REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (the "Agreement") is made and
entered into as of October 16, 1997, by and among Family Golf Centers, Inc., a
Delaware corporation (the "Company"), and Xxxxxxxxx & Company, Inc.,
Xxxxxxxxxxx & Co., Inc., Prudential Securities Incorporated and BancAmerica
Xxxxxxxxx Xxxxxxxx (the "Initial Purchasers") pursuant to the Purchase
Agreement, dated as of October 9, 1997 (the "Purchase Agreement"), between the
Company and the Initial Purchasers. In order to induce the Initial Purchasers
to enter into the Purchase Agreement, the Company has agreed to provide the
registration rights set forth in this Agreement. The execution of this
Agreement is a condition to the closing under the Purchase Agreement.
The Company agrees with the Initial Purchasers, (i) for their benefit
as Initial Purchasers and (ii) for the benefit of the holders from time to time
of the Notes (including the Initial Purchasers) and the holders from time to
time of the Common Stock issued upon conversion of the Notes (each of the
foregoing a "Holder" and together the "Holders"), as follows:
1. Definitions. Capitalized terms used herein without definition shall
have their respective meanings set forth in the Purchase Agreement. As used in
this Agreement, the following terms shall have the following meanings:
Affiliate: "Affiliate" means, with respect to any specified
person, (i) any other person directly or indirectly controlling or controlled
by, or under direct or indirect common control with, such specified person,
(ii) any officer or director of such other person, (iii) any spouse, immediate
family member or other relative who has the same principal residence as such
person, (iv) any trust in which any such person described above has a
beneficial interest, or (v) any corporation or other organization of which any
such person(s) described above collectively own 50% or more of the equity of
such entity. For purposes of this definition, the term "control" (including the
terms "controlling," "controlled by" and "under common control with") of a
person means the possession, direct or indirect, of the power (whether or not
exercised) to direct or cause the direction of the management and policies of a
person, whether through the ownership of voting securities, by contract, or
otherwise.
Business Day: Each Monday, Tuesday, Wednesday, Thursday and
Friday that is not a day on which banking institutions in The City of New York
are authorized or obligated by law or executive order to close.
Common Stock: The shares of common stock, par value $0.01 per
share, of the Company and any other shares of common stock as may constitute
"Common Stock" for purposes of the Indenture, in each case, as issuable or
issued upon conversion of the Notes.
Damages Accrual Period: See Section 2(e) hereof.
Damages Payment Date: Each of the semi-annual interest payment
dates provided in the Indenture, whether or not Liquidated Damages are payable
on such date.
Deferral Period: See Section 2(d) hereof.
Effectiveness Period: The period commencing with the date hereof
and ending on the earlier of (i) the date that is two years after the latest
date of original issuance of the Notes, (ii) the date that all Registrable
Securities have ceased to be Registrable Securities, or (iii) the date when all
outstanding Registrable Securities may be resold without registration pursuant
to Rule 144(k) under the Securities Act.
Event: See Section 2(e) hereof.
Event Date: See Section 2(e) hereof.
Exchange Act: The Securities Exchange Act of 1934, as amended,
and the rules and regulations of the SEC promulgated thereunder.
Filing Date: See Section 2(a) hereof.
Holder: See the second paragraph of this Agreement.
Indenture: The Indenture, dated as of October 16, 1997, between
the Company and United States Trust Company of New York, as trustee, pursuant
to which the Notes are being issued, as amended or supplemented from time to
time in accordance with the terms hereof.
Initial Purchasers: Xxxxxxxxx & Company, Inc., Xxxxxxxxxxx & Co.,
Inc., Prudential Securities Incorporated and BancAmerica Xxxxxxxxx Xxxxxxxx.
Initial Shelf Registration: See Section 2(a) hereof.
Liquidated Damages: See Section 2(e) hereof.
Losses: See Section 6 hereof.
Notes: The 5.75% Convertible Subordinated Notes due 2004 of the
Company being issued and sold pursuant to the Purchase Agreement and the
Indenture.
Notice Holder: See Section 2(d)(i) hereof
Prospectus: The prospectus included in any Registration Statement
(including, without limitation, a prospectus that discloses information
previously omitted from a prospectus filed as part of an effective registration
statement in reliance upon Rule 430A
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promulgated under the Securities Act), as amended or supplemented by any
amendment or prospectus supplement, including post-effective amendments, and
all material incorporated by reference or deemed to be incorporated by
reference in such Prospectus.
Purchase Agreement: See the first paragraph of this Agreement.
Record Holder: (i) with respect to any Damages Payment Date
relating to any Note as to which any Liquidated Damages have accrued, the
registered Holder of such Note on the record date with respect to the interest
payment date under the Indenture on which such Damages Payment Date shall occur
and (ii) with respect to any Damages Payment Date relating to any Common Stock
as to which any Liquidated Damages have accrued, the registered Holder of such
Common Stock 15 days prior to such Damages Payment Date.
Registrable Securities: The Notes and Common Stock of the Company
into which the Notes are convertible or converted, whether or not such Notes
have been converted (and associated rights), and at all times subsequent
thereto, and any Common Stock issued with respect thereto upon any stock
dividend, split or similar event until, in the case of any such Notes or Common
Stock, (i) it is effectively registered under the Securities Act and disposed
of in accordance with the Registration Statement covering it, (ii) it is
saleable by the holder thereof pursuant to Rule 144(k) or (iii) it is sold to
the public pursuant to Rule 144, and, as a result of the event or circumstance
described in any of the foregoing clauses (i) through (iii), the legends with
respect to transfer restrictions required under the Indenture (other than any
such legends required solely as the consequences of the fact that the
Registrable Securities (or the Notes, upon the conversion of which, such
Registrable Securities were issued or are issuable) are owned by, or were
previously owned by, the Company or an Affiliate of the Company) are removed or
removable in accordance with the terms of the Indenture.
Registration Expenses: See Section 5 hereof.
Registration Statement: Any registration statement of the Company
which covers any of the Registrable Securities pursuant to the provisions of
this Agreement, including the Prospectus, amendments and supplements to such
registration statement, including post-effective amendments, all exhibits, and
all material incorporated by reference or deemed to be incorporated by
reference in such registration statement.
Rule 144: Rule 144 under the Securities Act, as such Rule may be
amended from time to time, or any similar rule or regulation hereafter adopted
by the SEC.
Rule 144A: Rule 144A under the Securities Act, as such Rule may
be amended from time to time, or any similar rule or regulation hereafter
adopted by the SEC.
