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EXHIBIT 99.1
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement"), dated as
of January 7, 1999, is entered into by and among XXXXXXX AND BROAD HOME
CORPORATION, a Delaware corporation (the "Company") and the other signatories
hereto listed on the signature pages to this Agreement (each a "Shareholder" and
collectively the "Shareholders").
WHEREAS, the Company and the Shareholders are parties to that
certain Purchase Agreement (the "Purchase Agreement") whereby, among other
things, the Company will issue an aggregate of 7,886,686 shares of its common
stock, par value $1.00 per share ("Common Stock"), to the Shareholders as
partial consideration for the Company's purchase from the Shareholders of the
Homebuilding Business of the Homebuilding Entities of the Xxxxx Group of
Companies; and
WHEREAS, in connection with the Purchase Agreement, the parties
hereto desire to enter into this Agreement, which sets forth the terms of
certain registration rights applicable to the Registrable Securities (as defined
below);
NOW, THEREFORE, upon the premises and the mutual promises herein
contained, and for good and valuable consideration, the receipt and adequacy of
which are acknowledged, the parties hereby agree as follows:
1. CERTAIN DEFINITIONS. As used in this Agreement, the
following terms shall have the following meanings:
(a) "Affiliate" means, with respect to any person, any
other person who, directly or indirectly, is in control of, is controlled by or
is under common control with the former person.
(b) "Holders" means the Shareholders or any Affiliate of
the Shareholders and any "transferee" (as such term is defined in Section 11
hereof) which is the record holder of Registrable Securities.
(c) "Registrable Securities" means the shares of Common
Stock held by the Shareholders as of the date hereof, any stock or other
securities into which or for which such shares of Common Stock may hereafter be
changed, converted or exchanged, and any other securities issued to the Holders
of such shares of Common Stock (or such shares into which or for which such
shares are so changed, converted or exchanged) upon any reclassification, share
combination, share subdivision, share dividend, merger, consolidation or similar
transaction, provided that any such securities shall cease to be Registrable
Securities if (i) a registration
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statement with respect to the sale of such securities shall have become
effective under the Securities Act (as defined below) and such securities shall
have been disposed of in accordance with the plan of distribution set forth in
such registration statement, (ii) such securities shall have been transferred
pursuant to Rule 144, or (iii) such securities are held by a Holder other than a
Shareholder and the Company has furnished to such Holder an opinion of counsel,
which opinion shall be reasonably satisfactory to such Holder, to the effect
that all of such securities are permitted to be distributed by such Holder in
one transaction pursuant to Rule 144(k).
(d) "Registration Expenses" means all reasonable expenses
in connection with any registration of securities pursuant to this Agreement
including, without limitation, the following: (i) SEC filing fees; (ii) the
fees, disbursements and expenses of the Company's counsel(s) and accountants in
connection with the registration of the Registrable Securities to be disposed of
under the Securities Act; (iii) all expenses in connection with the preparation,
printing and filing of the registration statement, any preliminary prospectus or
final prospectus and amendments and supplements thereto and the mailing and
delivering of copies thereof to any Holders, underwriters and dealers and all
expenses incidental to delivery of the Registrable Securities; (iv) the cost of
producing blue sky or legal investment memoranda or surveys; (v) all expenses in
connection with the qualification of the Registrable Securities to be disposed
of for offering and sale under state securities laws, including the fees and
disbursements of counsel for the underwriters or Holders in connection with such
qualification; (vi) the filing fees incident to securing any required review by
the National Association of Securities Dealers, Inc. of the terms of the sale of
the Registrable Securities to be disposed of; (vii) transfer agents',
depositories' and registrars' fees and the fees of any other agent appointed in
connection with such offering; (viii) all security engraving and security
printing expenses; and (ix) all fees and expenses payable in connection with the
listing of the Registrable Securities on each securities exchange or
inter-dealer quotation system on which a class of common equity securities of
the Company is then listed.
(e) "Rule 144" means Rule 144 promulgated under the
Securities Act, or any successor rule to similar effect.
(f) "SEC" means the United States Securities and Exchange
Commission.
(g) "Securities Act" means the Securities Act of 1933, as
amended, or any successor statute.
2. DEMAND REGISTRATION.
(a) At any time, upon written notice from a Holder
requesting that the Company effect the registration under the Securities Act of
any or all of the Registrable Securities held by such Holder, which notice shall
specify the number of Registrable Securities for which registration is requested
and the intended method or methods of disposition of such Registrable
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Securities, the Company shall have the right, exercisable within 10 days by
written notice to such Holder, to purchase all of the Registrable Securities
requested to be registered by such Holder at a cash price per share equal to the
arithmetic mean of each of the closing sales prices per share of Common Stock on
the New York Stock Exchange for each of the 15 consecutive trading days ending
on the fifth trading day immediately preceding the date of the written notice
from the Holder under this Section 2(a). The closing of such purchase shall take
place no later than 15 days after the date of the written notice from the
Company under this Section 2(a). If the Company gives written notice under this
Section 2(a), the written notice from the Holder under this Section 2(a) shall
not be deemed a request for registration for purposes of Section 2(b).
