FLAGSTAR COMPANIES, INC.
---------------------------------------------------
REGISTRATION RIGHTS AGREEMENT
---------------------------------------------------
DATED AS OF {AGREEMENT DATE}
TABLE OF CONTENTS
1. REGISTRATION RIGHTS..................................................... 1
1.1 Shelf Registration............................................. 1
1.2 Required Registration.......................................... 3
1.3 Incidental Registration........................................ 5
1.4 Company Registration........................................... 6
1.5 Registration Procedures........................................ 6
1.6 Reasonable Investigation....................................... 9
1.7 Registration Expenses.......................................... 10
1.8 Holdback Agreements; Registration Rights to Others............. 10
1.9 Other Registration of Common Stock............................. 11
1.10 Availability of Information.................................... 11
2. INDEMNIFICATION; CONTRIBUTION; EXPENSES................................. 11
2.1 Indemnification; Contribution.................................. 11
2.2 Indemnification for Controlling Person Liability............... 12
2.3 Control of Defense............................................. 13
2.4 Contribution................................................... 14
2.5 Advancement of Expenses........................................ 14
3. TERMINATION............................................................. 15
3.1 Termination With Respect to Shares Sold in a Public Offering... 15
3.2 Termination Upon Ability to Freely Resell...................... 15
4. DEFINED TERMS........................................................... 16
5. MISCELLANEOUS........................................................... 20
5.1 Notices........................................................ 20
5.2 Amendments and Waivers......................................... 20
5.3 Governing Law.................................................. 20
5.4 Jurisdiction; Jury Trial....................................... 21
5.5 Counterparts................................................... 21
5.6 Descriptive Headings; Sections................................. 21
5.7 Severability................................................... 21
Annex 1 -- Names and Addresses of Holders
i
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT (as the same may hereafter be amended,
supplemented or modified, this "AGREEMENT"), dated as of {AGREEMENT DATE}, among
FLAGSTAR COMPANIES, INC. (together with its successors and assigns, the
"COMPANY"), a [Delaware] corporation, and each of the Holders (together with
their successors and assigns, the "HOLDERS") of Registrable Securities named on
Annex 1 hereto.
In consideration of the mutual promises herein contained, the Company
and the Holders mutually agree as follows:
1. REGISTRATION RIGHTS.
1.1 SHELF REGISTRATION.
(A) FILING AND EFFECTIVENESS. On or prior to the Shelf Filing
Date, the Company will file a "shelf" registration statement (the
"SHELF REGISTRATION") on an appropriate form pursuant to Rule 415 under
the Securities Act or any similar rule that may be adopted by the SEC
with respect to dispositions of all of the Registrable Securities in
such manner or manners specified by the Holders. The Company agrees to
use its best efforts to cause the Shelf Registration to be declared
effective as promptly as is practicable after such filing (and in any
event, prior to the Shelf Effective Date) and agrees to use its best
efforts to keep the Shelf Registration effective (and to take any and
all other actions necessary in order to permit public resale of the
Registrable Securities covered by the Shelf Registration) for a period
(the "SHELF EFFECTIVE PERIOD") beginning on the date such Shelf
Registration shall first be declared effective under the Securities Act
and ending upon the earliest to occur of:
(i) the fifth (5th) anniversary of the Effective
Date; PROVIDED, HOWEVER, that if a registration statement on
Form S-3 (or such successor form as is prescribed by the SEC)
is not available to the Company (other than as a result of
action taken in bad faith by the Company to cause such Form
S-3 to become unavailable) on the third (3rd) anniversary of
the Effective Date, the Shelf Effective Period shall terminate
(if not terminated earlier pursuant to Section or Section ) on
such third (3rd) anniversary of the Effective Date;
(ii) such date as no Registrable Securities shall
remain subject to the terms and conditions set forth in this
Agreement; and
(iii) the date on which the provisions of this
Section terminate in accordance with the provisions of Section
.
