EXHIBIT 10.4
AMENDED AND RESTATED STOCKHOLDERS AGREEMENT
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AMENDED AND RESTATED STOCKHOLDERS AGREEMENT (this "Agreement"), dated
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as of _______, 1999, by and among NRT Incorporated, a Delaware corporation (the
"Company"), Apollo Management, L.P., Cendant Corporation, each of the
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stockholders of the Company listed on Schedule A hereto and such other
stockholders of the Company as may, from time to time, become parties to this
Agreement in accordance with the provisions hereof (individually, a
"Stockholder" and, collectively, the "Stockholders").
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WHEREAS, as of the date hereof, each Stockholder is the beneficial
owner of the shares of Common Stock and/or Preferred Stock (each as defined
herein) set forth on Schedule A hereto; and
WHEREAS, the parties hereto desire to amend and restate the
Stockholders Agreement, dated as of August 11, 1997 (the "1997 Agreement"),
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as more fully set forth herein.
NOW, THEREFORE, in consideration of the foregoing and of the mutual
agreements and covenants contained herein, the sufficiency of which is hereby
acknowledged, the parties hereto agree as follows, hereby amending, restating
and superceding the 1997 Agreement in its entirety:
ARTICLE I
DEFINITIONS
Section 1.1 Definitions. Unless otherwise defined herein, the
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following terms used in this Agreement shall have the meanings specified below:
"Affiliate" shall mean, with respect to any Person, any of (i) a
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director or executive officer of such Person and (ii) any other Person that,
directly or indirectly, controls, or is controlled by or is under common control
with such Person. For the purpose of this definition, "control" (including the
terms "controlling", "controlled by" and "under common control with"), as used
with respect to any Person, shall mean the possession, directly or indirectly,
of the power to direct or cause the direction of the management or policies of
such Person, whether through the ownership of voting securities or by contract
or agency or otherwise; it being understood that Cendant and Sponsors and their
Affiliates shall be deemed to be Affiliates of the Company.
"Apollo" shall mean Apollo Management, L.P.
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"Board" shall mean the Board of Directors of the Company.
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"By-Laws" shall mean the Amended and Restated By-Laws of the Company,
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as amended from time to time.
"Cendant" shall mean Cendant Corporation, a Delaware corporation, or
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any subsidiary of Cendant Corporation that holds the Common Stock or the
Convertible Preferred Stock.
"Commission" shall mean the Securities and Exchange Commission or any
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other federal agency at the time administering the Securities Act.
"Common Stock" shall mean the Common Stock, par value $0.01 per share,
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of the Company.
"Convertible Preferred Stock" shall mean the 5.00% Series B Cumulative
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Convertible Redeemable Preferred Stock of the Company.
"Exchange Act" shall mean the Securities Exchange Act of 1934, or any
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similar federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time. Reference to a
particular section of the Securities Exchange Act of 1934 shall include a
reference to the comparable section, if any, of any such similar federal
statute.
"Junior Preferred Stock" shall mean the 18.00% Series C Cumulative
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Junior Redeemable Preferred Stock.
"Master Franchise Agreements" shall mean the Amended and Restated
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Master Franchise Agreements between the Company and each of Coldwell Banker Real
Estate Corporation, ERA Franchise Systems, Inc. and Century 21 Real Estate
Corporation, as the same shall be amended from time to time after the date
hereof.
"Person" shall mean a corporation, an association, a partnership, a
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limited liability company, an organization, a business, a trust, an individual,
a government or a subdivision thereof or a governmental agency or any other
entity.
"Preferred Stock" shall mean shares of any class of Preferred Stock of
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the Company, including the Senior Preferred Stock, the Convertible Preferred
Stock and the Junior Preferred Stock.
"Public Sale" shall mean any sale of Common Stock or Preferred Stock
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to the public pursuant to a public offering registered under the Securities Act
or to the public
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through a broker, dealer or market maker pursuant to the provisions of Rule 144
(or any similar provision then in force) adopted under the Securities Act.
"Registration Expenses" shall mean all expenses incidental to the
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Company's performance of, or compliance with, its obligations under Article IV
including, without limitation, all registration and filing fees, all fees and
expenses of compliance with securities and "blue sky" laws, all printing and
copying expense, all messenger and delivery expenses, the fees and expenses of
not more than one counsel for all selling securityholders, all fees and expenses
of the Company's independent certified public accountants and counsel and other
Persons retained by the Company in connection therewith. Notwithstanding the
foregoing, Registration Expenses shall not include underwriting discounts or the
fees and expenses of underwriters, accountants, agents or experts retained by a
holder of Common Stock in connection with the sale of Common Stock but shall
include the Company's 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 Common Stock on
the New York Stock Exchange or other exchange or automated quotation system.
"Restricted Securities" shall mean all shares of Common Stock and
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Preferred Stock and any securities obtained upon exchange for or upon conversion
or transfer of or as a distribution on such shares of Common Stock and Preferred
Stock or any such securities, except that any particular Restricted Securities
shall cease to be such when (i) a registration statement with respect to the
sale of such securities shall have become effective under the Securities Act and
such securities shall have been disposed of in accordance with such registration
statement, (ii) such securities shall have been distributed to the public
pursuant to Rule 144 (or any successor provision) under the Securities Act,
(iii) such securities shall have been otherwise transferred, new certificates
for them not bearing a legend restricting further transfer shall have been
delivered by the Company and subsequent disposition of them shall not require
registration or qualification of them under the Securities Act or any similar
state law then in force, or (iv) such securities shall have ceased to be
outstanding. Whenever any particular securities cease to be Restricted
Securities, the holder thereof shall be entitled to receive from the issuer
thereof or its transfer agent, without expense (other than transfer taxes, if
any), new securities of like tenor not bearing a legend of the character set
forth in Section 3.1.
"Securities Act" shall mean the Securities Act of 1933, or any similar
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federal statute, and the rules and regulations of the Commission thereunder, all
as the same shall be in effect at the time. Reference to a particular section
of the Securities Act of 1933 shall include a reference to the comparable
section, if any, of any such similar federal statute.
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"Senior Preferred Stock" shall mean the 9.00% Series A Cumulative
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Senior Redeemable Preferred Stock of the Company.
"Sponsors" shall mean Apollo Investment Fund III, L.P., Apollo
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Overseas Partners III, L.P. and Apollo (UK) Partners III, L.P. As used in this
Agreement, whenever any action requires the consent of, or the determination
of, Sponsors, such consent or determination shall be made upon obtaining the
consent or determination of a majority of the Sponsor Designees (as defined in
Section 2.1).
"Stockholder" shall mean the stockholders listed on Schedule A hereto
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and such other stockholders as may, from time to time, become parties to this
Agreement in accordance with the provisions hereof.
