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EXHIBIT 4.5
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REGISTRATION RIGHTS AGREEMENT
by and between
HOLLYWOOD THEATER HOLDINGS, INC.
and
XXXXXXX X. XXXXXXX REVOCABLE TRUST
Dated as of November 1, 1996
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REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT ("Agreement") is entered into as of
November 1, 1996, by and between HOLLYWOOD THEATER HOLDINGS, INC., a Delaware
corporation (the "Company") and XXXXXXX X. XXXXXXX REVOCABLE TRUST ("Xxxxxxx").
WITNESSETH:
WHEREAS, the Company and Xxxxxxx have entered into an Asset and Stock
Purchase Agreement (the "Purchase Agreement"), pursuant to which the Company
will, among other things, purchase all of the outstanding capital stock of
Crown Theatre Corporation from Xxxxxxx in exchange for shares of Common Stock
of the Company:
WHEREAS, simultaneously herewith, Xxxxxxx will enter into the existing
Shareholders Agreement (the "Shareholders' Agreement") with the Company and the
other equity holders of the Company ; and
WHEREAS, the execution and delivery of this Agreement is a condition
to the closing of the Purchase Agreement.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and obligations hereinafter set forth, the parties hereto hereby
agree as follows:
1. Certain Definitions.
As used in this Agreement, the following terms shall have the meanings
ascribed to them below:
"Affiliate" means (i) with respect to any Person, any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person or (ii) with respect to any
individual, the spouse, child, step-child, grandchild, niece, nephew or parent
of such Person, or the spouse thereof or (iii) with respect to Xxxxxxx, Xxxxxxx
X. Xxxxxxx.
"Common Stock" means the Common Stock, par value $.01 per share, of
the Company and any equity securities issued or issuable with respect to the
Common Stock in connection with a reclassification, recapitalization, merger,
consolidation or other reorganization.
"Holder" or "Holders" means Xxxxxxx and any Person who shall hereafter
acquire and hold Registrable Securities.
"Investor Conversion Shares" means "Conversion Shares" under and as
defined in any Investor Registration Rights Agreement.
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"Investor Registration Rights Agreement" means, individually or
collectively, (i) that certain Registration Rights Agreement dated as of
October 3, 1996, by and between the Company and The Beacon Group III-Focus
Value Fund, L.P. and/or (ii) that certain Amended and Restated Registration
Rights Agreement dated October 3, 1996, by and among the Company, Stratford
Capital Partners, L.P., a Texas limited partnership and Precept Investors,
Inc., a Texas corporation.
"Investor Registrable Securities" means "Registrable Securities" under
and as defined in any Investor Registration Rights Agreement.
"Investor Holders" means "Holders" under and as defined in any
Investor Registration Rights Agreement.
"IPO" means the initial underwritten public offering pursuant to which
the Common Stock becomes registered under Section 12 of the Securities Exchange
Act of 1934. as amended (the "Exchange Act").
"Major Holder" means with respect to any registration the Holder that,
together with its Affiliates, includes the largest number of Registrable
Securities in such registration.
"Person" means any individual, corporation, limited liability company,
limited or general partnership, joint venture, association, joint-stock
company, trust, unincorporated organization or government or any agency or
political subdivisions thereof.
"Registrable Securities" means any (i) shares of Common Stock owned by
Xxxxxxx, whether acquired on the date hereof or hereafter acquired, (ii) shares
of Common Stock acquired from Xxxxxxx by any Person after the date hereof
pursuant to rights granted to Xxxxxxx under the Shareholders' Agreement, and
(iii) shares of Common Stock issued or issuable, directly or indirectly, with
respect to the Common Stock referenced in clauses (i) or (ii) above by way of
stock dividend, stock split or combination of shares. As to any particular
Registrable Securities, such securities shall cease to be Registrable
Securities when (i) a registration statement with respect to the sale of such
securities shall have been declared effective under the Securities Act and such
securities shall have been disposed of in accordance with such registration
statement, or (ii) such securities shall have been sold (other than in a
privately negotiated sale) pursuant to Rule 144 (or any successor provision)
under the Securities Act or (iii) such securities are eligible for sale under
Rule 144(k) (or any successor provision) under the Securities Act.
"Requisite Percentage of Holders" means holders of 15% or more of the
total Registrable Securities then outstanding.
"SEC" means the United States Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
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2. Registration Rights.
2.1 Piggyback Registrations.
(a) Piggyback Registrations. If, at any time, the
Company first proposes or is required to register its Common Stock under the
Securities Act for purposes of effecting an IPO on a registration statement on
Form S-1 (or an equivalent general registration form then in effect), whether
or not for its own account, the Company shall give prompt written notice of its
intention to do so to each of the Holders of record of Registrable Securities.
Upon the written request of any of the Holders made within 15 days following
the receipt of any such written notice (which request shall specify the
Registrable Securities intended to be disposed of by such Holder and the
intended method of distribution thereof), the Company shall use its best
efforts to cause all such Registrable Securities, the Holders of which have so
requested the registration thereof, to be registered under the Securities Act
(with the securities which the Company at the time proposes to register) to
permit the sale or other disposition by the Holders (in accordance with the
intended method of distribution thereof) of the Registrable Securities to be so
registered. The number of such piggyback registrations pursuant to the
preceding sentence which the Company is obligated to effect is limited to one.