The Company further agrees, if necessary, to supplement or make
amendments to such Shelf Registration, if required by the registration
form utilized by the Company for the Shelf Registration or by the
instructions applicable to such registration form or by the Securities
Act, and the Company agrees to furnish to the Holders copies of any
such supplement or amendment prior to its being used or filed with the
SEC.
1
To the extent that any warrants to purchase Common Stock issued to
any of TW Associates, L.P., CD Associates, L.P. and KKR Partners II, L.P.,
under the Plan would require registration under the Securities Act, the
Holders hereby agree that the Company may include in the Shelf Registration
such warrants.
(B) APPROVAL OF SHELF REGISTRATIONS. If the Requisite Holders
shall have approved the filing of any Shelf Registration as provided in
Section , but any Holder elects not to participate therein, then such
Holder shall have the right, in its sole discretion, to withdraw from
the Shelf Registration upon written notice to the Company. If the
Company receives notice of such withdrawal from any Holder wishing to
withdraw from the Shelf Registration, then the Company shall not name
such Holder in the registration statement or, in the case of withdrawal
in connection with any amendment or supplement to a registration
statement in which such Holder is already named, shall amend such
registration statement to delete references to such Holder, and to
withdraw the Registrable Securities of such Holder, from the
registration statement. The Shelf Registration shall not be considered
effective with respect to any such withdrawing Holder.
(C) SELECTION OF UNDERWRITERS. If any offering pursuant to a
Shelf Registration is in the form of an underwritten offering, the
underwriters of such offering shall be one or more underwriting firms
of recognized standing selected by the Holders making such offering and
reasonably acceptable to the Company. In the event of an underwritten
offering pursuant to the Shelf Registration, no Securities of the
Company (other than the Registrable Securities) shall be included in
any such offering without the prior written consent of all Holders of
Registrable Securities participating in such offering.
(D) NOTICE OF SALES UNDER SHELF REGISTRATION. Other than in
connection with an underwritten offering, each Holder intending to sell
any Registrable Securities under the Shelf Registration agrees to
provide the Company with written notice of such intent (a "NOTICE OF
INTENT"), which notice need state only the identity of the Holder and
that the Holder intends to sell Registrable Securities under the Shelf
Registration. No Holder shall deliver any Registrable Security for the
purpose of sale or delivery after sale, or otherwise consummate any
such sale, under such Shelf Registration until the fourth (4th)
Business Day following the date it delivers to the Company the Notice
of Intent. In the event that the Company notifies such Holder in
writing (a "MATERIAL EVENT NOTICE"), delivered to such Holder within
three (3) Business Days after the date the Notice of Intent is
delivered, that an event or events have occurred which, in the good
faith opinion of the Company, require the then-current prospectus to be
amended or supplemented in order that the prospectus not contain any
misstatement of a material fact or not 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 were made) not
misleading, then the Holder shall not deliver any Registrable Security
for the purpose of sale or delivery after sale, or otherwise consummate
any such sale, under such Shelf Registration until the earlier to occur
of the fourteenth (14th) day after delivery of the Material Event
Notice and the date the Company delivers to such Holder a new
prospectus or prospectus supplement correcting all such material
misstatements or omissions. In the event that the Company delivers a
Material Event Notice, the Company shall prepare and deliver to such
Holder, as promptly as practicable but in any event within fourteen
(14) days after the date of the Material Event Notice, a new prospectus
or prospectus supplement correcting all such material misstatements or
omissions. Each Holder shall cooperate with the Company in connection
with any such sale by supplying the Company, promptly following any
request, with any information concerning the terms of such sale
necessary to prepare any
2
such new prospectus or supplement to the prospectus to be used in
connection with such sale.
Any Holder intending to sell any Registrable Securities under
the Shelf Registration pursuant to an underwritten offering shall
deliver a Notice of Intent to the Company no later than fourteen (14)
days prior to the closing of such offering and otherwise in accordance
with the reasonable requirements of the underwriters therefor.
