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REGISTRATION RIGHTS AND LOCK-UP AGREEMENT
Dated as of December 29, 1994
by and among
COLONIAL PROPERTIES TRUST
and
Certain Direct and Indirect Holders of
Limited Partnership Interests
of Colonial Realty Limited Partnership
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REGISTRATION RIGHTS AND LOCK-UP AGREEMENT
THIS REGISTRATION RIGHTS AND LOCK-UP AGREEMENT (this
"Agreement") is made and entered into as of December, 29, 1994 by and among
Colonial Properties Trust, a Maryland real estate investment trust (the
"Company"), Colonial Realty Limited Partnership, a Delaware limited partnership
(the "Operating Partnership"), and the other parties who are signatories hereto
(each a "Holder" and collectively the "Holders").
WHEREAS, on the date hereof the Operating Partnership is
acquiring, among other things, certain assets of various general partnerships in
which the Holders own direct or indirect interests (the "Property Partnerships")
pursuant to merger agreements or acquisition agreements of even date herewith
(the "Contribution Agreements") by and among the Operating Partnership, certain
acquisition partnerships of which the Operating Partnership is the managing
general partner, the Property Partnerships and the Holders, and in connection
therewith the Holders will receive Class C Units of limited partnership interest
in the Operating Partnership (such Class C Units and the Class A Units of
limited partnership interest into which such Class C Units may be converted
being referred to hereinafter as the "Units");
WHEREAS, in order to induce the Property Partnerships and the
Holders to consummate the closings contemplated under the Contribution
Agreements, the Company has agreed to grant to Holders the registration rights
set forth in Section 3 hereof; and
WHEREAS, in order to induce the Operating Partnership to
consummate the closings contemplated under the Contribution Agreements, the
Holders have agreed to the Lock-up (as defined in Section 2(a) hereof).
NOW, THEREFORE, the parties hereto, in consideration of the
foregoing, the mutual covenants and agreements hereinafter set forth, and other
good and valuable consideration, the receipt and sufficiency of which hereby are
acknowledged, hereby agree as follows:
1. Definitions.
As used in this Agreement, the following capitalized defined
terms shall have the following meanings:
"Common Shares" shall mean common shares of beneficial
interest, par value $.01 per share, in the Company.
"Company" shall have the meaning set forth in the Preamble and
also shall include the Company's successors.
"Dispose of" shall have the meaning set forth in Section 2(b)
hereof.
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended from time to time.
"Holder" or "Holders" shall have the meaning set forth in the
Preamble.
"Lock-up" shall have the meaning set forth in Section 2(a)
hereof.
"Lock-up Period" shall have the meaning set forth in Section
2(a) hereof.
"NASD" shall mean the National Association of Securities
Dealers, Inc.
"Operating Partnership" shall have the meaning set forth in
the Preamble and also shall include the Operating Partnership's successors.
"Person" shall mean an individual, partnership, corporation,
trust, estate, or unincorporated organization, or a government or agency or
political subdivision thereof.
"Prospectus" shall mean the prospectus included in a
Registration Statement, including any preliminary prospectus, and any such
prospectus as amended or supplemented by any prospectus supplement with respect
to the terms of the offering of any portion of the Registrable Securities
covered by a Shelf Registration Statement, and by all other amendments and
supplements to such prospectus, including post-effective amendments, and in each
case including all material incorporated by reference therein.
"Registrable Securities" shall mean the Shares, excluding (i)
Shares for which a Registration Statement relating to the sale thereof shall
have become effective under the Securities Act and which have been disposed of
under such Registration Statement or (ii) Shares sold or eligible for sale
pursuant to Section 4(1) of the Securities Act or Rule 144 thereunder.
