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Exhibit 10.4
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REGISTRATION RIGHTS AGREEMENT
Dated as of June 17, 1998
Among
LODGIAN CAPITAL TRUST I,
SERVICO, INC.,
LODGIAN, INC.
and
NATIONSBANC XXXXXXXXXX SECURITIES LLC
as Initial Purchaser
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This REGISTRATION RIGHTS AGREEMENT (this "AGREEMENT") is made and
entered into as of June 17, 1998 by and among LODGIAN CAPITAL TRUST I, a
Delaware statutory business trust (the "TRUST"), SERVICO, INC., a Florida
corporation (the "COMPANY"), LODGIAN, INC., a Delaware corporation ("LODGIAN"),
and NATIONSBANC XXXXXXXXXX SECURITIES LLC (the "INITIAL PURCHASER").
The Company, Lodgian and the Trust agree with the Initial Purchaser,
(i) for its benefit as Initial Purchaser and (ii) for the benefit of the
beneficial owners (including the Initial Purchaser) from time to time of the
CRESTS (as defined herein) and the beneficial owners from time to time of the
Underlying Common Stock (as defined herein) issued upon conversion of the
Convertible Debentures (as defined herein) (each of the foregoing a "HOLDER" and
together the "HOLDERS"), as follows:
The parties hereby agree as follows:
1. INTERPRETATION AND DEFINITIONS. In this Agreement, unless the
context otherwise requires:
(a) capitalized terms used in this Agreement but not defined
in the preamble above have the respective meanings assigned to them in
this Section 1;
(b) a term defined anywhere in this Agreement has the same
meaning throughout;
(c) all references to "the Agreement" or "this Agreement" are
to this Agreement as modified, supplemented or amended from time to
time;
(d) all references in this Agreement to Sections are to
Sections of this Agreement, unless otherwise specified;
(e) capitalized terms not defined herein shall have the
meaning given to such terms in the Declaration or, if the Convertible
Debentures have been distributed to the Holders of CRESTS in
liquidation of the Trust, the Indenture;
(f) a reference to the singular includes the plural and vice
versa and a reference to the masculine form of a term includes the
feminine form of a term, as applicable; and
(g) the following terms have the following meanings:
"AMENDMENT EFFECTIVENESS DEADLINE DATE": As defined in Section 4(a).
"APPLICABLE CONVERSION PRICE": The Applicable Conversion Price as of
any date of
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determination means the Conversion Price in effect as of such date of
determination or, if no Convertible Debentures are then outstanding, the
Conversion Price that would be in effect were Convertible Debentures then
outstanding.
"CLOSING DATE": The first date of original issuance of the Convertible
Debentures, Guarantees, CRESTS and Common Securities.
"COMMISSION": The Securities and Exchange Commission.
"COMMON SECURITIES": The beneficial ownership interest represented by
the common securities of the Trust.
"COMMON STOCK": The common stock, par value $.01 per share, of the
Company and any other shares of common stock as may constitute "Common Stock"
for purposes of the Indenture, including the Underlying Common Stock.
"CONVERTIBLE DEBENTURES": The 7% Convertible Junior Subordinated
Debentures of the Company to be purchased by the Trust pursuant to the Debenture
Purchase Agreement dated as of the date hereof between the Company and the
Trust.
"CRESTS": The 7% Convertible Redeemable Equity Structured Trust
Securities of the Trust.
"DAMAGES ACCRUAL PERIOD": As defined in Section 4(a).
"DAMAGES PAYMENT DATE": Each payment date under the Declaration, in the
case of CRESTS, each Interest Payment Date (as defined in the Indenture), in the
case of Convertible Debentures, and each March 31, June 30, September 30 and
December 31, in the case of Underlying Common Stock.
"DECLARATION": The Amended and Restated Declaration of Trust, dated as
of June 17, 1998, among the Company, Lodgian, Wilmington Trust Company, as
Property Trustee, Wilmington Trust Company, as Delaware Trustee and the other
trustees named therein, pursuant to which the CRESTS are being issued, as
amended or supplemented from time to time in accordance with the terms thereof.
"DEFERRAL DATE": As defined in Section 5(b)(v).
"DEFERRAL NOTICE": As defined in Section 5(b)(v).
"DEFERRAL PERIOD": As defined in Section 5(b)(v).
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"EFFECTIVENESS DEADLINE DATE": As defined in Section 3(a)(ii).
"EFFECTIVENESS PERIOD": The period commencing with the date hereof and
ending on the date that all CRESTS, Convertible Debentures and Underlying Common
Stock and the Guarantee have ceased to be Transfer Restricted Securities.
"EXCHANGE ACT": The Securities Exchange Act of 1934, as amended, and
the rules and regulations of the Commission promulgated thereunder.
"FILING DEADLINE DATE": As defined in Section 3(a).
"GUARANTEE AGREEMENT": The Guarantee Agreement, dated as of June 17,
1998, among the Company, Lodgian and Wilmington Trust Company, as Guarantee
Trustee, pursuant to which the Guarantee is being issued, as amended or
supplemented from time to time in accordance with the terms thereof.
"GUARANTEE": The guarantee by the Company of the CRESTS pursuant to the
Guarantee Agreement.
"HOLDERS": As defined in the second paragraph of this Agreement.
"IMPAC": Impac Hotel Group, L.L.C.
"INDENTURE": The Indenture, dated as of June 17, 1998, among the
Company, Lodgian and Wilmington Trust Company, as trustee, as amended or
supplemented, pursuant to which the Convertible Debentures are to be issued, as
such Indenture is further amended or supplemented from time to time in
accordance with the terms thereof.
"INITIAL PURCHASER": As defined in the preamble hereto.
"INSPECTOR": As defined in Section 5(b)(vi).
"LIQUIDATED DAMAGES AMOUNTS": As defined in Section 4(a).
"LODGIAN": As defined in the preamble of this Agreement.
"MATERIAL EVENT": As defined in Section 5(b)(v).
"MERGER" has the meaning specified in Section 12(m).
"NASD": National Association of Securities Dealers, Inc.
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"NOTICE AND QUESTIONNAIRE": A written notice delivered to the Company
and the Trust containing substantially the information called for by the Notice
and Questionnaire attached as Appendix A to the Offering Memorandum of the
Company and the Trust dated June 15, 1998 relating to the CRESTS.
"NOTICE HOLDER": On any date, a Holder that has delivered a Notice and
Questionnaire to the Company or the Trust on or prior to such date.
"PARTICIPANT": As defined in Section 8(a).
"PERSON": An individual, partnership, corporation. trust or
unincorporated organization, or a government or agency or political subdivision
thereof.
"PRINCIPAL HOLDER" means any Notice Holder, or any group of Notice
Holders acting together through a single representative, having at least
$75,000,000 in aggregate principal amount or aggregate liquidation amount of
Transfer Restricted Securities.
"PROSPECTUS": The prospectus included in the Shelf Registration
Statement, as amended or supplemented by any prospectus supplement and by all
other amendments thereto, including post-effective amendments, and all material
incorporated by reference into such Prospectus.
"PURCHASE AGREEMENT": As defined in the second paragraph of this
Agreement.
"RECORD HOLDER": (i) With respect to any Damages Payment Date relating
to any Convertible Preferred Security or Convertible Debenture as to which any
such Liquidated Damages Amount has accrued, the Registered Holder of such
Convertible Preferred Security or Convertible Debenture on the record date with
respect to the distribution payment date under the Declaration or the interest
payment date under the Indenture, as the case may be, on which such Damages
Payment Date shall occur and (ii) with respect to any Damages Payment Date
relating to any Underlying Common Stock as to which any such Liquidated Damages
Amount has accrued, the registered holder of such Underlying Common Stock 15
days prior to the next succeeding Damages Payment Date.
