Exhibit 2.2
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT, dated as of November 12, 1996
(the "Agreement"), among HFS Incorporated, a Delaware corporation (the
"Company"), and Xx. Xxxxxxxx XxXxxx, an individual resident of the State of
Indiana ("Holder").
WHEREAS, pursuant to that certain Stock Purchase Agreement,
dated as of October 6, 1996 (the "Purchase Agreement"), the Company has
acquired (the "Acquisition") from Holder (i) all of the issued and outstanding
shares of common stock, without par value, of Resort Condominiums
International, Inc., an Indiana corporation ("RCI"), and (ii) all of the
issued and outstanding shares of the Affiliated Entities (as defined in the
Purchase Agreement) held by Seller;
WHEREAS, in partial consideration for the Acquisition, the
Company has, among other things, issued to Holder 999,500 shares of common
stock, par value $.01 per share (the "Common Stock"), of the Company (the
shares of Common Stock issued to Holder in consideration for the Acquisition
are hereinafter referred to as the "Acquisition Shares"); and
WHEREAS, in order to induce Holder to enter into the
Purchase Agreement, the Company has agreed to provide registration rights with
respect to the Acquisition Shares.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements set forth herein and for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties agree as
follows:
ARTICLE I
CERTAIN DEFINITIONS
Section 1.01 Definitions.
As used in this Agreement, the following terms shall have
the following meanings:
The term "Acquisition" shall have the meaning ascribed to it
in the second paragraph of the preamble.
The term "Acquisition Shares" shall have the meaning
ascribed to it in the third paragraph of the preamble.
The term "Affiliate" shall have the meaning ascribed to it
in Rule 12b-2 of the General Rules and Regulations under the Exchange Act.
The term "Agreement" shall have the meaning ascribed to it
in the first paragraph of the preamble.
The term "Common Stock" shall have the meaning ascribed to
it in the third paragraph of the preamble.
The term "Company" shall have the meaning ascribed to it in
the first paragraph of the preamble.
The term "Company Offering" shall mean the sale of equity
securities of the Company, or securities convertible into or exchangeable or
exercisable for equity securities of the Company, pursuant to a registration
statement filed by the Company under the Securities Act (other than a
registration statement filed on Form S-8 or any successor form) respecting an
underwritten offering, whether primary or secondary, that is declared
effective by the SEC.
The term "Company Subsidiary" shall mean any Person the
majority of the outstanding voting securities or interests of which are owned
by the Company.
The term "Effective Date" shall have the meaning ascribed to
it in Section 2.02.
2
The term "Exchange Act" shall mean the Securities Exchange
Act of 1934, as amended, and the rules and regulations of the SEC promulgated
thereunder.
The term "Holder" shall have the meaning ascribed to it in
the first paragraph of the preamble.
The term "Losses" shall have the meaning ascribed to it in
Section 2.06(a).
The term "Person" shall mean an individual, trustee,
corporation, partnership, business trust, limited liability company, limited
liability partnership, joint stock company, trust, unincorporated association,
union, business association, firm or other entity.
The term "Purchase Agreement" shall have the meaning
ascribed to it in the second paragraph of the preamble.
The term "Registration Expenses" shall have the meaning
ascribed to it in Section 2.05.
The term "Rule 144" shall mean Rule 144 promulgated under
the Securities Act (or any successor rule).
The term "Rule 415 Offering" shall have the meaning ascribed
to it in Section 2.01(a).
The term "SEC" shall mean the United States Securities and
Exchange Commission.
The term "Securities Act" shall mean the Securities Act of
1933, as amended, and the rules and regulations of the SEC promulgated
thereunder.
The term "Shelf Registration Statement" shall have the
meaning ascribed to it in Section 2.01(a).
The term "Transfer" shall mean any attempt to, directly or
indirectly, offer, sell, assign, transfer, grant a participation in, pledge or
otherwise dispose of any of the Acquisition Shares, or the consummation of any
such
3
transactions, or the soliciting of any offers to purchase or otherwise
acquire, or take a pledge of any of the Acquisition Shares.