1.2 REQUIRED REGISTRATION.
(A) FILING OF REGISTRATION STATEMENT. Subject to Section
1.2(f), the Company will, upon the written request of the
Initiating Holders given at any time requesting that the Company
effect the registration under the Securities Act of all or
part of such Initiating Holders' Registrable Securities and
specifying the Registrable Securities to be
sold and the intended method of disposition thereof, promptly give
written notice of such requested registration to all Holders of
Registrable Securities, and thereupon will use its best efforts to
effect the registration (the "REQUIRED REGISTRATION") under the
Securities Act of:
(i) the Registrable Securities that the Company has
been so requested to register by the Initiating Holders; and
(ii) all other Registrable Securities that the
Company has been requested to register by the Holders thereof
by written request given to the Company within thirty (30)
days after the giving of such written notice by the Company
(which request shall specify the Registrable Securities to be
sold and the intended method of disposition of such
Registrable Securities);
all to the extent required to permit the disposition (in accordance
with the intended method thereof as aforesaid) of the Registrable
Securities so to be registered.
(B) TIME FOR FILING AND EFFECTIVENESS. On or before the date
which is ninety (90) days after the request for such registration, the
Company shall file with the SEC the Required Registration with respect
to all Registrable Securities to be so registered, and shall use its
best efforts to cause such Required Registration to become effective as
promptly as practicable after the filing thereof, but in no event later
than the day which is one hundred eighty (180) days after the request
for such registration.
(C) SELECTION OF UNDERWRITERS. If Registrable Securities that
the Company has been requested to register pursuant to a Required
Registration are to be disposed of in an underwritten public offering,
the underwriters of such offering shall be one or more underwriting
firms of recognized standing selected by the Requisite Holders and
reasonably acceptable to the Company.
(D) PRIORITY ON REQUIRED REGISTRATIONS. If the managing
underwriter shall advise the Company in writing (with a copy to each
Holder of Registrable Securities requesting sale) that, in such
underwriter's opinion, the number of shares of Securities requested to
be included in such Required Registration exceeds the number that can
be sold in such offering within a price range acceptable to the Company
(such writing to
3
state the basis of such opinion and the approximate number of shares of
Securities that may be included in such offering without such effect),
the Company will include in such Required Registration, to the extent
of the number of shares of Securities that the Company is so advised
can be sold in such offering:
(i) FIRST, Registrable Securities requested to be
sold by the Holders pursuant to this Section , PRO RATA among
the Holders requesting sale on the basis of the number of
shares requested to be so registered by such Holders; and
(ii) SECOND, all other shares of Common Stock
proposed to be registered by the Company and any other
stockholders, in such proportions as the Company and such
other stockholders shall agree.
(E) WHEN REQUIRED REGISTRATION IS DEEMED EFFECTED. A Required
Registration pursuant to this Section shall not be deemed to have been
effected for purposes of Section if:
(i) the registration does not become effective and
remain effective for a period of at least one hundred eighty
(180) days (or such shorter period as is necessary for all
Registrable Securities offered thereunder to have been sold),
without interference by the issuance by the SEC of any stop
order with respect thereto;
(ii) the Requisite Holders withdraw their request for
registration in its entirety at any time because the Requisite
Holders reasonably believed that the registration statement or
any prospectus related thereto 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 made therein (in the case of any prospectus, in
light of the circumstances under which they were made) not
misleading, notified the Company of such fact and requested
that the Company correct such alleged misstatement or
omission, and the Company has refused to correct such alleged
misstatement or omission; or
(iii) the conditions to closing specified in the
purchase agreement or underwriting agreement, if any, entered
into in connection with such Required Registration are not
satisfied, other than by reason of some act or omission by the
Holders of the Registrable Securities that were to have been
registered and sold.
(F) LIMITATION ON NUMBER OF REQUIRED REGISTRATIONS;
REGISTRATIONS ON FORM S-3. The Company shall be required to file and
effect only three (3) Required Registrations pursuant to this Section
that are deemed to have been effected under Section . Notwithstanding
the foregoing, the Company shall be required to file and effect
additional Required Registrations, which Required Registrations shall
not count toward the limitation set forth in the preceding sentence,
if:
(i) each such additional Required Registration is
filed and effected on a registration statement on Form S-3 (or
any similar successor form permitting
4
incorporation by reference of the reports filed by the Company
pursuant to section 13 of the Exchange Act); and
(ii) the Holders of Registrable Securities agree to
pay, and in fact pay, in addition to any underwriting fees,
discounts or commissions attributable to the sale of
Registrable Securities and other selling expenses, discounts
or commissions incurred in connection with the sale of
Registrable Securities, all Registration Expenses in
connection with such additional Required Registration (other
than Registration Expenses described in clauses (c), (e) and
(g) of the definition of Registration Expenses, which shall in
every event be borne by the Company).