"REGISTERED HOLDER": The holder of a Convertible Preferred Security
that is registered as such on the books of the Trust.
"REGISTRANTS": The Trust and the Company or, if the Convertible
Debentures have been distributed to the Holders of the CRESTS in liquidation of
the Trust, the Company only.
"REGISTRATION DEFAULT": As defined in Section 4(a).
"REGISTRATION DEFAULT DATE": (A) The Filing Deadline Date in the case
of Section
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4(a)(i), (B) the Effectiveness Deadline Date in the case of Section 4(a)(ii),
(C) the date by which the Registrants are required to perform their obligations
set forth in Section 3(b) in the case of Section 4(a)(iii), (D) the date on
which the aggregate duration of Deferral Periods in any period exceeds the
number of days permitted by Section 5(b)(v) in the case of Section 4(a)(iv), (E)
the date of the commencement of a Deferral Period that causes the limit on the
number of Deferral Periods in any period under Section 5(b)(v) to be exceeded in
the case of Section 4(a)(v) and (F) the date on which the Shelf Registration
Statement ceases to be effective or shall fail to be usable by a Notice Holder
with respect to such Shelf Registration Statement, in the case of Section
4(a)(vi). Notwithstanding the foregoing, a Registration Default Date shall not
exist with respect to any Security on the date on which such Security ceases to
be a Transfer Restricted Security.
"RULE 144": Rule 144 under the Securities Act, as such Rule may be
amended from time to time, or any similar rule or regulation hereafter adopted
by the Commission.
"RULE 144A": Rule 144A under the Securities Act, as such Rule may be
amended from time to time, or any similar rule or regulation hereafter adopted
by the Commission.
"SECURITIES": The Convertible Debentures, the CRESTS, the Common
Securities and the Guarantee.
"SECURITIES ACT": The Securities Act of 1933, as amended, and the rules
and regulations of the Commission promulgated thereunder.
"SHELF REGISTRATION STATEMENT": Any shelf registration statement of the
Registrants pursuant to Rule 415 under the Securities Act relating to the
registration for resale of Transfer Restricted Securities, which is filed
pursuant to the provisions of this Agreement including the Prospectus included
therein, all amendments and supplements thereto (including post-effective
amendments) and all exhibits and material incorporated by reference therein.
"SPECIAL COUNSEL": As defined in Section 5(b)(vi).
"TIA": The Trust Indenture Act of 1939 (15 U.S.C. Section
77aaa-77bbbb), as amended.
"TRANSFER RESTRICTED SECURITIES": The CRESTS, the Guarantee, the
Convertible Debentures and the Underlying Common Stock, until such securities
have been converted or exchanged, and, at all times subsequent to any such
conversion or exchange, any securities into or for which such securities have
been converted or exchanged, and any security issued with respect thereto upon
any stock dividend, split or similar event until, in the case of any such
security, (A) the earliest of (i) its effective registration under the
Securities Act and resale in accordance with the Shelf Registration Statement
covering it, (ii) expiration of the holding period that would be applicable
thereto under Rule 144(k) were it not held by an Affiliate of the Registrants or
(iii) its sale to the public pursuant to Rule 144, and (B) as a result of the
event or
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circumstance described in any of the foregoing clauses (i) through (iii), the
legends with respect to transfer restrictions required under the Declaration and
the Indenture are removed or removable in accordance with the terms of the
Declaration or the Indenture, as the case may be.
"TRUSTEE": Wilmington Trust Company (or any successor entity), the
Property Trustee under the Declaration and the Trustee under the Indenture.
"UNDERWRITTEN REGISTRATION OR UNDERWRITTEN OFFERING": A registration in
which securities of the Registrants are sold to an underwriter for reoffering to
the public.
2. SECURITIES SUBJECT TO THIS AGREEMENT. The securities entitled to the
benefits of this Agreement are the Transfer Restricted Securities.
3. SHELF REGISTRATION.
(a) SHELF REGISTRATION. The Registrants shall:
(i) cause to be filed a Shelf Registration Statement,
on or prior to the 120th day after the Closing Date (the
"FILING DEADLINE DATE"), which Shelf Registration Statement
shall provide for resales of all Transfer Restricted
Securities the Holders of which shall have provided the
information required pursuant to Section 3(b) hereof, and
(ii) use their respective best efforts to cause such
Shelf Registration Statement or any successor Shelf
Registration Statement to be declared effective by the
Commission on or before the 180th day after the Closing Date
(the "EFFECTIVENESS DEADLINE DATE").
The Registrants shall use their respective best
efforts to keep a Shelf Registration Statement continuously
effective, supplemented and amended as required by the
provisions of Sections 5(a) and (b) hereof to the extent
necessary to ensure that it is available for resales of
Securities by the Holders of Transfer Restricted Securities
entitled to the benefit of this Section 3(a), and to ensure
that it conforms with the requirements of this Agreement, the
Securities Act and the policies, rules and regulations of the
Commission as announced from time to time, until the end of
the Effectiveness Period.
(b) Each Holder of Transfer Restricted Securities agrees that
if such Holder wishes to sell Transfer Restricted Securities pursuant
to a Shelf Registration Statement and related Prospectus, it shall do
so only in accordance with this Section 3(b). Each Holder of Transfer
Restricted Securities wishing to sell Transfer Restricted Securities
pursuant to a Shelf Registration Statement and related Prospectus
agrees to deliver a
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Notice and Questionnaire to the Registrants at least three (3) business
days prior to any intended distribution of Transfer Restricted
Securities under the Shelf Registration Statement. From and after the
date the initial Shelf Registration Statement becomes effective, the
Registrants shall, as promptly as is practicable after the date a
Notice and Questionnaire is delivered, and in any event within five (5)
business days after such date, (i) if required by applicable law, file
with the Commission a post-effective amendment to the Shelf
Registration Statement or prepare and, if required by applicable law,
file a supplement to the related Prospectus or a supplement or
amendment to any document incorporated therein by reference or file any
other required document so that the Holder delivering such Notice and
Questionnaire is named as a selling security holder in the Shelf
Registration Statement and the related Prospectus in such a manner as
to permit such Holder to deliver such Prospectus to purchasers of the
Transfer Restricted Securities in accordance with applicable law and,
if the Registrants shall file a post-effective amendment to the Shelf
Registration Statement, use their best efforts to cause such
post-effective amendment to become effective under the Securities Act
as promptly as is practicable; (ii) provide such Holder copies of any
documents filed pursuant to Section 3(b)(i); and (iii) notify such
Holder as promptly as practicable after the effectiveness under the
Securities Act of any post-effective amendment filed pursuant to
Section 3(b)(i); PROVIDED, that if such Notice and Questionnaire is
delivered during a Deferral Period, the Registrants shall so inform the
Holder delivering such Notice and Questionnaire and shall take the
actions set forth in clauses (i), (ii) and (iii) above upon expiration
of the Deferral Period in accordance with Section 5(b)(v). The
Registrants shall be under no obligation to name any Holder that is not
a Notice Holder as a selling security holder in any Transfer Restricted
Statement or related Prospectus.
(c) The Registrants shall supplement and amend the Shelf
Registration Statement or file a new Shelf Registration Statement if
required by the Securities Act to permit registered resale of the
Transfer Restricted Securities or, to the extent to which the
Registrants do not reasonably object, as reasonably requested by the
Initial Purchaser or by the Trustee on behalf of the Registered
Holders.