ARTICLE II
REQUIRED REGISTRATION
Section 2.01 Required Registration.
(a) Form S-3. As promptly as practicable, the Company shall
use reasonable best efforts to prepare and file with the SEC a registration
statement (the "Shelf Registration Statement") on Form S-3 or another
appropriate form permitting registration of the Acquisition Shares so as to
permit promptly the resale of the Acquisition Shares by Holder pursuant to an
offering on a delayed or continuous basis pursuant to Rule 415 (or any
successor rule) under the Securities Act (a "Rule 415 Offering") and shall use
reasonable best efforts to cause the Shelf Registration Statement to be
declared effective by the SEC as promptly as practicable.
(b) Effectiveness. The Company shall use reasonable best
efforts to keep the Shelf Registration Statement continuously effective under
the Securities Act until the date that is the earliest to occur of (i) the
date by which all Acquisition Shares covered by the Shelf Registration
Statement have been sold, (ii) the third anniversary of the date hereof and
(iii) when, in the written opinion of counsel to the Company, all outstanding
Acquisition Shares held by persons who are not Affiliates of the Company may
be resold without registration under the Securities Act pursuant to Rule
144(k) under the Act or any successor provision thereto.
(c) Amendments/Supplements. The Company shall amend and
supplement the Shelf Registration Statement and the prospectus contained
therein if required by the rules, regulations or instructions applicable to
the registration form used by the Company for such Shelf Registration
Statement or if required by the Securities Act; provided, however, that the
Company may delay the filing of any such amendment or supplement for up to 90
days if the Company in good faith has a valid business reason for such delay.
(d) Offerings. At any time after the effective date of the
Shelf Registration Statement, Holder, subject to the restrictions and
conditions con- tained herein, and to compliance which all applicable state
and federal securities
4
laws, shall have the right to dispose of all or any portion of the Acquisition
Shares from time to time in negotiated or market transactions.
Section 2.02 Holdback Agreement.
From and after the date on which the Shelf Registration
Statement is declared effective by the SEC (the "Effective Date"), upon the
request of the Company, Holder shall not effect any public sale or
distribution (including sales pursuant to Rule 144) of Acquisition Shares,
during the ten (10)-day period prior to the date on which the Company has
notified Holder that the Company intends to commence a Company Offering
through the filing of a registration statement with the Securities and
Exchange Commission, through the one hundred twenty (120)-day period
immediately following the closing date of such Company Offering; provided,
however, that Holder shall not be obligated to comply with this Section 2.02
on more than one (1) occasion in any twelve (12)-month period.
Section 2.03 Blackout Provisions.
The Company shall be deemed not to have used its reasonable
best efforts to keep the Shelf Registration Statement effective during the
requisite period if the Company voluntarily takes any action that would result
in Holder not being able to offer and sell any Acquisition Shares during that
period, unless (i) such action is required by applicable law, (ii) upon the
occurrence of any event contemplated by Section 2.04(a)(8) below, such action
is taken by the Company in good faith and for valid business reasons or (iii)
the continued effectiveness of the Shelf Registration Statement would require,
on the advice of counsel to the Company, the Company to disclose a material
financing, acquisition or other corporate develoent, and the proper officers
of the Company shall have determined in good faith that such disclosure is not
in the best interests of the Company and its stockholders, and, in the case of
clause (ii) above, the Company thereafter promptly complies with the
requirements of Section 2.04(a)(8) below.
Section 2.04 Registration Procedures.