"Registration Expenses" shall mean any and all expenses
incident to performance of or compliance with this Agreement, including, without
limitation: (i) all SEC, stock exchange or NASD registration and filing fees;
(ii) all fees and expenses incurred in connection with compliance with state
securities or "blue sky" laws (including reasonable fees and disbursements of
counsel in connection with "blue sky" qualification of any of the Registrable
Securities and the preparation of a Blue Sky Memorandum) and compliance with the
rules of the NASD; (iii) all expenses of any Persons in preparing or assisting
in preparing, word processing, printing and distributing any Registration
Statement, any Prospectus, certificates and other documents relating to the
performance of and compliance with this Agreement; (iv) all fees and expenses
incurred in connection with the listing, if any, of any of the Registrable
Securities on any securities exchange or exchanges pursuant to Section 4(l)
hereof; and (v) the fees and disbursements of counsel for the Company and of the
independent public accountants of the Company, including the expenses of any
special audits or "cold comfort" letters required by or incident to such
performance and compliance. Registration Expenses shall specifically exclude
underwriting discounts and commissions, the fees and disbursements of counsel
representing a selling Holder, and transfer taxes, if any, relating to the sale
or disposition of Registrable Securities by a selling Holder, all of which shall
be borne by such Holder in all cases.
"Registration Notice" shall have the meaning set forth in
Section 3(a) hereof.
"Registration Statement" or "Shelf Registration Statement"
shall mean a "shelf" registration statement of the Company and any other Person
required to be a registrant with respect to such shelf registration statement
pursuant to the requirements of the Securities Act which covers the issuance or
resale of the Registrable Securities on an appropriate form under Rule 415 under
the Securities Act, or any similar rule that may be adopted by the SEC, and all
amendments and supplements to such registration statement, including
post-effective amendments, in each case including the Prospectus contained
therein, all exhibits thereto and all materials incorporated by reference
therein.
"SEC" shall mean the Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933, as
amended from time to time.
"Shares" shall mean any Common Shares issued or to be issued
to the Holders upon redemption of their Units.
"Shelf Registration" shall mean a registration required to be
effected pursuant to Section 3 hereof.
"Units" shall have the meaning set forth in the Preamble.
2. Lock-up Agreement.
2(a) Each Holder hereby agrees that, except as set forth in Section 2(b)
below, for one year following the date hereof (the "Lock-up Period"), it will
not, without the prior written consent of the Company, offer, pledge, sell,
contract to sell, grant any options for the sale of or otherwise dispose of,
directly or indirectly (collectively, "Dispose of"), any Units (the "Lock-up").
2(b) The following transfers of Units shall not
be subject to the Lock-up set forth in Section 2(a):
(i) a Holder may Dispose of Units to his or
her spouse, siblings, parents or any natural or
adopted children or other descendants or to any
personal trust in which such family members or such
Holder retain the entire beneficial interest;
(ii) a Holder may Dispose of Units on his or
her death to such Holder's estate, executor,
administrator or personal representative or to such
Holder's beneficiaries pursuant to a devise or
bequest or by the laws of descent and distribution;
(iii) a Holder may Dispose of Units as a
gift or other transfer without
consideration;
(iv) a Holder may Dispose of Units pursuant
to a pledge, grant of security interest or other
encumbrance effected in a bona fide transaction with
an unrelated and unaffiliated pledgee; and
(v) a Holder may Dispose of Units to
another Holder.
In the event that any Holder Disposes of Units as permitted by this Section
2(b), such Units shall remain subject to this Agreement and, as a condition of
the validity of such disposition, the transferee shall be required to execute
and deliver a counterpart of this Agreement (except that a pledgee shall not be
required to execute and deliver a counterpart of this Agreement until it
forecloses upon such Units). Thereafter, such transferee shall be deemed to be a
Holder for purposes of this Agreement.