4. LIQUIDATED DAMAGES AMOUNT.
(a) The parties hereto agree that the Holders of Transfer
Restricted Securities shall suffer damages, and that it would not be
feasible to ascertain the extent of such damages with precision if (i)
the Shelf Registration Statement required by this Agreement
is not filed with the Commission on or prior to the date specified for
such filing in this Agreement; (ii) a Shelf Registration Statement has
not been declared effective by the Commission on or prior to the date
specified for such effectiveness in this Agreement, (iii) the
Registrants have failed to perform their obligations set forth in
Section 3(b)(i) within the time period specified; (iv) the aggregate
duration of the Deferral Periods in any period exceeds the number of
days permitted in respect of such period pursuant to Section
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5(b)(v); (v) the number of Deferral Periods in any period exceeds the
number permitted in respect of such period pursuant to Section 5(b)(v);
or (vi) a Shelf Registration Statement required by this Agreement is
filed and declared effective but shall thereafter cease to be
effective, except during a Deferral Period in compliance with Section
5(b)(v), or fail to be usable by a Notice Holder with respect to such
Shelf Registration Statement without being succeeded within five
business days by a post-effective amendment to such Shelf Registration
Statement or a new Shelf Registration Statement that cures such failure
and that is itself promptly, and in any event no later than five
business days, declared effective (each such event referred to in
clauses (i) through (vi), a "REGISTRATION DEFAULT"), accordingly,
commencing on (and including) any Registration Default Date and ending
on (but excluding) the next date on which there are no Registration
Defaults that have occurred and are continuing (a "DAMAGES ACCRUAL
PERIOD"), the Registrants agree to pay, as liquidated damages and not
as a penalty, an amount (the "LIQUIDATED DAMAGES AMOUNT"), payable on
the Damages Payment Dates, (i) prior to the conversion thereof, to
Record Holders (as set forth in the succeeding paragraph) of (x) CRESTS
that are Transfer Restricted Securities or (y) in the event that the
Convertible Debentures are distributed to holders of CRESTS upon
dissolution of the Trust in accordance with the Declaration,
Convertible Debentures that are Transfer Restricted Securities,
accruing at a rate per annum equal to one-quarter of one percent (.25%)
of the liquidation amount of such CRESTS or of the principal amount of
such Convertible Debentures, as the case may be with respect to the
first 90 day period immediately following the occurrence of such
Registration Default, and (ii) to Record Holders (as set forth in the
succeeding paragraph) of shares of Underlying Common Stock issued upon
conversion of CRESTS or Convertible Debentures that are Transfer
Restricted Securities, accruing, for each portion of such Damages
Accrual Period beginning on and including a Damages Payment Date (or,
in respect of the first such portion, the Event Date) and ending on but
excluding the next subsequent Damages Payment Date with respect to the
first 90 day period immediately following the occurrence of such
Registration Default, at a rate per annum equal to one-quarter of one
percent (.25%) of the aggregate Applicable Conversion Price of such
shares of Underlying Common Stock as of the Business Day immediately
preceding such next subsequent Damages Payment Date, and the Liquidated
Damages Amount shall increase to 0.5% of such liquidation amount,
principal amount or Applicable Conversion Price after such 90 day
period; PROVIDED, that in the case of a Damages Accrual Period that is
in effect solely as a result of a Registration Default of the type
described in clause (iii) of the preceding paragraph, such Liquidated
Damages Amount shall be paid only to the Holders (as set forth in
Section 3(b)) that have delivered Notice and Questionnaires that caused
the Registrants to incur the obligations set forth in Section 3(b) the
non-performance of which is the basis of such Registration Default. The
rate of accrual of the Liquidated Damages Amount with respect to any
period shall not exceed the rate provided for in this paragraph
notwithstanding the occurrence of multiple concurrent Registration
Defaults.
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The Registrants shall pay on each Damages Payment Date that
portion of the Liquidated Damages Amount payable pursuant to this
Section in respect of any Damages Accrual Period that has accrued from
and including the next preceding Damages Payment Date during such
Damages Accrual Period (or, in respect of the first such portion, the
Registration Default Date with respect to such Damages Accrual Period)
to but excluding such Damages Payment Date on any Convertible Preferred
Security, Convertible Debenture or share of Underlying Common Stock to
the Record Holders thereof; PROVIDED, that any Liquidated Damages
Amount accrued with respect to any Convertible Preferred Security or
Convertible Debenture or portion thereof called for redemption on a
redemption date or converted into Underlying Common Stock on a
conversion date prior to the Damages Payment Date, shall, in any such
event, be paid instead to the holder who submitted such Convertible
Preferred Security or Convertible Debenture or portion thereof for
redemption or conversion on the applicable redemption date or
conversion date, as the case may be, on such date (or promptly
following the conversion date, in the case of conversion); PROVIDED
FURTHER, that, in the case of a Registration Default of the type
described in clause (iii) of the first paragraph of this Section, such
Liquidated Damages Amount shall be paid only to the Holders entitled
thereto pursuant to such first paragraph by check mailed to the address
set forth in the Notice and Questionnaire delivered by such Holder. The
Trustee shall be entitled, on behalf of Registered Holders of CRESTS,
Convertible Debentures or Underlying Common Stock, to seek any
available remedy for the enforcement of this Agreement, including for
the payment of such Liquidated Damages Amount. Notwithstanding the
foregoing, the parties agree that the sole damages payable for a
violation of the terms of this Agreement with respect to which
liquidated damages are expressly provided shall be such liquidated
damages. Nothing shall preclude a Holder of Transfer Restricted
Securities from pursuing or obtaining specific performance or other
equitable relief with respect to this Agreement.
All of the Registrants' obligations set forth in this Section
that are outstanding with respect to any Transfer Restricted Security
at the time such security ceases to be a Transfer Restricted Security
shall survive until such time as all such obligations with respect to
such security have been satisfied in full (notwithstanding termination
of this Agreement pursuant to Section 12(l).
The parties hereto agree that the liquidated damages provided
for in this Section constitute a reasonable estimate of the damages
that may be incurred by Holders of Transfer Restricted Securities by
reason of the failure of the Shelf Registration Statement to be filed
or declared effective or available (absolutely or as a practical
matter) for effecting resales of Transfer Restricted Securities in
accordance with the provisions hereof.
(b) The Registrants shall notify the Trustee, as the Property
Trustee under the Declaration (or, if the Convertible Debentures shall
have been distributed to the Holders
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of the CRESTS in liquidation of the Trust, the Trustee, as Trustee
under the Indenture) within two business days after each and every date
on which an event occurs in respect of which Liquidated Damages Amounts
are required to be paid.
5. REGISTRATION PROCEDURES.
(a) SHELF REGISTRATION STATEMENT. In connection with the Shelf
Registration Statement, the Registrants shall comply with all the
provisions of Section 5(b) below and shall use their best efforts to
effect such registration to permit the sale of the Transfer Restricted
Securities being sold in accordance with the intended method or methods
of distribution thereof, and pursuant thereto the Registrants shall as
expeditiously as possible prepare and file with the Commission a Shelf
Registration Statement relating to the registration on the appropriate
form under the Securities Act, which form shall be available for the
sale of the Transfer Restricted Securities in accordance with the
intended method or methods of distribution thereof.