(a) Procedures. In connection with the registration of the
Acquisition Shares pursuant to this Agreement, the Company shall use
reasonable best efforts to effect the registration and sale of the Acquisition
Shares in accordance with Holder's intended method of disposition thereof and,
in connection therewith, the Company shall as promptly as practicable:
5
(1) prepare and file with the SEC the Shelf
Registration Statement and use reasonable best efforts to cause the
Shelf Registration Statement to become and remain effective in
accordance with Section 2.01(a) and (b) above;
(2) prepare and file with the SEC amendments and
supplements to the Shelf Registration Statement and the prospectuses
used in connection therewith in accordance with Section 2.01(c)
above;
(3) before filing with the SEC the Shelf
Registration Statement or prospectus or any amendments or supplements
thereto, the Company shall furnish to one counsel selected by Holder
and one counsel for the underwriter or sales or placement agent, if
any, in connection therewith, drafts of all such documents proposed
to be filed and provide such counsel with a reasonable opportunity
for review thereof and comment thereon, such review to be conducted
and such comments to be delivered with reasonable promptness;
(4) promptly (i) notify Holder of each of (x) the
filing and effectiveness of the Shelf Registration Statement and each
prospectus and any amendments or supplements thereto, (y) the receipt
of any comments from the SEC or any state securities law authorities
or any other governmental authorities with respect to any such Shelf
Registration Statement or prospectus or any amendments or supplements
thereto, and (z) any oral or written stop order with respect to such
registration, any suspension of the registration or qualification of
the sale of the Acquisition Shares in any jurisdiction or any
initiation or threatening of any proceedings with respect to any of
the foregoing and (ii) use reasonable best efforts to obtain the
withdrawal of any order suspending the registration or qualification
(or the effectiveness thereof) or suspending or preventing the use of
any related prospectus in any jurisdiction with respect thereto;
(5) furnish to Holder, the underwriters or the
sales or placement agent, if any, and one counsel for each of the
foregoing, a conformed copy of the Shelf Registration Statement and
each amendment and supplement thereto (in each case, includ-
6
ing all exhibits thereto) and such additional number of copies of
such Shelf Registration Statement, each amendment and supplement
thereto (in such case, without such exhibits), the prospectus
(including each preliminary prospectus) included in such Shelf
Registration Statement and prospectus supplements and all exhibits
thereto and such other documents as Holder, underwriter, agent or
such counsel may reasonably request in order to facilitate the
disposition of the Acquisition Shares by Holder;
(6) in connection with a sale of Acquisition Shares
by or through an underwriter, if requested by Holder or the managing
underwriter or underwriters of a Rule 415 Offering, subject to
approval of counsel to the Company in its reasonable judgment,
promptly incorporate in a prospectus, supplement or post-effective
amendment to the Shelf Registration Statement such information
concerning underwriters and the plan of distribution of the
Acquisition Shares as such managing underwriter or underwriters or
Holder reasonably shall furnish to the Company in writing and request
be included therein, including, without limitation, information with
respect to the number of Acquisition Shares being sold by Holder to
such underwriter or underwriters, the purchase price being paid
therefor by such underwriter or underwriters and with respect to any
other terms of the underwritten offering of the Acquisition Shares to
be sold in such offering; and make all required filings of such
prospectus, supplement or post-effective amendment as soon as
reasonably practicable after being notified of the matters to be
incorporated in such prospectus, supplement or post-effective
amendment;
(7) use reasonable best efforts to register or
qualify the Acquisition Shares under such securities or "blue sky"
laws of such jurisdictions as Holder reasonably requests and do any
and all other acts and things which may be reasonably necessary or
advisable to enable Holder to consummate the disposition in such
jurisdictions in which the Acquisition Shares are to be sold and keep
such registration or qualification in effect for so long as the Shelf
Registration Statement remains effective under the Securities Act
(provided that the Company shall not be required to (i) qualify
generally to do business in any jurisdiction where it would not
otherwise be required to qualify but for this paragraph, (ii) subject
7
itself to taxation in any such jurisdiction where it would not
otherwise be subject to taxation but for this paragraph or (iii)
consent to the general service of process in any jurisdiction where