3. Shelf Registration Under the Securities Act.
3(a) Filing of Shelf Registration Statement. Beginning after the expiration
of the Lock-up Period, each Holder shall be entitled to offer for sale pursuant
to a Registration Statement any Registrable Securities held by such Holder,
subject to the terms and conditions hereof. Upon receipt by the Company of a
written notice (a "Registration Notice") from one or more Holders that such
Holder(s) propose to make a registered offer of a specified number of
Registrable Securities (which number shall not be less than 50,000), the Company
shall cause to be filed a Shelf Registration Statement providing for the sale by
such Holder(s) of the Registrable Securities specified in such Registration
Notice in accordance with the terms hereof and will use its reasonable efforts
to cause such Shelf Registration Statement to be declared effective by the SEC
as soon as practicable. The Company agrees to use its reasonable efforts to keep
the Shelf Registration Statement continuously effective for a period expiring on
the date on which all of the Registrable Securities covered by the Shelf
Registration Statement have been sold pursuant to the Shelf Registration
Statement or have become eligible for sale pursuant to Section 4(1) of the
Securities Act or Rule 144 thereunder and, subject to Section 4(b) and Section
4(i), further agrees to supplement or amend the Shelf Registration Statement, if
and as required by the rules, regulations or instructions applicable to the
registration form used by the Company for such Shelf Registration Statement or
by the Securities Act or by any other rules and regulations thereunder for shelf
registration; provided, however, that the Company shall not be deemed to have
used its reasonable efforts to keep a Registration Statement effective during
the applicable period if it voluntarily takes any action that would result in
selling Holders covered thereby not being able to sell such Registrable
Securities during that period, unless such action is required under applicable
law or the Company has filed a post-effective amendment to the Registration
Statement and the SEC has not declared it effective. Notwithstanding the
foregoing, the Company shall not be required to file a Registration Statement or
to keep a Registration Statement effective if the negotiation or consummation of
a transaction is pending or an event has occurred, which negotiation,
consummation or event would require additional disclosure by the Company in the
Registration Statement of material information which the Company has a bona fide
business purpose for keeping confidential and the nondisclosure of which in the
Registration Statement might cause the Registration Statement to fail to comply
with applicable disclosure requirements; provided, however, that the Company may
not delay, suspend or withdraw a Registration Statement for such reason for more
than 60 days or more often than twice during any period of 12 consecutive
months.
3(b) Expenses. The Company shall pay all Registration Expenses in
connection with any registration pursuant to Section 3(a). Each Holder shall pay
all underwriting discounts, if any, sales commissions, the fees and
disbursements of counsel representing such Holder, and transfer taxes, if any,
relating to the sale or disposition of such Holder's Registrable Securities
pursuant to the Shelf Registration Statement, Section 4(1) of the Securities Act
or Rule 144 thereunder.
3(c) Inclusion in Shelf Registration Statement. Any Holder who does not
timely provide the information reasonably requested by the Company in connection
with the Shelf Registration Statement shall not be entitled to have its
Registrable Securities included in the Shelf Registration Statement.
3(d) Repurchase Option. In lieu of registering Registrable Securities that
a Holder seeks to register pursuant to Section 3(a) hereof, the Company may, by
delivery of written notice to such Holder within 30 days after receipt of a
Registration Notice from such Holder, elect to repurchase such Registrable
Securities for cash, in an amount per Share equal to the average of the closing
prices of the Common Shares on the New York Stock Exchange (or on such other
exchange or in such other market as the Common Shares are then listed or traded)
on the ten trading days preceding the Company's receipt of such Registration
Notice (or, if the common shares have not traded on all ten of such trading
days, in an amount equal to the fair value of such Registrable Securities as
determined in good faith by the Board of Trustees of the Company).
4. Registration Procedures.
In connection with the obligations of the Company with respect
to the Registration Statement pursuant to Section 3 hereof, the Company shall,
to the extent applicable:
4(a) prepare and file with the SEC, within the time period set forth in
Section 3 hereof, a Shelf Registration Statement, which Shelf Registration
Statement (i) shall be available for the sale of the Registrable Securities in
accordance with the intended method or methods of distribution by the selling
Holders thereof, and (ii) shall comply as to form in all material respects with
the requirements of the applicable form and include all financial statements
required by the SEC to be filed therewith;
4(b) subject to the last three sentences of this Section 4(b) and Section
4(i) hereof, (i) prepare and file with the SEC such amendments and
post-effective amendments to each such Registration Statement as may be
necessary to keep such Registration Statement effective for the applicable
period; (ii) cause each such Prospectus to be supplemented by any required
prospectus supplement, and as so supplemented to be filed pursuant to Rule 424
or any similar rule that may be adopted under the Securities Act; (iii) respond
as promptly as practicable to any comments received from the SEC with respect to
the Shelf Registration Statement, or any amendment, post-effective amendment or
supplement relating thereto; and (iv) comply with the provisions of the
Securities Act with respect to the disposition of all securities covered by each
Registration Statement during the applicable period in accordance with the
intended method or methods of distribution by the selling Holders thereof.