(b) GENERAL PROVISIONS. In connection with the Shelf
Registration Statement and any Prospectus required by this Agreement to
permit the sale or resale of Transfer Restricted Securities, the
Registrants shall:
(i) use their best efforts to keep such Shelf
Registration Statement continuously effective and provide all
requisite financial statements for the Effectiveness Period;
upon the occurrence of any event that would cause any such
Shelf Registration Statement or the Prospectus contained
therein (A) to contain a material misstatement or omission or
(B) not to be effective and usable for resale of Transfer
Restricted Securities during the period required by this
Agreement, the Registrants shall file promptly an appropriate
amendment to such Shelf Registration Statement or a new Shelf
Registration Statement, in the case of clause (A), correcting
any such misstatement or omission, and, in the case of either
clause (A) or (B), use their best efforts to cause such
amendment or new Shelf Registration Statement to be declared
effective and such Shelf Registration Statement and the
related Prospectus to become usable for their intended
purpose(s) as soon as practicable thereafter;
(ii) prepare and file with the Commission such
amendments and post-effective amendments to the Shelf
Registration Statement as may be necessary to keep the Shelf
Registration Statement effective for the Effectiveness Period;
cause the Prospectus to be supplemented by any required
Prospectus supplement, and as so supplemented to be filed
pursuant to Rule 424 under the Securities Act, and to comply
fully with the applicable provisions of Rules 424 and 430A
under the Securities Act in a timely manner, and comply with
the provisions of the Securities Act with respect to the
disposition of all securities covered by such
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Shelf Registration Statement during the applicable period in
accordance with the intended method or methods of distribution
by the sellers thereof set forth in such Shelf Registration
Statement or supplement to the Prospectus;
(iii) advise the underwriter(s), if any, the Initial
Purchaser and Notice Holders promptly and, if requested by
such Persons, to confirm such advice in writing, (A) when the
Prospectus or any Prospectus supplement or post-effective
amendment has been filed, and, with respect to the Shelf
Registration Statement or any post-effective amendment
thereto, when the same has become effective, (B) of any
request by the Commission for amendments to the Shelf
Registration Statement or amendments or supplements to the
Prospectus or for additional information relating thereto, (C)
of the issuance by the Commission of any stop order suspending
the effectiveness of the Shelf Registration Statement under
the Securities Act or of the suspension by any state
securities commission of the qualification of the Transfer
Restricted Securities for offering or sale in any
jurisdiction, or the initiation of any proceeding for any of
the preceding purposes, (D) of the occurrence of (but not the
nature of or details concerning) a Material Event and (E) of
the determination by the Registrants that a post-effective
amendment to a Shelf Registration Statement would be
appropriate, which notice may, at the discretion of the
Registrants (or as required by Section 5(b)(v)), state that it
constitutes a Deferral Notice, in which event the provisions
of Section 5(b)(v) shall apply. If at any time the Commission
shall issue any stop order suspending the effectiveness of the
Shelf Registration Statement, or any state securities
commission or other regulatory authority shall issue an order
suspending the qualification or exemption from qualification
of the Transfer Restricted Securities under state securities
or Blue Sky laws, the Registrants shall use their best efforts
to obtain the withdrawal or lifting of such order at the
earliest possible time;
(iv) furnish to each of the Notice Holders, the
Initial Purchaser and each of the underwriter(s), if any,
before filing with the Commission, copies of the Shelf
Registration Statement or any Prospectus included therein or
any amendments or supplements to any such Shelf Registration
Statement or Prospectus (excluding all documents incorporated
by reference after the initial filing of such Shelf
Registration Statement and any such amendments or supplements
required to be filed as a consequence of the filing of reports
or other documents pursuant to Section 13(a), 13(c), 14 or
15(d) of the Securities Exchange Act of 1934, as amended),
which documents shall be subject to the review of such Holders
and underwriter(s), if any, for a period of at least five
business days, and the Registrants shall not file any such
Shelf Registration Statement or Prospectus or any amendment or
supplement to any such Shelf Registration Statement or
Prospectus (excluding any documents incorporated by
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reference and any such amendments or supplements required to
be filed as a consequence of the filing of reports or other
documents pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act of 1934, as amended) to which a Notice
Holder of Transfer Restricted Securities covered by such Shelf
Registration Statement or the underwriter(s), if any, shall
reasonably object within five business days after the receipt
thereof;
(v) upon (A) the issuance by the Commission of a stop
order suspending the effectiveness of the Shelf Registration
Statement or the initiation of proceedings with respect to the
Shelf Registration Statement under Section 8(d) or 8(e) of the
Securities Act, (B) the occurrence of any event or the
existence of any fact (a "MATERIAL EVENT") as a result of
which any Shelf Registration Statement shall contain any
untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to
make the statements therein not misleading, or any Prospectus
shall contain any untrue statement of a material fact or omit
to state any 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, or
(C) the occurrence or existence of any pending corporate
development that, in the discretion of the Registrants, makes
it appropriate to suspend the availability of the Shelf
Registration Statement and the related Prospectus, (i) in the
case of clause (B) above, subject to the next sentence, as
promptly as practicable prepare and file, if necessary
pursuant to applicable law, a post-effective amendment to such
Shelf Registration Statement or a supplement to the related
Prospectus or a new Shelf Registration Statement or any
document incorporated therein by reference or file any other
required document that would be incorporated by reference into
such Shelf Registration Statement and Prospectus so that such
Shelf Registration Statement does not contain any untrue
statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the
statements therein not misleading, and such Prospectus does
not contain any untrue statement of a material fact or omit to
state any 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, as
thereafter delivered to the purchasers of the Transfer
Restricted Securities being sold thereunder, and, in the case
of a new Shelf Registration Statement or a post-effective
amendment to a Shelf Registration Statement, subject to the
next sentence, use their best efforts to cause it to become
effective as promptly as is practicable, and (ii) give notice
to the Notice Holders that the availability of the Shelf
Registration Statement is suspended (a "DEFERRAL NOTICE") and,
upon receipt of any Deferral Notice, each Notice Holder shall
not sell any Transfer Restricted Securities pursuant to the
Shelf Registration Statement until such Notice Holder's
receipt of copies of the supplemented or amended Prospectus
provided for in clause (i) above, or until it is advised in
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writing by the Company that the Prospectus may be used, and
has received copies of any additional or supplemental filings
that are incorporated or deemed incorporated by reference in
such Prospectus. The Registrants, shall use their best efforts
to ensure that the use of the Prospectus may be resumed (x) in
the case of clause (A) or (B) above, as promptly as is
practicable and (y) in the case of clause (C) above, as soon
as, in the discretion of the Registrants, such suspension is
no longer appropriate. The Registrants shall be entitled to
exercise their right under this Section to suspend the
availability of the Shelf Registration Statement or any
Prospectus, without incurring any obligation to pay liquidated