(b) If the Company does not exercise its right to purchase
under Section 2(a) above, the Company shall, within 15 days after receipt of the
Holder's request, serve written notice (the "Request Notice") of such
registration request to all other Holders of Registrable Securities. The Request
Notice will state that the Company will include in such registration all
Registrable Securities, subject to the limitations of this Section 2(b) and to
compliance with the other provisions of this Agreement, as to which the Company
receives written requests for inclusion within 15 days after the date of the
Request Notice. As promptly as practicable after such 15 day period, the Company
shall use its best efforts to effect, in the manner set forth in Section 5, the
registration under the Securities Act of the Registrable Securities to be
included for disposition in accordance with the intended method or methods of
disposition stated in the Holder's request, provided that:
(i) if prior to receipt of a registration request
pursuant to this Section 2(b), the Company had commenced a financing
plan through a formal "all hands" meeting with outside advisors,
including an underwriter if such financing plan is an underwritten
offering, and, in the good-faith judgment of the Company's underwriter,
confirmed to the Company in writing (with a copy to the Holders
requesting registration), a registration by the requesting Holders at
the time and on the terms requested would materially and adversely
affect such financing plan of the Company (a "Transaction Blackout"),
the Company shall not be obligated to serve the Request Notice, but
shall give written notice of such events to the Holders requesting
registration and shall not be required to serve the Request Notice and
effect a registration pursuant to this Section 2(b) until the earliest
of (A) the Company's abandonment of such offering, (B) 90 days after the
termination of such offering, (C) the termination of any "hold back"
period obtained by the underwriter(s) of such offering from any person,
including the Company, in connection therewith or (D) 110 days after
receipt by the Holder requesting registration of the written notice of
Transaction Blackout from the Company;
(ii) if, while a registration request is pending
pursuant to this Section 2(b), the Company has determined in good faith
that (A) the filing of a registration statement would jeopardize or
delay a contemplated material transaction other than a financing plan
involving the Company or would require the disclosure of material
information that the Company has a bona fide business purpose for
preserving as
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confidential, or (B) the Company then is unable to comply
with SEC requirements applicable to the requested registration
(notwithstanding all reasonable efforts to so comply), the Company shall
not be required to effect a registration pursuant to this Section 2(b)
until the earlier of (1) the date upon which such contemplated
transaction is completed or abandoned or such material information is
otherwise disclosed to the public or ceases to be material or the
Company is able to so comply with applicable SEC requirements, as the
case may be, and (2) 45 days after the Company makes such good-faith
determination, provided that the Company shall not be permitted to delay
a requested registration in reliance on this clause (ii) more than once
in any Demand Period (as defined below); and
(iii) the Company shall not be obligated to file a
registration statement relating to a registration request pursuant to
this Section 2(b): (A) sooner than July 1, 2000 (except that, after July
1, 1999, the foregoing restriction shall not apply to a request for
registration of Registrable Securities held by or on behalf of the
estate of a deceased Shareholder, but in such case the Company shall
have no obligation to serve the Request Notice or to include in the
registration any Registrable Securities other than those held by or on
behalf of such estate); (B) for an aggregate of more than 2,000,000
shares of Common Stock during each of (I) the six (6) month period
commencing July 1, 2000, (II) the twelve (12) month period commencing
January 1, 2001, and (III) the six-month period commencing January 1,
2002 (each of the periods described in clauses (I) - (III) being a
"Demand Period"); (C) more than once in any one of Demand Period; (D)
within a period of two months after the effective date of any other
registration statement of the Company demanded pursuant to this Section
2(b); or (E) if such registration request (including Registrable
Securities requested to be included in response to a Request Notice) is
for a number of Registrable Securities which have an aggregate market
value less than $10 million.
(c) Notwithstanding any other provision of this Agreement
to the contrary:
(i) a registration requested pursuant to this Section
2 shall not be deemed to have been effected (and, therefore, not
requested for purposes of Section 2(b)), (A) until the registration
statement with respect thereto has become effective under the Securities
Act (unless the registration statement fails to become effective because
the Holders request that the registration be withdrawn for a reason
other than contemplated in clause (B)); (B) if it is withdrawn based
upon material adverse information relating to the Company that is
different from the information known to the Holder requesting
registration at the time of the Holder's request for registration; (C)
if after it has become effective such registration is interfered with by
any stop order, injunction or other order or requirement of the SEC or
other governmental agency or court for any reason other than a
misrepresentation or an omission by a Holder whose Registrable
Securities are included in such registration; or (D) if the conditions
to closing specified in the purchase agreement or
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underwriting agreement entered into in connection with such registration
are not satisfied (other than solely by reason of some act or omission
by a Holder) or waived by the underwriters;
(ii) at the request of the Holders of 50% or more of
the Registrable Securities included in a registration, the Company will
withdraw a registration requested pursuant to this Section 2, but a
registration withdrawn upon such request (other than for any reason set
forth in Section 2(c)(i)) shall be deemed to have been effected (and,
therefore, requested for purposes of Section 2(b)), whether withdrawn
prior to or after the effectiveness of such requested registration.
(d) In the event that any registration pursuant to this
Section 2 shall involve, in whole or in part, an underwritten offering, the
Company, on the one hand, and the Holders whose Registrable Securities are
included in the registration, on the other hand, shall each have the right to
designate an underwriter as the sole lead managing underwriters of such
underwritten offering. The Company and such Holders shall consult with each
other as to which of the co-lead managing underwriters shall serve as "books-
running" underwriter; provided that such Holders shall have the right to select
the "books-running underwriter, subject to the Company's consent which shall not
be unreasonably withheld, and the "books-running" underwriter shall determine
the allocation of underwriting spreads and discounts and management fees as
among the underwriters.