(b) Abandonment or Delay. If, at any time after giving
written notice of its intention to effect an IPO and register its Common Stock
and prior to the effective date of the registration statement filed in
connection with such registration, the Company shall determine for any reason
not to register or to delay registration of its Common Stock, the Company may,
at its election, give written notice of such determination to all Holders of
record of Registrable Securities and (i) in the case of a determination not to
register, shall be relieved of its obligation to register any Registrable
Securities in connection with such abandoned registration, without prejudice,
however, to the rights of Holders under Section 2.1(a), and (ii) in the case of
a determination to delay such registration of its Common Stock shall be
permitted to delay the registration of such Registrable Securities for the same
period as the delay in registering its Common Stock.
(c) Holder's Right to Withdraw. Any Holder shall have
the right to withdraw its request for inclusion of its Registrable Securities
in any registration statement pursuant to this Section 2.1 by giving written
notice to the Company of its request to withdraw; provided, however, that (i)
such request must be made in writing prior to the earlier of the execution of
the underwriting agreement or the execution of the custody agreement with
respect to such registration and (ii) such withdrawal shall be irrevocable and,
after making such withdrawal, a Holder shall no longer have any right to
include Registrable Securities in the registration as to which such withdrawal
was made or any subsequent registration if any Registrable Securities are
registered pursuant to the initial registration.
(d) Cutbacks. If the managing underwriter of any
underwritten offering shall inform the Company in writing of its belief that
the number of Registrable Securities requested to be included in a registration
under this Section 2.1 would materially adversely affect such offering,
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then the Company will include in such registration, first, Investor Registrable
Securities of any Investor Holder or Investor Holders to the extent, but only
to the extent that registration is being requested under this Section 2.1 in
connection with a registration required because of an exercise by such Investor
Holder or Investor Holders of demand registration rights under an Investor
Registration Rights Agreement, second, the securities proposed by the Company
to be sold for its own account, third, the Registrable Securities and Investor
Registrable Securities to be included in such registration to the extent of the
number and type which the Company is so advised can be sold in (or during the
time of) such offering, pro rata among the Holders and Investor Holders
participating in such offering in accordance with the number of Registrable
Securities held by each such Holder and Investor Conversion Shares held by and
issuable upon conversion of Investor Registrable Securities held by each such
Investor Holder, and fourth, all other securities of the Company to be included
in such registration to the extent of the number and type which the Company is
so advised can be sold in (or during the time of) such offering.
2.2 Demand Registrations.
(a) Request for Registration. If any of the Holders'
Registrable Securities are cutback pursuant to Section 2.1(d), then all
Holders, in the aggregate, shall be entitled to one Demand Registration Request
as defined herein. Subject to Section 2.2(c), at any time after the closing of
an IPO, one or more Holders of Registrable Securities representing the
Requisite Percentage of Holders shall have the right to require the Company to
file a registration statement under the Securities Act covering the Registrable
Securities, by delivering a written request therefor to the Company specifying
the Registrable Securities to be included in such registration by such
Holder(s) and the intended method of distribution thereof. Any such request
pursuant to this Section 2.2(a) is referred to herein as a "Demand Registration
Request," and the registration so requested is referred to herein as a "Demand
Registration."
(b) Registration. The Company shall, as expeditiously as
possible following a Demand Registration Request, use its best efforts to (i)
effect such registration under the Securities Act (including, without
limitation, by means of a shelf registration pursuant to Rule 415 under the
Securities Act if so requested and if the Company is then eligible to use such
a registration) of the Registrable Securities which the Company has been so
requested to register, for distribution in accordance with such intended method
of distribution, and (ii) if requested by the Major Holder, obtain acceleration
of the effective date of the registration statement relating to such
registration.
(c) Limitations on Requested Registrations. The rights
of Holders of Registrable Securities to request a Demand Registration pursuant
to Section 2.2(a) are subject to the following limitations: (i) in no event
shall a Holder be entitled to a Demand Registration Request unless such Holder
was subject to a cutback pursuant to Section 2.1(d), (ii) the Company shall not
be obligated to effect a Demand Registration within six months after the
effective date of any other registration of securities (other than pursuant to
a registration on Form S-8 or any successor or similar form which is then in
effect), (iii) the Company shall not be required to effect more than one Demand
Registration relating to Registrable Securities and (iv) in no event shall the
Company be required
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to effect a Demand Registration unless the Company, at the time of the filing
of the registration statement to be filed pursuant to the Demand Registration,
will be entitled to register the Registrable Securities on Form S-3.
(d) Cutbacks. If the managing underwriter of any
underwritten offering shall advise the Holders participating in a Demand
Registration that the Registrable Securities covered by the registration
statement cannot be sold in such offering within a price range acceptable to
the Major Holder, then the Major Holder shall have the right to notify the
Company in writing that they have determined that the registration statement be
abandoned or withdrawn, in which event the Company shall abandon or withdraw
such registration statement. If the managing underwriter of any underwritten
offering shall advise the Company in writing that, in its opinion, the number
of securities requested to be included in a Demand Registration exceeds the
number which can be sold in such offering within a price range acceptable to
the Major Holder, 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,
Registrable Securities requested to be included in such registration, pro rata
among the Holders in accordance with the number of Registrable Securities each
such Holder so requested to be registered. Any Registrable Securities
requested to be included in such registration by Xxxxxxx shall be the last to
be reduced.