damages pursuant to Section 4(a), no more than one (1) time in
any three (3) month period or three (3) times in any twelve
(12) month period, and the period during which the
availability of the Shelf Registration Statement and any
Prospectus is suspended (the "DEFERRAL PERIOD") shall, without
incurring any obligation to pay liquidated damages pursuant to
Section 4(a), not exceed thirty (30) days; PROVIDED, that in
the case of a Material Event relating to an acquisition or a
probable acquisition meeting the significance test of Rule
3-05(b)(2)(ii) of Regulation S-X under the Securities Act, the
Registrants may, without incurring any obligation to pay
liquidated damages pursuant to Section 4(a), deliver to Notice
Holders a second certificate to the effect set forth above,
which shall have the effect of extending the Deferral Period
by up to an additional thirty (30) days, or such shorter
period of time as is specified in such second notice;
PROVIDED, that the aggregate duration of any Deferral Periods
shall not, without incurring any obligation to pay liquidated
damages pursuant to Section 4(a), exceed sixty (60) days in
any three (3) month period or ninety (90) days in any twelve
(12) month period;
(vi) make available at reasonable times for
inspection by a representative of the Principal Holder (the
"INSPECTOR"), any underwriter participating in any disposition
pursuant to such Shelf Registration Statement, and any
attorney or accountant retained by such Principal Holder (the
"SPECIAL COUNSEL") or any of the underwriter(s), all financial
and other records, pertinent corporate documents, other
relevant documents and properties of the Registrants and use
its reasonable best efforts to cause the Registrants'
officers, trustees, directors, managers and employees to
supply all relevant information reasonably requested by any
such underwriter, Inspector or Special Counsel in connection
with such Shelf Registration Statement subsequent to the
filing thereof and prior to its effectiveness, in each case as
is customary for similar "due diligence" examinations;
(vii) if requested by any Notice Holders, the Initial
Purchaser or the underwriter(s), if any, promptly incorporate
in the Shelf Registration Statement or Prospectus, pursuant to
a supplement or post-effective amendment if necessary, such
information as such Notice Holders and underwriter(s), if any,
may
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reasonably request to have included therein, including,
without limitation, information relating to the "Plan of
Distribution" of the Transfer Restricted Securities,
information with respect to the liquidation or principal
amount of Transfer Restricted Securities being sold to such
underwriter(s), the purchase price being paid therefor and any
other terms of the offering of the Transfer Restricted
Securities to be sold in such offering; and make all required
filings of such Prospectus supplement or post-effective
amendment as soon as practicable after the Registrants are
notified of the matters to be incorporated in such Prospectus
supplement or post-effective amendment;
(viii) furnish to each Notice Holder, the Initial
Purchaser and each of the underwriter(s), if any, without
charge, at least one copy of the Shelf Registration Statement,
as first filed with Commission, and of each amendment thereto,
including all documents incorporated by reference therein and
all exhibits (including exhibits incorporated therein by
reference);
(ix) deliver to each Notice Holder, the Initial
Purchaser and each of the underwriter(s), if any, without
charge, as many copies of the Prospectus (including each
preliminary prospectus) and any amendment or supplement
thereto as such Persons reasonably may request; the
Registrants hereby consent to the use of the Prospectus and
any amendment or supplement thereto by each of the Notice
Holders, the Initial Purchaser and each of the underwriter(s),
if any, in connection with the offering and the sale of the
Transfer Restricted Securities covered by the Prospectus or
any amendment or supplement thereto;
(x) enter into such customary agreements (including
an underwriting agreement in customary form), and make such
representations and warranties, and take all such other
actions in connection therewith in order to expedite or
facilitate the disposition of the Transfer Restricted
Securities pursuant to the Shelf Registration Statement
contemplated by this Agreement, all to such extent as may be
requested by any Principal Holder of Transfer Restricted
Securities or underwriter in connection with any sale or
resale pursuant to the Shelf Registration Statement
contemplated by this Agreement, PROVIDED, however, that the
Company shall not be obligated to enter into an underwriting
agreement or to facilitate such disposition in an underwritten
offering pursuant to the Shelf Registration Statement unless a
Principal Holder elects to dispose of such Transfer Restricted
Securities in such an underwritten offering, and in connection
with an Underwritten Registration, the Registrants shall:
(A) upon request of any Principal Holder,
furnish to each Notice Holder, the Initial Purchaser
and each underwriter, if any, in such substance and
scope as such Principal Holder may request and as are
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customarily made by issuers to underwriters in
primary underwritten offerings, upon the closing of
the Underwritten Registration:
(1) a certificate in customary
form, dated the date of the closing of the
Underwritten Registration signed by (y) its
Chairman of the Board, its President, a Vice
President or trustee and (z) its Chief
Financial Officer confirming, as of such
date, such matters as such parties may
reasonably request;
(2) an opinion in customary form,
dated the date of the closing of the
Underwritten Registration, of counsel for
the Registrants, covering such matters as
such parties may reasonably request, and in
any event including a statement to the
effect that such counsel has participated in
conferences with officers and other
representatives of the Registrants,
representatives of the independent public
accountants for the Registrants in
connection with the preparation of such
Shelf Registration Statement and the related
Prospectus and have considered the matters
required to be stated therein and the
statements contained therein, although such
counsel has not independently verified the
accuracy, completeness or fairness of such
statements; and that such counsel advises
that, on the basis of the foregoing, no
facts came to such counsel's attention that
caused such counsel to believe that the
Shelf Registration Statement, at the time
such Shelf Registration Statement or any
post-effective amendment thereto became
effective, contained an untrue statement of
a material fact or omitted to state a
material fact required to be stated therein
or necessary to make the statements therein
not misleading, or that the Prospectus
contained in such Shelf Registration
Statement, as of its date, contained an
untrue statement of a material fact or
omitted to state a material fact necessary
in order to make the statements therein, in
light of the circumstances under which they
were made, not misleading. Without limiting
the foregoing, such counsel may state
further that such counsel assumes no
responsibility for, and has not
independently verified, the accuracy,
completeness or fairness of the financial
statements, notes and schedules and other
financial data included in the Shelf
Registration Statement contemplated by this
Agreement or the related Prospectus; and
(3) if permitted by Statement of
Accounting Standards No. 72, customary
comfort letters, dated the date of the
closing of the Underwritten Registration
from the Registrants' and, in the
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event the Merger has not been completed or
terminated, Impac's independent accountants,
in the customary form and covering matters
of the type customarily covered in comfort
letters by underwriters in connection with
primary underwritten offerings.
(B) set forth in full or incorporate by
reference in the underwriting agreement, if any, the
indemnification provisions and procedures of Section
8 hereof with respect to all parties to be
indemnified pursuant to said Section; and
(C) deliver such other customary documents
and certificates as may be reasonably requested by
such parties to evidence compliance with clause (A)
above and with any customary conditions contained in
the underwriting agreement or other agreement entered
into by the Registrants pursuant to this clause
(xii), if any.