(e) In connection with those registrations in which
multiple Holders participate, in the event such registration involves an
underwritten offering and the books-running lead managing underwriter advises
that marketing factors require a limitation on the number of shares to be
underwritten, the number of shares to be included in the underwriting and
registration shall be allocated pro rata among the Holders on the basis of the
shares of Registrable Securities held by each such Holder.
(f) The Company shall have the right to cause the
registration of additional securities for sale for the account of any person
(including the Company) in any registration of Registrable Securities requested
pursuant to Section 2(b); provided that the Company shall not have the right to
cause the registration of such additional securities if the Holders whose
Registrable Securities are included in the registration are advised in writing
(with a copy to the Company) by the books-running lead managing underwriter
that, in such firm's good-faith opinion, registration of such additional
securities would materially and adversely affect the offering and sale of the
Registrable Securities then contemplated by such Holders.
3. PIGGYBACK REGISTRATION. If at any time prior to July 1, 2002,
the Company proposes to register any of its Common Stock ("Other Securities")
under the Securities Act (other than a registration on Form S-4 or S-8 or any
successor form thereto), whether or not for sale for its own account, in a
manner which would permit registration of Registrable Securities for sale for
cash to the public under the Securities Act, it will each such time give prompt
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notice to each Holder of its intention to do so at least 15 business days prior
to the anticipated filing date of the registration statement relating to such
registration. Such notice shall offer each such Holder the opportunity to
include in such registration statement such number of Registrable Securities as
each such Holder may request. Upon the written request of any such Holder made
within 10 business days after the receipt of the Company's notice (which request
shall specify the number of Registrable Securities intended to be disposed of
and the intended method of disposition thereof), the Company shall effect, in
the manner set forth in Section 5, in connection with the registration of the
Other Securities, the registration under the Securities Act of all Registrable
Securities which the Company has been so requested to register, to the extent
required to permit the disposition (in accordance with such intended methods
thereof) of the Registrable Securities so requested to be registered, provided
that:
(a) if at any time after giving written notice of its
intention to register any securities and prior to the effective date of such
registration, the Company shall determine for any reason not to register or to
delay registration of such securities, the Company may, at its election, give
written notice of such determination to the Holders who requested inclusion and,
thereupon, (A) in the case of a determination not to register, the Company shall
be relieved of its obligation to register any Registrable Securities in
connection with such registration and (B) in the case of a determination to
delay such registration, the Company shall be permitted to delay registration of
any Registrable Securities requested to be included in such registration for the
same period as the delay in registering such Other Securities;
(b) (i) if the registration referred to in the first
sentence of this Section 3 is to be an underwritten primary registration on
behalf of the Company, and the managing underwriter advises the Company in
writing (with a copy to the Holders who requested registration) that, in such
firm's opinion, such offering would be materially and adversely affected by the
inclusion therein of the Registrable Securities requested to be included
therein, the Company shall include in such registration: (1) all securities the
Company proposes to sell for its own account ("the Company Securities") and (2)
up to the full number of Registrable Securities in excess of the number or
dollar amount of the Company Securities, which, in the good-faith opinion of
such managing underwriter, can be so sold without materially and adversely
affecting such offering of the Company Securities (and, if less than the full
number of such Registrable Securities, allocated pro rata among the Holders of
such Registrable Securities on the basis of the number of securities requested
to be included therein by each such Holder), and (ii) if the registration
referred to in the first sentence of this Section 3 is to be an underwritten
secondary registration on behalf of holders of securities (other than
Registrable Securities) of the Company (the "Other Holders"), and the managing
underwriter advises the Company in writing (with a copy to the Holders who
requested registration) that in their good-faith opinion such offering would be
materially and adversely affected by the inclusion therein of the Registrable
Securities requested to be included therein, the Company shall include in such
registration the amount of securities (including Registrable Securities) that
such managing underwriter advises, allocated pro rata among the Other Holders
and the Holders on the basis of the number of remaining securities
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(including Registrable Securities) requested to be included therein by each
Other Holder and each Holder;
(c) The Company shall not be required to effect any
registration of Registrable Securities under this Section 3 incidental to the
registration of any of its securities in connection with mergers, acquisitions,
reincorporation, dividend reinvestment plans or stock option or other executive
or employee benefit or compensation plans; and
(d) no registration of Registrable Securities effected
under this Section 3 shall relieve the Company of its obligation to effect a
registration of Registrable Securities pursuant to Section 2 hereof.
4. EXPENSES. The Company agrees to pay all Registration
Expenses with respect to an offering pursuant to Section 2 and Section 3 hereof.