(e) Selection of Underwriters. The managing underwriter
or underwriters with respect to a Demand Registration shall be selected by the
Company (and shall be reasonably acceptable to the Major Holder).
2.3 Registration Procedures. If and whenever the Company is
required by the provisions of this Agreement to use its best efforts to effect
or cause the registration of any Registrable Securities under the Securities
Act as provided in this Agreement, the Company shall, as expeditiously as
possible:
(a) prepare and file with the SEC a registration
statement on an appropriate registration form of the SEC for the disposition of
such Registrable Securities in accordance with the intended method of
disposition thereof, which form (i) shall be selected by the Company and (ii)
shall, in the case of a shelf registration, be available for the sale of the
Registrable Securities by the selling Holders thereof and such registration
statement 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, and the Company shall use its best
efforts to cause such registration statement to become effective (provided,
however, that before filing a registration statement or prospectus or any
amendments or supplements thereto, or comparable statements under securities or
blue sky laws of any jurisdiction, the Company will furnish to one counsel for
the Holders participating in the planned offering (selected by the Major
Holder) and the underwriters, if any, copies of all such documents proposed to
be filed (including all exhibits thereto), which documents will be subject to
the reasonable review and reasonable comment of such counsel, and the Company
shall not file any registration statement or amendment thereto or any
prospectus or supplement thereto to which the holders of a majority of the
aggregate of the Registrable Securities and Investor
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Registrable Securities covered by such registration statement or the
underwriters, if any, shall reasonably object in writing);
(b) prepare and file with the SEC 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 for such period (which shall not be required to exceed 120 days in
the case of a registration pursuant to Section 2.1 or 150 days in the case of a
registration pursuant to Section 2.2) as any seller of Registrable Securities
pursuant to such registration statement shall request and to comply with the
provisions of the Securities Act with respect to the sale or other disposition
of all Registrable Securities covered by such registration statement in
accordance with the intended methods of disposition by the seller or sellers
thereof set forth in such registration statement;
(c) furnish, without charge, to each seller of such
Registrable Securities and each underwriter, if any, of the securities covered
by such registration statement such number of copies of such registration
statement, each amendment and supplement thereto (in each case including all
exhibits), and the prospectus included in such registration statement
(including each preliminary prospectus) in conformity with the requirements of
the Securities Act, and other documents, as such seller and underwriter may
reasonably request in order to facilitate the public sale or other disposition
of the Registrable Securities owned by such seller (the Company hereby
consenting to the use in accordance with applicable law of each such
registration statement (or amendment or post-effective amendment thereto) and
each such prospectus (or preliminary prospectus or supplement thereto) by each
such seller of Registrable Securities and the underwriters, if any, in
connection with the offering and sale of the Registrable Securities covered by
such registration statement or prospectus);
(d) use its best efforts to register or qualify the
Registrable Securities covered by such registration statement under such other
securities or "blue sky" laws of such jurisdictions as any sellers of
Registrable Securities or any managing underwriter, if any, shall reasonably
request in writing, and do any and all other acts and things which may be
reasonably necessary or advisable to enable such sellers or underwriter, if
any, to consummate the disposition of the Registrable Securities in such
jurisdictions, except that in no event shall the Company be required to qualify
to do business as a foreign corporation in any jurisdiction where it would not,
but for the requirements of this paragraph (d), be required to be so qualified,
to subject itself to taxation in any such jurisdiction or to consent to general
service of process in any such jurisdiction;
(e) promptly notify each Holder selling Registrable
Securities covered by such registration statement and each managing
underwriter, if any: (i) when the registration statement, any pre-effective
amendment, 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, when the
same has become effective; (ii) of any request by the SEC or state securities
authority for amendments or supplements to the registration statement or the
prospectus related thereto or for additional information; (iii) of the issuance
by the SEC of any
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stop order suspending the effectiveness of the registration statement or the
initiation of any proceedings for that purpose; (iv) of the receipt by the
Company of any notification with respect to the suspension of the qualification
of any Registrable Securities for sale under the securities or blue sky laws of
any jurisdiction or the initiation of any proceeding for such purpose; (v) of
the existence of any fact of which the Company becomes aware which results in
the registration statement, the prospectus related thereto or any document
incorporated therein by reference containing an untrue statement of a material
fact or omitting to state a material fact required to be stated therein or
necessary to make any statement therein not misleading; and (vi) if at any time
the representations and warranties contemplated by Section 3 below cease to be
true and correct in all material respects, and, if the notification relates to
an event described in clause (v), the Company shall promptly prepare and
furnish to each such seller and each underwriter, if any, a reasonable number
of copies of a prospectus supplemented or amended so that, as thereafter
delivered to the purchasers of such Registrable 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 in the light of the circumstances under which they were made not
misleading;
(f) comply with all applicable rules and regulations of
the SEC, and make generally available to its security holders, as soon as
reasonably practicable after the effective date of the registration statement
(and in any event within 16 months thereafter), an earnings statement (which