(xi) prior to any public offering of Transfer
Restricted Securities, cooperate with the Notice Holders, the
Initial Purchaser, the underwriter(s), if any, and their
respective counsel in connection with the registration and
qualification of the Transfer Restricted Securities under the
securities or Blue Sky laws of such jurisdictions as the
Notice Holders, the Initial Purchaser or underwriter(s) may
reasonably request and do any and all other acts or things
necessary or advisable to enable the disposition in such
jurisdictions of the Transfer Restricted Securities covered by
the Shelf Registration Statement; PROVIDED, HOWEVER, that no
Registrant shall be required to register or qualify as a
foreign corporation where it is not now so qualified or to
take any action that would subject it to the service of
process in suits or to taxation, other than as to matters and
transactions relating to the Shelf Registration Statement, in
any jurisdiction where it is not now so subject;
(xii) cooperate with the Notice Holders, the Initial
Purchaser and the underwriter(s), if any, to facilitate the
timely preparation and delivery of certificates representing
Transfer Restricted Securities to be sold and to the extent
applicable not bearing any restrictive legends; and enable
such Transfer Restricted Securities to be in such
denominations and registered in such names as the Holders or
the underwriter(s), if any, may request at least one business
day prior to any sale of Transfer Restricted Securities made
by such underwriter(s);
(xiii) use its reasonable best efforts to cause the
Transfer Restricted Securities covered by the Shelf
Registration Statement to be registered with or approved by
such other governmental agencies or authorities as may be
necessary to enable the seller or sellers thereof or the
underwriter(s), if any, to consummate
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the disposition of such Transfer Restricted Securities,
subject to the proviso contained in clause (xiii) above;
(xiv) provide CUSIP numbers for all Transfer
Restricted Securities not later than the effective date of the
Shelf Registration Statement and provide certificates for the
Transfer Restricted Securities;
(xv) cooperate and assist in any filings required to
be made with the NASD and in the performance of any due
diligence investigation by any underwriter (including any
"qualified independent underwriter") that is required to be
retained in accordance with the rules and regulations of the
NASD;
(xvi) otherwise use its reasonable best efforts to
comply with all applicable rules and regulations of the
Commission, and make generally available to its security
holders, as soon as practicable, a consolidated earning
statement meeting the requirements of Rule 158 (which need not
be audited) for the twelve-month period (A) commencing at the
end of any fiscal quarter in which Transfer Restricted
Securities are sold to underwriters in a firm or best efforts
Underwritten Offering or (B) if not sold to underwriters in
such an offering, beginning with the first month of the
Registrants' first fiscal quarter commencing after the
effective date of the Shelf Registration Statement;
(xvii) cause the Indenture and, if the Convertible
Debentures shall not have been distributed to the Holders of
the CRESTS in liquidation of the Trust, the Declaration and
the Guarantee to be qualified under the TIA not later than the
effective date of the first Shelf Registration Statement
required by this Agreement, and, in connection therewith,
cooperate with the Trustee and the Holders of Securities to
effect such changes to the Indenture, the Declaration and the
Guarantee as may be required for the Indenture, the
Declaration and the Guarantee to be so qualified in accordance
with the terms of the TIA; and execute and use their best
efforts to cause the Indenture Trustee, Guarantee Trustee and
the Property Trustee to execute all documents that may be
required to effect such changes and all other forms and
documents required to be filed with the Commission to enable
such Indenture and Declaration and Guarantee to be so
qualified in a timely manner; and
(xviii) provide promptly to each Holder upon request
each document filed with the Commission pursuant to the
requirements of Section 13 and Section 15 of the Exchange Act;
and
6. HOLDER'S OBLIGATIONS. Each Holder agrees, by acquisition of the
Transfer Restricted Securities, that no Holder of Transfer Restricted Securities
shall be entitled to sell any of such
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Transfer Restricted Securities pursuant to a Shelf Registration Statement or to
receive a Prospectus relating thereto, unless such Holder has furnished the
Registrants with a Notice and Questionnaire as required pursuant to Section 3(b)
hereof (including the information required to be included in such Notice and
Questionnaire) and the information set forth in the next sentence. Each Notice
Holder agrees promptly to furnish to the Registrants all information required to
be disclosed in order to make the information previously furnished to the
Registrants by such Notice Holder not misleading and any other information
regarding such Notice Holder and the distribution of such Transfer Restricted
Securities as the Registrants may from time to time reasonably request. Any sale
of any Transfer Restricted Securities by any Holder shall constitute a
representation and warranty by such Holder that the information relating to such
Holder and its plan of distribution is as set forth in the Prospectus delivered
by such Holder in connection with such disposition, that such Prospectus does
not as of the time of such sale contain any untrue statement of a material fact
relating to or provided by such Holder or its plan of distribution and that such
Prospectus does not as of the time of such sale omit to state any material fact
relating to or provided by such Holder or its plan of distribution necessary to
make the statements in such Prospectus, in the light of the circumstances under
which they were made, not misleading.
Each Holder further agrees that, upon receipt of any Deferral Notice
from the Company, such Holder shall forthwith discontinue disposition of
Transfer Restricted Securities pursuant to the applicable Shelf Registration
Statement until (i) such Holder has received copies of the supplemented or
amended Prospectus contemplated by Section 5(b)(v) hereof, or (ii) such Holder
is advised in writing by the Company that the use of the Prospectus may be
resumed, and has received copies of any additional or supplemental filings that
are incorporated by reference in the Prospectus. Each Holder receiving a
Deferral Notice hereby agrees that it will either (i) destroy any Prospectuses,
other than permanent file copies, then in such Holder's possession which have
been replaced by the Company with more recently dated Prospectuses or (ii)
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 Transfer Restricted Securities that was current at the time of
receipt of the Deferral Notice.
7. REGISTRATION EXPENSES.
All expenses incident to the Registrants' performance of or compliance with this
Agreement shall be borne by the Registrants, regardless of whether the Shelf
Registration Statement becomes effective, including without limitation: (i) all
registration and filing fees and expenses; (ii) all fees and expenses of
compliance with federal securities and state Blue Sky or securities laws; (iii)
all expenses of printing, messenger and delivery services and telephone; (iv)
all fees and disbursements of counsel for the Registrants; and (v) all fees and
disbursements of independent certified public accountants of the Registrants and
Impac (including the expenses of any special audit and comfort letters required
by or incident to such performance). In addition, the Registrants shall bear or
reimburse the Notice Holders for the reasonable fees and disbursements of one
firm of legal counsel for the Holders, which shall initially be Xxxxx Xxxx &
Xxxxxxxx, but
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which may, with the written consent of the Initial Purchaser (which shall not be
unreasonably withheld), be another nationally recognized law firm experienced in
securities law matters designated by the Registrants. Notwithstanding the
provisions of this Section, each seller of Transfer Restricted Securities shall
pay all registration expenses to the extent the Registrants are prohibited by
applicable Blue Sky laws from paying for or on behalf of such seller of Transfer
Restricted Securities. The Company shall not have any obligation to pay any
underwriting fees, discounts or commissions attributable to the sale of any
Transfer Restricted Securities pursuant to this Agreement.
The Registrants shall, in any event, bear their internal expenses (including,
without limitation, all salaries and expenses of their officers and employees
performing legal or accounting duties), the expenses of any annual audit and the
fees and expenses of any Person, including special experts and legal counsel,
retained by the Registrants.
8. INDEMNIFICATION AND CONTRIBUTION.
(a) In connection with the Shelf Registration Statement, the
Registrants shall indemnify and hold harmless each Holder of Transfer
Restricted Securities included within any such Shelf Registration
Statement, and each person, if any, who controls any such person within
the meaning of the Securities Act (each, a "PARTICIPANT"), from and
against any loss, claim, damage or liability, joint or several, or any
action in respect thereof (including, but not limited to, any loss,
claim, damage, liability or action relating to purchases and sales of
Securities) to which such Participant or controlling person may become
subject, under the Securities Act or otherwise, insofar as such loss.
claim, damage, liability or action arises out of, or is based upon, (i)
any untrue statement or alleged untrue statement of a material fact
contained in any preliminary Prospectus, such Shelf Registration
Statement or any Prospectus or in any amendment or supplement thereto
or (ii) 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, and shall reimburse each Participant promptly
upon demand for any legal or other expenses reasonably incurred by such
Participant in connection with investigating or defending or preparing
to defend against any such loss, claim, damage, liability or action as
such expenses are incurred; PROVIDED, however, that (i) the Registrants
shall not be liable 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 omission or alleged
omission made in any such Shelf Registration Statement or any
prospectus forming part thereof or in any such amendment or supplement
in reliance upon and in conformity with written information furnished
to the Registrants by or on behalf of any Participant specifically for
inclusion therein; and provided further that as to any preliminary
Prospectus, the indemnity agreement contained in this Section 8(a)
shall not inure to the benefit of any such Participant or any
controlling person of such Participant on account of any loss, claim,
damage, liability or action arising from the sale of the
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Securities to any person by that Participant if (i) that Participant
failed to send or give a copy of the Prospectus, as the same may be
amended or supplemented, to that person within the time required by the
Securities Act and (ii) the untrue statement or alleged untrue
statement of a material fact or omission or alleged omission to state a
material fact in such preliminary Prospectus was corrected in the
Prospectus, unless, in each case, such failure resulted from
non-compliance by the Registrants with Section 5(b). The foregoing
indemnity agreement is in addition to any liability which the
Registrants may otherwise have to any Participant or to any controlling
person of that Participant.