Notwithstanding anything to the contrary contained herein, the Company shall not
be required to take any of the actions described in subsections (i), (ii) or
(iii) above with respect to each particular Holder of Registrable Securities
unless and until the Company has received a Registration Notice from a Holder
that such Holder intends to make offers or sales under the Registration
Statement as specified in such Registration Notice; provided, however, that the
Company shall have 10 business days to prepare and file any such amendment or
supplement after receipt of the Registration Notice. Once a Holder has delivered
a Registration Notice to the Company, such Holder shall promptly provide to the
Company such information as the Company reasonably requests in order to identify
such Holder and the method of distribution in a post-effective amendment to the
Registration Statement or a supplement to the Prospectus. Such Holder also shall
notify the Company in writing upon completion of such offer or sale or at such
time as such Holder no longer intends to make offers or sales under the
Registration Statement;
4(c) furnish to each Holder of Registrable Securities that has delivered a
Registration Notice to the Company, without charge, as many copies of each
Prospectus, including each preliminary Prospectus, and any amendment or
supplement thereto and such other documents as such Holder may reasonably
request, in order to facilitate the public sale or other disposition of the
Registrable Securities; the Company consents to the use of the Prospectus,
including each preliminary Prospectus, by each such Holder of Registrable
Securities in connection with the offering and sale of the Registrable
Securities covered by the Prospectus or the preliminary Prospectus;
4(d) use its reasonable efforts to register or qualify the Registrable
Securities by the time the applicable Registration Statement is declared
effective by the SEC under all applicable state securities or "blue sky" laws of
such jurisdictions as any Holder of Registrable Securities covered by a
Registration Statement shall reasonably request in writing, keep each such
registration or qualification effective during the period such Registration
Statement is required to be kept effective or during the period offers or sales
are being made by a Holder that has delivered a Registration Notice to the
Company, whichever is shorter, and do any and all other acts and things which
may be reasonably necessary or advisable to enable such Holder to consummate the
disposition in each such jurisdiction of such Registrable Securities owned by
such Holder; provided, however, that the Company shall not be required to (i)
qualify generally to do business in any jurisdiction or to register as a broker
or dealer in such jurisdiction where it would not otherwise be required to
qualify but for this Section 4(d), (ii) subject itself to taxation in any such
jurisdiction, or (iii) submit to the general service of process in any such
jurisdiction;
4(e) notify each Holder of Registrable Securities that has delivered a
Registration Notice to the Company promptly and, if requested by such Holder,
confirm such advice in writing (i) when a Registration Statement has become
effective and when any post-effective amendments and supplements thereto become
effective, (ii) of the issuance by the SEC or any state securities authority of
any stop order suspending the effectiveness of a Registration Statement or the
initiation of any proceedings for that purpose, (iii) if the Company receives
any notification with respect to the suspension of the qualification of the
Registrable Securities for sale in any jurisdiction or the initiation of any
proceeding for such purpose, and (iv) of the happening of any event during the
period a Registration Statement is effective which is of a type specified in the
last sentence of Section 3(a) hereof or as a result of which such Registration
Statement or the related Prospectus contains any untrue statement of a material
fact or omits to state any material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made (in the case of the Prospectus), not misleading;
4(f) make every reasonable effort to obtain the withdrawal of any order
suspending the effectiveness of a Registration Statement at the earliest
possible moment;
4(g) furnish to each Holder of Registrable Securities that has delivered a
Registration Notice to the Company, without charge, at least one conformed copy
of each Registration Statement and any post-effective amendment thereto (without
documents incorporated therein by reference or exhibits thereto, unless
requested);
4(h) cooperate with the selling Holders of Registrable Securities to
facilitate the timely preparation and delivery of certificates representing
Registrable Securities to be sold and not bearing any Securities Act legend; and
enable certificates for such Registrable Securities to be issued for such
numbers of Shares and registered in such names as the selling Holders may
reasonably request at least two business days prior to any sale of Registrable
Securities;