need not be audited) covering the period of at least twelve consecutive months
beginning with the first day of the Company's first calendar quarter after the
effective date of the registration statement, which earnings statement shall
satisfy the provisions of Section 11(a) of the Securities Act and Rule 158
thereunder;
(g) (i) cause all such Registrable Securities covered by
such registration statement to be listed on the principal securities exchange
on which similar securities issued by the Company are then listed (if any), if
the listing of such Registrable Securities is then permitted under the rules of
such exchange, or (ii) if no similar securities are then so listed, to either
cause all such Registrable Securities to be listed on a national securities
exchange or to secure designation of all such Registrable Securities as a
Nasdaq Stock Market ("NASDAQ") "national market system security" within the
meaning of Rule 11 Aa2-1 of the SEC or, failing that, secure NASDAQ
authorization for such shares and, without limiting the generality of the
foregoing, take all actions that may be required by the Company as the issuer
of such Registrable Securities in order to facilitate the managing
underwriter's arranging for the registration of at least two market makers as
such with respect to such shares with the National Association of Securities
Dealers, Inc. (the "NASD");
(h) provide and cause to be maintained a transfer agent
and registrar for all such Registrable Securities covered by such registration
statement not later than the effective date of such registration statement;
(i) enter into such customary agreements (including, if
applicable, an underwriting agreement) and take such other actions as the
Holders and Investor Holders of a majority of an aggregate of the Registrable
Securities and Investor Registrable Securities
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participating in such offering shall reasonably request in order to expedite or
facilitate the disposition of such Registrable Securities. The Holders and
Investor Holders of the Registrable Securities which are to be distributed by
such underwriters shall be parties to such underwriting agreement and may, at
their option, require that the Company make to and for the benefit of such
Holders and Investor Holders the representations, warranties and covenants of
the Company which are being made to and for the benefit of such underwriters
and which are of the type customarily provided to institutional investors in
secondary offerings;
(j) obtain an opinion from the Company's counsel and a
"cold comfort" letter from the Company's independent public accountants in
customary form and covering such matters as are customarily covered by such
opinions and "cold comfort" letters delivered to underwriters in underwritten
public offerings, which opinion and letter shall be reasonably satisfactory to
the underwriters, if any, and furnish to each Holder participating in the
offering and to each underwriter, if any, a copy of such opinion and letter
addressed to such Holder (in the case of the opinion) and underwriter (in the
case of the opinion and the "cold comfort" letter);
(k) deliver promptly to the Major Holder and counsel for
the selling Holders participating in the offering and each underwriter, if any,
copies of all correspondence between the Commission and the Company, its
counsel or auditors and any memoranda relating to discussions with the
Commission or its staff with respect to the registration statement, other than
those portions of any such memoranda which contain information subject to
attorney-client privilege with respect to the Company, and, upon receipt of
such confidentiality agreements as the Company may reasonably request, make
reasonably available for inspection by any seller of such Registrable
Securities covered by such registration statement, by any underwriter, if any,
participating in any disposition to be effected pursuant to such registration
statement and by any attorney, accountant or other agent retained by any such
seller or any such underwriter, all pertinent financial and other records,
pertinent corporate documents and properties of the Company, and cause all of
the Company's officers, directors and employees to supply all information
reasonably requested by any such seller, underwriter, attorney, accountant or
agent in connection with such registration statement;
(l) use its best efforts to obtain promptly the
withdrawal of any order suspending the effectiveness of the registration
statement;
(m) provide a CUSIP number for all Registrable
Securities, not later than the effective date of the registration statement;
(n) make reasonably available its employees and personnel
and otherwise provide reasonable assistance to the underwriters (taking into
account the needs of the Company's businesses and the requirements of the
marketing process) in the marketing of Registrable Securities in any
underwritten offering;
(o) promptly prior to the filing with the SEC of any
document which is to be incorporated by reference into the registration
statement or the prospectus (after the initial filing of
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such registration statement) provide copies of such document to counsel for the
selling holders of Registrable Securities and to each managing underwriter, if
any, and make the Company's representatives reasonably available for discussion
of such document and make such changes in such document concerning the selling
holders prior to the filing thereof as counsel for such selling holders or
underwriters may reasonably request;
(p) furnish to each Holder participating in the offering
and the managing underwriter, without charge, at least one copy of the
registration statement and any post-effective amendments thereto, including
financial statements and schedules, all documents incorporated therein by
reference and all exhibits (including those incorporated by reference);
(q) cooperate with the selling Holders of Registrable
Securities and the managing underwriter, if any, to facilitate the timely
preparation and delivery of certificates not bearing any restrictive legends
representing the Registrable Securities to be sold, and cause such Registrable
Securities to be issued in such denominations and registered in such names in
accordance with the underwriting agreement prior to any sale of Registrable
Securities to the underwriters or, if not an underwritten offering, in
accordance with the instructions of the selling holders of Registrable
Securities at least three business days prior to any sale of Registrable
Securities; and
(r) take all such other commercially reasonable actions
as are necessary or advisable in order to expedite or facilitate the
disposition of such Registrable Securities.