(b) Each Participant, severally and not jointly, shall
indemnify and hold harmless the Registrants, each of its trustees,
directors, officers, employees or agents and each person, if any, who
controls the Registrants within the meaning of the Securities Act, from
and against any loss, claim, damage or liability, joint or several, or
any action in respect thereof, to which the Registrants or any such
director, officer, employees or agents or controlling person may become
subject, under the Securities Act or otherwise, insofar as such loss,
claim, damage, liability or action arises out of, or is based upon, (i)
any untrue statement or alleged untrue statement of a material fact
contained in any preliminary Prospectus, Shelf Registration Statement
or Prospectus or in any amendment or supplement thereto or (ii) 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, but in each case only to the extent that the untrue
statement or alleged untrue statement or omission or alleged omission
was made in reliance upon and in conformity with written information
furnished to the Registrants by or on behalf of that Participant
specifically for inclusion herein, and shall reimburse the Registrants
and any such trustee, director, officer, employees or agents or
controlling person for any legal or other expenses reasonably incurred
by the Registrants or any such trustee, director, officer, employees or
agents or controlling person in connection with investigating or
defending or preparing to defend against any such loss, claim, damage,
liability or action as such expenses are incurred. In no event shall
the liability of any selling Holder of Transfer Restricted Securities
hereunder be greater in amount than the dollar amount of the proceeds
received by such Holder upon the sale of the Transfer Restricted
Securities pursuant to the Shelf Registration Statement giving rise to
such indemnification obligation. The foregoing indemnity agreement is
in addition to any liability which any Participant may otherwise have
to the Registrants or any such trustee, director, officer or
controlling person.
(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made
against the indemnifying party under this Section 8, notify the
indemnifying party in writing of the claim or the commencement of that
action; provided, however, that the failure to notify the indemnifying
party shall not relieve it from any liability which it may have under
this Section 8 except to the extent it has been materially prejudiced
by such failure and, provided further, that the failure to notify the
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indemnifying party shall not relieve it from any liability which it may
have to an indemnified parry otherwise than under this Section 8. If
any such claim or action shall be brought against an indemnified party,
and it shall have notified 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
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, however, that any indemnified party shall have
the right to employ separate counsel in any such action and to
participate in the defense thereof but the fees and expenses of such
counsel shall be at the expense of such indemnified party unless (i)
the employment thereof has been specifically authorized by the
indemnifying party in writing, (ii) such indemnified party shall have
been advised by such counsel that there may be one or more legal
defenses available to it which are different from or additional to
those available to the indemnifying party and in the reasonable
judgment of such counsel it is advisable for such indemnified party to
employ separate counsel or (iii) the indemnifying party has failed to
assume the defense of such action and employ counsel reasonably
satisfactory to the indemnified party, in which case, if such
indemnified party notifies the indemnifying party in writing that it
elects to employ separate counsel at the expense of the indemnifying
party, the indemnifying party shall not have the right to assume the
defense of such action on behalf of such indemnified party, it being
understood, however, that the indemnifying party shall not, in
connection with any one such action or separate but substantially
similar or related actions in the same jurisdiction arising out of the
same general allegations or circumstances, be liable for the reasonable
fees and expenses of more than one separate firm of attorneys at any
time for all such indemnified parties, which firm shall be designated
in writing by the Initial Purchaser. No indemnifying party shall (i)
without the prior written consent of the indemnified parties (which
consent shall not be unreasonably withheld), settle or compromise or
consent to the entry of any judgment with respect to any pending or
threatened claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or not
the indemnified parties are actual or potential parties to such claim
or action) unless such settlement, compromise or consent includes an
unconditional release of each indemnified party from all liability
arising out of such claim, action, suit or proceeding, or (ii) be
liable for any settlement of any such action effected without its
written consent (which consent shall not be unreasonably withheld), but
if settled with its written consent or if there be a final judgment of
the plaintiff in any such action, the indemnifying party agrees to
indemnify and hold harmless any indemnified party from and against any
loss of liability by reason of such settlement or judgment.
(d) If the indemnification provided for in this Section shall
for any reason be
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unavailable to or insufficient to hold harmless an indemnified party
under Section 8(a) or 8(b) in respect of any loss, claim, damage or
liability, or any action in respect thereof, referred to therein, 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 Registrants on the one hand and the
Participants on the other with respect to the statements or omissions
which resulted in such 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 Registrants or the Participants. the intent
of the parties and their relative knowledge, access to information and
opportunity to correct or prevent such statement or omission. The
Registrants and the Participants agree that it would not be just and
equitable if contributions pursuant to this Section 8(d) were to be
determined by pro rata allocation (even if the Participants were
treated as one entity for such purpose) or by any other method of
allocation which does not take into account the equitable
considerations referred to herein. 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 Section 8(d)
shall be deemed to include, for purposes of this Section 8(d), any
legal or other expenses reasonably incurred by such indemnified party
in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 8(d), no Participant
shall be required to contribute any amount in excess of the amount by
which the total received by such Participant with respect to the sale
of its Securities exceeds the amount of any damages which such
Participant has otherwise paid or become liable to pay by reason of any
untrue or alleged untrue statement or omission or alleged omission. 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. The Participants' obligations to contribute as
provided in this Section 8(d) are several and not Joint.
The indemnity and contribution provisions contained in this Section 8 shall
remain operative and in full force and effect regardless of (i) any termination
of this Agreement, (ii) any investigation made by or on behalf of any Holder or
any person controlling any Holder, or any Registrant or its officers, directors
or trustees or any person controlling the Registrants and (iii) the sale of any
Transfer Restricted Securities by any Holder.
9. RULE 144A.
The Registrants hereby agree with each Holder, for so long as any Transfer
Restricted Securities remain outstanding, to make available to any Holder or
beneficial owner of Transfer Restricted Securities in connection with any sale
thereof and any prospective purchaser of such Transfer
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Restricted Securities from such Holder or beneficial owner, the information
required by Rule 144A(d)(4) under the Securities Act in order to permit resales
of such Transfer Restricted Securities pursuant to Rule 144A.
10. Participation in Underwritten Registrations.
No Holder may participate in any Underwritten Registration hereunder unless such
Holder (a) agrees to sell such Holder's Transfer Restricted Securities on the
basis provided in any underwriting arrangements approved by the Registrants and
(b) completes and executes all reasonable questionnaires, powers of attorney,
indemnities, underwriting agreements, lock-up letters and other documents
required under the terms of such underwriting arrangements.
11. Selection of Underwriters.
If any of the Transfer Restricted Securities covered by a Shelf Registration
Statement are to be sold in an Underwritten Offering, the investment banker or
investment bankers and manager or managers that shall administer the offering
shall be selected by the Holders of a majority in aggregate principal amount or
liquidation amount of the Transfer Restricted Securities included in such
offering; PROVIDED, that such investment bankers and managers must be reasonably
satisfactory to the Company and such Holders shall be responsible for all
underwriting commissions and discounts in connection therewith.
