Exchange Right at any time after the consummation of such
reclassification, change, or reorganization shall, if CM ARCap Investors LLC
makes an election to satisfy an Exchanging Member's Exchange Right in the manner
set forth in Section 2.1.B, be entitled to receive, in lieu of the stock or
other securities and property (including cash) receivable upon the exercise of
the Exchange Right prior to such consummation, the stock or other securities or
property (including cash) to which such SCI Member would have been entitled upon
such consummation if such SCI Member had exercised the Exchange Right
immediately prior thereto, or if CM ARCap Investors LLC satisfies the Exchange
Right in cash, the value thereof, all subject to further adjustment pursuant to
the provisions of this subsection E.
F. Upon receipt of a Notice of Exchange, the Company shall, if
CharterMac then is contemplating exercising its right pursuant to Section 2(a)
of the Registration Rights Agreement to not file a Registration Statement or not
keep a Registration Statement effective because additional disclosure would be
required, notify the SCI Members and grant them the opportunity, prior to
consummating the exchange pursuant to such Notice of Exchange, to rescind such
Notice of Exchange.
ARTICLE 3
OTHER PROVISIONS
Section 3.1. Covenants of CharterMac and CM ARCap Investors LLC
A. At all times during the pendency of the Exchange Right, CharterMac
shall reserve for issuance such number of CharterMac Common Shares as may be
necessary to enable the issuance of such shares in full payment of the Common
Share Amount in regard to all Special Common Interests held by SCI Members which
are from time to time outstanding. CharterMac shall use its commercially
reasonable efforts, at CharterMac's expense, to list (on the New York Stock
Exchange or any other exchange on which the CharterMac Common Shares are then
listed) CharterMac Common Shares when issued pursuant to this Agreement.
B. During the pendency of the Exchange Right, CharterMac shall deliver
to the SCI Members in a timely manner all reports filed by CharterMac with the
SEC to the extent CharterMac also transmits such reports to its shareholders and
all other communications transmitted from time to time by CharterMac to its
shareholders generally.
C. The Company shall notify each SCI Member, upon request, of the then
current Exchange Factor and such notice will include a reasonable explanation of
the Exchange Factor calculation to be applied at such time.
Section 3.2. Fractional Shares. No fractional CharterMac Common Shares
shall be issued upon exchange of Special Common Interests. The number of full
CharterMac
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Common Shares which shall be issuable upon exchange of Special Common Interests
(or the cash equivalent amount thereof if the Cash Amount is paid) shall be
computed on the basis of the aggregate amount of Special Common Interests so
surrendered. Instead of any fractional CharterMac Common Shares which would
otherwise be issuable upon exchange of any Special Common Interests, the Company
shall pay a cash adjustment in respect of such fraction in an amount equal to
the Cash Amount of a Special Common Interest multiplied by such fraction.
Section 3.3 Investment Representations and Warranties. By delivering a
Notice of Exchange, each Exchanging Member will make the representations,
warranties and certifications set forth in the Notice of Exchange and will be
deemed to represent and warrant to CharterMac, CM ARCap Investors LLC and the
Company that such Exchanging Member is aware of CM ARCap Investors LLC's option
to exchange such Exchanging Member's Special Common Interests for CharterMac
Common Shares pursuant to Section 2.1.B hereof and that:
(a) Such Exchanging Member has received and reviewed copies of all
reports and other filings (the "SEC Reports"), including Annual
Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current
Reports on Form 8-K, made by CharterMac with the SEC pursuant to
the Securities Exchange Act of 1934, as amended, and the rules
and regulations thereunder, as the Exchanging Member has deemed
relevant in connection with the exercise of the Exchange Right
and understands the risks of, and other considerations relating
to, an investment in CharterMac Common Shares.
(b) Such Exchanging Member, by reason of its business and financial
experience, together with the business and financial experience
of those Persons, if any, retained by it to represent or advise
it with respect to its investment in CharterMac Common Shares,
(i) has such knowledge, sophistication and experience in
financial and business matters and in making investment
decisions of this type that it is capable of evaluating the
merits and risks of, and of making an informed investment
decision with respect to, an investment in CharterMac Common
Shares;
(ii) is capable of protecting its own interest or has engaged
representatives or advisors to assist it in protecting its
interests; and
(iii) is capable of bearing the economic risk of such investment.