4(i) subject to the last sentence of Section 3(a) hereof and the last three
sentences of Section 4(b) hereof, upon the occurrence of any event contemplated
by Section 4(e)(iv) hereof, use its reasonable efforts promptly to prepare and
file a supplement or prepare, file and obtain effectiveness of a post-effective
amendment to a Registration Statement or the related Prospectus or any document
incorporated therein by reference or file any other required document so that,
as thereafter delivered to the purchasers of the Registrable Securities, such
Prospectus will not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading;
4(j) make available for inspection by representatives of the Holders of the
Registrable Securities and any counsel or accountant retained by such Holders,
all financial and other records, pertinent corporate documents and properties of
the Company, and cause the respective officers, directors and employees of the
Company to supply all information reasonably requested by any such
representative, counsel or accountant in connection with a Registration
Statement; provided, however, that such records, documents or information which
the Company determines, in good faith, to be confidential and notifies such
representatives, counsel or accountants in writing that such records, documents
or information are confidential shall not be disclosed by the representatives,
counsel or accountants unless (i) the disclosure of such records, documents or
information is necessary to avoid or correct a material misstatement or omission
in a Registration Statement, (ii) the release of such records, documents or
information is ordered pursuant to a subpoena or other order from a court of
competent jurisdiction, or (iii) such records, documents or information have
been generally made available to the public;
4(k) a reasonable time prior to the filing of any Registration Statement,
any Prospectus, any amendment to a Registration Statement or amendment or
supplement to a Prospectus, provide copies of such document (not including any
documents incorporated by reference therein unless requested) to the Holders of
Registrable Securities that have provided a Registration Notice to the Company;
4(l) use its reasonable efforts to cause all Registrable Securities to be
listed on any securities exchange on which similar securities issued by the
Company are then listed;
4(m) provide a CUSIP number for all Registrable Securities, not later than
the effective date of a Registration Statement;
4(n) otherwise use its reasonable efforts to comply with all applicable
rules and regulations of the SEC and make available to its security holders, as
soon as reasonably practicable, an earnings statement covering at least 12
months which shall satisfy the provisions of Section 11(a) of the Securities Act
and Rule 158 thereunder; and
4(o) use its reasonable efforts to cause the Registrable Securities covered
by a Registration Statement to be registered with or approved by such other
governmental agencies or authorities as may be necessary by virtue of the
business and operations of the Company to enable Holders that have delivered
Registration Notices to the Company to consummate the disposition of such
Registrable Securities.
The Company may require each Holder of Registrable Securities
to furnish to the Company in writing such information regarding the proposed
distribution by such Holder of such Registrable Securities as the Company may
from time to time reasonably request in writing.
In connection with and as a condition to the Company's
obligations with respect to the Registration Statement pursuant to Section 3
hereof and this Section 4, each Holder agrees that (i) it will not offer or sell
its Registrable Securities under the Registration Statement until it has
provided a Registration Notice pursuant to Section 4(b) hereof and has received
copies of the supplemental or amended Prospectus contemplated by Section 4(b)
hereof and receives notice that any post-effective amendment has become
effective, (ii) upon receipt of any notice from the Company of the happening of
any event of the kind described in Section 4(e)(iv) hereof, such Holder will
forthwith discontinue disposition of Registrable Securities pursuant to a
Registration Statement until such Holder receives copies of the supplemented or
amended Prospectus contemplated by Section 4(i) hereof and receives notice that
any post-effective amendment has become effective, and, if so directed by the
Company, such Holder will deliver to the Company (at the expense of the Company)
all copies in its possession, other than permanent file copies then in such
Holder's possession, of the Prospectus covering such Registrable Securities
current at the time of receipt of such notice, and (iii) all offers and sales
under the Registration Statement shall be completed within sixty (60) days after
the first date on which offers or sales can be made pursuant to clause (i)
above, and upon expiration of such sixty (60) day period the Holder will not
offer or sell its Registrable Securities under the Registration Statement until
it has again complied with the provisions of clause (i) above.