SEC: The Securities and Exchange Commission.
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Securities Act: The Securities Act of 1933, as amended, and the
rules and regulations promulgated by the SEC thereunder.
Selling Period: See Section 2(d)(i) hereof.
Shelf Registration: See Section 2(a) hereof.
Special Counsel: Xxxxx, Xxxxx & Xxxxx, or such other successor
counsel as shall be specified by the holders of a majority of the Registerable
Securities, the fees and expenses of which will be paid by the Company pursuant
to Section 5 hereof.
Subsequent Shelf Registration: See Section 2(b) hereof.
TIA: The Trust Indenture Act of 1939, as amended.
Trustee: The Trustee under the Indenture.
Underwritten Registration or Underwritten Offering: A
registration in which securities of the Company are sold to an underwriter for
reoffering to the public.
2. Shelf Registration.
(a) Shelf Registration. The Company shall prepare and file with
the SEC, as soon as practicable, but in any event on or prior to the date sixty
(60) days following the latest date of original issuance of the Notes (the
"Filing Date"), a Registration Statement for an offering to be made on a
continuous basis pursuant to Rule 415 of the Securities Act (a "Shelf
Registration") registering the resale from time to time by Holders thereof of
all of the Registrable Securities (the "Initial Shelf Registration") and shall
use its best efforts to cause such Shelf Registration to be declared effective
by the SEC on or prior to 120 days following the date of original issuance of
the Notes (the "Effectiveness Date"). The Initial Shelf Registration shall be
on Form S-3 or another appropriate form permitting registration of such
Registrable Securities for resale by such Holders in the manner or manners
designated by them (however, not including any Underwritten Offerings). The
Company shall use its reasonable efforts to cause the Initial Shelf
Registration to be declared effective under the Securities Act as soon as
practicable and to keep the Initial Shelf Registration continuously effective
under the Securities Act until the earlier of the expiration of the
Effectiveness Period or the date a Subsequent Shelf Registration, as defined
below, covering all of the Registrable Securities has been declared effective
under the Securities Act.
(b) If the Initial Shelf Registration or any Subsequent Shelf
Registration, as defined below, ceases to be effective for any reason as a
result of the issuance of a stop order by the SEC at any time during the
Effectiveness Period, the Company shall use its reasonable efforts to obtain
the prompt withdrawal of any order suspending the effectiveness thereof, and in
any event shall within thirty (30) days of such cessation of effectiveness
amend the Shelf
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Registration in a manner reasonably expected to obtain the withdrawal of the
order suspending the effectiveness thereof, or file an additional Shelf
Registration covering all of the Registrable Securities (a "Subsequent Shelf
Registration"). If a Subsequent Shelf Registration is filed, the Company shall
use its reasonable efforts to cause the Subsequent Shelf Registration to be
declared effective as soon as practicable after such filing and to keep such
Registration Statement continuously effective until the end of the
Effectiveness Period.
(c) The Company shall supplement and amend the Shelf Registration
if required by the rules, regulations or instructions applicable to the
registration form used by the Company for such Shelf Registration, if required
by the Securities Act, or if reasonably requested by the Initial Purchasers or
by the Trustee on behalf of a majority of the Holders of the Registrable
Securities covered by such Registration Statement.
(d) Each Holder of Registrable Securities agrees that if the
Holder wishes to sell its Registrable Securities pursuant to a Shelf
Registration and related Prospectus, it will do so only in accordance with this
Section 2(d). Each Holder of Registrable Securities agrees to give notice to
the Company at least three Business Days (but no more than 30 Business Days)
prior to any intended distribution of Registrable Securities under the Shelf
Registration, which notice shall specify the date on which such Holder intends
to begin such distribution and such information with respect to such Holder and
the intended distribution of Registrable Securities by such Holder as may be
required to amend the Registration Statement or supplement the related
Prospectus with respect to such intended distribution of Registrable Securities
by such Holder. As soon as practicable after the date such notice is provided,
and in any event within two Business Days after such date, the Company shall
either:
(i) (A) If necessary, prepare and file with the Commission a
post effective amendment to the Shelf Registration or a supplement to the
related Prospectus or a supplement or amendment to any document incorporated
therein by reference or file any other required document so that such
Registration Statement will not contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they
were made, not misleading, and so that, as thereafter delivered to purchasers
of the Registrable Securities being sold thereunder, such Prospectus will not
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading; (B)
provide the Notice Holder (as defined below) copies of any documents filed
pursuant to Section 2(d)(i)(A); and (C) inform the Notice Holder that the
Company has complied with its obligations in Section 2(d)(i)(A) (or that, if
the Company has filed a post-effective amendment to the Shelf Registration
which has not yet been declared effective, the Company will notify the Notice
Holder to that effect, will use its reasonable efforts to secure the
effectiveness of such post-effective amendment and will immediately notify the
Notice Holder when the amendment has become effective); each Holder who has
given notice of intention to distribute such Holder's Registrable Securities in
accordance with Section 2(d) hereof (a "Notice Holder") will sell all or any of
such Registrable Securities pursuant to the Shelf
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Registration and related Prospectus only during the 45-day period commencing
with the date on which the Company gives notice, pursuant to Section
2(d)(i)(C), that the Registration Statement and Prospectus may be used for such
purpose (such 45-day period is referred to as a "Selling Period"). The Notice
Holders will not sell any Registrable Securities pursuant to such Registration
Statement or Prospectus after such Selling Period without giving a new notice
of intention to sell pursuant to Section 2(d) hereof and receiving a further
notice from the Company pursuant to Section 2(d)(i)(C) hereof.