(c) Such Exchanging Member is an "accredited investor" as defined in
Rule 501 of the regulations promulgated under the Securities Act;
provided, however, that if such Exchanging Member notifies the
Company that it is not an "accredited investor" at the time it
delivers a Notice of Exchange, the Company shall either pay the
Cash Amount or, at its expense, cause the
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registration of the issuance of the CharterMac Common Shares to
such Exchanging Member in the amount of the Common Share Amount
payable to such Exchanging Member.
(d) If such Exchanging Member has retained or retains a Person to
represent or advise it with respect to its investment in
CharterMac Common Shares, such Exchanging Member will advise CM
ARCap Investors LLC and CharterMac of such retention and, at CM
ARCap Investors LLC's or CharterMac's request, such Exchanging
Member shall, prior to or at delivery of the CharterMac Common
Shares hereunder,
(i) acknowledge in writing such representation; and
(ii) cause such representative or advisor to deliver a
certificate to CM ARCap Investors LLC and CharterMac
containing such representations as may be reasonably
requested by CM ARCap Investors LLC and CharterMac.
(e) Such Exchanging Member understands that an investment in
CharterMac involves substantial risks.
(f) Such Exchanging Member has been given the opportunity to make a
thorough investigation of the activities of CharterMac and has
been furnished with materials relating to CharterMac and its
activities, including, without limitation, the SEC Reports which
it has requested.
(g) Such Exchanging Member has relied and is making its investment
decision based upon the SEC Reports and other written information
provided to the Exchanging Member by or on behalf of CharterMac
and, where applicable, such Exchanging Member's position as a
director or executive officer of the Company or CM ARCap
Investors LLC.
(h) The CharterMac Common Shares to be issued to such Exchanging
Member hereunder will be acquired by such Exchanging Member for
its own account, for investment only and not with a view to, or
with any intention of, a distribution in violation of the
Securities Act.
(i) Such Exchanging Member was not formed for the specific purpose of
acquiring an interest in CharterMac.
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(j) Such Exchanging Member acknowledges that:
(i) the CharterMac Common Shares to be issued to such Exchanging
Member hereunder have not been registered under the
Securities Act or state securities laws by reason of a
specific exemption or exemptions from registration under the
Securities Act and applicable state securities laws and, the
certificates representing such CharterMac Common Shares will
bear a legend to such effect, unless the CharterMac Common
Shares are subsequently registered in accordance with
Section 3.3(j)(v);
(ii) CharterMac's and the Company's reliance on such exemptions
is predicated in part on the accuracy and completeness of
the representations and warranties of such Exchanging Member
contained herein;
(iii) the CharterMac Common Shares to be issued to such
Exchanging Member hereunder may not be resold or otherwise
distributed unless registered under the Securities Act and
applicable state securities laws, or unless an exemption
from registration is available;
(iv) there may be no market for unregistered CharterMac Common
Shares; and
(v) CharterMac has no obligation or intention to register such
CharterMac Common Shares under the Securities Act or any
state securities laws or to take any action that would make
available any exemption from the registration requirements
of such laws, except as may be provided in the Registration
Rights Agreement entered into by CharterMac and the
Exchanging Members (the "Registration Rights Agreement").
(k) Such Exchanging Member acknowledges that because of the
restrictions on transfer or assignment of such CharterMac Common
Shares to be issued hereunder, such Exchanging Member may have to
bear the economic risk of its investment in CharterMac Common
Shares issued hereunder for an indefinite period of time,
although the holder of any such CharterMac Common Shares will be
afforded certain rights to have such CharterMac Common Shares
registered under the Securities Act and applicable state
securities laws pursuant to the Registration Rights Agreement.
(l) The address set forth under such Exchanging Member's name in the
Notice of Exchange is the address of the Exchanging Member's
principal place of business or, if a natural person, the address
of the Exchanging Member's
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residence, and such Exchanging Member has no present intention of
becoming a resident of any country, state or jurisdiction other
than the country and state in which such principal place of
business or residence is situated.