5. Indemnification; Contribution.
5(a) Indemnification by the Company. The Company agrees to indemnify and
hold harmless each Holder and its officers and directors or trustees and each
Person, if any, who controls any Holder within the meaning of Section 15 of the
Securities Act as follows:
(i) against any and all loss, liability,
claim, damage and expense whatsoever, as incurred,
arising out of any untrue statement or alleged untrue
statement of a material fact contained in any
Registration Statement (or any amendment thereto)
pursuant to which Registrable Securities were
registered under the Securities Act, including all
documents incorporated therein by reference, or the
omission or alleged omission therefrom of a material
fact required to be stated therein or necessary to
make the statements therein not misleading or arising
out of any untrue statement or alleged untrue
statement of a material fact contained in any
Prospectus (or any amendment or supplement thereto),
including all documents incorporated therein by
reference, or the omission or alleged omission
therefrom of a material fact necessary in order to
make the statements therein, in the light of the
circumstances under which they were made, not
misleading;
(ii) against any and all loss, liability,
claim, damage and expense whatsoever, as incurred, to
the extent of the aggregate amount paid in settlement
of any litigation, or investigation or proceeding by
any governmental agency or body, commenced or
threatened, or of any claim whatsoever based upon any
such untrue statement or omission, or any such
alleged untrue statement or omission, if such
settlement is effected with the written consent of
the Company; and
(iii) against any and all expense
whatsoever, as incurred (including reasonable fees
and disbursements of counsel), reasonably incurred in
investigating, preparing or defending against any
litigation, or investigation or proceeding by any
governmental agency or body, commenced or threatened,
in each case whether or not a party, or any claim
whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or
omission, to the extent that any such expense is not
paid under subparagraph (i) or (ii) above;
provided, however, that the indemnity provided pursuant to this Section 5(a)
does not apply to any Holder with respect to any loss, liability, claim, damage
or expense to the extent arising out of (x) any untrue statement or omission or
alleged untrue statement or omission made in reliance upon and in conformity
with written information furnished to the Company by such Holder expressly for
use in a Registration Statement (or any amendment thereto) or any Prospectus (or
any amendment or supplement thereto) or (y) such Holder's failure to deliver an
amended or supplemental Prospectus if such loss, liability, claim, damage or
expense would not have arisen had such delivery occurred.
5(b) Indemnification by Holders. Each Holder severally agrees to indemnify
and hold harmless the Company and the other selling Holders, and each of their
respective directors and officers (including each director and officer of the
Company who signed the Registration Statement), and each Person, if any, who
controls the Company or any other selling Holder within the meaning of Section
15 of the Securities Act, to the same extent as the indemnity contained in
Section 5(a) hereof (except that any settlement described in Section 5(a)(ii)
shall be effected with the written consent of such Holder), but only insofar as
such loss, liability, claim, damage or expense arises out of or is based upon
any untrue statement or omission, or alleged untrue statements or omissions,
made in a Registration Statement (or any amendment thereto) or any Prospectus
(or any amendment or supplement thereto) in reliance upon and in conformity with
written information furnished to the Company by such selling Holder expressly
for use in such Registration Statement (or any amendment thereto) or such
Prospectus (or any amendment or supplement thereto).
5(c) Conduct of Indemnification Proceedings. Each indemnified party shall
give reasonably prompt notice to each indemnifying party of any action or
proceeding commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party (i) shall not relieve
it from any liability which it may have under the indemnity agreement provided
in Section 5(a) or 5(b) above, unless and to the extent it did not otherwise
learn of such action and the lack of notice by the indemnified party results in
the forfeiture by the indemnifying party of substantial rights and defenses and
(ii) shall not, in any event, relieve the indemnifying party from any
obligations to any indemnified party other than the indemnification obligation
provided under Section 5(a) or 5(b) above. If the indemnifying party so elects
within a reasonable time after receipt of such notice, the indemnifying party
may assume the defense of such action or proceeding at such indemnifying party's
own expense with counsel chosen by the indemnifying party and approved by the
indemnified parties defendant in such action or proceeding, which approval shall
not be unreasonably withheld; provided, however, that, if such indemnified party
or parties reasonably determine that a conflict of interest exists where it is
advisable for such indemnified party or parties to be represented by separate
counsel or that, upon advice of counsel, there may be legal defenses available
to them which are different from or in addition to those available to the
indemnifying party, then the indemnifying party shall not be entitled to assume
such defense and the indemnified party or parties shall be entitled to one
separate counsel at the indemnifying party's or parties' expense. If an
indemnifying party is not entitled to assume the defense of such action or
proceeding as a result of the proviso to the preceding sentence, such