"Transfer" shall mean any conveyance, sale, disposition, lease,
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transfer, pledge or transaction granting a mortgage, encumbrance, lien, security
interest or charge, or any similar transaction.
ARTICLE II
BOARD OF DIRECTORS; VOTING AGREEMENTS
Section 2.1 Board of Directors. (a) Each of the Stockholders shall
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vote all of its Common Stock, and will take all other necessary or desirable
actions within its control, and the Company will take all necessary or desirable
action within its control, in order to cause (i) the number of directors on the
Board to be twelve, except as provided in Section 2.1(b), (ii) five of the Board
members to be nominated by Cendant (each, a "Cendant Designee"), (iii) five of
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the Board members to be nominated by Sponsors (each a "Sponsor Designee") and
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(iv) two of the Board members (the "Jointly Designated Directors") to be
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jointly nominated by Cendant and Sponsors, provided that at each such person
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designated as a Jointly Designated Director must not be employed by, a
consultant to, or an officer or director of, Cendant, Sponsors or any of their
Affiliates (other than the Company or its subsidiaries); provided, further, that
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at least one Cendant Designee and least one Sponsor Designee must be an
"independent director" (within the meaning of the rules of the New York Stock
Exchange or other exchange or market upon which the Common Stock is then or
proposed to be listed) and shall be subject to the approval of Sponsors and
Cendant, respectively, which approval will not be unreasonably withheld. It is
hereby agreed that the Jointly Designated Directors shall initially be Xxxxxxxx
X. Xxxxxx and Xxxxxx X. Xxxxxx.
(b) As soon as legally permissible, each Stockholder shall vote
all of its shares of Common Stock and will take all other necessary or desirable
actions to call, or cause the Company to call, a special or annual meeting of
stockholders of the
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Company and to vote all of the shares of Common Stock owned or held of record by
such Stockholder for, or to take all actions by written consent in lieu of any
such meeting necessary to cause, the removal, in accordance with the applicable
provisions of the By-Laws, of any director designated and elected pursuant to
Section 2.1(a) if:
(i) such director is a Cendant Designee, upon the request of
Cendant by written notice to the other Stockholders;
(ii) such director is a Sponsor Designee, upon the request of
Sponsors by written notice to the other Stockholders; or
(iii) such director is a Jointly Designated Director, only upon
the request of both Cendant and Sponsors.
(c) In the event that any Cendant Designee or Sponsor Designee
shall for any reason cease to serve as a member of the Board during his term of
office, the resulting vacancy on the Board will be filled by a representative
designated, respectively, by Cendant or Sponsors, as the case may be. In the
event that any Jointly Designated Director shall for any reason cease to serve
as a member of the Board during his term of office, the resulting vacancy on the
Board will be filled by a Jointly Designated Director jointly chosen by Cendant
and Sponsors.
(d) Each Stockholder agrees to vote its shares of Common Stock
at any special or annual meeting of stockholders, or take all actions by written
consent in lieu of any meeting necessary to (i) cause the election of members of
the Board so that the Board is constituted in accordance with this Section 2.1
and (ii) prevent the removal, other than for cause, of any Jointly Designated
Director, except as provided in Section 2.1(b)(iii).
ARTICLE III
TRANSFER OF SHARES
Section 3.1 Restrictions on Transfer; Legend on Certificates. (a)
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Except for Transfers of shares of capital stock of the Company (i) to a
Stockholder on the date hereof or one of its wholly owned subsidiaries (in the
case of Sponsors, whose officers are all bona fide officers of such Sponsor),
(ii) from one Sponsor to another Sponsor, (iii) pursuant to a registration
statement filed by the Company pursuant to Article IV hereof, (iv) from a
Sponsor to an investment fund of which Apollo or an entity that is an Affiliate
of Apollo holds sole voting and investment discretion with respect to such
shares or (v) in connection with the Transfer by any Sponsor of all or
substantially all of its assets to its investors, from such Sponsor to its
investors (provided that such Transfer would not
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otherwise be a Transfer of the type described in (A), (B) or (C) below)), in
each case in compliance with federal and all applicable state securities laws,
none of Sponsors or Apollo shall, directly or indirectly, Transfer, in a single
transaction or a series of transactions, (A) shares of Common Stock and/or
securities convertible into or exercisable for shares of Common Stock to any
person or group (each as defined in Section 13(d)(3) of the Exchange Act), if
such person or group would, as a result of such Transfer, acquire beneficial
ownership of 20% or more of the then outstanding Common Stock, (B) shares of
Common Stock and/or securities convertible into or exercisable for shares of
Common Stock representing in the aggregate more than 10% of the then outstanding
Common Stock to any person or group, and (C) shares of Common Stock and/or
securities convertible into or exercisable for Common Stock to any person or
group (other than Cendant or its designee) if such person or group would, as a
result of such Transfer, become the beneficial owner of 30% or more of the
Common Stock, unless, in the case of (A) or (B) above, Sponsors or Apollo shall
have received the prior written consent of Cendant to such Transfer (which
consent shall not be unreasonably withheld). For purposes of the foregoing
sentence, reasonable grounds for withholding consent shall include, without
limitation, if Cendant believes in good faith, in its sole discretion, that the
proposed transferee may be acquiring such securities with the purpose of
acquiring, changing or influencing control of the Company (or facilitating any
such acquisition, change or influence of control), which belief may be based,
without limitation, on the proposed transferee's failure to disclaim any present
control intention, any previous history or a reputation of seeking to acquire,
change or influence control of a company. In the case of a Transfer pursuant to
clause (i) above, immediately prior to such time as the transferee of such
shares is no longer a wholly owned subsidiary of the holder of such shares on
the date hereof, the transferee shall immediately transfer such shares to a
Person who is then a wholly owned subsidiary of the holder of such shares on the
date hereof and who would then be a permitted transferee pursuant to clause (i).
Notwithstanding the foregoing, nothing in this Agreement shall restrict the
Transfer of any ownership interests in Apollo or any successor thereto, or any
Transfer of indirect ownership interests in Apollo; and nothing in this
Agreement shall restrict the Transfer of investment interests in any funds
managed by Apollo or any affiliate thereof which do not hold, as their primary
investment, securities of the Company.