(ii) in the event (A) of the happening of any event of the
kind described in Section 3(c)(ii), 3(c)(iii), 3(c)(iv), 3(c)(v) or 3(c)(vi)
hereof or (B) that, in the judgment of the Company, it is advisable to suspend
use of the Prospectus for a discrete period of time due to pending material
corporate developments or similar material events that have not yet been
publicly disclosed and as to which the Company believes public disclosure will
be prejudicial to the Company, the Company shall deliver a certificate in
writing, signed by an authorized executive officer of the Company, to the
Notice Holders and the Special Counsel, to the effect of the foregoing and,
upon receipt of such certificate, each such Notice Holder's Selling Period will
not commence until such Notice Holder's receipt of copies of the supplemented
or amended Prospectus provided for in Section 2(d)(i)(A) hereof, or until it is
advised in writing by the Company that the Prospectus may be used, and has
received copies of any additional or supplemental filings that are incorporated
or deemed incorporated by reference in such Prospectus, if such copies are
requested by Holder in writing. The Company will use its reasonable efforts to
ensure that the use of the Prospectus may be resumed, and the Selling Period
will commence, as soon as practicable and, in the case of a pending development
or event referred to in Section 2(d)(ii)(B) hereof, as soon as the earlier of
(x) public disclosure of such pending material corporate development or similar
material event or (y) such time as in the judgment of the Company, public
disclosure of such material corporate development or similar material event
would not be prejudicial to the Company. Notwithstanding the foregoing, the
Company shall not under any circumstances be entitled to exercise its right
under this Section 2(d)(ii) to defer the commencement of a Selling Period
(whether as a result of events referred to in Section 2(d)(ii)(A) hereof or as
a result of the pending development or event referred to in Section 2(d)(ii)(B)
hereof) more than one (1) time in any three (3) month period or two (2) times
in any twelve (12) month period, and the period in which a Selling Period is
suspended shall not exceed forty-five (45) days. In no event shall the Company
be permitted to extend the period during which such Selling Period is deferred
from and after the date a Notice Holder provides notice to the Company in
accordance with this Section 2(d) of its intention to distribute Registrable
Securities (a "Deferral Period") beyond such forty-five (45) day period.
(e) The parties hereto agree that the Holders of Registrable
Securities will suffer damages, and that it would not be feasible to ascertain
the extent of such damages with precision, if (i) the Initial Shelf
Registration has not been filed on or prior to the Filing Date, (ii) the
Initial Shelf Registration has not been declared effective by the SEC on or
prior to the Effectiveness Date, (iii) prior to the end of the Effectiveness
Period, the SEC shall have issued a stop order suspending the effectiveness of
the Shelf Registration or proceedings have
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been initiated with respect to the Shelf Registration under Section 8(d) or
8(e) of the Securities Act, (iv) the aggregate number of days in any one
Deferral Period exceeds the periods permitted pursuant to Section 2(d)(ii)
hereof or (v) the number of Deferral Periods exceeds the number permitted
pursuant to Section 2(d)(ii) hereof (each of the events of a type described in
any of the foregoing clauses (i) through (iv) are individually referred to
herein as an "Event," and each of the Filing Date in the case of clause (i),
the date on which the effectiveness of the Shelf Registration has been
suspended or proceedings with respect to the Shelf Registration under Section
8(d) or 8(e) of the Securities Act have been commenced in the case of clause
(ii), the date on which the duration of a Deferral Period exceeds the periods
permitted by Section 2(d)(ii) hereof in the case of clause (iii), and the date
of the commencement of a Deferral Period that causes the limit on the number of
Deferral Periods under Section 2(d)(ii) hereof to be exceeded in the case of
clause (iv), being referred to herein as an "Event Date"). Events shall be
deemed to continue until the date of the termination of such Event, which shall
be the following dates with respect to the respective types of Events: the date
the Initial Registration Statement is filed in the case of an Event of the type
described in clause (i), the date the Initial Registration Statement becomes
effective in the case of an Event of the type described in clause (ii), the
date that all stop orders suspending effectiveness of the Shelf Registration
have been removed and the proceedings initiated with respect to the Shelf
Registration under Section 8(d) or 8(e) of the Securities Act have terminated,
as the case may be, in the case of Events of the types described in clause
(iii), termination of the Deferral Period which caused the aggregate number of
days in any one Deferral Period to exceed the number permitted by Section
2(d)(ii) to be exceeded in the case of an Event of the type described in clause
(iv), and termination of the Deferral Period the commencement of which caused
the number of Deferral Periods permitted by Section 2(d)(ii) to be exceeded in
the case of an Event of the type described in clause (v).
Accordingly, upon the occurrence of any Event and until such time as
there are no Events which have occurred and are continuing (a "Damages Accrual
Period"), commencing on the Event Date on which such Damages Accrual Period
began, the Company agrees to pay, as liquidated damages, and not as a penalty,
an additional amount (the "Liquidated Damages"): (A)(i) to each Holder of a
Note that is a Notice Holder, accruing at a rate equal to one-quarter of one
percent per annum (25 basis points) on the aggregate principal amount of Notes
held by such Notice Holder and (ii) to each Holder of Common Stock that is a
Notice Holder, accruing at a rate equal to one-quarter of one percent per annum
(25 basis points) calculated on an amount equal to the product of (x) the
then-applicable Conversion Price (as defined in the Indenture), times (y) the
number of shares of Common Stock held by such Holder; and (B) if the Damages
Accrual Period continues for a period in excess of ninety (90) days from the
Event Date, from and after the end of such ninety (90) day period until such
time as there are no Events which have occurred and are continuing, (i) to each
Holder of a Note (whether or not a Notice Holder), accruing at a rate equal to
one-half of one percent per annum (50 basis points) on the aggregate principal
amount of Notes held by such Holder and (ii) to each holder of Common Stock
(whether or not a Notice Holder), accruing at a rate equal to one-half of one
percent per annum (50 basis points) calculated on an amount equal to the
product of (x) the then-applicable Conversion Price (as defined in the
Indenture),
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times (y) the number of shares of Common Stock held by such Holder.
Notwithstanding the foregoing, no Liquidated Damages shall accrue under clause
(A) for the preceding sentence during any period for which Liquidated Damages
accrue under clause (B) of the preceding sentence or as to any Registrable
Securities from and after the earlier of (x) the date such securities are no
longer Registrable Securities, and (y) the expiration of the Effectiveness
Period. The rate of accrual of the Liquidated Damages with respect to any
period shall not exceed the rate provided for in this paragraph notwithstanding
the occurrence of multiple concurrent Events.