1.3 INCIDENTAL REGISTRATION.
(A) FILING OF REGISTRATION STATEMENT. If the Company at any
time proposes to register any of its Common Stock (an "INCIDENTAL
REGISTRATION") under the Securities Act (other than pursuant to a
registration statement on Form S-4 or Form S-8 or any successor forms
thereto, in connection with an offer made solely to existing Security
holders or employees of the Company), for sale in a Public Offering, it
will each such time give prompt written notice to all Holders of its
intention to do so, which notice shall be given to all such Holders at
least thirty (30) days prior to the date that a registration statement
relating to such registration is proposed to be filed with the SEC.
Upon the written request of any Holder to include its shares under such
registration statement (which request shall be made within fifteen (15)
days after the receipt of any such notice and shall specify the
Registrable Securities intended to be disposed of by such Holder), the
Company will use its best efforts to effect the registration of all
Registrable Securities that the Company has been so requested to
register by such Holder; PROVIDED, HOWEVER, that if, at any time after
giving written notice of its intention to register any Securities and
prior to the effective date of the registration statement filed in
connection with such Incidental Registration, the Company shall
determine for any reason not to register such Securities, the Company
may, at its election, give written notice of such determination to each
Holder and, thereupon, shall be relieved of its obligation to register
any Registrable Securities of such Persons in connection with such
Incidental Registration.
(B) SELECTION OF UNDERWRITERS. Notice of the Company's
intention to register such Securities shall designate the proposed
underwriters of such offering (which shall be one or more underwriting
firms of recognized standing) and shall contain the Company's agreement
to use its best efforts, if requested to do so, to arrange for such
underwriters to include in such underwriting the Registrable Securities
that the Company has been so requested to register pursuant to this
Section , it being understood that the Holders shall have no right to
select different underwriters for the disposition of their Registrable
Securities.
(C) PRIORITY ON INCIDENTAL REGISTRATIONS. If the managing
underwriter shall advise the Company in writing (with a copy to each
Holder of Registrable Securities requesting sale) that, in such
underwriter's opinion, the number of shares of Securities requested to
be included in such Incidental Registration exceeds the number that can
be sold in such offering within a price range acceptable to the Company
(such writing to
5
state the basis of such opinion and the approximate number of shares of
Securities that may be included in such offering without such effect),
the Company will include in such Incidental Registration, to the extent
of the number of shares of Securities that the Company is so advised
can be sold in such offering:
(i) in the case of any Registration initiated by the
Company for the purpose of selling Securities for its own
account:
(A) FIRST, shares that the Company proposes
to issue and sell for its own account; and
(B) SECOND, Registrable Securities requested
to be sold by the Holders pursuant to this Section
and all Securities proposed to be registered by other
stockholders, PRO RATA among such Holders and other
stockholders on the basis of the number of shares
requested to be so registered by such Holders and
other stockholders; and
(ii) in the case of any Registration initiated by any
other stockholder pursuant to demand or required registration
rights in favor of such other stockholder:
(A) FIRST, Registrable Securities requested
to be sold by the other stockholders requesting such
Registration;
(B) SECOND, Registrable Securities requested
to be sold by the Holders pursuant to this Section
and all Securities proposed to be registered by
stockholders other than those referred to in Section
(c)(ii)(A), PRO RATA among such Holders and
stockholders on the basis of the number of shares
requested to be so registered by such Holders and
stockholders; and
(C) THIRD, shares that the Company proposes
to issue and sell for its own account.