5. REGISTRATION AND QUALIFICATION. If and whenever the
Company is required to use its best efforts to effect the registration of any
Registrable Securities under the Securities Act as provided in Section 2 or 3
hereof, the Company, shall:
(a) prepare and file a registration statement under the
Securities Act relating to the Registrable Securities to be offered as soon as
practicable, but in no event later than 30 days (60 days if the applicable
registration form is other than Form S-3) after the date notice is given, and
use its best efforts to cause the same to become effective as promptly as
practicable;
(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
90 days (or, in the case of an underwritten offering, such shorter time period
as the underwriters may require);
(c) furnish to the Holders and to any underwriter of such
Registrable Securities such number of conformed copies of such registration
statement and of each such amendment and supplement thereto (in each case
including all exhibits), such number of copies of the prospectus included in
such registration statement (including each preliminary prospectus, final
prospectus and any summary prospectus) in conformity with the requirements of
the Securities Act, and such other documents, as the Holders or such underwriter
may reasonably request in order to facilitate the public sale of the Registrable
Securities, and a copy of any and all transmittal letters or other
correspondence to, or received from, the SEC or any other governmental agency or
self-regulatory body or other body having jurisdiction (including any domestic
or foreign securities exchange) relating to such offering;
(d) unless the exemption from state regulation of
securities offerings under Section 18 of the Securities Act applies, use its
best efforts to register or qualify all
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Registrable Securities covered by such registration statement under the
securities or blue sky laws of such jurisdictions as the Holders or any
underwriter of such Registrable Securities shall request, and use its best
efforts to obtain all appropriate registrations, permits and consents required
in connection therewith, and do any and all other acts and things which may be
necessary or advisable to enable the Holders or any such underwriter to
consummate the disposition in such jurisdictions of its Registrable Securities
covered by such registration statement; provided that the Company shall not for
any such purpose be required to register or qualify generally to do business as
a foreign corporation in any jurisdiction wherein it is not so qualified, or to
subject itself to taxation in any such jurisdiction, or to consent to general
service of process in any such jurisdiction;
(e) (i) use its best efforts to furnish an opinion of
counsel for the Company addressed to the underwriters and each Holder of
Registrable Securities included in such registration (each a "Selling Holder")
and dated the date of the closing under the underwriting agreement (if any) (or
if such offering is not underwritten, dated the effective date of the
registration statement), and (ii) use its best efforts to furnish a "cold
comfort" letter addressed to the underwriters and each Selling Holder, if
permissible under applicable accounting practices, and signed by the independent
public accountants who have audited the Company's financial statements included
in such registration statement, in each such case covering substantially the
same matters with respect to such registration statement (and the prospectus
included therein) as are customarily covered in opinions of issuer's counsel and
in accountants' letters delivered to underwriters in underwritten public
offerings of securities and, in the case of such accountants' letter, with
respect to events subsequent to the date of such financial statements;
(f) immediately notify the Selling Holders in writing (i)
at any time when a prospectus relating to a registration pursuant to Section 2
or 3 hereof is required to be delivered under the Securities Act of the
happening of any event as a result of which the prospectus included in such
registration statement, as then in effect, includes an untrue statement of a
material fact or omits to state any material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, and (ii) of any request by the SEC or any
other regulatory body or other body having jurisdiction for any amendment of or
supplement to any registration statement or other document relating to such
offering, and in either such case at the request of the Selling Holders prepare
and furnish to the Selling Holders a reasonable number of copies of a
supplement to or an amendment of such prospectus as may be necessary so that, as
thereafter delivered to the purchasers of such Registrable Securities, such
prospectus shall not include an untrue statement of material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they are made, not
misleading;
(g) to the extent not already listed, use its best efforts
to list all such Registrable Securities covered by such registration on each
securities exchange and inter-dealer quotation system on which a class of common
equity securities of the Company is then listed; and
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(h) furnish unlegended certificates representing ownership
of the Registrable Securities being sold in such denominations as shall be
requested by the Selling Holders or the underwriters with expenses therewith to
be paid in accordance with Section 4 hereof.
6. CONVERSION OF OTHER SECURITIES, ETC. If a Holder offers
any options, rights, warrants or others securities issued by it or any other
person that are convertible into or exercisable or exchangeable for any
Registrable Securities, the Registrable Securities underlying such options,
rights, warrants or other securities shall, but such options, rights, warrants
or other securities shall not, be eligible for registration pursuant to Section
2 and Section 3 of this Agreement.
7. UNDERWRITING, DUE DILIGENCE.
(a) If requested by the underwriters for any underwritten
offering of Registrable Securities pursuant to a registration requested under
this Agreement, the Company shall enter into an underwriting agreement with such
underwriters for such offering, such agreement to contain such representations
and warranties by the Company and such other terms and provisions as are
customarily contained in underwriting agreements with respect to secondary
distributions, including, without limitation, indemnities and contribution
substantially to the effect and to the extent provided in Section 8 hereof and
the provision of opinions of counsel and accountants' letters to the effect and
to the extent provided in Section 5(e) hereof. The Selling Holders on whose
behalf the Registrable Securities are to be distributed by such underwriters
shall be parties to any such underwriting agreement and 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 Selling Holders. Such underwriting agreement shall also contain such
representations, warranties, and other agreements by the Selling Holders on
whose behalf the Registrable Securities are to be distributed as are customarily
contained in underwriting agreements with respect to secondary distributions.
Selling Holders may require that any additional securities included in an
offering proposed by a Holder be included on the same terms and conditions as
the Registrable Securities that are included therein.
(b) In the event that any registration pursuant to Section
3 shall involve, in whole or in part, an underwritten offering, the Company may
require that the Registrable Securities requested to be registered pursuant to
Section 3 be included in such underwriting on the same terms and conditions as
shall be applicable to the other securities being sold through underwriters
under such registration. If requested by the underwriters for such underwritten
offering, the Selling Holders on whose behalf the Registrable Securities are to
be distributed shall enter into an underwriting agreement with such
underwriters, such agreement to contain such representations, warranties and
other agreements by the Selling Holders and such other terms and provisions as
are customarily contained in underwriting agreements with respect to secondary
distributions, including, without limitation, indemnities and contribution
substantially to the effect and to the extent provided in Section 8 hereof. Such
underwriting agreement shall
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also contain such representations and warranties by the Company and such other
person or entity for whose account securities are being sold in such offering as
are customarily contained in underwriting agreements with respect to secondary
distributions.