Section 3.4. Indemnification. Each Exchanging Member shall indemnify
and hold harmless CharterMac, CM ARCap Investors LLC and the Company, and their
respective officers, directors, trustees, managers and employees, from and
against any and all losses, claims, judgments, amounts paid in settlement,
damages, liabilities and expenses (joint or several), including attorneys' fees
and disbursements and expenses of investigation, incurred by any such party
pursuant to any actual or threatened action, suit, proceeding or investigation
in any way arising out of relating to any inaccuracy of any of the
representations, warranties or certifications made by such Exchanging Member
pursuant to the provisions of Section 3.3 or an applicable Notice of Exchange.
ARTICLE 4
GENERAL PROVISIONS
Section 4.1. Taxable Transaction
(a) The exercise of the Exchange Right provided under this Agreement
by any SCI Member shall be treated and reported as a taxable
transaction.
(b) Each SCI Member and its Assignees hereby authorizes the Company
or CM ARCap Investors LLC to (x) pay using distributions under
the Operating Agreement that would otherwise be made to the SCI
Member or (y) withhold from such SCI Member, any amount of
federal, state, local, or foreign taxes that the Company or CM
ARCap Investors LLC determines that the Company or CM ARCap
Investors LLC is required to pay or withhold with respect to any
amount distributable or allocable to such SCI Member as a result
of the SCI Member's exercise of the Exchange Right pursuant to
this Agreement, including, without limitation, any taxes required
to be withheld by the Company or CM ARCap Investors LLC pursuant
to Sections 1441, 1442, 1445, or 1446 of the Code, and that any
taxes so paid or withheld will reduce the cash or CharterMac
Common Shares to which an Exchanging Member is entitled. Prior to
withholding, the Company or CM ARCap Investors LLC, as the case
may be, shall endeavor to (i) provide reasonable advance notice
to the SCI Members, which shall provide the basis for withholding
and (ii) if requested, discuss the need to withhold with the SCI
Members. The Company or CM ARCap Investors LLC, as the case may
be, shall permit an SCI Member who is subject to withholding to
contest the obligation to withhold at its own expense.
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Section 4.2 Notices.
All notices and other communications given or made pursuant hereto
shall be in writing and delivered by hand or sent by registered or certified
mail (postage prepaid, return receipt requested) or by a nationally recognized
overnight air courier service and shall be deemed to have been duly given or
made as of the date delivered if delivered personally, or if mailed, on the
third business day after mailing (on the first business day after mailing in the
case of a nationally recognized overnight air courier service) to the Company,
CharterMac, CM ARCap Investors LLC, an SCI Member or Assignee, as the case may
be, (i) at the address listed on Schedule A, with respect to an SCI Member, (ii)
at the address listed on the records of the Company with respect to an Assignee,
and (iii) at 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn: President, with
respect to the Company, CharterMac or CM ARCap Investors LLC. Any party may by
notice given in accordance with this Section 4.2 to the other parties designate
another address or person for receipt of notices hereunder.
Section 4.3. Amendment and Modification.
This Agreement may be modified, amended or supplemented only by an
instrument in writing signed by all of the parties hereto.
Section 4.4. Waiver of Compliance; Consents.
Except as otherwise provided in this Agreement, any failure of any of
the parties to comply with any obligation, covenant, agreement or condition
herein may be waived by the party or parties entitled to the benefits thereof
only by a written instrument signed by the party granting such waiver, but such
a waiver or failure to insist upon strict compliance with such obligation,
covenant, agreement or condition shall not operate as a waiver of, or estoppel
with respect to, any subsequent other failure. Whenever this Agreement requires
or permits consent by or on behalf of any party hereto, such consent shall be
given in writing in a manner consistent with the requirements for a waiver of
compliance as set forth in this Section 4.4.
Section 4.5. Governing Law.
This Agreement shall be governed by the laws of the State of New York
without regard to the conflict of laws principles thereof.
Section 4.6. Severability.
The invalidity or unenforceability of any provisions of this Agreement
in any such jurisdiction shall not affect the validity, legality or
enforceability of the remainder of this Agreement in such jurisdiction or the
validity, legality or enforceability of this Agreement, including any such
provision, in any other jurisdiction, it being intended that all rights and
obligations of the parties hereunder shall be enforceable to the fullest extent
permitted by law.