The Company shall pay the Liquidated Damages due on any Notes or
Common Stock by depositing with the Trustee under the Indenture, in trust, for
the benefit of the Holders of Notes or Common Stock or Notice Holder, as the
case may be, entitled thereto, at least one Business Day prior to the
applicable Damages Payment Date, sums sufficient to pay the Liquidated Damages
accrued or accruing since the last preceding Damages Payment Date through such
Damages Payment Date. The Liquidated Damages shall be paid by the Company to
the Record Holders on each Damages Payment Date by wire transfer of immediately
available funds to the accounts specified by them or by mailing checks to their
registered addresses as they appear in the list of Securityholders (as defined
in the Indenture), in the case of the Notes, and in the register of the Company
for the Common Stock, in the case of the Common Stock, if no such accounts have
been specified on or before the Damage Payment Date; provided, however, that
any Liquidated Damages accrued with respect to any Note or portion thereof
called for redemption on a redemption date, or repurchased in connection with a
Change of Control (as defined in the Indenture) on a repurchase date, or
converted into Common Stock on a conversion date prior to the Damages Payment
Date, shall, in any such event, be paid instead to the Holder who submitted
such Note or portion thereof for redemption, repurchase or conversion on the
applicable redemption date, repurchase date or conversion date, as the case may
be, on such date (or promptly following the conversion date, in the case of
conversion of a Note). If a Holder of a Note submits a Note for conversion
during the period between a record date for the payment of Liquidated Damages
and the related Damages Payment Date, Liquidated Damages for the period from
the conversion date through the next succeeding Damages Payment Date shall
accrue and be payable to the Holder of Common Stock received on conversion on
the next succeeding Damages Payment Date, notwithstanding that such Holder was
not a Record Holder with respect to such Damages Payment Date. The Trustee
shall be entitled, on behalf of the Holders of Notes and Common Stock and
Notice Holders, to seek any available remedy for the enforcement of this
Agreement, including for the payment of such Liquidated Damages.
Notwithstanding the foregoing, the parties agree that the sole damages payable
for a violation of the terms of this Agreement with respect to which Liquidated
Damages are expressly provided shall be such Liquidated Damages. Nothing shall
preclude a Notice Holder or Holder of Registrable Securities from pursuing or
obtaining specific performance or other equitable relief with respect to this
Agreement.
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All of the Company's obligations set forth in this Section 2(e) which
are outstanding with respect to any Registrable Securities at the time such
security ceases to be a Registrable Security shall survive until such time as
all such obligations with respect to such security have been satisfied in full
(notwithstanding termination of the Agreement pursuant to Section 8(o)).
The parties hereto agree that the Liquidated Damages provided for in
this Section 2(e) constitute a reasonable estimate of the damages that may be
incurred by Holders of Registrable Securities (other than the Initial
Purchasers) by reason of the failure of the Shelf Registration to be filed or
declared effective or unavailable (absolutely or as a practical matter) for
effecting resales of Registrable Securities, as the case may be, in accordance
with the provisions hereof.
3. Registration Procedures. In connection with the Company's
registration obligations under Section 2 hereof, the Company shall effect such
registrations to permit the sale of the Registrable Securities in accordance
with the intended method or methods of disposition thereof, and pursuant
thereto the Company shall as expeditiously as possible:
(a) Prepare and file with the SEC a Registration Statement or
Registration Statements on any appropriate form under the Securities Act
available for the sale of the Registrable Securities by the Holders thereof in
accordance with the intended method or methods of distribution thereof, and use
its reasonable efforts to cause each such Registration Statement to become
effective and remain effective as provided herein; provided, that before filing
any such Registration Statement or Prospectus or any amendments or supplements
thereto (other than documents that would be incorporated or deemed to be
incorporated therein by reference and that the Company is required by
applicable securities laws or stock exchange requirements to file) the Company
shall furnish to the Initial Purchasers and the Special Counsel copies of all
such documents proposed to be filed, which documents will be subject to the
review of the Initial Purchasers and the Special Counsel and the Company shall
not file any such Registration Statement or amendment thereto or any Prospectus
or any supplement thereto (other than such documents which, upon filing, would
be incorporated or deemed to be incorporated by reference therein and that the
Company is required by applicable securities laws or stock exchange
requirements to file) to which the Holders of a majority of the Registrable
Securities covered by such Registration Statement, the Initial Purchasers or
the Special Counsel shall reasonably object in writing within two full Business
Days.
(b) Prepare and file with the SEC such amendments and
post-effective amendments to each Registration Statement as may be necessary to
keep such Registration Statement continuously effective for the applicable
period specified in Section 2; cause the related Prospectus to be supplemented
by any required Prospectus supplement, and as so supplemented to be filed
pursuant to Rule 424 (or any similar provisions then in force) under the
Securities Act; and comply with the provisions of the Securities Act with
respect to the
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disposition of all securities covered by such Registration Statement during the
applicable period in accordance with the intended methods of disposition by the
sellers thereof set forth in such Registration Statement as so amended or such
Prospectus as so supplemented.
(c) Notify the Notice Holders, the Initial Purchasers and the
Special Counsel promptly, and (if requested by any such person) confirm such
notice in writing, (i) when a Prospectus, any Prospectus supplement, a
Registration Statement or a post-effective amendment to a Registration
Statement has been filed with the SEC, and, with respect to a Registration
Statement or any post-effective amendment, when the same has become effective,
(ii) of any request by the SEC or any other federal or state governmental
authority for amendments or supplements to a Registration Statement or related
Prospectus or for additional information, (iii) of the issuance by the SEC or
any other federal or state governmental authority of any stop order suspending
the effectiveness of a Registration Statement or the initiation or threatening
of any proceedings for that purpose, (iv) of the receipt by the Company of any
notification with respect to the suspension of the qualification or exemption
from qualification of any of the Registrable Securities for sale in any
jurisdiction or the initiation or threatening of any proceeding for such
purpose, (v) of the existence of any fact or happening of any event which makes
any statement of a material fact in such Registration Statement or related
Prospectus or any document incorporated or deemed to be incorporated therein by
reference untrue or which would require the making of any changes in the
Registration Statement or Prospectus in order that, in the case of the
Registration Statement, it will not contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, and that in the case
of the Prospectus, it will not contain any untrue statement of a material fact
or omit to state any material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances under which they
were made, not misleading, and (vi) of the Company's determination that a
post-effective amendment to a Registration Statement would be appropriate.
(d) Use its reasonable efforts to obtain the withdrawal of any
order suspending the effectiveness of a Registration Statement, or the lifting
of any suspension of the qualification (or exemption from qualification) of any
of the Registrable Securities for sale in any jurisdiction, at the earliest
possible moment.
(e) If reasonably requested by the Initial Purchasers or the
Holders of a majority of the Registrable Securities being sold, (i) promptly
incorporate in a Prospectus supplement or post-effective amendment to a
Registration Statement such information as the Initial Purchaser and the
Special Counsel, or such Holders, in connection with any offering of
Registrable Securities, agree should be included therein as required by
applicable law, and (ii) make all required filings of such Prospectus
supplement or such post-effective amendment as soon as practicable after the
Company has received notification of the matters to be
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incorporated in such Prospectus supplement or post-effective amendment;
provided, that the Company shall not be required to take any actions under this
Section 3(e) that are not, in the reasonable opinion of counsel for the
Company, in compliance with applicable law.