1.4 COMPANY REGISTRATION. If the Securities Act (whether by statutory
amendment, amendment of the rules and regulations thereunder or both) is amended
after the date hereof to provide for a Companies Registration Scheme, and the
Company is or becomes eligible to participate in the Companies Registration
Scheme, then the Company, promptly following the request of the Required
Holders, shall use its reasonable best efforts to register promptly under the
Companies Registration Scheme so as to facilitate the resale under the
registration statement contemplated by such Companies Registration Scheme of the
Registrable Securities in accordance with the method or methods of distribution
contemplated by the Holders.
1.5 REGISTRATION PROCEDURES. The Company will use its best efforts to
effect each Registration, and to cooperate with the sale of such Registrable
Securities in accordance with the intended method of disposition thereof as
quickly as practicable, and the Company will as expeditiously as possible:
6
(a) subject, in the case of an Incidental Registration, to the
proviso to Section , prepare and file with the SEC the registration
statement and use its best efforts to cause the Registration to become
effective; PROVIDED, HOWEVER, that before filing any registration
statement or prospectus or any amendments or supplements thereto, the
Company will furnish to the Holders of the Registrable Securities
covered by such registration statement, their counsel, and the
underwriters, if any, and their counsel, copies of all such documents
proposed to be filed as promptly as practicable prior thereto, which
documents will be subject to the reasonable review of such Holders,
their counsel and the underwriters; and the Company will not file any
registration statement or amendment thereto or any prospectus or any
supplement thereto (including such documents incorporated by reference)
to which the Requisite Holders shall reasonably object after having had
a reasonable opportunity for review and comment;
(b) subject, in the case of an Incidental Registration, to the
proviso to Section , prepare and file with the SEC such amendments and
post-effective amendments to any registration statement and any
prospectus used in connection therewith as may be necessary to keep
such registration statement effective and to comply with the provisions
of the Securities Act with respect to the disposition of all
Registrable Securities covered by such registration statement; and
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;
(c) furnish to each Holder of Registrable Securities included
in such Registration and the underwriter or underwriters, if any,
without charge, at least one signed copy of the registration statement
and any post-effective amendment thereto, upon request, and such number
of conformed copies thereof and such number of copies of the prospectus
(including each preliminary prospectus and each prospectus filed under
Rule 424 under the Securities Act), any amendments or supplements
thereto and any documents incorporated by reference therein, as such
Holder or underwriter may reasonably request in order to facilitate the
disposition of the Registrable Securities being sold by such Holder (it
being understood that the Company consents to the use of the prospectus
and any amendment or supplement thereto by each Holder of Registrable
Securities covered by such registration statement and the underwriter
or underwriters, if any, in connection with the offering and sale of
the Registrable Securities covered by the prospectus or any amendment
or supplement thereto);
(d) notify each Holder of any stop order or other order
suspending the effectiveness of any registration statement, issued or
threatened by the SEC in connection therewith, and take all reasonable
actions required to prevent the entry of such stop order or to remove
it or obtain withdrawal of it at the earliest possible moment if
entered;
(e) if requested by the managing underwriter or underwriters,
if any, or any Holder in connection with any sale pursuant to a
registration statement, promptly incorporate in a prospectus supplement
or post-effective amendment such information relating to such
underwriting as the managing underwriter or underwriters, if any, or
such Holder reasonably requests to be included therein; and make all
required filings of such prospectus supplement or post-effective
amendment as soon as practicable after being
7
notified of the matters incorporated in such prospectus supplement or
post-effective amendment;
(f) on or prior to the date on which a Registration is
declared effective, use its best efforts to register or qualify, and
cooperate with the Holders of Registrable Securities included in such
Registration, the underwriter or underwriters, if any, and their
counsel, in connection with the registration or qualification of the
Registrable Securities covered by such Registration for offer and sale
under the securities or "blue sky" laws of each state and other