it would not otherwise be subject to general service of process but
for this paragraph);
(8) notify Holder, at any time when a prospectus
relating to the Shelf Registration Statement is required to be
delivered under the Securities Act, upon the discovery that, or of
the happening of any event as a result of which, the Shelf
Registration Statement, as then in effect, contains an untrue
statement of a material fact or omits to state any material fact
required to be stated therein or any fact necessary to make the
statements therein not misleading, and, subject to Section 2.03
above, promptly prepare and furnish to the Holder a supplement or
amendment to the prospectus contained in the Shelf Registration
Statement so that the Shelf Registration Statement shall not, and
such prospectus as thereafter delivered to the purchasers of such
Acquisition Shares shall not, contain an untrue statement of a
material fact or omit to state any material fact required to be
stated therein or any fact necessary to make the statements therein
not misleading;
(9) cause all of the Acquisition Shares to be
listed on each national securities exchange and included in each
established over-the-counter market on which or through which the
Common Stock is then listed or traded;
(10) in connection with a sale of Acquisition
Shares by or through an underwriter, make available for inspection by
Holder, any underwriter participating in any disposition pursuant to
the Shelf Registration Statement, and any attorney, accountant or
other agent retained by Holder or underwriter, all reasonably
requested financial and other records, pertinent corporate documents
and properties of the Company, and cause the Company's officers,
directors, employees, attorneys and independent accountants to supply
all information reasonably requested by Holder, underwriters,
attorneys, accountants or agents in connection with the Shelf
Registration Statement; information which the Company determines, in
good faith, to be confidential shall not be disclosed by such persons
unless, subject to Section 2.03 above,
8
(i) the disclosure of such information is required by applicable
federal securities laws or is necessary to avoid or correct a
misstatement or omission in such Shelf Registration Statement or (ii)
the release of such information is ordered pursuant to a subpoena or
other order from a court of competent jurisdiction; Holder agrees, on
Holder's own behalf and on behalf of all of Holder's underwriters,
accountants, attorneys and agents, that the information obtained by
any of them as a result of such inspections shall be deemed
confidential unless and until such is made generally available to the
public; Holder further agrees, on Holder's own behalf and on behalf
of all of Holder's underwriters, accountants, attorneys and agents,
that Holder will, upon learning that disclosure of such information
is sought in a court of competent jurisdiction, give notice to the
Company and allow the Company, at Holder's expense, to undertake
appropriate action to prevent disclosure of the information deemed
confidential; nothing contained herein shall require the Company to
waive any attorney-client privilege or disclose attorney work
product;
(11) use reasonable best efforts to comply with all
applicable laws related to the Shelf Registration Statement and
offering and sale of securities and all applicable rules and
regulations of governmental authorities in connection therewith
(including, without limitation, the Securities Act and the Exchange
Act, and the rules and regulations promulgated by the Commission) and
make generally available to its security holders as soon as
practicable (but in any event not later than fifteen (15) months
after the effectiveness of the Shelf Registration Statement) an
earnings statement of the Company and the Company Subsidiaries
complying with Section 11(a) of the Securities Act;
(12) in connection with a sale of Acquisition
Shares by or through an underwriter, use reasonable best efforts to
furnish to Holder a signed counterpart of (x) an opinion of counsel
for the Company and (y) a "comfort" letter signed by the independent
public accountants who have certified the Company's financial
statements included or incorporated by reference in such registration
statement, covering such matters with respect to such registration
statement and, in the case of the accountants' comfort letter, with
respect to events subsequent to the date of such financial
9
statements as are customarily covered in opinions of issuer's counsel
and in accountants' comfort letters delivered to the underwriters in
underwritten public offerings of securities for the account of, or on
behalf of, a holder of common stock, such opinion and comfort letters
to be dated the date that such opinion and comfort letters are
customarily dated in such transactions; and
(13) take other actions as Holder or the
underwriters, if any, reasonably request in order to expedite or
facilitate the disposition of the Acquisition Shares.