(f) Furnish to the Special Counsel and the Initial Purchasers,
without charge, at least one conformed copy of the Registration Statement or
Statements and any amendment thereto, including financial statements but
excluding schedules, all documents incorporated or deemed to be incorporated
therein by reference and all exhibits (unless requested in writing by such
counsel or Initial Purchasers).
(g) Deliver to each selling Holder, the Special Counsel and the
Initial Purchasers in connection with any offering of Registrable Securities,
without charge, as many copies of the Prospectus or Prospectuses relating to
such Registrable Securities (including each preliminary prospectus) and any
amendment or supplement thereto as such persons may reasonably request; and the
Company hereby consents to the use of such Prospectus or each amendment or
supplement thereto by each of the selling Holders of Registrable Securities, in
connection with any offering and sale of the Registrable Securities covered by
such Prospectus or any amendment or supplement thereto.
(h) Prior to any public offering of Registrable Securities, to
register or qualify or cooperate with the selling Holders, and the Special
Counsel in connection with the registration or qualification (or exemption from
such registration or qualification) of such Registrable Securities for offer
and sale under the securities or Blue Sky laws of such jurisdictions within the
United States as any selling Holder reasonably requests in writing; keep each
such registration or qualification (or exemption therefrom) effective during
the period such Registration Statement is required to be kept effective and do
any and all other acts or things necessary or advisable to enable the
disposition in such jurisdictions of the Registrable Securities covered by the
applicable Registration Statement; provided, that the Company will not be
required to (i) qualify generally to do business in any jurisdiction where it
is not then so qualified or (ii) take any action that would subject it to
general service of process in suits or to taxation in any such jurisdiction
where it is not then so subject.
(i) Cause the Registrable Securities covered by the applicable
Registration Statement to be registered with or approved by such other
governmental agencies or authorities within the United States, except as may be
required solely as a consequence of the nature of such selling Holder, in which
case the Company will cooperate in all reasonable respects with the filing of
such Registration Statement and the granting of such approvals, as may be
necessary to enable the selling Holder or Holders thereof, to consummate the
disposition of such Registrable Securities.
(j) During any Selling Period (other than during a Deferral
Period), immediately upon the existence of any fact or the occurrence of any
event as a result of which a Registration Statement shall contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements
11
therein not misleading, or a Prospectus shall contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading, promptly prepare and file a
post-effective amendment to each Registration Statement or a supplement to the
related Prospectus or any document incorporated therein by reference or file
any other required document (such as a Current Report on Form 8-K) that would
be incorporated by reference into the Registration Statement so that the
Registration Statement shall not contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, and so that the
Prospectus will not contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading, as thereafter delivered to the purchasers of the Registrable
Securities being sold thereunder, and, in the case of a post-effective
amendment to a Registration Statement, use its best efforts to cause it to
become effective as soon as practicable.
(k) Intentionally Omitted.
(l) If requested in connection with a disposition of Registrable
Securities pursuant to a Registration Statement, make available for inspection
by a representative of the Holders of Registrable Securities being sold, and
any attorney or accountant retained by such selling Holders or underwriter,
financial and other records, pertinent corporate documents and properties of
the Company and its subsidiaries, and cause the executive officers, directors
and employees of the Company and its subsidiaries to supply all information
reasonably requested by any such representative, attorney or accountant in
connection with such disposition; subject to reasonable assurances by each such
person that such information will only be used in connection with matters
relating to such Registration Statement, provided, however, that such persons
shall first agree in writing with the Company that any information that is
reasonably and in good faith designated by the Company in writing as
confidential at the time of delivery of such information shall be kept
confidential by such persons, unless (i) disclosure of such information is
required by court or administrative order or is necessary to respond to
inquiries of regulatory authorities, (ii) disclosure of such information is
required by law (including any disclosure requirements pursuant to Federal
securities laws in connection with the filing of any Registration Statement or
the use of any prospectus referred to in this Agreement), (iii) such
information becomes generally available to the public other than as a result of
a disclosure or failure to safeguard by any such person or (iv) such
information becomes available to any such person from a source other than the
Company and such source is not bound by a confidentiality agreement.
(m) Comply with all applicable rules and regulations of the SEC
and make generally available to its Securityholders earning statements (which
need not be audited) satisfying the provisions of Section 11(a) of the
Securities Act and Rule 158 thereunder (or any similar rule promulgated under
the Securities Act) no later than 45 days after the end of any 12-month period
(or 90 days after the end of any 12-month period if such period is a
12
fiscal year) commencing on the first day of the first fiscal quarter of the
Company commencing after the effective date of a Registration Statement, which
statements shall cover said 12-month periods.
(n) Cooperate with the selling Holders of Registrable Securities
to facilitate the timely preparation and delivery of certificates representing
Registrable Securities to be sold and not bearing any restrictive legends; and
enable such Registrable Securities to be in such denominations and registered
in such names as the Holders may request.
(o) Provide the transfer agent for the Common Stock with
certificates for the Registrable Securities which are in a form eligible for
deposit with The Depository Trust Company.
(p) Cause all Registrable Securities covered by the Registration
Statement to be listed on each securities exchange or quotation system on which
the Company's Common Stock is then listed no later than the date the
Registration Statement is declared effective and, in connection therewith, to
the extent applicable, to make such filings under the Exchange Act (e.g., the
filing of a Registration Statement on Form 8-A) and to have such filings
declared effective thereunder.
(q) Cooperate and assist in any filings required to be made with
the National Association of Securities Dealers, Inc.