(b) Until the earlier of (i) the third anniversary of the date hereof
or (ii) the date on which Sponsors own less than 5% of the Common Stock, Cendant
shall not be entitled to Transfer any shares of Common Stock or Convertible
Preferred Stock except that Cendant may Transfer such shares (i) to a
Stockholder on the date hereof or one of its wholly owned subsidiaries, (ii)
pursuant to a registration statement filed by the Company pursuant to Article IV
hereof or (iii) in a sale not registered under the Securities Act up to an
aggregate of $25 million of Common Stock and Convertible Preferred Stock in any
quarter but not in excess of an aggregate of $50 million of Common Stock and
Convertible Preferred Stock in any year, in each case less any amount sold by
Cendant pursuant to Article IV during the respective quarter or year, as the
case may
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be. In the case of a Transfer pursuant to clause (i) above, immediately prior to
such time as the transferee of such shares is no longer a wholly owned
subsidiary of the holder of such shares on the date hereof, the transferee shall
immediately transfer such shares to a Person who is then a wholly owned
subsidiary of the Stockholder on the date hereof and who would then be a
permitted transferee pursuant to clause (A).
(c) In addition to any other restrictions contained in this
Agreement, no Stockholder shall Transfer any Restricted Securities except (i)
pursuant to an effective registration statement under the Securities Act, (ii)
pursuant to Rule 144 or 144A (or any successor provisions) under the Securities
Act or (iii) upon receipt by the Company of an opinion of counsel in form and
substance reasonably satisfactory to the Company to the effect that such
Transfer is exempt from the registration requirements of the Securities Act.
(d) Unless otherwise expressly provided herein, each certificate
for Restricted Securities and each certificate issued in exchange for or upon
transfer of any thereof shall be stamped or otherwise imprinted with a legend in
substantially the following form:
"The securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended, and the transfer
of such securities is subject to the conditions specified in that certain
Amended and Restated Stockholders Agreement, dated as of ________ __, 1999,
among NRT Incorporated and the stockholders listed therein, a counterpart
of which has been placed on file by the issuer at its principal place of
business and its registered office. The issuer reserves the right to
refuse the transfer of such securities until such conditions have been
fulfilled with respect to such transfer."
(e) Any other provision of this Agreement to the contrary
notwithstanding, no Transfer of any shares of Common Stock or Preferred Stock
may be made to any Person (other than Transfers pursuant to a registration
statement filed by the Company pursuant to Article IV hereof) unless such Person
shall have agreed in writing that such Person, as a Stockholder, and the shares
of Common Stock or Preferred Stock it acquires, shall be bound by all the
provisions of this Agreement applicable to shares of the class of Common Stock
or Preferred Stock acquired by such Person. Any purported Transfer of shares of
Common Stock or Preferred Stock without compliance with the applicable
provisions of this Agreement shall be void and of no effect, and the purported
transferee shall have no rights hereunder. In the event of such non-complying
Transfer, the Company shall not transfer any such shares of Common Stock or
Preferred Stock on its books or recognize the purported transferee as a
shareholder for any purpose, until all applicable provisions of this Agreement
have been complied with.
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ARTICLE IV
REGISTRATION RIGHTS
Section 4.1 Demand Registration. (a) At the request of Sponsors, the
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Company shall use reasonable efforts to effect the registration under the
Securities Act pursuant to the terms of this Section 4.1(a) of the shares of
Common Stock held by Sponsors; provided that upon the Public Sale of all of
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Sponsors' Common Stock, Sponsors will no longer be entitled to any registration
rights pursuant to this Section 4.1. At the request of Cendant, the Company
shall use reasonable efforts to effect a registration under the Securities Act
pursuant to this Section 4.1(a) of the shares of Common Stock or Convertible
Preferred Stock held by Cendant. Sponsors jointly and Cendant shall each be
entitled to four underwritten registrations pursuant to this Section 4.1 and
Sponsors jointly and Cendant shall each be entitled to one "shelf" registration
pursuant to this Section 4.1. Until the earlier of (i) the third anniversary of
the date hereof or (ii) the date on which Sponsors own less than 5% of the
Common Stock, in any such registration requested by Sponsors or Cendant, and in
any additional underwritten registrations of Common Stock held by Sponsors or
Cendant which the Company elects to effect (other than as required pursuant to
this Section 4.1(a)), Sponsors shall be entitled to register up to the greater
of (i) 80% of the total number of shares to be registered in the secondary
offering by Sponsors and Cendant (including any shares to be sold by Sponsors
and Cendant pursuant to the underwriters' over-allotment option, if exercised)
or (ii) such percentage of the total number of shares to be registered in the
secondary offering by Sponsors and Cendant such that Sponsors will have sold at
least 70% of all shares sold by Sponsors and Cendant following the Company's
initial public offering. After the third anniversary of the date hereof, in any
registration requested by Sponsors or Cendant, and in any additional under
written registrations of Common Stock held by Sponsors or Cendant which the
Company elects to effect (other than as required pursuant to this Section
4.1(a)), each of Sponsors and Cendant shall be entitled to register a number of
shares equal to 50% of the total number of shares to be registered in the
secondary offering by Sponsors and Cendant (including any shares to be sold by
Sponsors and Cendant pursuant to the underwriters' over-allotment option, if
exercised). Notwithstanding the foregoing, once Sponsors own less than 5% of
the Common Stock, in any registration requested by Cendant or Sponsors, Cendant
shall be entitled to register 100% of the total number of shares to be
registered in a secondary offering (including any shares to be sold pursuant to
the underwriters' overallotment option, if exercised), subject to Sponsors'
right to include shares in such registration pursuant to Section 4.2 (subject to
the limitations set forth in Section 4.2(b)). In any registration hereunder,
Cendant shall be entitled, at its election, to (i) register the number of shares
permitted to be registered by Cendant hereunder or (ii) cause the Company to
register on its own behalf the number of shares set forth in clause (i) and use
the proceeds from the sale of such shares to redeem, at Cendant's election, the
Convertible Preferred Stock or Senior Preferred Stock, if permitted by
applicable law. If the proceeds of any sale under this Section 4.1 are not
permitted under applicable law to be used to
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redeem the Convertible Preferred Stock or Senior Preferred Stock, then such
proceeds shall be held by the Company to be paid in respect of such shares when
and to the extent permitted by law.
(b) Registrations under this Section 4.1 shall be on such
appropriate registration form of the Commission (i) as shall be selected by the
Company and (ii) as shall permit the disposition of the Common Stock in
accordance with the intended method or methods of disposition.
(c) The Company will pay all Registration Expenses in connection
with any registration pursuant to this Section 4.1.
(d) If a registration pursuant to this Section 4.1 involves an
underwritten offering, the underwriter or underwriters thereof shall be
selected, after consultation with the Company, jointly by Sponsors and Cendant,
and shall be reasonably acceptable to the Company.