(b) Further Agreements. Without limiting any of the
foregoing, in the event that the sale of Acquisition Shares is to be made by
or through an underwriter, the Company shall enter into an underwriting
agreement with a managing underwriter or underwriters selected by Holder
containing representations, warranties, indemnities and agreements customarily
included (but not inconsistent with the agreements contained herein) by an
issuer of common stock in underwriting agreements with respect to offerings of
common stock for the account of, or on behalf of, holders of common stock;
provided, however, that the Holder shall not utilize the Shelf Registration
Statement for more than one underwritten offering during the term of this
Agreement. In connection with the sale of Acquisition Shares hereunder, Holder
may, at Holder's option, require that any and all representations and
warranties by, and the other agreements of, the Company to or for the benefit
of such underwriter or underwriters (or which would be made to or for the
benefit of such an underwriter or underwriter if such sale of Acquisition
Shares were pursuant to a customary underwritten offering) be made to and for
the benefit of Holder and that any or all of the conditions precedent to the
obligations of such underwriter or underwriters (or which would be so for the
benefit of such underwriter or underwriters under a customary underwriting
agreement) be conditions precedent to the obligations of Holder in connection
with the disposition of Holder's securities pursuant to the terms hereof. In
connection with any offering of Acquisition Shares registered pursuant to this
Agreement, the Company shall, upon receipt of duly endorsed certificates
representing the Acquisition Shares, (x) furnish to the underwriter, if any
(or, if no underwriter, Holder), unlegended certificates representing
ownership of Acquisition Shares being sold, in such denominations as
requested, and (y) instruct any transfer agent and registrar of the
Acquisition Shares to release any stop transfer order with respect thereto.
10
Holder agrees that upon receipt of any notice from the
Company of the happening of any event of the kind described in paragraph (8)
of Section 2.04(a), Holder shall forthwith discontinue Holder's disposition of
Acquisition Shares pursuant to the Shelf Registration Statement and prospectus
relating thereto until Holder's receipt of the copies of the supplemented or
amended prospectus contemplated by paragraph (8) of Section 2.04(a) and, if so
directed by the Company, deliver to the Company all copies, other than
permanent file copies, then in Holder's possession of the prospectus current
at the time of receipt of such notice relating to the Acquisition Shares.
Section 2.05 Registration Expenses.
All expenses incidental to the Company's performance of, or
compliance with, its obligations under this Agreement including, without
limitation, all registration and filing fees, all fees and expenses of
compliance with securities and "blue sky" laws (including, without limitation,
the fees and expenses of counsel for underwriters or placement or sales agents
in connection with "blue sky" law compliance), all printing and copying
expenses, all messenger and delivery expenses, all fees and expenses of the
Company's independent certified public accountants and counsel (including,
without limitation, with respect to "comfort" letters and opinions) and other
Persons retained by the Company in connection therewith (collectively, the
"Registration Expenses"), shall be borne by the Company. The Company shall not
be responsible for and shall not pay the fees and expenses of legal counsel,
accountants, agents or experts retained by Holder in connection with the sale
of the Acquisition Shares. The Company will 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 and the expense of any liability insurance) and the expenses and fees
for listing the Acquisition Shares on the New York Stock Exchange.
Section 2.06 Indemnification.
(a) By the Company. The Company agrees to indemnify Holder
and Holder's heirs, legatees, beneficiaries and permitted assigns against all
losses, claims, damages, liabilities and expenses (collectively, the "Losses")
caused by, resulting from or relating to any untrue or alleged untrue
statement of material fact contained in the Shelf Registration Statement, any
prospectus or preliminary prospectus or any amendment thereof or supplement
thereto or any omission or alleged omission of a material fact required to be
stated therein or
11
necessary to make the statements therein not misleading, except insofar as the
same are caused by or contained in, or alleged to be omitted from, (i) any
financial information of RCI or any of the Affiliated Entities or (ii) any
information furnished in writing to the Company by Holder or its underwriter
or other agent expressly for use therein or by Holder's failure to deliver, or
its underwriter's or other agent's failure to deliver, a copy of the Shelf
Registration Statement or prospectus or any amendments or supplements thereto
after the Company has furnished Holder with the requested number of copies of
the same. In connection with an underwritten offering and without limiting any
of the Company's other obligations under this Agreement, the Company shall
indemnify such underwriters, their officers, directors, employees and agents
and each Person who controls (within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act) such underwriters or such
other indemnified Person to the same extent as provided above with respect to
the indemnification of Holder.