4. Holder's Obligations. Each Holder agrees, by acquisition of the
Notes and Registrable Securities, that no Holder of Registrable Securities
shall be entitled to sell any of such Registrable Securities pursuant to a
Registration Statement or to receive a Prospectus relating thereto, unless such
Holder has furnished the Company with the notice required pursuant to Section
2(d) hereof, such notice to include such other information regarding such
Holder and the distribution of such Registrable Securities as may be required
to be included in the Registration Statement or the Prospectus or as the
Company may from time to time reasonably request. The Company may exclude from
such registration the Registrable Securities of any Holder who does not furnish
such information provided above for so long as such information is not so
furnished. Each Holder of Registrable Securities as to which any Registration
Statement is being effected agrees promptly to furnish to the Company all
information required to be disclosed in order to make the information
previously furnished to the Company by such Holder not misleading. Any sale of
any Registrable Securities by any Holder shall constitute a representation and
warranty by such Holder that the information relating to such Holder and its
plan of distribution is as set forth in the Prospectus delivered by such Holder
in connection with such disposition, that such Prospectus does not as of the
time of such sale contain any untrue statement of a material fact relating to
such Holder or its plan of distribution and that such Prospectus does not as of
the time of such sale omit to state any material fact relating to such Holder
or its plan of distribution necessary to make the statements in such
Prospectus, in light of the circumstances under which they were made, not
misleading.
13
5. Registration Expenses. All fees and expenses incident to the
Company's performance of or compliance with this Agreement shall be borne by
the Company whether or not any of the Registration Statements become effective.
Such fees and expenses shall include, without limitation, (i) all registration
and filing fees (including, without limitation, fees and expenses (x) with
respect to filings required to be made with the National Association of
Securities Dealers, Inc. and (y) of compliance with federal securities or Blue
Sky laws (including, without limitation, fees and disbursements of Special
Counsel in connection with Blue Sky qualifications of the Registrable
Securities laws of such jurisdictions as the Managing Underwriters, if any, or
Holders of a majority of the Registrable Securities being sold may designate)),
(ii) printing expenses (including, without limitation, expenses of printing
certificates for Registrable Securities in a form eligible for deposit with The
Depository Trust Company and of printing prospectuses if the printing of
prospectuses is requested by the Special Counsel or the Holders of a majority
of the Registrable Securities included in any Registration Statement), (iii)
messenger, telephone and delivery expenses, (iv) reasonable fees and
disbursements of counsel for the Company and the Special Counsel in connection
with the Shelf Registration (provided that the Company shall not be liable for
the fees and expenses of more than one separate firm for all parties
participating in any transaction hereunder), (v) fees and disbursements of all
independent certified public accountants referred to in Section 3(k)(iii)
hereof (including the expenses of any special audit and "cold comfort" letters
required by or incident to such performance) and (vi) Securities Act liability
insurance obtained by the Company in its sole discretion. In addition, the
Company shall pay its internal expenses (including, without limitation, all
salaries and expenses of its officers and employees performing legal or
accounting duties), the expense of any annual audit, the fees and expenses
incurred in connection with the listing of the securities to be registered on
any securities exchange on which similar securities issued by the Company are
then listed and the fees and expenses of any person, including special experts,
retained by the Company. Notwithstanding the provisions of this Section 5, each
seller of Registrable Securities shall pay all selling expenses (including all
broker's commissions and discounts) and all registration expenses to the extent
that the Company is prohibited by applicable Blue Sky laws from paying for or
on behalf of such seller of Registrable Securities.
6. Indemnification.
(a) Indemnification by the Company. The Company shall indemnify
and hold harmless each Holder and each person, if any, who controls any Holder
(within the meaning of either Section 15 of the Securities Act or Section 20(a)
of the Exchange Act) from and against all losses, liabilities, damages and
expenses (including, without limitation, any legal or other expenses reasonably
incurred in connection with defending or investigating any such action or
claim) (collectively, "Losses"), arising out of or based upon any untrue
statement or alleged untrue statement of a material fact contained in any
Registration Statement or Prospectus or in any amendment or supplement thereto
or in any preliminary prospectus, or arising out of or based upon any omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, except
insofar as such Losses arise out of or are based upon the information
14
relating to any Holder furnished to the Company in writing by such Holder
expressly for use therein; provided, that the Company shall not be liable to
any Holder of Registrable Securities (or any person controlling such Holder) to
the extent that any such Losses arise out of or are based upon an untrue
statement or alleged untrue statement or omission or alleged omission made in
any preliminary prospectus if either (A)(i) such Holder failed to send or
deliver a copy of the Prospectus with or prior to the delivery of written
confirmation of the sale by such Holder to the person asserting the claims from
which such Losses arise and (ii) the Prospectus would have corrected such
untrue statement or alleged untrue statement or such omission or alleged
omission, or (B)(x) such untrue statement or alleged untrue statement, omission
or alleged omission is corrected in an amendment or supplement to the
Prospectus and (y) having previously been furnished by or on behalf of the
Company with copies of the Prospectus as so amended or supplemented, such
Holder thereafter fails to deliver such Prospectus as so amended or
supplemented, with or prior to the delivery of written confirmation of the sale
of a Registrable Security to the person asserting the claim from which such
Losses arise. The Company shall also indemnify each underwriter and each person
who controls such person (within the meaning of Section 15 of the Securities
Act or Section 20(a) of the Exchange Act) to the same extent and with the same
limitations as provided above with respect to the indemnification of the
Holders of Registrable Securities.
(b) Indemnification by Holder of Registrable Securities. Each
Holder agrees severally and not jointly to indemnify and hold harmless the
Company, its directors, its officers who sign a Registration Statement, and
each person, if any, who controls the Company (within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act), from and
against all losses arising out of or based upon any untrue statement of a
material fact contained in any Registration Statement, Prospectus or
preliminary prospectus or arising out of or based upon any omission of a
material fact required to be stated therein or necessary to make the statements
therein not misleading, to the extent, but only to the extent, that such untrue
statement or omission is contained in any information relating to such Holder
so furnished in writing by such Holder to the Company expressly for use in such
Registration Statement or Prospectus. In no event shall the liability of any
selling Holder of Registrable Securities hereunder be greater in amount than
the dollar amount of the proceeds received by such Holder upon the sale of the
Registrable Securities giving rise to such indemnification obligation.