indemnifying party's counsel shall be entitled to conduct such indemnifying
party's defense and counsel for the indemnified party or parties shall be
entitled to conduct the defense of such indemnified party or parties, it being
understood that both such counsel will cooperate with each other to conduct the
defense of such action or proceeding as efficiently as possible. If an
indemnifying party is not so entitled to assume the defense of such action or
does not assume such defense, after having received the notice referred to in
the first sentence of this paragraph, the indemnifying party or parties will pay
the reasonable fees and expenses of counsel for the indemnified party or
parties. In such event, however, no indemnifying party will be liable for any
settlement effected without the written consent of such indemnifying party. If
an indemnifying party is entitled to assume, and assumes, the defense of such
action or proceeding in accordance with this paragraph, such indemnifying party
shall not be liable for any fees and expenses of counsel for the indemnified
parties incurred thereafter in connection with such action or proceeding. 5(d)
Contribution. In order to provide for just and equitable contribution in
circumstances in which the indemnity agreement provided for in this Section 5 is
for any reason held to be unenforceable although applicable in accordance with
its terms, the Company and the selling Holders shall contribute to the aggregate
losses, liabilities, claims, damages and expenses of the nature contemplated by
such indemnity agreement incurred by the Company and the selling Holders, in
such proportion as is appropriate to reflect the relative fault of and benefits
to the Company on the one hand and the selling Holders on the other (in such
proportions that the selling Holders are severally, not jointly, responsible for
the balance), in connection with the statements or omissions which resulted in
such losses, claims, damages, liabilities or expenses, as well as any other
relevant equitable considerations. The relative benefits to the indemnifying
party and indemnified parties shall be determined by reference to, among other
things, the total proceeds received by the indemnified party and indemnified
parties in connection with the offering to which such losses, claims, damages,
liabilities or expenses relate. The relative fault of the indemnifying party and
indemnified parties shall be determined by reference to, among other things,
whether the action in question, including any untrue or alleged untrue statement
of a material fact or omission or alleged omission to state a material fact, has
been made by, or relates to information supplied by, such indemnifying party or
the indemnified parties, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such action.
The parties hereto agree that it would not be just or
equitable if contribution pursuant to this Section 5(d) were determined by pro
rata allocation or by any other method of allocation which does not take account
of the equitable considerations referred to in the immediately preceding
paragraph. Notwithstanding the provisions of this Section 5(d), no selling
Holder shall be required to contribute any amount in excess of the amount by
which the total price at which the Registrable Securities of such selling Holder
were offered to the public exceeds the amount of any damages which such selling
Holder would otherwise have been required to pay by reason of such untrue
statement or omission.
Notwithstanding the foregoing, no Person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any Person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section 5(d), each Person, if
any, who controls a Holder within the meaning of Section 15 of the Securities
Act and directors and officers of a Holder shall have the same rights to
contribution as such Holder, and each director of the Company, each officer of
the Company who signed the Registration Statement and each Person, if any, who
controls the Company within the meaning of Section 15 of the Securities Act
shall have the same rights to contribution as the Company.
6. Rule 144 Sales.
6(a) The Company covenants that it will file the reports required to be
filed by the Company under the Securities Act and the Exchange Act so as to
enable any Holder to sell Shares pursuant to Rule 144 under the Securities Act.
6(b) In connection with any sale, transfer or other disposition by any
Holder of any Shares pursuant to Section 4(1) of the Securities Act or Rule 144
thereunder, the Company shall cooperate with such Holder to facilitate the
timely preparation and delivery of certificates representing Shares to be sold
and not bearing any Securities Act legend, and enable certificates for such
Shares to be for such number of shares and registered in such names as the
selling Holders may reasonably request at least two business days prior to any
sale of Shares.
7. Miscellaneous.
7(a) Amendments and Waivers. The provisions of this Agreement, including
the provisions of this sentence, may not be amended, modified or supplemented,
and waivers or consents to departures from the provisions hereof may not be
given without the written consent of the Company and the Holders of a majority
in amount of the outstanding Registrable Securities; provided, however, that no
amendment, modification or supplement or waiver or consent to the departure with
respect to the provisions of Sections 2, 3, 5 or 6 hereof shall be effective as
against any Holder of Registrable Securities unless consented to in writing by
such Holder of Registrable Securities. Notice of any amendment, modification or
supplement to this Agreement adopted in accordance with this Section 7(a) shall
be provided by the Company to each Holder of Registrable Securities at least
thirty (30) days prior to the effective date of such amendment, modification or
supplement.