(b) By Holder. In connection with the Shelf Registration
Statement, Holder shall furnish to the Company in writing information
regarding Holder's ownership of Acquisition Shares and Holder's intended
method of distribution thereof and shall indemnify the Company, its directors,
officers, employees and agents and each Person who controls (within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act)
the Company or such other indemnified Person against all Losses caused by,
resulting from or relating to any untrue or alleged untrue statement of
material fact contained in the Shelf Registration Statement, any prospectus or
preliminary prospectus or any amendment thereof or supplement thereto or any
omission or alleged omission of a material fact required to be stated therein
or necessary to make the statements therein not misleading, but only to the
extent that such untrue sement or omission or alleged untrue statement or
omission (i) is caused by, results from or relates to, or is alleged to be
omitted from, such information so furnished in writing by Holder or (ii)
arises out of or results from Holder's failure to deliver, or Holder's
underwriter's or other agent's failure to deliver, a copy of the Shelf
Registration Statement or prospectus or any amendments or supplements thereto
after the Company has furnished Holder with the requested number of copies of
the same. In connection with an underwritten offering and without limiting any
of Holder's other obligations under this Agreement, (i) Holder shall indemnify
such underwriters, their officers, directors, employees and agents and each
Person who controls (within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act) such underwriters or such other indemnified
Person to the same extent as provided above with respect to the
indemnification of the Company and (ii) Holder shall cause each underwriter of
an underwritten offering to
12
indemnify the Company, its directors, officers, employees and agents and each
Person who controls (within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act) the Company or such indemnified Person against
all Losses caused by, resulting from or relating to any untrue or alleged
untrue statement of material fact contained in the Shelf Registration
Statement, any prospectus or preliminary prospectus or any amendment thereof
or supplement thereto or any omission or alleged omission of a material fact
required to be stated therein or necessary to make the statements therein not
misleading, but only to the extent that such untrue statement or omission or
alleged untrue statement or omission (x) is caused by, results from or relates
to, or is alleged to be omitted from, such information furnished in writing by
such underwriter or (y) arises out of or results from such underwriter's
failure to delivery a copy of the Shelf Registration Statement or prospectus
or any amendments or supplements thereto after the Company has furnished such
underwriter with the requested number of copies of the same.
(c) Notice. Any Person entitled to indemnification hereunder
shall give prompt written notice to the indemnifying party of any claim with
respect to which it seeks indemnification; provided, however, the failure to
give such notice shall not release the indemnifying party from its obligation,
except to the extent that the indemnifying party has been prejudiced by such
failure to provide such notice.
(d) Defense of Actions. In any case in which any such action
is brought against any indemnified party, and it notifies an indemnifying
party of the commencement thereof, the indemnifying party shall be entitled to
participate therein, and, to the extent that it may wish, jointly with any
other indemnifying party similarly notified, to assume the defense thereof,
with counsel reasonably satisfactory to such indemnified party, and after
notice from the indemnifying party to such indemnified party of its election
so to assume the defense thereof, the indemnifying party shall not (so long as
it shall continue to have the right to defend, contest, litigate and settle
the matter in question in accordance with this paragraph) be liable to such
indemnified party hereunder for any legal or other expense subsequently
incurred by such indemnified party in connection with the defense thereof
other than reasonable costs of investigation, supervision and monitoring
(unless such indemnified party reasonably objects to such assumption on the
grounds that there may be defenses available to it which are different from or
in addition to the defenses available to such indemnifying party, in which
event the indemnified party shall be reimbursed by the indemnifying party for
the reasonable expenses incurred in connection with retaining one separate
legal
13
counsel). An indemnifying party shall not be liable for any settlement of an
action or claim effected without its consent. The indemnifying party shall
lose its right to defend, contest, litigate and settle a matter if it shall
fail to diligently contest such matter (except to the extent settled in
accordance with the next following sentence). No matter shall be settled by an
indemnifying party without the consent of the indemnified party unless such
settlement contains a full and unconditional release of the indemnified party.