(c) Conduct of Indemnification Proceedings. In case any
proceeding (including any governmental investigation) shall be instituted
involving any person in respect of which indemnity may be sought pursuant to
either of the two preceding paragraphs, such person (the "indemnified party")
shall promptly notify the person against whom such indemnity may be sought (the
"indemnifying party") in writing and the indemnifying party, upon request of
the indemnified party, shall retain counsel reasonably satisfactory to the
indemnified party to represent the indemnified party and any others the
indemnifying party may designate in such proceeding and shall pay the fees and
disbursements of such counsel related to such proceeding. In any such
proceeding, any indemnified party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the
15
expense of such indemnified party unless (i) the indemnifying party and the
indemnified party shall have mutually agreed to the retention of such counsel
or (ii) the named parties to any such proceeding (including any impleaded
parties) include both the indemnifying party and the indemnified party and
representation of both parties by the same counsel would be inappropriate due
to actual or potential differing interests between them. It is understood that
the indemnifying party shall not, in respect of the legal expenses of any
indemnified party in connection with any proceeding or related proceedings in
the same jurisdiction, be liable for (a) the fees and expenses of more than one
separate firm (in addition to any local counsel) for all Holders and all
persons, if any, who control any Holder within the meaning of either Section 15
of the Securities Act or Section 20 of the Exchange Act, and (b) the fees and
expenses of more than one separate firm (in addition to any local counsel) for
the Company, its directors, its officers who sign a Registration Statement and
each person, if any, who controls the Company within the meaning of either such
Section, and that all such fees and expenses shall be reimbursed as they are
incurred. In the case of any such separate firm for the Company, and such
directors, officers and control persons of the Company, such firm shall be
designated in writing by the Company. The indemnifying party shall not be
liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment for
the plaintiff, the indemnifying party agrees to indemnify the indemnified party
from and against any loss or liability by reason of such settlement or
judgment. Notwithstanding the foregoing sentence, if at any time an indemnified
party shall have requested an indemnifying party to reimburse the indemnified
party for fees and expenses of counsel as contemplated by the second and third
sentences of this paragraph, the indemnifying party agrees that it shall be
liable for any settlement of any proceeding effected without its written
consent if (i) such settlement is entered into more than 45 days after receipt
by such indemnifying party of the aforesaid request and (ii) such indemnifying
party shall not have reimbursed the indemnified party in accordance with such
request prior to the date of such settlement. No indemnifying party shall,
without the prior written consent of the indemnified party, effect any
settlement of any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such proceeding.
(d) Contribution. If the indemnification provided for in this
Section 6 is unavailable to an indemnified party under Section 6(a) or 6(b)
hereof in respect of any Losses or is insufficient to hold such indemnified
party harmless, then each applicable indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such Losses, (i) in such
proportion as is appropriate to reflect the relative benefits received by the
indemnifying party or parties on the one hand and the indemnified party or
parties on the other hand or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (i) above but
also the relative fault of the indemnifying party or parties on the one hand
and of the indemnified party or parties on the other hand in connection with
the statements or omissions that resulted
16
in such Losses, as well as any other relevant equitable considerations.
Benefits received by the Company shall be deemed to be equal to the total net
proceeds from the initial placement (before deducting expenses) of the Notes
pursuant to the Purchase Agreement. Benefits received by the Initial Purchasers
shall be deemed to be equal to the total purchase discounts and commissions
received by them pursuant to the Purchase Agreement and benefits received by
any other Holders shall be deemed to be equal to the value of receiving Notes
registered under the Securities Act. Benefits received by any underwriter shall
be deemed to be equal to the total underwriting discounts and commissions, as
set forth on the cover page of the Prospectus forming a part of the
Registration Statement which resulted in such Losses. The relative fault of the
Holders on the one hand and the Company on the other hand 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 Holders or by the Company
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Holders'
respective obligations to contribute pursuant to this paragraph are several in
proportion to the respective number of Registrable Securities they have sold
pursuant to a Registration Statement, and not joint.
The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 6(d) were determined by pro rata
allocation or by any other method or allocation that does not take into account
the equitable considerations referred to in the immediately preceding
paragraph. The amount paid or payable by an indemnified party as a result of
the Losses referred to in the immediately preceding paragraph shall be deemed
to include, subject to the limitations set forth above, any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding this
Section 6(d), an indemnifying party that is a selling Holder of Registrable
Securities shall not be required to contribute any amount in excess of the
amount by which the total price at which the Registrable Securities sold by
such indemnifying party and distributed to the public were offered to the
public exceeds the amount of any damages which such indemnifying party has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.
The indemnity, contribution and expense reimbursement obligations of
the Company hereunder shall be in addition to any liability the Company may
otherwise have hereunder, under the Purchase Agreement or otherwise. The
provisions of this Section 6 shall survive so long as Registrable Securities
remain outstanding, notwithstanding any transfer of the Registrable Securities
by any Holder or any termination of this Agreement.
The indemnity and contribution provisions contained in this Section 6
shall remain operative and in full force and effect regardless of (i) any
termination of this Agreement, (ii) any investigation made by or on behalf of
any Holder or any person controlling any Holder,
17
or the Company, its officers or directors or any person controlling the Company
and (iii) the sale of any Registrable Securities by any Holder.
7. Information Requirements.
(a) The Company shall file the reports required to be filed by it
under the Securities Act and the Exchange Act, and if at any time the Company
is not required to file such reports, it will, upon the request of any Holder
of Registrable Securities, make publicly available other information so long as
necessary to permit sales pursuant to Rule 144 and Rule 144A under the
Securities Act. The Company further covenants that it will cooperate with any
Holder of Registrable Securities and take such further reasonable action as any
Holder of Registrable Securities may reasonably request (including, without
limitation, making such reasonable representations as any such Holder may
reasonably request), all to the extent required from time to time to enable
such Holder to sell Registrable Securities without registration under the
Securities Act within the limitation of the exemptions provided by Rule 144 and
Rule 144A under the Securities Act. Upon the request of any Holder of
Registrable Securities, the Company shall deliver to such Holder a written
statement as to whether it has complied with such filing requirements.
Notwithstanding the foregoing, nothing in this Section 7 shall be deemed to
require the Company to register any of its securities under any section of the
Exchange Act.
(b) The Company shall file the reports required to be filed by it
under the Exchange Act and shall comply with all other requirements set forth
in the instructions to Form S-3 in order to allow the Company to be eligible to
file registration statements on Form S-3.
8. Miscellaneous.
(a) Remedies. In the event of a breach by the Company of its
obligations under this Agreement, each Holder of Registrable Securities, in
addition to being entitled to exercise all rights granted by law, including
recovery of damages, will be entitled to specific performance of its rights
under this Agreement, provided that the sole damages payable for a violation of
the terms of this Agreement for which Liquidated Damages are expressly provided
pursuant to Section 2(e) hereof shall be such Liquidated Damages. The Company
agrees that monetary damages would not be adequate compensation for any loss
incurred by reason of a breach by it of any of the provisions of this Agreement
and hereby further agrees that, in the event of any action for specific
performance in respect of such breach, it shall waive the defense that a remedy
at law would be adequate.