(e) A registration requested pursuant to this Section 4.1 shall
not be deemed to have been effected (i) if a registration statement with respect
thereto has not become effective, provided that a registration which does not
become effective after the Company has filed a registration statement with
respect thereto solely by reason of the refusal of Sponsors or Cendant to
proceed shall be deemed to have been effected by the Company at the request of
Sponsors or Cendant, as the case may be, (ii) if, after it has become effective,
such registration becomes subject to, for longer than 90 days, any stop order,
injunction or other order of the Commission or other governmental agency or
court for any reason or (iii) if the conditions to closing specified in the
purchase agreement or underwriting agreement entered into in connection with
such registration are not satisfied, other than by reason of some act or
omission by Sponsors. If a registration requested pursuant to this Section 4.1
is to be a "shelf" registration, the Company shall use reasonable efforts to
keep such registration statement effective for one year after the effective date
thereof, provided that the Company shall not be required to keep the
registration statement effective if the continued effectiveness of the
registration statement would require the Company to disclose a material
financing, acquisition or other corporate development and the Company shall have
determined that such disclosure is not in the best interests of the Company for
such period not to exceed 180 days; and provided further that the requirement to
use reasonable efforts to keep the registration statement effective shall be
extended one day for each day that the Company allows the effectiveness of the
registration statement to lapse in reliance on the preceding proviso.
(f) If a registration pursuant to this Section 4.1 involves an
underwritten offering, and the managing underwriter shall advise the Company in
writing (with a copy to each holder of Common Stock being registered) that, in
its opinion, the number of shares of Common Stock requested to be included in
such registration exceeds
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the number which can be sold in such offering within a price range acceptable to
the Stockholders requesting such registration, the Company will include in such
registration, to the extent of the number which the Company is so advised can be
sold in such offering, Common Stock to be included in such registration by
Sponsors and Cendant (or, if Cendant makes the election described in Section
4.1(a), the Company) pro rata among such holders on the basis of the number of
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shares of Common Stock requested to be included by such holders.
Section 4.2 Incidental Registration. (a) If the Company at any time
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proposes to register any of its Common Stock under the Securities Act (other
than by a registration on Form S-4 or S-8 or any successor or similar forms and
other than pursuant to Section 4.1), whether or not for sale for its own
account, it will each such time give prompt written notice to the Stockholders
of its intention to do so and of such holders' rights under this Section 4.2.
Upon the written request of any such holder made within 20 days after the
receipt of any such notice (which request shall specify the Common Stock or
Convertible Preferred Stock intended to be disposed of by such holder and the
intended method of disposition thereof), the Company will, subject to the terms
of this Agreement, use reasonable efforts to effect the registration under the
Securities Act of all Common Stock and Convertible Preferred Stock which the
Company has been so requested to register by the holders thereof, to the extent
required to permit the disposition (in accordance with the intended methods
thereof as aforesaid) of the Common Stock and Convertible Preferred Stock so
to be registered, provided that if, at any time after giving written notice of
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its intention to register any securities and prior to the effective date of the
registration statement filed in connection with such registration, the Company
shall determine for any reason either not to register or to delay registration
of such securities, the Company may, at its election, give written notice of
such determination to each Stockholder and, thereupon, (i) in the case of a
determination not to register, shall be relieved of its obligation to register
any Common Stock and Convertible Preferred Stock in connection with such
registration (but not from its obligation to pay the Registration Expenses in
connection therewith), and (ii) in the case of a determination to delay
registering, shall be permitted to delay registering any Common Stock and
Convertible Preferred Stock, for the same period as the delay in registering
such other securities. The Company will pay all Registration Expenses in
connection with each registration of Common Stock and Convertible Preferred
Stock pursuant to this Section 4.2.
(b) If (i) a registration pursuant to this Section 4.2
involves an underwritten offering of the securities so being registered, whether
or not for sale for the account of the Company, to be distributed (on a firm
commitment basis) by or through one or more underwriters of recognized standing
under underwriting terms appropriate for such a transaction and (ii) the
managing underwriter of such underwritten offering shall inform the Company and
holders of Common Stock and Convertible Preferred Stock requesting such
registration by letter of its belief that the distribution of all or a specified
number of such Common Stock and Convertible Preferred Stock concurrently with
the
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securities being distributed by such underwriters would interfere with the
successful marketing of the securities being distributed by such underwriters
(such writing to state the basis of such belief and the approximate number of
shares of such Common Stock and Convertible Preferred Stock which may be
distributed without such effect), then the Company may, upon written notice to
all holders of Common Stock and Convertible Preferred Stock, reduce pro rata (if
and to the extent stated by such managing underwriter to be necessary to
eliminate such effect) the number of such shares of Common Stock and Convertible
Preferred Stock the registration of which shall have been requested by each
holder of Common Stock and each holder of Convertible Preferred Stock pursuant
to this Section 4.2 so that the resultant aggregate number of shares of Common
Stock and Convertible Preferred Stock so included in such registration pursuant
to this Section 4.2 shall be equal to the number of shares stated in such
managing underwriter's letter.