(e) Survival. The indemnification provided for under this
Agreement shall remain in full force and effect regardless of any
investigation made by or on behalf of the indemnified Person and will survive
the transfer of the Acquisition Shares.
(f) Contribution. If recovery is not available under the
foregoing indemnification provisions for any reason or reasons other than as
specified therein, any Person who otherwise would be entitled to
indemnification by the terms thereof shall nevertheless be entitled to
contribution with respect to any Losses with respect to which such Person
would be entitled to such indemnification but for such reason or reasons. In
determining the amount of contribution to which the respective Persons are
entitled, there shall be considered the Persons' relative knowledge and access
to information concerning the matter with respect to which the claim was
asserted, the opportunity to correct and prevent any statement or omission,
and other equitable considerations appropriate under the circumstances. It is
hereby agreed that it would not necessarily be equitable if the amount of such
contribution were determined by pro rata or per capita allocation. 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 found guilty of such fraudulent misrepresentation.
(g) Applicability. The provisions of this Section 2.06 shall
not affect or apply to any rights or obligations of the parties pursuant to
Section 8.9(e) or Article X of the Purchase Agreement.
Section 2.07 Transferability of Registration Rights.
The rights and obligations of Holder under this ARTICLE II
may not be transferred or assigned without the prior written consent of the
Company.
14
ARTICLE III
TRANSFERS OF ACQUISITION SHARES
Section 3.01 Transferability of Acquisition Shares
Holder may not Transfer the Acquisition Shares except in the
following circumstances:
(a) pursuant to Rule 144;
(b) pursuant to the Shelf Registration Statement; or
(c) upon receipt by the Company of an opinion of counsel,
reasonably satisfactory to the Company, that such Transfer is exempt from
registration under the Act.
Section 3.02 Restrictive Legends.
Holder hereby acknowledges and agrees that, during the term
of this Agreement, each of the certificates representing Acquisition Shares
shall be subject to stop transfer instructions and shall include the following
legend:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR THE
SECURITIES LAWS OF ANY STATE. THE SHARES REPRESENTED BY THIS CERTIFICATE MAY
NOT BE TRANSFERRED WHETHER BY SALE, ASSIGNMENT, PLEDGE, ENCUMBRANCE, GIFT,
BEQUEST, APPOINTMENT OR OTHERWISE, AND HFS INCORPORATED (THE "COMPANY") WILL
NOT REGISTER THE TRANSFER OF SUCH SHARES, EXCEPT (A) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE ACT (B) PURSUANT TO RULE 144 UNDER THE ACT OR
(C) UPON RECEIPT BY THE COMPANY OF AN OPINION OF COUNSEL, REASONABLY
SATISFACTORY TO THE COMPANY, THAT SUCH TRANSFER IS EXEMPT FROM REGISTRATION
UNDER THE ACT.
15
ARTICLE IV
MISCELLANEOUS
Section 4.01 Effectiveness of Agreement.
The provisions of this Agreement shall be effective as of
the date hereof.
Section 4.02 Recapitalization.
In the event that any capital stock or other securities are
issued as a dividend or distribution on, in respect of, in exchange for, or in
substitution of, any Acquisition Shares, such securities shall be deemed to be
Acquisition Shares for all purposes under this Agreement.
Section 4.03 Notices.
All notices, requests, demands, waivers and other
communications required or permitted to be given under this Agreement shall be
in writing and shall be deemed to have been duly given if delivered
personally, by mail (certified or registered mail, return receipt requested),
by reputable overnight courier or by facsimile transmission (receipt of which
is confirmed):
(a) If to the Company, to:
HFS Incorporated
Six Xxxxxx Xxx
Xxxxxxxxxx, Xxx Xxxxxx 00000
Attention: Xxxxx X. Xxxxxxx, Esq.