(c) In connection with the preparation and filing of each
registration statement registering Registrable Securities under the Securities
Act, the Company shall give the Holders of such Registrable Securities and the
underwriters, if any, and their respective counsel and accountants, such
reasonable and customary access to its books and records and such opportunities
to discuss the business of the Company with its officers and the independent
public accountants who have certified the Company's financial statements as
shall be necessary, in the opinion of such Holder and such underwriters or their
respective counsel, to conduct a reasonable investigation within the meaning of
the Securities Act.
8. INDEMNIFICATION AND CONTRIBUTION.
(a) In the case of each offering of Registrable Securities
made pursuant to this Agreement, the Company agrees to indemnify and hold
harmless each Holder, its officers and directors, each underwriter of
Registrable Securities so offered and each person, if any, who controls any of
the foregoing persons within the meaning of the Securities Act, from and against
any and all claims, liabilities, losses, damages, expenses and judgments, joint
or several, to which they or any of them may become subject, under the
Securities Act or otherwise, including any amount paid in settlement of any
litigation commenced or threatened, and shall promptly reimburse them, as and
when incurred, for any reasonable legal or other expenses incurred by them in
connection with investigating any claims and defending any actions, insofar as
such losses, claims, damages, liabilities or actions shall arise out of, or
shall be based upon, any untrue statement or alleged untrue statement of a
material fact contained in the registration statement (or in any preliminary or
final prospectus included therein) or any amendment thereof or supplement
thereto, or in any document incorporated by reference therein, or any omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading; provided,
however, that the Company shall not be liable to a particular Holder in any such
case to the extent that any such loss, claim, damage, liability or action arises
out of, or is based upon, any untrue statement or alleged untrue statement, or
any omission, if such statement or omission shall have been made in reliance
upon and in conformity with information relating to such Holder furnished to the
Company in writing by or on behalf of such Holder specifically for use in the
preparation of the registration statement (or in any preliminary or final
prospectus included therein) or any amendment thereof or supplement thereto.
Such indemnity shall remain in full force and effect regardless of any
investigation made by or on behalf of a Holder and shall survive the transfer of
such securities. The foregoing indemnity agreement is in addition to any
liability which the Company may otherwise have to each Holder, its officers and
directors, underwriters of the Registrable Securities or any controlling person
of the foregoing; provided, further, that, as to any underwriter or any person
controlling any underwriter, this indemnity does not apply to any loss,
liability, claim, damage or expense arising out of or based upon any untrue
statement or alleged untrue statement or omission or alleged
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omission in any preliminary prospectus if a copy of a prospectus was required
to be sent or given and was not sent or given by or on behalf of an underwriter
to such person asserting such loss, claim, damage, liability or action at or
prior to the written confirmation of the sale of the Registrable Securities as
required by the Securities Act, such untrue statement or omission had been
corrected in such prospectus, and copies of the corrected prospectus were
provided to such underwriter prior to the giving or sending of such written
confirmation.
(b) In the case of each offering made pursuant to this
Agreement, each Holder of Registrable Securities included in such offering, by
exercising its registration rights hereunder, agrees to indemnify and hold
harmless the Company, its officers and directors and each person, if any, who
controls any of the foregoing within the meaning of the Securities Act (and if
requested by the underwriters, each underwriter who participates in the offering
and each person, if any, who controls any such underwriter within the meaning of
the Securities Act), from and against any and all claims, liabilities, losses,
damages, expenses and judgments, joint or several, to which they or any of them
may become subject under the Securities Act or otherwise, including any amount
paid in settlement of any litigation commenced or threatened, and shall promptly
reimburse them, as and when incurred, for any legal or other expenses incurred
by them in connection with investigating any claims and defending any actions,
insofar as any such losses, claims, damages, liabilities or actions shall arise
out of, or shall be based upon, any untrue statement or alleged untrue statement
of a material fact contained in the registration statement (or in any
preliminary or final prospectus included therein) or any amendment thereof or
supplement thereto, or any omission or alleged omission to state therein a
material fact relating to the Holder required to be stated therein or necessary
to make the statements therein not misleading, but in each case only to the
extent that such untrue statement of a material fact is contained in, or such
material fact relating to the Holder is omitted from, information relating to
such Holder furnished in writing to the Company by or on behalf of such Holder
specifically for use in the preparation of such registration statement (or in
any preliminary or final prospectus included therein) or any amendment or
supplement thereto. The foregoing indemnity is in addition to any liability
which such Holder may otherwise have to the Company, or any of its directors,
offices or controlling persons; provided, however, that, as to any underwriter
or any person controlling any underwriter, this indemnity does not apply to any
loss, liability, claim, damage or expense arising out of or based upon any
untrue statement or alleged untrue statement or omission or alleged omission in
any preliminary prospectus if a copy of a prospectus was required to be sent or
given and was not sent to given by or on behalf of an underwriter to such person
asserting such loss, claim damage, liability or action at or prior to the
written confirmation of the sale of the Registrable Securities as required by
the Securities Act, such untrue statement or omission had been corrected in such
prospectus, and copies of the corrected prospectus were provided to such
underwriter prior to the giving or mailing of such written confirmation; and
provided, further, that in no event shall any such Holder be liable for any
amount in excess of the net proceeds received from the sale of the Registrable
Securities by such Holder in the subject offering.