The Company may require as a condition precedent to the
Company's obligations under this Section 2.3 that each seller of Registrable
Securities as to which any registration is being effected furnish the Company
such information regarding such seller and the distribution of such securities
as the Company may from time to time reasonably request provided that such
information shall be used only in connection with such registration.
Each Holder of Registrable Securities agrees that upon receipt
of any notice from the Company of the happening of any event of the kind
described in clause (v) of paragraph (e) of this Section 2.3, such Holder will
discontinue such Holder's disposition of Registrable Securities pursuant to the
registration statement covering such Registrable Securities until such Holder's
receipt of the copies of the supplemented or amended prospectus contemplated by
paragraph (e) of this Section 2.3 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 Holder's possession of the prospectus
covering such Registrable Securities that was in effect at the time of receipt
of such notice. In the event the Company shall give any such notice, the
applicable period mentioned in paragraph (b) of this Section 2.3 shall be
extended by the number of days during such period from and including the date
of the giving of such notice to and including the date when each seller of any
Registrable Securities covered by such registration statement shall have
received the copies of the supplemented or amended prospectus contemplated by
paragraph (e) of this Section 2.3.
2.4 Registration Expenses.
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(a) "Expenses" shall mean any and all fees and expenses
incident to the Company's performance of or compliance with this Article 2,
including, without limitation: (i) SEC, stock exchange or NASD registration,
listing and filing fees and all listing fees and fees with respect to the
inclusion of securities in NASDAQ, (ii) fees and expenses of compliance with
state securities or "blue sky" laws and in connection with the preparation of a
"blue sky" survey, including without limitation, reasonable fees and expenses
of blue sky counsel, (iii) printing and copying expenses, (iv) messenger and
delivery expenses, (v) expenses incurred in connection with any road show, (vi)
fees and disbursements of counsel for the Company, (vii) with respect to each
registration, the reasonable fees and disbursements of one counsel for the
selling Holder(s) (selected by the Major Holder) not to exceed $10,000, (viii)
fees and disbursements of all independent public accountants (including the
expenses of any audit and/or "cold comfort" letter) and fees and expenses of'
other persons, including special experts, retained by the Company, (ix) fees
and expenses payable to a "qualified independent underwriter" if required by
the NASD (a "Qualified Independent Underwriter") and (x) any other fees and
disbursements of underwriters, if any, customarily paid by issuers or sellers
of securities (collectively, "Expenses").
(b) The Company shall pay all Expenses with respect to
any Demand Registration, whether or not it becomes effective or remains
effective for the period contemplated by Section 2.3(b), and with respect to
any registration effected under Section 2.1.
(c) Notwithstanding the foregoing, (x) the provisions of
this Section 2.4 shall be deemed amended to the extent necessary to cause these
expense provisions to comply with "blue sky" laws of each state in which the
offering is made and (y) in connection with any registration hereunder, each
Holder of Registrable Securities being registered shall pay all underwriting
discounts and commissions and any transfer taxes, it any, attributable to the
sale of such Registrable Securities, pro rata with respect to payments of
discounts and commissions in accordance with the number of shares sold in the
offering by such Holder, and (z) the Company shall, in the case of all
registrations under this Article 2, be responsible for all its internal
expenses (including, without limitation, all salaries and expenses of its
officers and employees performing legal or accounting duties).
2.5 Certain Limitations on Registration Rights. In the case of
any registration under Section 2.2 pursuant to an underwritten offering, or in
the case of a registration under Section 2.1, all securities to be included in
such registration shall be subject to an underwriting agreement and no Person
may participate in such registration unless such Person agrees to sell such
Person's securities on the basis provided therein and completes and executes
all reasonable questionnaires and other documents (including custody agreements
and powers of attorney) which must be executed in connection therewith, and
provides such other information to the Company or the underwriter as may be
necessary to register such Person's securities.
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2.6 Limitations on Sale or Distribution of Other Securities. To
the extent requested in writing by a managing underwriter, if any, of any
registration effected pursuant to Section 2.1 or 2.2, each Holder of
Registrable Securities agrees not to sell, transfer or otherwise dispose of,
including any sale pursuant to Rule 144 under the Securities Act, any Common
Stock, or any other equity security of the Company or any security convertible
into or exchangeable or exercisable for any equity security of the Company
(other than as part of such underwritten public offering) during the time
period reasonably requested by the managing underwriter, not to exceed 180 days
(and the Company hereby also so agrees (except that the Company may effect any
sale or distribution of any such securities pursuant to a registration on Form
S-4 (if reasonably acceptable to such managing underwriter) or Form S-8, or any
successor or similar form which is then in effect or upon the conversion,
exchange or exercise of any then outstanding derivative security relating to
Common Stock) to use its reasonable best efforts to cause each holder of any
equity security or any security convertible into or exchangeable or exercisable
for any equity security of the Company purchased from the Company at any time
other than in a public offering so to agree). Each managing underwriter shall
be entitled to rely on the agreements of each Holder of Registrable Securities
set forth in this Section 2.6 and shall be a third party beneficiary of the
provisions of this Section 2.6.