jurisdiction of the United States as any such Holder or the managing
underwriter, if any, reasonably requests in writing; use its best
efforts to keep each such registration or qualification effective,
including through new filings, or amendments or renewals, during the
period such registration statement is required to be kept effective;
and do any and all other acts or things necessary or advisable to
enable the disposition in all such jurisdictions reasonably requested
of the Registrable Securities covered by such Registration; PROVIDED,
HOWEVER, that the Company will not be required to qualify generally to
do business in any jurisdiction where it is not then so qualified or to
take any action which would subject it to general service of process in
any such jurisdiction where it is not then so subject;
(g) in connection with any sale pursuant to a Registration,
cooperate with the Holders and the managing underwriter or
underwriters, if any, to facilitate the timely preparation and delivery
of certificates (not bearing any restrictive legends) representing
Securities to be sold under such Registration, and enable such
Securities to be in such denominations and registered in such names as
the managing underwriter or underwriters, if any, or such Holders may
request;
(h) use its best efforts to cause the Registrable Securities
to be registered with or approved by such other governmental agencies
or authorities within the United States and having jurisdiction over
the Company as may reasonably be necessary to enable the seller or
sellers thereof or the underwriter or underwriters, if any, to
consummate the disposition of such Securities;
(i) enter into such agreements (including underwriting
agreements in customary form) and take such other actions as the
Requisite Holders shall reasonably request in order to expedite or
facilitate the disposition of such Registrable Securities;
(j) use its best efforts to obtain:
(i) at the time of effectiveness of each
Registration, a comfort letter from the Company's independent
certified public accountants covering such matters of the type
customarily covered by cold comfort letters as the Requisite
Holders and, if applicable, the underwriters reasonably
request; and
(ii) at the time of any underwritten sale pursuant to
the registration statement, a bring-down comfort letter, dated
as of the date of such sale, from the Company's independent
certified public accountants covering such matters of the type
customarily covered by comfort letters as the Requisite
Holders and, if applicable, the underwriters reasonably
request;
8
(k) use its best efforts to obtain, at the time of
effectiveness of each Incidental Registration and at the time of any
sale pursuant to each Registration, an opinion or opinions, reasonably
acceptable to the Requisite Holders in form and scope, from counsel for
the Company in customary form;
(l) notify each Holder upon discovery that, or upon the
happening of any event as a result of which, the prospectus included in
such Registration, as then in effect, includes an untrue statement of a
material fact or omits to state any material fact required to be stated
therein or necessary to make the statements therein not misleading, and
promptly prepare, file with the SEC and furnish to each Holder 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 or prospective purchasers of such Securities, such
prospectus shall not include an untrue statement of a material fact or
omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in the light of
the circumstances under which they are made;
(m) otherwise comply with all applicable rules and regulations
of the SEC, and make generally available to its Security holders (as
contemplated by section 11(a) under the Securities Act) an earnings
statement satisfying the provisions of Rule 158 under the Securities
Act, as applicable;
(n) provide and cause to be maintained a transfer agent and
registrar for all Registrable Securities covered by each Registration
from and after a date not later than the effective date of such
Registration; and
(o) obtain and maintain the registration of the Common Stock
under either section 12(b) or section 12(g) of the Exchange Act; and
use its best efforts to cause all Registrable Securities covered by
each Registration to be listed subject to notice of issuance, prior to
the date of first sale of such Registrable Securities pursuant to such
Registration, on:
(i) either the New York Stock Exchange, Inc., or the
NASDAQ National Market; and
(ii) each other securities exchange, if any, on which
the Common Stock is then listed.
The Company may require each Holder of Registrable Securities that will be
included in such Registration to furnish the Company with such information in
respect of such Holder of its Registrable Securities that will be included in
such Registration as the Company may reasonably request in writing and as is
required by applicable laws or regulations.