(c) Procedure for Indemnification. Each party indemnified
under paragraph (a) or (b) of this Section 8 shall, promptly after receipt of
notice of any claim or the
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commencement of any action against such indemnified party in respect of which
indemnity may be sought, notify the indemnifying party in writing of the claim
or the commencement thereof; provided that the failure to notify the
indemnifying party shall not relieve it from any liability which it may have to
an indemnified party on account of the indemnity agreement contained in
paragraph (a) or (b) of this Section 8, except to the extent the indemnifying
party was prejudiced by such failure, and in no event shall relieve the
indemnifying party from any other liability which it may have to such
indemnified party. If any such claim or action shall be brought against an
indemnified party, and it shall notify the indemnifying party thereof, the
indemnifying party shall be entitled to participate therein, and, to the extent
that it wishes, jointly with any other similarly notified indemnifying party, to
assume the defense thereof with counsel reasonably satisfactory to the
indemnified party. After notice from the indemnifying party to the indemnified
party of its election to assume the defense of such claim or action, the
indemnifying party shall not be liable to the indemnified party under this
Section 8 for any legal or other expenses subsequently incurred by the
indemnified party in connection with the defense thereof other than reasonable
costs of investigation; provided that each indemnified party, its officers and
directors, if any, and each person, if any, who controls such indemnified party
within the meaning of the Securities Act, shall have the right to employ
separate counsel reasonably approved by the indemnifying party to represent them
if the named parties to any action (including any impleaded parties) include
both such indemnified party and an indemnifying party or an affiliate of an
indemnifying party, and such indemnified party shall have been advised by
counsel either (i) that there may be one or more legal defenses available to
such indemnified party that are different from or additional to those available
to such indemnifying party or such affiliate or (ii) a conflict may exist
between such indemnified party and such indemnifying party or such affiliate,
and in that event the fees and expenses of one such separate counsel for all
such indemnified parties shall be paid by the indemnifying party. An indemnified
party will not enter into any settlement agreement which is not approved by the
indemnifying party, such approval not to be unreasonably withheld. The
indemnifying party may not agree to any settlement of any such claim or action
which provides for any remedy or relief other than monetary damages for which
the indemnifying party shall be responsible hereunder, without the prior written
consent of the indemnified party, which consent shall not be unreasonably
withheld. In any action hereunder as to which the indemnifying party has assumed
the defense thereof with counsel reasonably satisfactory to the indemnified
party, the indemnified party shall continue to be entitled to participate in the
defense thereof, with counsel of its own choice, but, except as set forth above,
the indemnifying party shall not be obligated hereunder to reimburse the
indemnified party for the costs thereof. In all instances, the indemnified party
shall cooperate fully with the indemnifying party or its counsel in the defense
of each claim or action.
If the indemnification provided for in this Section 8 shall for
any reason be unavailable to an indemnified party in respect of any loss, claim,
damage or liability, or any action in respect thereof, referred to herein, then
each indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability, or action in respect thereof, in such
proportion as shall be appropriate to reflect the relative fault of the
indemnifying party on the one hand and the indemnified party on the other with
respect to the statements or omissions which resulted in such
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loss, claim, damage or liability, or action in respect thereof, as well as any
other relevant equitable considerations. The relative fault shall be determined
by reference to whether the untrue or alleged untrue statement of a material
fact or omission or alleged omission to state a material fact relates to
information supplied by the indemnifying party on the one hand or the
indemnified party on the other, the intent of the parties and their relative
knowledge, access to information and opportunity to correct or prevent such
statement or omission, but not by reference to any indemnified party's stock
ownership in the Company. In no event, however, shall a Holder be required to
contribute in excess of the amount of the net proceeds received by such Holder
in connection with the sale of Registrable Securities in the offering which is
the subject of such loss, claim, damage or liability. The amount paid or payable
by an indemnified party as a result of the loss, claim, damage or liability, or
action in respect thereof, referred to above in this paragraph shall be deemed
to include, for purposes of this paragraph, any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claims. 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.
9. RULE 144. Until such time as each Holder may sell in
compliance with the Securities Act all Registrable Securities held by such
Holder without an effective registration statement under the Securities Act or
compliance with Rule 144, the Company shall take such measures and file such
information, documents and reports as shall be required by the SEC as a
condition to the availability of Rule 144.
10. HOLDBACK.
(a) Until the first to occur of (i) there no longer being
any Registrable Securities, (ii) the Holders having completed their sale under
their last registration demanded under Section 2(b), and (iii) the Holders no
longer having the right to demand a registration under Section 2(b), each Holder
agrees, if so required by the managing underwriter in writing to the Holders,
not to sell, make any short sale of, loan, grant any option for the purchase of,
effect any public sale or distribution of or otherwise dispose of any securities
of the Company, during the 10 days prior to and the 90 days after any
underwritten registration pursuant to Section 2 or 3 hereof has become effective
(or such shorter period as may be required by the underwriter), except as part
of such underwritten registration. The Company may legend and may impose stop
transfer instructions on any certificate evidencing Registrable Securities
relating to the restrictions provided for in this Section 10.