Section 4.3 Registration Procedures. If and whenever the Company is
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required to use reasonable efforts to effect the registration of any Common
Stock or Convertible Preferred Stock under the Securities Act as provided in
Sections 4.1 and 4.2, the Company shall, as expeditiously as possible:
(i) prepare and within 60 days after the end of the
period within which requests for registration may be given to the Company
or as soon thereafter as possible (in the case of a registration pursuant
to Section 4.1, such filing to be made within 60 days after the request of
Sponsors or Cendant, as applicable, or in any event, as soon thereafter as
possible) file with the Commission the requisite registration statement to
effect such registration and thereafter use reasonable efforts to cause
such registration statement to become effective, provided, however, that
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the Company may postpone filing any registration statement otherwise
required to be filed by the Company pursuant to Section 4.1 or suspend the
use of any effective registration statement for a reasonable period of time
not to exceed 180 days, if the Chairman of the Board determines in his good
faith, reasonable judgment that such registration or distribution would be
materially detrimental to the Company or because the Company is in
possession of material non-public information the disclosure of which would
be materially detrimental to the Company;
(ii) subject to Section 4.1(e), prepare and file with
the Commission such amendments and supplements to such registration
statement and the prospectus used in connection therewith as may be
necessary to keep such registration statement effective and to comply with
the provisions of the Securities Act with respect to the disposition of all
securities covered by such registration statement until the earlier of (A)
such time as all of such securities have been disposed of in accordance
with the intended methods of disposition set forth in the registration
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statement and (B) (i) in the case of a registration pursuant to Section 4.1
other than a "shelf" registration statement, the expiration of 180 days
after such registration statement becomes effective, (ii) in the case of a
"shelf" registration pursuant to Section 4.1, the expiration of one year
after such registration statement becomes effective, but subject to Section
4.1(e), and (iii) in the case of a registration pursuant to Section 4.2,
the expiration of 90 days after such registration statement becomes
effective;
(ii) furnish to each seller of Common Stock and Convertible
Preferred Stock covered by such registration statement such number of
conformed copies of such registration statement and of each such amendment
and supplement thereto (in each case including all exhibits), such number
of copies of the prospectus contained in such registration statement
(including each preliminary prospectus and any summary prospectus) and any
other prospectus filed under Rule 424 under the Securities Act, in
conformity with the requirements of the Securities Act, and such other
documents, as such seller may reasonably request in order to facilitate the
public sale or other disposition of the Common Stock and Convertible
Preferred Stock owned by such seller;
(iv) use reasonable efforts to register or qualify all Common
Stock and Convertible Preferred Stock under such other securities laws or
blue sky laws of such jurisdictions as any seller thereof shall reasonably
request, to keep such registrations or qualifications in effect for so long
as such registration statement remains in effect, and take any other action
which may be reasonably necessary or advisable to enable such seller to
consummate the disposition in such jurisdictions of the securities owned by
such seller, except that the Company shall not for any such purpose be
required to qualify generally to do business as a foreign corporation in
any jurisdiction wherein it would not but for the requirements of this
subdivision (iv) be obligated to be so qualified, to subject itself to
income taxation in any such jurisdiction or to consent to general service
of process in any such jurisdiction;
(v) use reasonable efforts to cause all Common Stock and
Convertible Preferred Stock covered by such registration statement to be
registered with or approved by such other governmental agencies or
authorities as may be necessary to enable the seller or sellers thereof to
consummate the disposition of such Common Stock or Convertible Preferred
Stock;
(vi) notify the holders of Common Stock and Convertible
Preferred Stock and the managing underwriter or underwrit-
12
ers, if any, promptly and confirm such advice in writing promptly there
after:
(A) when the registration statement, the prospectus or any
prospectus supplement related thereto or post-effective amendment to
the registration statement has been filed, and, with respect to the
registration statement or any post-effective amendment thereto, when
the same has become effective;
(B) of any request by the Commission for amendments or
supplements to the registration statement or the prospectus or for
additional information;
(C) of the issuance by the Commission of any stop order
suspending the effectiveness of the registration statement or the
initiation of any proceedings by any Person for that purpose;
(D) if at any time the representations and warranties of the
Company made as contemplated by Section 4.4 below cease to be true and
correct; and
(E) of the receipt by the Company of any notification with
respect to the suspension of the qualification of any Common Stock or
Convertible Preferred Stock for sale under the securities or blue sky
laws of any jurisdiction or the initiation or threat of any
proceeding for such purpose;
(vii) notify each seller of Common Stock and Convertible
Preferred Stock covered by such registration statement, at any time when a
prospectus relating thereto is required to be delivered under the
Securities Act, upon the Company's discovery that, or upon the happening of
any event as a result of which, the prospectus included in such
registration statement, as then in effect, includes an untrue statement of
a material fact or omits to state any material fact required to be stated
therein or necessary to make the statements therein not misleading in the
light of the circumstances under which they were made, and at the request
of any such seller promptly prepare and furnish to such seller a reasonable
number of copies of a supplement to or an amendment of such prospectus
as may be necessary so that, as thereafter delivered to the purchasers of
such securities, such prospectus shall not include an untrue statement of
a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading in the
light of the circumstances under which they were made;
13
(viii) otherwise use reasonable efforts to comply with all
applicable rules and regulations of the Commission, and make available to
the holders of Common Stock and Convertible Preferred Stock, as soon as
reasonably practicable, an earnings statement covering the period of at
least twelve months, but not more than eighteen months, beginning with the
first full quarter after the effective date of such registration statement,
which earnings statement shall satisfy the provisions of Section 11(a) of
the Securities Act and Rule 158 thereunder, and will furnish to each such
seller at least five business days prior to the filing thereof a copy of
any amendment or supplement to such registration statement or prospectus
and shall not file any thereof to which any such seller shall have
reasonably objected on the grounds that such amendment or supplement does
not comply in all material respects with the requirements of the Securities
Act or of the rules or regulations thereunder;
(ix) make available for inspection by a representative or
representatives of the holders of Common Stock and Convertible Preferred
Stock, each such representative representing the holders of not less than a
majority of the Common Stock and Convertible Preferred Stock included in
the registration, any underwriter participating in any disposition pursuant
to the registration statement and any attorney or accountant retained by
such selling holders or underwriter (each, an "Inspector"), all reasonably
---------
requested financial and other records, pertinent corporate documents and
properties of the Company (the "Records"), and cause the Company's
-------
officers, directors and employees to supply all information reasonably
requested by any such Inspector in connection with such registration in
order to permit a reasonable investigation within the meaning of Section 11
of the Securities Act, provided that the Company shall not be required to
--------
comply with this subdivision (ix) if there is a reasonable likelihood, in
the judgment of the Company, that such delivery could result in the loss of
any attorney-client privilege related thereto; and provided, further, that
-------- -------
Records which the Company determines, in good faith, to be confidential and
which it notifies the Inspectors are confidential shall not be disclosed to
any Inspector unless such Inspector shall have executed a confidentiality
agreement reasonably acceptable to the Company.
(x) furnish to each underwriter, if an underwritten offering,
customary "comfort" letters from its independent auditors, legal opinions
from counsel to the Company on customary matters, and such other
certificates, instruments or other matters reasonably requested by the
underwriters;
(xi) cause the Company's executive officers, including its
chief executive officer and chief financial officer, to be available to
meet with potential investors and to participate in any "roadshow"
requested by the underwriters and which in the underwriters' judgment is
reasonably necessary or
14
appropriate for the sale of the Common Stock and Convertible Preferred
Stock; and
(xii) take such other action that may be requested by a seller
of Common Stock or Convertible Preferred Stock that are customary and
reasonably required in connection with the sale of Common Stock or
Convertible Preferred Stock.
The Company may require each seller of Common Stock and Convertible
Preferred Stock as to which any registration is being effected to furnish the
Company such information regarding such seller and the distribution of such
securities as the Company, state "blue sky" commissions or the Commission may
from time to time reasonably request in writing.
Each Stockholder agrees that, upon receipt of any notice from the
Company of the occurrence of any event of the kind described in subdivision
(vii) of this Section 4.3, such holder will forthwith discontinue such
Stockholder's disposition of Common Stock and Convertible Preferred Stock
pursuant to the registration statement relating to such Common Stock and
Convertible Preferred Stock until such Stockholder's receipt of the copies of
the supplemented or amended prospectus contemplated by subdivision (vii) of this
Section 4.3 and, if so directed by the Company, will deliver to the Company (at
the Company's expense) all copies, other than permanent file copies, then in
such Stockholder's possession of the prospectus relating to such Common Stock
and Convertible Preferred Stock current at the time of receipt of such notice.