2.7 No Required Sale. Nothing in this Agreement shall be deemed
to create an independent obligation on the part of any Holder to sell any
Registrable Securities pursuant to any effective registration statement.
2.8 Indemnification.
(a) In the event of any registration of any securities of
the Company under the Securities Act pursuant to this Article 2, the Company
will, and hereby does, indemnify and hold harmless, to the fullest extent
permitted by law, each Holder of Registrable Securities, its directors,
officers, affiliates, employees, stockholders, members and partners (and the
directors, officers, affiliates, employees, stockholders, members and partners
thereof), each other Person who participates as an underwriter or a Qualified
Independent Underwriter, if any, in the offering or sale of such securities,
each officer, director, employee, stockholder, member or partner of such
underwriter or Qualified Independent Underwriter, and each other Person, if
any, who controls such seller or any such underwriter within the meaning of the
Securities Act, against any and all losses, claims, damages or liabilities,
joint or several, actions or proceedings (whether commenced or threatened) in
respect thereof ("Claims") and expenses (including reasonable fees of counsel
and any amounts paid in any settlement effected with the Company's consent,
which consent shall not be unreasonably withheld or delayed) to which each such
indemnified party may become subject under the Securities Act or otherwise,
insofar as such Claims or expenses arise out of or are based upon (i) any
untrue statement or alleged untrue statement of a material fact contained in
any registration statement under which such securities were registered under
the Securities Act, together with the documents incorporated by reference
therein, or the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, or (ii) any untrue statement or alleged untrue statement of a
material fact contained in any preliminary, final or summary prospectus or any
amendment or supplement thereto, together with
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the documents incorporated by reference therein, or the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided, however,
that the Company shall not be liable to any such indemnified party in any such
case to the extent such Claim or expense arises out of or is based upon any
untrue statement or alleged untrue statement of a material fact or omission or
alleged omission of a material fact made in such registration statement or
amendment thereof or supplement thereto or in any such prospectus or any
preliminary, final or summary prospectus in reliance upon and in conformity
with written information furnished to the Company by or on behalf of such
indemnified party specifically for use therein. Such indemnity and
reimbursement of expenses shall remain in full force and effect regardless of
any investigation made by or on behalf of such indemnified party and shall
survive the transfer of such securities by such seller.
(b) Each Holder of Registrable Securities that are
included in the securities as to which any registration under Section 2.1 or
2.2 is being effected (and, if the Company requires as a condition to including
any Registrable Securities in any registration statement filed in accordance
with Section 2.1 or 2.2, any underwriter and Qualified Independent Underwriter,
if any) shall, severally and not jointly, indemnify and hold harmless (in the
same manner and to the same extent as set forth in paragraph (a) of this
Section 2.8) to the extent permitted by law the Company, its officers and
directors, each Person controlling the Company within the meaning of the
Securities Act and all other prospective sellers and their directors, officers,
general and limited partners and respective controlling Persons with respect to
any untrue statement or alleged untrue statement of any material fact in, or
omission or alleged omission of any material fact from, such registration
statement, any preliminary, final 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
written information furnished to the Company or its representatives by or on
behalf of such Holder or underwriter or Qualified Independent Underwriter, if
any, specifically for use therein and reimburse such indemnified party for any
legal or other expenses reasonably incurred in connection with investigating or
defending any such Claim as such expenses are incurred; provided, however, that
the aggregate amount which any such Holder shall be required to pay pursuant to
this Section 2.8(b) and Sections 2.8(c) and (e) shall in no case be greater
than the amount of the net proceeds received by such person upon the sale of
the Registrable Securities pursuant to the registration statement giving rise
to such claim. Such indemnity and reimbursement of expenses shall remain in
full force and effect regardless of any investigation made by or on behalf of
such indemnified party and shall survive the transfer of such securities by
such Holder.
(c) Indemnification similar to that specified in the
preceding paragraphs (a) and (b) of this Section 2.8 (with appropriate
modifications) shall be given by the Company and each seller of Registrable
Securities with respect to any required registration or other qualification of
securities under any state securities and "blue sky" laws.