1.6 REASONABLE INVESTIGATION. The Company shall:
(a) give the Holders of Registrable Securities, their
underwriters, if any, and their respective counsel and
accountants the opportunity to participate in the preparation
9
of the registration statement, each prospectus included therein or
filed with the SEC and each amendment thereof or supplement thereto;
(b) give each such Holder and underwriter reasonable
opportunities to discuss the business of the Company with its officers,
counsel and the independent public accountants who have certified its
financial statements;
(c) make available for inspection by any Holder of Registrable
Securities included in any Registration, any underwriter participating
in any disposition pursuant to any Registration, and any attorney,
accountant or other agent retained by any such seller or underwriter,
all financial and other records, pertinent corporate documents and
properties of the Company; and
(d) cause the Company's officers, directors and
employees to supply all information reasonably requested by
any such Person in connection with such Registration;
in each such case, as shall be reasonably necessary, in the opinion of such
Holder or such underwriter, to enable it to conduct a "reasonable investigation"
within the meaning of section 11(b)(3) of the Securities Act and to satisfy the
requirement of reasonable care imposed by section 12(a)(2) of the Securities
Act.
1.7 REGISTRATION EXPENSES. Other than as provided in Section (ii), the
Company will pay all Registration Expenses in connection with each registration
of Registrable Securities, including, without limitation, any such registration
not effected by the Company.
1.8 HOLDBACK AGREEMENTS; REGISTRATION RIGHTS TO OTHERS.
(a) In connection with each underwritten sale of Registrable
Securities, the Company agrees, and each Holder by acquisition of such
Registrable Securities agrees, to enter into customary holdback
agreements concerning sale or distribution of Registrable Securities
and other equity Securities of the Company, except, in the case of any
Holder, to the extent that such Holder is prohibited by applicable law
or exercise of fiduciary duties from agreeing to withhold Registrable
Securities from sale. Without limiting the scope of the term
"fiduciary," a Holder shall be deemed to be acting as a fiduciary if
its actions or the Registrable Securities proposed to be sold are
subject to the Employee Retirement Income Security Act of 1974, as
amended, or the Investment Company Act of 1940, as amended, or if such
Registrable Securities are held in a separate account under applicable
insurance law or regulation. Notwithstanding the foregoing, no Holder
who has been engaged on behalf of an Account shall be required to hold
back Registrable Securities attributable to such Account if either:
(i) such Account directs such Holder to dispose of
some or all of such Registrable Securities attributable to
such Account; PROVIDED, HOWEVER, that any holdback agreement
relating to such underwritten sale shall continue to apply to
Registrable Securities attributable to such Account which such
Account has not directed such Holder to sell, and PROVIDED,
FURTHER, that such Holder shall not have directly or
indirectly induced such Account to make such sale; or
10
(ii) such Securities have ceased to be Registrable
Securities pursuant to clause (v) of the definition of
Registrable Securities.
(b) If the Company shall at any time after the date hereof
provide to any holder of any Securities of the Company rights with
respect to the registration of such Securities under the Securities
Act, such rights shall not be in conflict with or adversely affect any
of the rights provided in this Section to the Holders of Registrable
Securities.
1.9 OTHER REGISTRATION OF COMMON STOCK. If any shares of Common Stock
require registration with or approval of any governmental authority under any
federal or state law (other than the Securities Act) before such shares may be
issued upon conversion, the Company will, at its expense and as expeditiously as
possible, use its best efforts to cause such shares to be duly registered or
approved, as the case may be.
1.10 AVAILABILITY OF INFORMATION. The Company will comply with the
reporting requirements of sections 13 and 15(d) of the Exchange Act and will
comply with all other public information reporting requirements of the SEC from
time to time in effect. In addition, the Company shall file such reports and
information, and shall make available to the public and to each Holder such
information, as shall be necessary to permit such Holder to offer and sell
shares of Common Stock held by such Holder pursuant to the provisions of Rule
144 promulgated under the Securities Act. The Company will also cooperate with
each Holder in supplying such information as may be necessary for such Holder to
complete and file any information reporting forms presently or hereafter
required by the SEC as a condition to the availability of an exemption from the
registration provisions of the Securities Act in connection with the sale of any
shares held by such Holder. The Company will furnish to each Holder, promptly
upon their becoming available, copies of all financial statements, reports,
notices and proxy statements sent or made available generally by the Company to
its stockholders, and copies of all regular and periodic reports filed by the
Company with any securities exchange or with the SEC.