In the event the Company shall give any such notice, the period mentioned in
paragraph (ii) of this Section 4.3 shall be extended by the length of the period
from and including the date when each seller of any Common Stock or Convertible
Preferred Stock covered by such registration statement shall have received such
notice to the date on which each such seller has received the copies of the
supplemented or amended prospectus contemplated by paragraph (vii) of this
Section 4.3.
Section 4.4 Underwritten Offerings. (a) If requested by the
----------------------
underwriters for any underwritten offering pursuant to a registration under
Section 4.1, the Company will enter into an underwriting agreement with such
underwriters for such offering, such agreement to be reasonably satisfactory in
substance and form to the Company and the underwriters, and to contain such
representations and warranties by the Company and such other terms as are
generally prevailing in agreements of this type, including, without limitation,
indemnities to the effect and to the extent provided in Section 4.6. The
Stockholders will cooperate with the Company in the negotiation of the
underwriting agreement and will give consideration to the reasonable suggestions
of the Company regarding the form thereof.
15
(b) If the Company at any time proposes to register any of its
securities under the Securities Act and such securities are to be distributed by
or through one or more underwriters, the Company will, if requested by any
Stockholder as provided in Section 4.2 and subject to the provisions of Section
4.2(b), use reasonable efforts to arrange for such underwriters to include all
the Common Stock and Convertible Preferred Stock to be offered and sold by such
holder among the securities to be distributed by such underwriters.
(c) Each Stockholder agrees, if so required by the managing
underwriter, not to sell, make any short sale of, loan, grant any option for the
purchase of, effect any public sale or distribution of or otherwise dispose of
any equity securities of the Company, in violation of Regulation M under the
Securities Act or during the 120 days (or such time as reasonably requested by
the managing underwriter) after any underwritten registration pursuant to
Section 4.1 or 4.2 has become effective, except as part of such underwritten
registration or pursuant to Section 3.1, whether or not such Stockholder
participates in such registration.
(d) No Person may participate in any underwritten offering
hereunder unless such Person (i) agrees to sell such Person's securities on the
basis provided in any underwriting arrangements approved, subject to the terms
and conditions hereof, by the Company and the holders of a majority of Common
Stock and Convertible Preferred Stock to be included in such underwritten
offering, (ii) completes and executes all questionnaires, indemnities,
underwriting agreements and other documents (other than powers of attorney)
required under the terms of such underwriting arrangements and (iii) makes the
representations and warranties provided for in Section 4.4(a).
Section 4.5 Preparation; Reasonable Investigation. In connection
-------------------------------------
with the preparation and filing of each registration statement under the
Securities Act pursuant to this Agreement, the Company will give the holders of
Common Stock and Convertible Preferred Stock registered under such registration
statement, their underwriters, if any, and their respective counsel and
accountants the reasonable opportunity to participate in the preparation of such
registration statement, each prospectus included therein or filed with the
Commission, and each amendment thereof or supplement thereto.
Section 4.6 Indemnification. (a) In the event of any registration
---------------
of any securities of the Company under the Securities Act, the Company will, and
hereby does, indemnify and hold harmless (i) in the case of any registration
statement filed pursuant to Section 4.1 or 4.2, each Stockholder covered by such
registration statement, its directors and officers, each broker who participates
in such offering or sale on behalf of a Stockholder, each other Person who
participates as an underwriter in the offering or sale of such securities and
each other Person, if any, who controls such Stockholder or any such
underwriter within the meaning of the Securities Act, against any losses,
claims, damages or liabilities, joint or several, to which such Stockholder or
any such director or officer or
16
underwriter or controlling person may become subject under the Securities Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions or
proceedings, whether commenced or threatened, in respect thereof) arise out of
or are based upon any untrue statement or alleged untrue statement of any
material fact contained in any registration statement under which such
securities were registered under the Securities Act, any preliminary prospectus,
final prospectus or summary prospectus contained therein, or any amendment or
supplement thereto, or any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, and the Company will reimburse such Stockholder and each
such director, officer, underwriter and controlling person for any legal or any
other expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, liability, action or proceeding, provided that
--------
the Company shall not be liable in any such case to the extent that any such
loss, claim, damage, liability (or action or proceeding in respect thereof) or
expense arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in such registration statement,
any such preliminary prospectus, final prospectus, summary prospectus, amendment
or supplement in reliance upon and in conformity with information furnished to
the Company by any Stockholder or any underwriter participating in the offering,
and provided further that the Company shall not be liable to any Person who
--------
participates as an underwriter in the offering or sale of Common Stock or
Convertible Preferred Stock or to any other Person, if any, who controls such
underwriter within the meaning of the Securities Act, in any such case to the
extent that any such loss, claim, damage, liability (or action or proceeding in
respect thereof) or expense arises out of such Person's failure to send or give
a copy of the final prospectus, as the same may be then supplemented or amended,
within the time required by the Securities Act to the Person asserting an untrue
statement or alleged untrue statement or omission or alleged omission at or
prior to the written confirmation of the sale of Common Stock or Convertible
Preferred Stock to such Person if such statement or omission was corrected in
such final prospectus. Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of such Stockholder or any
such director, officer, underwriter or controlling person and shall survive the
transfer of such securities by such Stockholder.
(b) The Company may require, as a condition to including any
Common Stock or Convertible Preferred Stock in any registration statement filed
pursuant to Sections 4.1 or 4.2, that the Company shall have received an
undertaking satisfactory to it from the prospective seller of such Common Stock
or Convertible Preferred Stock, to indemnify and hold harmless (in the same
manner and to the same extent as set forth in subdivision (a) of this Section
4.6) the Company, each director of the Company, each officer of the Company and
each other Person, if any, who controls the Company within the meaning of the
Securities Act and each other Person who participates as an underwriter in the
offering or sale of such securities and each other Person, if any, who controls
any such underwriter within the meaning of the Securities Act, with respect to
any statement or alleged statement in or omission or alleged omission from such
registration statement, any
17
preliminary prospectus, final prospectus or summary prospectus contained
therein, or any amendment or supplement thereto, if such statement or alleged
statement or omission or alleged omission was made in reliance upon and in
conformity with information furnished to the Company by such seller. Any such
indemnity shall remain in full force and effect, regardless of any investigation
made by or on behalf of the Company or any such director, officer or controlling
person and shall survive the transfer of such securities by such seller. Such
indemnity shall be limited to the net proceeds from such offering received by
such indemnitor.