12. Miscellaneous.
(a) REMEDIES. The Registrants agree that monetary damages
(including the liquidated damages contemplated hereby) would not be
adequate compensation for any loss incurred by reason of a breach by it
of the provisions of this Agreement and hereby agree to waive the
defense in any action for specific performance that a remedy at law
would be adequate.
(b) NO INCONSISTENT AGREEMENTS. The Registrants shall not on
or after the date of this Agreement enter into any agreement with
respect to their securities that is inconsistent with the rights
granted to the Holders in this Agreement or otherwise conflicts with
the provisions hereof. The Registrants have not previously entered into
any agreement granting any Person the right to include securities of
the Company on any Shelf Registration Statement pursuant to this
Agreement. The rights granted to the Holders hereunder do not in any
way conflict with and are not inconsistent with the rights granted to
the holders of the Registrants' securities under any agreement in
effect on the date hereof.
(c) AMENDMENTS AND WAIVERS. The provisions of this Agreement
may not be amended, modified or supplemented, and waivers or consents
to or departures from the
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provisions hereof may not be given unless the Registrants have obtained
the written consent of Holders of a majority of the then outstanding
Underlying Common Stock constituting Transfer Restricted Securities
(with Holders of CRESTS (or Convertible Debentures issued upon
liquidation of the Trust) deemed to be the Holders, for purposes of
this Section, of the number of outstanding shares of Underlying Common
Stock into which such CRESTS (or Convertible Debentures) are or would
be convertible or exchangeable as of the date on which such consent is
requested). Notwithstanding the foregoing, a waiver or consent to
depart from the provisions hereof with respect to a matter that relates
exclusively to the rights of Holders of Transfer Restricted Securities
whose securities are being sold pursuant to a Shelf Registration
Statement and that does not directly or indirectly affect the rights of
other Holders of Transfer Restricted Securities may be given by Holders
of at least a majority of the Transfer Restricted Securities being sold
by such Holders pursuant to such Shelf Registration Statement;
PROVIDED, that the provisions of this sentence may not be amended,
modified, or supplemented except in accordance with the provisions of
the immediately preceding sentence.
(d) NOTICES. All notices and other communications provided for
or permitted hereunder shall be made in writing by hand-delivery,
first-class mail (registered or certified, return receipt requested),
telex, telecopier, or air courier guaranteeing overnight delivery:
(i) if to a Holder, at the address set forth on the
records of the Trust; and
(ii) if to the Registrants:
Servico, Inc.
0000 Xxxxxxxxx Xxxx
Xxxx Xxxx Xxxxx, Xxxxxxx 00000
Attention: Chief Executive Officer
All such notices and communications shall be deemed to have
been duly given: at the time delivered by hand, if personally
delivered; five business days after being deposited in the mail,
postage prepaid, if mailed; when answered back, if telexed; when
receipt acknowledged, if telecopied; and on the next business day, if
timely delivered to an air courier guaranteeing overnight delivery.
Copies of all such notices, demands or other communications
shall be concurrently delivered by the Person giving the same to the
Trustee at the address specified in the Indenture.
(e) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the
benefit of and be
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binding upon the successors and assigns of each of the parties,
including without limitation and without the need for an express
assignment, subsequent Holders of Transfer Restricted Securities;
PROVIDED, HOWEVER, that this Agreement shall not inure to the benefit
of or be binding upon a successor or assign of a Holder unless and to
the extent such successor or assign acquired Transfer Restricted
Securities from such Holder; and PROVIDED, further, that nothing herein
shall be deemed to permit any assignment, transfer or other disposition
of Transfer Restricted Securities in violation of the terms hereof or
of the Purchase Agreement or the Indenture. If any transferee of any
Holder shall acquire Transfer Restricted Securities in any manner,
whether by operation of law or otherwise, such Transfer Restricted
Securities shall be held subject to all of the terms of this Agreement,
and by taking and holding such Transfer Restricted Securities such
Person shall be conclusively deemed to have agreed to be bound by and
to perform all of the terms and provisions of this Agreement, including
the restrictions on resale set forth in this Agreement and, if
applicable, the Purchase Agreement, and such Person shall be entitled
to receive the benefits hereof.
(f) COUNTERPARTS. This Agreement may be executed in any number
of counterparts and by the parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and
all of which taken together shall constitute one and the same
agreement.
(g) HEADINGS. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect
the meaning hereof.
(h) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REGARD TO THE CONFLICT OF LAW RULES THEREOF.
(i) SEVERABILITY. In the event that any one or more of the
provisions contained herein, or the application thereof in any
circumstance, is held invalid, illegal or unenforceable, the validity,
legality and enforceability of any such provision in every other
respect and of the remaining provisions contained herein shall not be
affected or impaired thereby.
(j) ENTIRE AGREEMENT. This Agreement together with the other
transaction documents is intended by the parties as a final expression
of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in
respect of the subject matter contained herein. There are no
restrictions, promises, warranties or undertakings, other than those
set forth or referred to herein with respect to the registration rights
granted by the Registrants with respect to the Transfer Restricted
Securities. This Agreement supersedes all prior agreements and
understandings between the parties with respect to such subject matter.
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(k) REQUIRED CONSENTS. Whenever the consent or approval of
Holders of a specified percentage of Transfer Restricted Securities is
required hereunder, Transfer Restricted Securities held by the
Registrants or their affiliates (as such term is defined in Rule 405
under the Securities Act) shall not be counted in determining whether
such consent or approval was given by the Holders of such required
percentage.
(l) TERMINATION. This Agreement and the obligations of the
parties hereunder shall terminate upon the end of the Effectiveness
Period, except for any liabilities or obligations under Sections 6, 7
or 8 hereof and the obligations to make payments of and provide for
liquidated damages under Section 4(a) hereof to the extent such damages
accrue prior to the end of the Effectiveness Period, each of which
shall remain in effect in accordance with their terms.
(m) MERGER. In the event the merger (the "MERGER") pursuant to
the Agreement and Plan of Merger, dated as of March 20, 1998 among
Lodgian, the Company, Impac Hotel Group, L.L.C., SHG-S Sub and SHG-I
Sub, L.L.C. is consummated, Lodgian, the successor corporation in the
Merger, shall assume the Company's obligations under this Agreement and
shall execute and deliver such documents as may be necessary to carry
out the intent of this Section. From and after the Merger and the
assumption by Lodgian of Servico, Inc.'s obligations hereunder,
Servico, Inc. shall be released from its obligations under this
Agreement. Following the Merger, all references to the Company
hereunder shall instead refer to Lodgian.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
SERVICO, INC.
By: /s/ Xxxxxxx X. Xxxx
-----------------------------------
Name: Xxxxxxx X. Xxxx
Title: Vice President and Secretary
LODGIAN CAPITAL TRUST I
By: /s/ Xxxxxxx X. Xxxx
-----------------------------------
Name: Xxxxxxx X. Xxxx
Title: Regular Trustee
LODGIAN, INC.
By: /s/ Xxxxxxx X. Xxxx
-----------------------------------
Name: Xxxxxxx X. Xxxx
Title: Vice President and Secretary
Accepted as of the date hereof
NATIONSBANC XXXXXXXXXX
SECURITIES LLC
By: /s/ Xxxxxxx Xxxxx
---------------------------------
Name: Xxxxxxx Xxxxx
Title: Senior Managing Director
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