(b) No Conflicting Agreements. The Company has not, as of the
date hereof, and shall not, on or after the date of this Agreement, enter into
any agreement with respect to its securities which conflicts with the rights
granted to the Holders of Registrable Securities in this Agreement. The Company
represents and warrants that the rights granted to
18
the Holders of Registrable Securities hereunder do not in any way conflict with
the rights granted to the Holders of the Company's securities under any other
agreements.
(c) Amendments and Waivers. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given, unless the Company has obtained the written consent of
Holders of a majority of the then outstanding Common Stock constituting
Registrable Securities (with Holders of Notes deemed to be the Holders, for
purposes of this Section, of the number of outstanding shares of Common Stock
into which such Notes are convertible). Notwithstanding the foregoing, a waiver
or consent to depart from the provisions hereof with respect to a matter that
relates exclusively to the rights of Holders of Registrable Securities whose
securities are being sold pursuant to a Registration Statement and that does
not directly or indirectly affect the rights of other Holders of Registrable
Securities may be given by Holders of at least a majority of the Registrable
Securities being sold by such Holders; provided, that the provisions of this
sentence may not be amended, modified, or supplemented except in accordance
with the provisions of the immediately preceding sentence.
(d) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing and shall be deemed given (i) when
made, if made by hand delivery, (ii) upon confirmation, if made by telecopier
or (iii) one business day after being deposited with a reputable next-day
courier, postage prepaid, to the parties as follows:
(x) if to a Holder of Registrable Securities, at the most
current address given by such Holder to the Company in accordance with
the provisions of Section 8(e);
(y) if to the Company, to:
Family Golf Centers, Inc.
000 Xxxxxxxxxxx Xxxx
Xxxxxxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxx, Esq.,
Vice President and General Counsel
Telecopy No.: (000) 000-0000
with a copy to:
Squadron, Ellenoff, Plesent & Xxxxxxxxx, LLP
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxx, Esq.
Telecopy No.: (000) 000-0000
19
and
(z) if to the Special Counsel to:
Xxxxx, Xxxxx & Xxxxx
000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxx X. Xxxxxx, Esq.
Telecopy No.: (000) 000-0000
or to such other address as such person may have furnished to the other persons
identified in this Section 8(d) in writing in accordance herewith.
(e) Owner of Registrable Securities. The Company will maintain,
or will cause its registrar and transfer agent to maintain, a register with
respect to the Registrable Securities in which all transfers of Registrable
Securities of which the Company has received notice will be recorded. The
Company may deem and treat the person in whose name Registrable Securities are
registered in such register of the Company as the owner thereof for all
purposes, including, without limitation, the giving of notices under this
Agreement
(f) Approval of Holders. Whenever the consent or approval of
Holders of a specified percentage of Registrable Securities is required
hereunder, Registrable Securities held by the Company or its affiliates (as
such term is defined in Rule 405 under the Securities Act) (other than the
Initial Purchasers or subsequent Holders of Registrable Securities if such
subsequent Holders are deemed to be such affiliates solely by reason of their
holdings of such Registrable Securities) shall not be counted in determining
whether such consent or approval was given by the Holders of such required
percentage.
(g) Successors and Assigns. Any person who purchases any
Registerable Securities from an Initial Purchaser shall be deemed, for purposes
of this Agreement, to be an assignee of such Initial Purchaser. The Agreement
shall inure to the benefit of and be binding upon the successors and assigns of
each of the parties and shall inure to the benefit of and be binding upon each
Holder of any Registrable Securities.
(h) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be original and all of which taken together
shall constitute one and the same agreement.
(i) Headings. The headings in this Agreement are for convenience
of reference only and shall not limit or otherwise affect the meaning hereof.
20
(j) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO
CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK WITHOUT REGARD TO
PRINCIPLES OF CONFLICT OF LAWS.
(k) Severability. If any term, provision, covenant or restriction
of this Agreement is held to be invalid, illegal, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions set forth herein
shall remain in full force and effect and shall in no way be affected, impaired
or invalidated thereby, and the parties hereto shall use their best efforts to
find and employ an alternative means to achieve the same or substantially the
same result as that contemplated by such term, provision, covenant or
restriction. It is hereby stipulated and declared to be the intention of the
parties that they would have executed the remaining terms, provisions,
covenants and restrictions without including any of such which may be hereafter
declared invalid, illegal, void or unenforceable.
(l) Entire Agreement This Agreement is intended by the parties as
a final expression of their agreement and is intended to be a complete and
exclusive statement of the agreement and understanding of the parties hereto in
respect of the subject matter contained herein and the registration rights
granted by the Company with respect to the Common Stock of the Company into
which Notes are convertible sold pursuant to the Purchase Agreement. Except as
provided in the Purchase Agreement, there are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein,
with respect to the registration rights granted by the Company with respect to
the Common Stock of the Company into which the Notes are convertible. This
Agreement supersedes all prior agreements and understandings among the parties
with respect to such registration rights.
(m) Attorneys' Fees. 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 prevailing party, as determined by the
court, shall be entitled to recover reasonable attorneys' fees in addition to
any other available remedy.
(n) Further Assurances. Each of the parties hereto shall use all
reasonable efforts to take, or cause to be taken, all appropriate action, do or
cause to be done all things reasonably necessary, proper or advisable under
applicable law, and execute and deliver such documents and other papers, as may
be required to carry out the provisions of this Agreement and the other
documents contemplated hereby and consummate and make effective the
transactions contemplated hereby.
(o) Termination. This Agreement and the obligations of the
parties hereunder shall terminate upon the end of the Effectiveness Period,
except for any liabilities or obligations under Sections 4, 5 or 6 hereof and
the obligations to make payments of and
21
provide for Liquidated Damages under Section 2(e) hereof to the extent such
damages accrue prior to the end of the Effectiveness Period, each of which
shall remain in effect in accordance with their terms.
SIGNATURE PAGE FOLLOWS
22
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
FAMILY GOLF CENTERS, INC.
By: /s/ Xxxxxxx Xxxxx
--------------------------------
Name: Xxxxxxx Xxxxx
Title: President and Chief
Executive Officer
Accepted as of the date first above written:
XXXXXXXXX & COMPANY, INC.
XXXXXXXXXXX & CO., INC.
PRUDENTIAL SECURITIES INCORPORATED
BANCAMERICA XXXXXXXXX XXXXXXXX
By: XXXXXXXXX & COMPANY, INC.
By: /s/ Xxxxx Xxxxxxx
-------------------------------