7(b) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, registered
first-class mail, telex, telecopier, or any courier guaranteeing overnight
delivery, to the parties at their respective addresses set forth opposite their
signatures below or at such other address as a party may indicate by written
notice to the other party or parties.
All such notices and communications shall be deemed to have
been duly given: at the time delivered by hand, if personally delivered; three
(3) business days after being deposited in the mail, postage prepaid, if mailed;
when answered back., if telexed; when receipt is acknowledged, if telecopied; or
at the time delivered, if delivered by an air courier guaranteeing overnight
delivery.
7(c) Successors and Assigns. This Agreement shall inure to the benefit of
and be binding upon the successors, assigns and transferees of each of the
parties, including, without limitation and without the need for an express
assignment, subsequent Holders. If any successor, assignee or transferee of any
Holder shall acquire Registrable Securities, in any manner, whether by operation
of law or otherwise, such Registrable Securities shall be held subject to all of
the terms of this Agreement, and by taking and holding such Registrable
Securities such Person shall be entitled to receive the benefits hereof and
shall be conclusively deemed to have agreed to be bound by all of the terms and
provisions hereof.
7(d) [Intentionally Omitted]
7(e) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
7(f) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
7(g) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF MARYLAND WITHOUT GIVING EFFECT TO THE
CONFLICTS OF LAW PROVISIONS THEREOF.
7(h) Specific Performance. The parties hereto acknowledge that there would
be no adequate remedy at law if any party fails to perform any of its
obligations hereunder, and accordingly agree that each party, in addition to any
other remedy to which it may be entitled at law or in equity, shall be entitled
to compel specific performance of the obligations of any other party under this
Agreement in accordance with the terms and conditions of this Agreement in any
court of the United States or any State thereof having jurisdiction.
7(i) Entire Agreement. This Agreement is intended by the parties as a final
expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the subject matter contained herein. This Agreement supersedes all prior
agreements and understandings between the parties with respect to such subject
matter.
IN WITNESS WHEREOF, each of the parties hereto has executed
this Agreement, or caused this Agreement to be duly executed on its behalf, as
of the date first written above.
Address:
0000 0xx Xxxxxx Xxxxx, COLONIAL PROPERTIES TRUST
Xxxxx 000
Xxxxxxxxxx, Xxxxxxx 00000 By: /s/ Xxxxxx X. Xxxxxx
Chairman of the Board,
President and Chief Executive
Officer
0000 0xx Xxxxxx Xxxxx, COLONIAL REALTY LIMITED
Xxxxx 000 XXXXXXXXXXX
Xxxxxxxxxx, Xxxxxxx 00000
By: COLONIAL PROPERTIES
HOLDING COMPANY, INC.,
General Partner
By: /s/ Xxxxxx X. Xxxxxx
Xxxxxx X. Xxxxxx
President
HOLDERS:
Address:
0000 Xxxx Xxxxxxx Xxxx /s/ Xxxxxx X. Xxxxx
-----------------------------------
Xxxxxxxxxx, Xxxxxxx 00000 Xxxxxx X. Xxxxx
Address:
0000 Xxxxxxxxx Xxxxxxx /s/ Xxxxxxx X. Xxxxxx, Xx.
Xxxxxxxxxx, Xxxxxxx 00000 Xxxxxxx X. Xxxxxx, Xx.
0000 Xxxxx Xxxxxxx Xxxxx /s/ Xxxxxxx X. Xxxxxxx
Xxxxxx, Xxxxxxx 00000 Xxxxxxx X. Xxxxxxx
000 Xxxxxxxx Xxxxx /s/ Xxxxxx X. Xxxxxxx
-----------------------------------
XxXxxxxxx, Xxxxxxx 00000 Xxxxxx X. Xxxxxxx
BERFAN COMPANY
By: /s/ Xxxxxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxxx
Title: General Partner
BAMIL INVESTMENT COMPANY
000 Xxxxxx Xxxxxxx Xxxx By: /s/ Xxxxx X. Xxxxxxx
Xxxxxxxxxx, Xxxxxxx 00000 Xxxxx X. Xxxxxxx,
Managing Partner