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(d) Any person entitled to indemnification under this
Agreement shall notify promptly the indemnifying party in writing of the
commencement of any action or proceeding with respect to which a claim for
indemnification may be made pursuant to this Section 2.8, but the failure of
any indemnified party to provide such notice shall not relieve the indemnifying
party of its obligations under the preceding paragraphs of this Section 2.8,
except to the extent the indemnifying party is materially prejudiced thereby
and shall not relieve the indemnifying party from any liability which it may
have to any indemnified party otherwise than under this Article 2. In case any
action or proceeding is brought against an indemnified party and it shall
notify the indemnifying party of the commencement thereof, the indemnifying
party shall be entitled to participate therein and, unless in the reasonable
opinion of outside counsel to the indemnified party a conflict of interest
between such indemnified and indemnifying parties may exist in respect of such
claim, to assume the defense thereof jointly with any other indemnifying party
similarly notified, to the extent that it chooses, with counsel reasonably
satisfactory to such indemnified party, and after notice from the indemnifying
party to such indemnified party that it so chooses, the indemnifying party
shall not be liable to such indemnified party for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof other than reasonable costs of investigation; provided, however, that
(i) if the indemnifying party fails to take reasonable steps necessary to
defend diligently the action or proceeding within 20 days after receiving
notice from such indemnified party that the indemnified party believes it has
failed to do so; or (ii) if such indemnified party who is a defendant in any
action or proceeding which is also brought against the indemnifying party
reasonably shall have concluded that there may be one or more legal defenses
available to such indemnified party which are not available to the indemnifying
party; or (iii) if representation of both parties by the same counsel is
otherwise inappropriate under applicable standards of professional conduct,
then, in any such case, the indemnified party shall have the right to assume or
continue its own defense as set forth above (but with no more than one firm of
counsel for all indemnified parties in each jurisdiction who shall be approved
by the Major Holder of the registration in respect of which such
indemnification is sought), and the indemnifying party shall be liable for any
expenses therefor. No indemnifying party shall, without the written consent of
the indemnified party, effect the settlement or compromise of, or consent to
the entry of any judgment with respect to, any pending or threatened action or
claim in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified party is an actual or potential party
to such action or claim) unless such settlement, compromise or judgment (A)
includes an unconditional release of the indemnified party from all liability
arising out of such action or claim and (B) does not include a statement as to
or an admission of fault, culpability or a failure to act, by or on behalf of
any indemnified party.
(e) If for any reason the foregoing indemnity is
unavailable or is insufficient to hold harmless an indemnified party under
Sections 2.8(a), (b) or (c), then each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a result of any Claim
in such proportion as is appropriate to reflect the relative fault of the
indemnifying party, on the one hand, and the indemnified party, on the other
hand, with respect to such offering of securities. The relative fault shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to
state a material fact relates
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to information supplied by the indemnifying party or the indemnified party and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such untrue statement or omission. If, however, the
allocation provided in the second preceding sentence is not permitted by
applicable law, then each indemnifying party shall contribute to the amount
paid or payable by such indemnified party in such proportion as is appropriate
to reflect not only such relative faults but also the relative benefits of the
indemnifying party and the indemnified party as well as any other relevant
equitable considerations. The parties hereto agree that it would not be just
and equitable if contributions pursuant to this Section 2.8(e) were to be
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
preceding sentences of this Section 2.8(e). The amount paid or payable in
respect of any Claim shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such Claim. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(t) of the Securities Act) shall be entitled
to contribution from any person who was not guilty of such fraudulent
misrepresentation. Notwithstanding anything in this Section 2.8(e) to the
contrary, no indemnifying party (other than the Company) shall be required
pursuant to this Section 2.8(e) to contribute any amount in excess of the net
proceeds received by such indemnifying party from the sale of Registrable
Securities in the offering to which the losses, claims, damages or liabilities
of the indemnified parties relate, less the amount of any indemnification
payment made by such indemnifying party pursuant to Sections 2.8(b) and (c).
(f) The indemnity agreements contained herein shall be in
addition to any other rights to indemnification or contribution which any
indemnified party may have pursuant to law or contract and shall remain
operative and in full force and effect regardless of any investigation made or
omitted by or on behalf of any indemnified party and shall survive the transfer
of the Registrable Securities by any such party.
(g) The indemnification and contribution required by this
Section 2.8 shall be made by periodic payments of the amount thereof during the
course of the investigation or defense, as and when bills are received or
expense, loss, damage or liability is incurred.
3. Underwritten Offerings.
3.1 Requested Underwritten Offerings. If requested by the
underwriters for any underwritten offering by the Holders pursuant to a
registration requested under Section 2.2, the Company shall enter into a
customary underwriting agreement with the underwriters. Such underwriting
agreement shall be satisfactory in form and substance to the Major Holder and
shall contain such representations and warranties by, and such other agreements
on the part of, the Company and such other terms as are generally included in
the underwriting agreement of such underwriters, including, without limitation,
indemnities and contribution agreements. Any Holder participating in the
offering shall be a party to such underwriting agreement and may, at its
option, require that any or all of the representations and warranties by, and
the other agreements on the part of, the Company to and for the benefit of such
underwriters shall also be made to and for the benefit
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of such Holder and that any or all of the conditions precedent to the
obligations of such underwriters under such underwriting agreement be
conditions precedent to the obligations of such Holder; provided, however, that
the Company shall not be required to make any representations or warranties
with respect to written information specifically by a selling Holder for
inclusion in the registration statement. Such underwriting agreement shall
also contain such representations and warranties by the participating Holders
as are customary in agreements of that type.
3.2 Piggyback Underwritten Offerings. In the case of a
registration pursuant to Section 2.1 hereof, the Company shall enter into an
underwriting agreement in connection therewith and all of the Holders'
Registrable Securities to be included in such registration shall be subject to
such underwriting agreement. Any Holder participating in such registration
may, at its option, require that any or all of the representations and
warranties by, and the other agreements on the part of, the Company to and for
the benefit of such underwriters shall also be made to and for the benefit of
such Holder and that any or all of the conditions precedent to the obligations
of such underwriters under such underwriting agreement be conditions precedent
to the obligations of such Holder. Such underwriting agreement shall also
contain such representations and warranties by the participating Holders as are
customary in agreements of that type.