Facsimile: (000) 000-0000
with a copy to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx
Xxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxxx Xxxxx Chuff, Esq.
Facsimile: (000) 000-0000
16
(b) If to Holder, to:
Xx. Xxxxxxxx XxXxxx
0000 Xxxxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxx 00000
with a copy to:
Ice Xxxxxx Xxxxxxx & Xxxx
Xxx Xxxxxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxx 00000
Attention: Berkley Duck, Esq.
Facsimile: (000) 000-0000
or to such other person or address as any party shall specify by notice in
writing, given in accordance with this Section 4.03, to the other parties
hereto. All such notices, requests, demands, waivers and communications shall
be deemed to have been given on the date on which so hand-delivered, on the
third business day following the date on which so mailed, on the next business
day following the date on which delivered to such overnight courier and on the
date of such facsimile transmission and confirmation, except for a notice of
change of person or address, which shall be effective only upon receipt
thereof.
Section 4.04 Entire Agreement.
This Agreement contains the entire understanding of the
parties hereto with respect to the subject matter hereof. This Agreement
supersedes all prior agreements and understandings, oral and written, with
respect to its subject matter.
Section 4.05 Binding Effect; Assignment.
This Agreement and all of the provisions hereof shall be
binding upon and inure to the benefit of the parties hereto and their
respective heirs, executors, successors and permitted assigns, but, except as
expressly contemplated herein, neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned, directly or indirectly,
by the Company or Holder without the prior written consent of the other. Upon
any such assignment, this Agreement shall be amended to substitute the
assignee as a party hereto in a writing reasonably acceptable to the other
party.
17
Section 4.06 Amendment, Modification and Waiver.
This Agreement may be amended, modified or supplemented at
any time by written agreement of the parties hereto. Any failure by Holder, on
the one hand, or the Company, on the other hand, to comply with any term or
provision of this Agreement may be waived by the Company or Holder,
respectively, at any time by an instrument in writing signed by or on behalf
of the Company and Holder, but such waiver or failure to insist upon strict
compliance with such term or provision shall not operate as a waiver of, or
estoppel with respect to, any subsequent or other failure to comply.
Section 4.07 Third-Party Beneficiaries.
This Agreement is not intended, and shall not be deemed, to
confer upon or give any person except the parties hereto and their respective
successors and permitted assigns, any remedy, claim, liability, reimbursement,
cause of action or other right under or by reason of this Agreement.
Section 4.8 Counterparts.
This Agreement may be executed in counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
Section 4.9 Interpretation.
The article and 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.
Section 4.10 Governing Law.
This Agreement shall be governed by the laws of the State of
New York, without regard to the principles of conflicts of law thereof.
Section 4.11 Termination; Restrictive Legend.
Subject to the provisions of Section 2.01(b) hereof, this
Agreement shall terminate on the third anniversary of the date hereof;
provided, however, that the provisions of Section 2.06 hereof shall survive
termination of this Agreement.
18
It is understood and agreed that any restrictive legends set forth on any
Acquisition Shares shall be removed by delivery of substitute certificates
without such legends and such Acquisition Shares shall no longer be subject to
the terms of this Agreement, upon the resale of such Acquisition Shares in
accordance with the terms of this Agreement or, if not theretofore removed, on
the third anniversary of the date hereof.
[SIGNATURE PAGE FOLLOWS]
19
IN WITNESS WHEREOF, the undersigned hereby agree to be bound
by the terms and provisions of this Registration Rights Agreement as of the
date first above written.
HFS INCORPORATED
By:__________________________
Name: Xxxxxxx X. Xxxxxx
Title: Vice Chairman
STOCKHOLDER
_____________________________
Xx. Xxxxxxxx XxXxxx
20