(b) The Company agrees, if so required by the managing
underwriter, not to sell, make any short sale of, loan, grant any option for the
purchase of (other than pursuant to a stock option plan or agreement for
employees of the Company or its subsidiaries or other Company employee benefit
plans), effect any public sale or distribution of or otherwise dispose of its
equity securities or securities convertible into or exchangeable or exercisable
for any such securities during the 30 days prior to and the 90 days after any
underwritten registration pursuant
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to Section 2 or 3 hereof has become effective, except (i) as part of such
underwritten registration, (ii) pursuant to registrations on Form X-0, X-0 or
any successor or similar forms thereto or (iii) upon the exercise, conversation,
exchange or consummation by the holder of a convertible or exchangeable security
or security-sales commitment (including the 16,500,000 outstanding "Feline
Prides" of the Company) of the Company outstanding on the date such underwritten
registration pursuant to Section 2 or 3 became effective.
11. TRANSFER OF REGISTRATION RIGHTS.
(a) Subject to Section 11(c), a Holder may transfer its
rights under Section 2(b) and Section 3 of this Agreement, with its obligation
under Section 2(a), to (i) any transferee of Registrable Securities representing
at least 5% of the total outstanding common equity of the Company, (ii) any
transferee who as of the date of this Agreement is a shareholder or member of a
transferring Shareholder that as of the date of this Agreement is a Subchapter S
corporation or limited liability company, or (iii) any transferee who is a
member of the immediate family, a sibling, a descendant, or a niece or nephew of
the transferring Shareholder (including without limitation family trusts, trusts
for the benefit of family members, siblings, descendants, and/or nieces and
nephews, and other similar entities used for the transferring Shareholder's
estate-planning purposes) (each, a "transferee"). The Holder making such
transfer shall promptly notify the Company in writing stating the name and
address of any transferee and identifying the amount of Registrable Securities
with respect to which the rights and obligations under Sections 2 and 3 of this
Agreement are being transferred. In connection with any such transfer, the term
"Holder" as used in this Agreement shall, where appropriate to assign the rights
and obligations of a Holder hereunder to such direct transferee, be deemed to
refer to the transferee holder of such Registrable Securities.
(b) After any such transfer, the Holder making such
transfer shall retain its rights and obligations under this Agreement with
respect to all other Registrable Securities still owned by such Holder.
(c) Upon the request of the Holder making such transfer,
the Company shall execute a Registration Rights Agreement with such transferee
or a proposed transferee substantially similar to this Agreement. Upon the
written request of the Company made to the transferring Holder before
consummation of the transfer, such Holder shall deliver to the Company, as a
condition to the transfer of rights under Sections 2 and 3, a written assumption
of the obligation under Section 2(a) signed by the transferee.
12. MISCELLANEOUS.
(a) INJUNCTIONS. Each party acknowledges and agrees that
irreparable damage would occur in the event that any of the provisions of this
Agreement was not performed in accordance with its specific terms or was
otherwise breached. Therefore, each party shall be entitled to an injunction or
injunctions to prevent breaches of the provisions of this Agreement
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and to enforce specifically the terms and provisions hereof in any court having
jurisdiction, such remedy being in addition to any other remedy to which such
party may be entitled at law or in equity.
(b) SEVERABILITY. If any term or provision of this
Agreement shall be held by a court of competent jurisdiction to be invalid, void
or unenforceable, the remainder of the terms and provisions set forth herein
shall remain in full force and effect and shall in no way be affected, impaired
or invalidated, and each of the parties shall use its best efforts to find and
employ an alternative means to achieve the same or substantially the same result
as that contemplated by such term or provision.
(c) FURTHER ASSURANCES. Subject to the specific terms of
this Agreement, each of the parties hereto shall make, execute, acknowledge and
deliver such other instruments and documents, and take all such other actions,
as may be reasonably required in order to effectuate the purposes of this
Agreement and to consummate the transactions contemplated hereby.
(d) WAIVERS, ETC. No failure or delay on the part of
either party (or the intended third-party beneficiaries referred to herein) in
exercising any power or right hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any such right or power, or any
abandonment or discontinuance of steps to enforce such a right or power preclude
any other or further exercise thereof or the exercise of any other right or
power. No modification or waiver of any provision of this Agreement nor consent
to any departure therefrom shall in any event be effective unless the same shall
be in writing and signed by an authorized officer of each of the parties, and
then such waiver or consent shall be effective only in the specific instance and
for the purpose for which given.
(e) ENTIRE AGREEMENT. This Agreement contains the entire
understanding of the parties with respect to its subject matter. This Agreement
supersedes all prior agreements and understandings between the parties, whether
written or oral, with respect to the subject matter hereof. The paragraph
headings contained in this Agreement are for reference purposes only, and shall
not affect in any manner the meaning or interpretation of this Agreement.
(f) COUNTERPARTS. For the convenience of the parties, this
Agreement may be executed in any number of counterparts, each of which shall be
deemed to be an original but all of which together shall be one and the same
instrument.
(g) AMENDMENT. This Agreement may be amended only by a
written instrument duly executed by an authorized officer of each of the Company
and the Shareholders.