4. General.
4.1 Rule 144. If the Company shall have filed a registration
statement pursuant to the requirements of Section 12 of the Exchange Act or a
registration statement pursuant to the requirements of the Securities Act in
respect of the Common Stock or securities of the Company convertible into or
exchangeable or exercisable for Common Stock, the Company covenants that (1) so
long as it remains subject to the reporting provisions of the Exchange Act, it
will timely file the reports required to be filed by it under the Securities
Act or the Exchange Act (including, but not limited to, the reports under
Sections 13 and 15(d) of the Exchange Act referred to in subparagraph (c)(1) of
Rule 144 under the Securities Act), and (ii) will take such further action as
any Holder of Registrable Securities may reasonably request, all to the extent
required from time to time to enable such Holder to sell Registrable Securities
without registration under the Securities Act within the limitation of the
exemptions provided by (A) Rule 144 under the Securities Act, as such Rule may
be amended from time to time, or (B) any similar rule or regulation hereafter
adopted by the Commission. Upon the request of any Holder of Registrable
Securities, the Company will deliver to such Holder a written statement as to
whether it has complied with such requirements.
4.2 Amendments and Waivers. This Agreement may be amended,
modified, supplemented or waived only upon the written agreement of the party
against whom enforcement of such amendment, modification, supplement or waiver
is sought.
4.3 Notices. Except as otherwise provided in this Agreement, all
notices, requests, consents and other communications hereunder to any party
shall be deemed to be sufficient if contained in a written instrument delivered
in person or by telecopy, nationally recognized overnight courier or first
class registered or certified mail, return receipt requested, postage prepaid,
addressed
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to such party at the address set forth below or such other address as may
hereafter be designated in writing by such party to the other parties:
(i) if to the Company, to:
Hollywood Theater Holdings, Inc.
0000 Xxxxxx Xxxxx Xxxx.
Xxxxx 0000
Xxxxxx, Xxxxx 00000
Telecopy: (000) 000-0000
Attention: Xxxxxx X. Xxxxxxxxxx, Xx.
(ii) if to Xxxxxxx, to:
Xxxxxxx X. Xxxxxxx Revocable Trust
0000 Xxxxxxx Xxxxx
Xxxxxxx, Xxxxxxx, XX 00000
with a copy to:
Xxxxxxx X. Xxxx
Xxxxx Xxxx LLP
0000 Xxx Xxxxxx Xxxx Xxxxx
Xxxxxx Xxxx, XX 00000
Telecopy: (000) 000-0000
All such notices, requests, consents and other communications shall be deemed
to have been given when received.
4.4 Miscellaneous.
(a) This Agreement shall be binding upon and inure to the
benefit of and be enforceable by the parties hereto and the respective
successors, personal representatives and assigns of the parties hereto, whether
so expressed or not. If any Person shall acquire Registrable Securities from
any Holder, in any manner, whether by operation of law or otherwise, such
transferee shall promptly notify the Company and such Registrable Securities
acquired from such Holder 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 of and be conclusively deemed to have
agreed to be bound by and to perform all of the terms and provision of this
Agreement. If the Company shall so request, any such successor or assign shall
agree in writing to acquire and hold the Registrable Securities acquired from
such Holder subject to all of the terms hereof. If any Holder shall acquire
additional Registrable Securities, such Registrable Securities shall be subject
to all of
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the terms, and entitled to all the benefits, of this Agreement. No Person
other than a Holder shall be entitled to any benefits under this Agreement,
except as otherwise expressly provided herein.
(b) This Agreement (with the documents referred to herein
or delivered pursuant hereto) embodies the entire agreement and understanding
between the parties hereto and supersedes all prior agreements and
understandings relating to the subject matter hereof.
(c) This Agreement shall be construed and enforced in
accordance with and governed by the laws of the State of Texas without giving
effect to the conflicts of law principles thereof.
(d) The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof. All
section references are to this Agreement unless otherwise expressly provided.
(e) This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
(f) Any term or provision of this Agreement which is
invalid or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Agreement or affecting the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdiction.
(g) 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
injunctive relief, including specific performance, to enforce such obligations
without the posting of any bond, and, if any action should be brought in equity
to enforce any of the provisions of this Agreement, none of the parties hereto
shall raise the defense that there is an adequate remedy at law.
(h) Each party hereto shall do and perform or cause to be
done and performed all such further acts and things and shall execute and
deliver all such other agreements, certificates, instruments, and documents as
any other party hereto reasonably may request in order to carry out the intent
and accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.
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IN WITNESS WHEREOF, the undersigned have executed this Registration Rights
Agreement as of the date set forth above.
HOLLYWOOD THEATER HOLDINGS, INC.
By: /s/ Xxxxxx X. Xxxxxxxxxx, Xx.
-------------------------------------
Name: Xxxxxx X. Xxxxxxxxxx, Xx.
Title: President
XXXXXXX X. XXXXXXX REVOCABLE TRUST
By: /s/ Xxxxxxx X. Xxxxxxx
-------------------------------------
Xxxxxxx X. Xxxxxxx, Trustee
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