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Upon such determination that any provision is invalid, illegal or incapable of
being enforced, the parties hereto will negotiate in good faith to modify this
Agreement so as to effect the original intent of the parties as closely as
possible in an acceptable manner to the end that the transactions contemplated
hereby and thereby are fulfilled to the extent possible.
Section 4.7. Counterparts.
This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
Section 4.8. Section Headings.
The section headings contained in this Agreement are solely for the
purpose of reference, are not part of the agreement of the parties and shall not
in any way affect the meaning or interpretation of this Agreement. All
references in this Agreement to Sections are to sections of this Agreement,
unless otherwise indicated.
Section 4.9. Entire Agreement.
This Agreement, together with the Operating Agreement, the SPA and the
Registration Rights Agreement, embodies the entire agreement and understanding
of the parties hereto in respect of the transactions contemplated by this
Agreement. There are no restrictions, promises, inducements, representations,
warranties, covenants or undertakings, other than those expressly set forth or
referred to herein or therein. This Agreement, the Operating Agreement, the SPA
and the Registration Rights Agreement supersede all prior written or oral
agreements and understandings between the parties with respect to the
transactions contemplated hereby and thereby.
Section 4.10. No Third-Party Beneficiaries.
This Agreement shall be binding upon and inure to the benefit of each
party hereto and their respective representatives, heirs, successors and
permitted assigns, including without limitation and without need for express
assignment, any substituted SCI Member and any Assignee. Nothing in this
Agreement, express or implied, is intended to or shall confer upon any other
Person any right, benefit, claim or remedy of any nature whatsoever under or by
reason of this Agreement.
Section 4.11. Interpretation.
(a) The parties hereto have participated jointly in the negotiation
and drafting of this Agreement. If any ambiguity or question of
intent or interpretation arises, this Agreement will be construed
as if drafted jointly by the parties
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and no presumptions or burden of proof will arise favoring or
disfavoring any party by virtue of authorship of any provisions
of this Agreement.
(b) All pronouns and any variations thereof refer to the masculine,
feminine or neuter, singular or plural, as the context may
require.
(c) The words "include", "includes" and "including" shall be deemed
to be followed by the phrase "without limitation".
Section 4.12. Further Assurances.
Each of the parties shall use reasonable efforts to execute and deliver
to any other party such additional documents and take such other action, as any
other party may reasonably request, to carry out the intent of this Agreement
and the transactions contemplated hereby.
Section 4.13. Specific Performance.
The parties hereto acknowledge that there would be no adequate remedy
at law if any party fails to perform any of its obligations hereunder, and
accordingly agree that each party, in addition to any other remedy to which it
may be entitled at law or in equity, shall be entitled to compel specific
performance of the obligations of any other party under this Agreement in
accordance with the terms and conditions of this Agreement in any court of the
United States or any State thereof having jurisdiction.
[SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF, the parties have executed this Exchange Rights
Agreement as of the date first written above.
ARCAP INVESTORS, L.L.C.
By: CM ARCap Investors LLC, its Managing Member
By: /s/ Xxxx X. Xxxxxxxxx
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Name: Xxxx X. Xxxxxxxxx
Title: Chief Executive Officer and President
CM ARCAP INVESTORS LLC
By: /s/ Xxxx X. Xxxxxxxxx
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Name: Xxxx X. Xxxxxxxxx
Title: Chief Executive Officer and President
SCI MEMBERS:
/s/ Xxxxxxx X. Xxxxxx
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XXXXXXX X. XXXXXX
/s/ Xxxxx X. Xxxxxxx
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XXXXX X. XXXXXXX
[SIGNATURE PAGE TO EXCHANGE RIGHTS AGREEMENT]
By its signature below, CharterMac is executing this Agreement solely
for the purposes of confirming its obligations pursuant to Sections 2.1.B,
3.1.A, 3.1.B and 3.1.D.
CHARTERMAC
By: /s/ Xxxx X. Xxxxxxxxx
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Name: Xxxx X. Xxxxxxxxx
Title: Chief Executive Officer and President
[SIGNATURE PAGE TO EXCHANGE RIGHTS AGREEMENT]