(h) NOTICES. Unless expressly provided herein, all
notices, claims, certificates, requests, demands and other communications
hereunder shall be in writing and shall be deemed to be duly given (i) when
personally delivered or (ii) if mailed registered or certified
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mail, postage prepaid, return receipt requested, on the date the return receipt
is executed or the letter refused by the addressee or its agent or (iii) if sent
by overnight courier which delivers only upon the signed receipt of the
addressee, on the date the receipt acknowledgment is executed or refused by the
addressee or its agent:
(i) if to the Shareholders:
to their addresses and telecopy numbers set
forth on the signature pages hereto;
With copy to:
O'Melveny & Xxxxx LLP
000 Xxxxx Xxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxx
Telecopy No: (000) 000-0000
(ii) if to the Company:
Xxxxxxx and Broad Home Corporation
00000 Xxxxxxxx Xxxxxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx Xxxxxxx
General Counsel
Telecopy No.: (000) 000-0000
With copy to:
Xxxxxx, Xxxxxx & Xxxxx LLP
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, XX 00000-0000
Attn.: R. Xxxxxxx Xxxxxx
Telecopy No.: (000) 000-0000
(i) GOVERNING LAW. This Agreement and the rights and
obligations of the parties hereunder shall be construed in accordance with and
be governed by the internal laws of the State of California.
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(j) TERM. This Agreement shall remain in full force and
effect until there are no Registrable Securities outstanding or until terminated
by the mutual agreement of the Company and the Shareholders.
(k) ASSIGNMENT. Except as provided herein, the parties may
not assign their rights under this Agreement. The Company may not delegate its
obligations under this Agreement.
(l) APPROPRIATE ADJUSTMENTS. If, at any time when a Holder
may demand registration of Registrable Securities under Section 2 of this
Agreement, the issued Common Stock shall have been changed into a different
number or class of shares as a result of a stock split, reverse stock split,
stock dividend, spin-off, extraordinary dividend, recapitalization,
reclassification or other similar transaction, the limitation of the number of
Registrable Securities for which registration may be requested shall be
appropriately adjusted.
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IN WITNESS WHEREOF, the Shareholders and the Company have executed this
Agreement or caused this Agreement to be duly executed by their authorized
representative as of the date first above written.
XXXXXXX AND BROAD HOME CORPORATION
By: /s/ XXXXXXX X. XXXXXXXXX
-------------------------------------
Its: Vice President and Controller
-------------------------------------
SHAREHOLDERS
Xxxxx X. Xxxxx
By: /s/ XXXXXX X. XXXXX
-------------------------------------
Xxxxxx X. Xxxxx, his attorney-in-fact
/s/ XXXXXX X. XXXXX ON BEHALF
OF XXXXX X. XXXXX
-------------------------------------
Xxxxx X. Xxxxx
-------------------------------------
Xxxxxxx X. Xxxxx
/s/ XXXXXX X. XXXXX
-------------------------------------
Xxxxxx X. Xxxxx
/s/ XXXXX X. XXXXX
-------------------------------------
Xxxxx X. Xxxxx
/s/ XXXXXXX X. XXXXX
-------------------------------------
Xxxxxxx X. Xxxxx
/s/ XXXX X. XXXXXXX
-------------------------------------
Xxxx X. Xxxxxxx
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XX XXXXXX, LLC
Xxxxx X. Xxxxx, its member
By: /s/ XXXXXX X. XXXXX
-------------------------------------
Xxxxxx X. Xxxxx, his attorney-in-fact
/s/ XXXXXX X. XXXXX ON BEHALF
OF XXXXX X. XXXXX
-------------------------------------
Xxxxx X. Xxxxx, its member
LHE PLATTE, LLC
By: Xxxxx Holding Company, a Delaware limited
liability company, its member
By: Xxxxxxxx Development Corp., a California
corporation, its member
By /s/ XXXX X. XXXXXXX
---------------------------------
Xxxx X. Xxxxxxx,
its Authorized Agent
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LH AUGUSTA, LLC
By: /s/ XXXXXXX X. XXXXX
------------------------------------
Xxxxxxx X. Xxxxx, its member
XX XXXXX, LLC
By: /s/ XXXXXX X. XXXXX
------------------------------------
Xxxxxx X. Xxxxx, its member
LH GRUNHORN, LLC
By: /s/ XXXXX X. XXXXX
------------------------------------
Xxxxx X. Xxxxx, its member
XX XXXXXXX, LLC
By: /s/ XXXXXXX X. XXXXX
------------------------------------
Xxxxxxx X. Xxxxx, its member
XX XXXXXXXXX, LLC
By: /s/ XXXX X. XXXXXXX
------------------------------------
Xxxx X. Xxxxxxx, its member
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COLLINE ENTERPRISES, INC.
By: /s/ XXXXXXX X. XXXXX
------------------------------------
Name:
Title:
TERRAIN ENTERPRISES, INC.
By: /s/ XXXXXX X. XXXXX
------------------------------------
Name:
Title:
MARMOT ENTERPRISES, INC.
By: /s/ XXXXX X. XXXXX
------------------------------------
Name:
Title:
GITAN ENTERPRISES, INC.
By: /s/ XXXXXXX X. XXXXX
------------------------------------
Name:
Title:
TOPSPIN ENTERPRISES, INC.
By: /s/ XXXX X. XXXXXXX
------------------------------------
Name:
Title:
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For purposes of Section 12(h) of this Agreement, the address and
telecopy number for each Shareholder is as follows:
Address: Xxxxx Operating Corp.
0000 X. Xxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Telecopy Number: (000) 000-0000
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