(c) Promptly after receipt by an indemnified party of notice of
the commencement of any action or proceeding involving a claim referred to in
the preceding subdivisions of this Section 4.6, such indemnified party will, if
a claim in respect thereof is to be made against an indemnifying party, give
written notice to the latter of the commencement of such action, provided that
--------
the failure of any indemnified party to give notice as provided herein shall not
relieve the indemnifying party of its obligations under the preceding
subdivisions of this Section 4.6, except to the extent that the indemnifying
party is actually prejudiced by such failure to give notice. In case any such
action is brought against an indemnified party, unless a conflict of interest
between such indemnified and indemnifying parties would exist in respect of
such claim, the indemnifying party shall be entitled to participate in and to
assume the defense thereof, jointly with any other indemnifying party similarly
notified, to the extent that the indemnifying party may wish, with counsel
reasonably satisfactory to such indemnified party, and after notice from the
indemnifying party to such indemnified party of its election so to assume the
defense thereof, the indemnifying party shall not be liable to such indemnified
party for any legal or other expenses subsequently incurred by the latter in
connection with the defense thereof other than reasonable costs of
investigation. No indemnifying party shall, without the consent of the
indemnified party, consent to entry of any judgment or enter into any settlement
of any such action which does not include as an unconditional term thereof the
giving by the claimant or plaintiff to such indemnified party of a release from
all liability, or a covenant not to xxx, in respect to such claim or litigation.
No indemnified party shall consent to entry of any judgment or enter into any
settlement of any such action the defense of which has been assumed by an
indemnifying party without the consent of such indemnifying party.
(d) If the indemnification provided for in the preceding
subdivisions of this Section 4.6 is unavailable to an indemnified party in
respect of any expense, loss, claim, damage or liability referred to therein,
then each 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 expense, loss, claim, damage or liability. In determining the
amount of contribution to which an indemnified party is entitled, there shall be
considered such indemnified party's 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 appro-
18
priate 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.
ARTICLE V
CERTAIN COVENANTS
Section 5.1 Reasonable Access. Subject to Section 5.4, the Company
-----------------
agrees that each Stockholder (and its representatives) may, upon reasonable
notice during normal business hours, visit and inspect the properties of the
Company and its subsidiaries and examine and copy their books of record and
account and discuss their affairs, finances and accounts with their officers and
accountants. Subject to Section 5.4, the Company shall furnish to Sponsors and
Cendant, monthly financial information consisting of at least: monthly and year-
to-date operating statements, statements of cash flows and month-end balance
sheets, in each case, on a pre-acquisition accounting and a post-acquisition
accounting basis, and otherwise in accordance with generally accepted accounting
principles as then in effect, any forecasted information prepared by the
Company, a comparison to Company's forecast for such period and a corresponding
period of the prior year and such other financial information as may be
reasonably required by any stockholder in order to evaluate and monitor its
investment in the Company.
Section 5.2 Action by Stockholders. The Stockholders shall from time
----------------------
to time vote their shares of Common Stock and Convertible Preferred Stock as may
be required to cause the Company to comply with the provisions of this
Agreement.
Section 5.3 Further Actions. In case at any time after the date
---------------
hereof any further action is necessary or desirable to carry out the purposes of
this Agreement, each party hereto shall take all such necessary action.
Section 5.4 Confidentiality. Each Stockholder shall use, and shall
---------------
cause its Affiliates, employees and agents to use, its or their best efforts to
ensure that confidential information concerning the business and affairs of the
Company and its subsidiaries are kept confidential unless the Company shall have
consented to the disclosure of such information, provided that such information
--------
may be disclosed to the extent required by law or legal process, provided,
--------
further, that any party may disclose such information pursuant to the terms of a
-------
customary confidentiality agreement to a Person engaged in good faith
negotiations to acquire all or substantially all of the equity interests or
business of such party, provided, further, that the Stockholders may provide
-------- -------
regular reports to their respective investors. The Company shall use, and shall
cause its Affiliates, employees and
19
agents to use, its or their best efforts to ensure that the terms of this
Agreement and information concerning the business and affairs of each
Stockholder are kept confidential unless such Stockholder shall have consented
to the disclosure of such information. The foregoing shall not prohibit
disclosure of information which (i) is or becomes publicly available other than
as a result of a violation of this Section 5.4, (ii) is or becomes available to
a Stockholder or the Company, as the case may be, from a source (other than the
Company or any Stockholder, as the case may be) which is not prohibited from
disclosing such information by legal, contractual or fiduciary obligations or
(iii) is required to be included in a registration statement filed pursuant to
Article IV.
Section 5.5 Additional Shares. Each Stockholder agrees that upon
-----------------
acquisition of additional shares of Common Stock or Preferred Stock by such
party or its subsidiaries or other controlled entities, whether by purchase,
conversion, exercise of an option, or otherwise, the additional shares will
become subject to this Agreement and such Stockholder shall become bound by the
terms of this Agreement with respect to such additional shares.
ARTICLE VI
MISCELLANEOUS
Section 6.1 Notices. Any notice, request or other document to be
-------
given hereunder to any party shall be effective upon receipt (or refusal of
receipt) and shall be in writing and delivered personally or sent by telex,
telecopy or certified or registered mail, postage prepaid and addressed to:
If to the Company, addressed to:
NRT Incorporated
0 Xxxxxx Xxx
Xxxxxxxxxx, XX 00000
Telecopy No.: (000) 000-0000
Attention: General Counsel
If to Cendant or Cendant Operations, Inc., addressed to:
Cendant Corporation
0 Xxxxxx Xxx
Xxxxxxxxxx, XX 00000
Telecopy No.: (000) 000-0000
Attention: General Counsel
20
with a copy to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Telecopy No.: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxx
If to Apollo or Sponsors, addressed to:
Apollo Management L.P.
0000 Xxxxxx xx xxx Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Telecopy No.: (000) 000-0000
Attention: Xxxxxx X. Xxxxxx
With a copy to:
Xxxxxx & Xxxxxxx
000 Xxxxx Xxxxxx
Xxxxx 0000
Xxx Xxxx, XX 00000
Telecopy No.: (000) 000-0000
Attention: Xxxxxxx X. Xxx
or to such other address as any party shall have specified by written notice
given to the other parties in the manner specified above.
Section 6.2 Binding Nature of Agreement; No Third Party
-------------------------------------------
Beneficiaries. This Agreement shall be binding upon and inure to the benefit of
and be enforceable by the parties hereto or their successors in interest, except
as expressly otherwise provided herein. Nothing in this Agreement shall convey
any rights upon any person or entity which is not a party or an assignee of a
party to this Agreement.
Section 6.3 Descriptive Headings. The descriptive headings of the
--------------------
several sections and paragraphs of this Agreement are inserted for reference
only and shall not limit or otherwise affect the meaning hereof.
Section 6.4 Specific Performance. Without limiting the rights of
--------------------
each party hereto to pursue all other legal and equitable rights available to
such party for the other parties' failure to perform their obligations under
this Agreement, the parties hereto
21
acknowledge and agree that the remedy at law for any failure to perform their
obligations hereunder would be inadequate and that each of them, respectively,
shall be entitled to specific performance, injunctive relief or other equitable
remedies in the event of any such failure.
Section 6.5 Governing Law. This Agreement shall be construed and
-------------
enforced in accordance with, and the rights of the parties shall be governed by,
the laws of the State of Delaware, without regard to the principles of conflicts
of law. Each party irrevocably consents to the service of any and all process
in any action or proceeding arising out of or relating to this Agreement by the
mailing of copies of such process to each party at its address specified herein.
The parties hereto irrevocably submit to the non-exclusive jurisdiction of the
United States District Court for the Southern District of New York (or, if
subject matter jurisdiction in that court is not available, in any state court
located within the City of New York) over any dispute arising out of or relating
to this Agreement or any agreement or instrument contemplated hereby or entered
into in connection herewith or any of the transactions contemplated hereby or
thereby. Each party hereby irrevocably agrees that all claims in respect of
such dispute or proceeding may be heard and determined in such courts. The
parties hereby irrevocably waive, to the fullest extent permitted by applicable
law, any objection which they may now or hereafter have to the laying of venue
of any such dispute brought in such court or any defense of inconvenient forum
in connection therewith.
Section 6.6 Counterparts. This Agreement may be executed
------------
simultaneously in any number of counterparts, each of which shall be deemed an
original, but all such counterparts shall together constitute one and the same
instrument.
Section 6.7 Severability. In the event that any one or more of the
------------
provisions contained herein, or the application thereof in any circumstances, is
held invalid, illegal or unenforceable in any respect for any reason, the
validity, legality and enforceability of any such provision in every other
respect and of the remaining provisions contained herein shall not be in any way
impaired thereby, it being intended that all of the rights and privileges of the
parties hereto shall be enforceable to the fullest extent permitted by law.
Section 6.8 Entire Agreement. This Agreement is intended by the
----------------
parties hereto as a final and complete expression of their agreement and
understanding in respect to the subject matter contained herein. This Agreement
supersedes all prior agreements and understandings, written or oral, between the
parties with respect to such subject matter.
Section 6.9 Amendment and Waiver. Any provision of this Agreement
--------------------
may be amended if, but only if, such amendment is in writing and is signed by
the Company and the Stockholders (or their Affiliates or transferees) owning at
least a
22
majority of the then outstanding shares of each class of Preferred Stock and
Common Stock, provided that (i) no such amendment may materially adversely
--------
affect the rights of any Stockholder without the prior written consent of such
Stockholder, (ii) Section 3.1 may be amended only if such amendment is in
writing and is signed by the Company and all of the Stockholders, (iii) no such
amendment may both (A) adversely affect the rights of Stockholders of any class
and (B) treat the holders of such class differently from holders of another
class in a manner not contemplated by this Agreement without the prior written
consent of holders of a majority of shares (whether outstanding or issuable) of
the class so adversely affected. Any provision may be waived if, but only if,
such waiver is in writing and is signed by or on behalf of the party waiving
such provision.
Section 6.10 Termination. Upon such time as either of Cendant or
-----------
Sponsors ceases to beneficially own any shares of the Common Stock or the
Convertible Preferred Stock, this Agreement shall terminate and be of no further
force and effect; provided, however, that (i) the obligations of the parties
-------- -------
under Article II shall terminate when either of Cendant or Apollo beneficially
owns less than 5% of the outstanding shares of the Company's voting stock, (ii)
the obligations of the parties pursuant to Articles IV and V shall continue and
shall not terminate and (iii) Cendant shall continue to have the right to
designate one director for election to the Board pursuant to Article II, and the
Company shall cause such designee to be nominated for election to the Board, so
long as any of the Master Franchise Agreements remains in effect.
Section 6.11 Expenses. All costs and expenses incurred by Sponsors,
--------
Cendant and Bear, Xxxxxxx & Co., Inc. in connection with this Agreement and the
transactions contemplated hereby shall be borne by the Company.
Section 6.12 Effect on Prior Agreement; References. (a) This
-------------------------------------
Agreement amends, restates and supercedes the 1997 Agreement in its entirety
and, upon the effective date hereof, all provisions of the 1997 Agreement shall
terminate and have no further force or effect.
(b) All references to the 1997 Agreement in any other agreement to
which any of the parties hereto are a party shall from and after the date hereof
be deemed to be references to this Agreement.
23
IN WITNESS HEREOF, the parties have caused this Agreement to be
executed and delivered as of the date first above written.
CENDANT CORPORATION
By:____________________________________
Name:
Title:
CENDANT OPERATIONS, INC.
By:____________________________________
Name:
Title:
For purposes of Article III only,
APOLLO MANAGEMENT L.P.
By:____________________________________
Name:
Title:
APOLLO INVESTMENT FUND III, L.P.
By: APOLLO ADVISORS II, L.P.
------------------------
its General Partner
By: APOLLO CAPITAL MANAGEMENT II, INC.
----------------------------------
its General Partner
By: _____________________
Name:
Title:
24
APOLLO OVERSEAS PARTNERS III, L.P.
By: APOLLO ADVISORS II, L.P.
------------------------
its General Partner
By: APOLLO CAPITAL MANAGEMENT II, INC.
----------------------------------
its General Partner
By: _______________________
Name:
Title:
APOLLO (UK) PARTNERS III, L.P.
By: APOLLO ADVISORS II, L.P.
------------------------
its General Partner
By: APOLLO CAPITAL MANAGEMENT II, INC.
----------------------------------
its General Partner
By: _______________________
Name:
Title:
25
Schedule A to
Stockholders Agreement
----------------------
Class Number
Stockholder of Stock of Shares
----------- -------- ---------
Apollo Investment Fund III, L.P. Common Stock 9,116,263
Apollo Overseas Partners III, L.P. Common Stock 545,832
Apollo (UK) Partners III, L.P. Common Stock 337,905
Cendant Operations, Inc. Senior Preferred Stock 157,591
Cendant Operations, Inc. Convertible Preferred Stock 24,000
Apollo Investment Fund III, L.P. Junior Preferred Stock 62,459
Apollo Overseas Partners III, L.P. Junior Preferred Stock 3,738
Apollo (UK) Partners III, L.P. Junior Preferred Stock 2,313
26