2. INDEMNIFICATION; CONTRIBUTION; EXPENSES.
2.1 INDEMNIFICATION; CONTRIBUTION.
(A) INDEMNIFICATION BY THE COMPANY. The Company shall
indemnify, to the fullest extent permitted by law, each Holder, its
officers, directors, partners and agents, if any, and each Person, if
any, who controls such Holder within the meaning of section 15 of the
Securities Act, against all losses, claims, damages, liabilities (or
proceedings in respect thereof) and expenses, joint or several, in each
case, under the Securities Act or common law or otherwise, resulting
from any violation by the Company of the provisions of the Securities
Act or any untrue statement or alleged untrue statement of a material
fact contained in any registration statement or amendment thereto or
prospectus (and as amended or supplemented if amended or supplemented)
or any preliminary prospectus provided for under Section 1 or caused by
any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein (in the case of any prospectus, in light of the circumstances
under which they were made) not misleading, except to the extent that
such losses, claims, damages, liabilities (or proceedings in respect
thereof) or expenses are caused by any untrue
11
statement or alleged untrue statement contained in or by any omission
or alleged omission from information concerning any Holder, or
concerning such Holder's intended method of distribution, furnished in
writing to the Company by such Holder expressly for use therein, or
from any information provided by an underwriter selected by the Holders
or any of them. If the offering pursuant to any registration statement
provided for under Section is made through underwriters, no action or
failure to act on the part of such underwriters shall affect the
obligations of the Company to indemnify any Holder or any other Person
pursuant to the preceding sentence. If the offering pursuant to any
registration statement provided for under Section is made through
underwriters, the Company agrees, to the extent required by such
underwriters, to enter into an underwriting or other agreement
providing for indemnity of such underwriters, their officers,
directors, partners and agents, if any, and each Person, if any, who
controls such underwriters within the meaning of section 15 of the
Securities Act to the same extent as hereinbefore provided with respect
to the indemnification of the Holders; PROVIDED that the Company shall
not be required to indemnify any such underwriter, or any officer or
director of such underwriter or any Person who controls such
underwriter within the meaning of section 15 of the Securities Act, to
the extent that the loss, claim, damage, liability (or proceedings in
respect thereof) or expense for which indemnification is claimed
results from such underwriter's failure to send or give a copy of an
amended or supplemented final prospectus to the Person asserting an
untrue statement or alleged untrue statement or omission or alleged
omission at or prior to the written confirmation of the sale of
Registrable Securities to such Person if such statement or omission was
corrected in such amended or supplemented final prospectus prior to
such written confirmation and the underwriter was provided with such
amended or supplemented final prospectus.
(B) INDEMNIFICATION BY THE HOLDERS. In connection with any
registration statement in which a Holder is participating, each such
Holder, severally and not jointly, shall indemnify, to the fullest
extent permitted by law, the Company, each underwriter (if the
underwriter so requires) and their respective officers, directors,
partners and agents, if any, and each Person, if any, who controls the
Company or such underwriter within the meaning of section 15 of the
Securities Act, against any losses, claims, damages, liabilities (or
proceedings in respect thereof) and expenses resulting from any untrue
statement or alleged untrue statement of a material fact or any
omission or alleged omission of a material fact required to be stated
in the registration statement or prospectus or preliminary prospectus
or any amendment thereof or supplement thereto or necessary to make the
statements therein (in the case of any prospectus, in light of the
circumstances under which they were made) not misleading, but only to
the extent that such untrue statement is contained in or such omission
is from information so concerning a Holder, or such Holder's intended
method of distribution, furnished in writing by such Holder expressly
for use therein; PROVIDED, HOWEVER, that such Holder's obligations
hereunder shall be limited to an amount equal to the proceeds to such
Holder of the Registrable Securities sold pursuant to such registration
statement.
2.2 INDEMNIFICATION FOR CONTROLLING PERSON LIABILITY. In addition to
the indemnification provided for in Section 2.1, the Company shall indemnify, to
the fullest extent permitted by law, each Holder, its officers, directors,
partners and agents, if any, and each Person, if any, who controls such Holder
within the meaning of section 15 of the Securities Act,
12
against all losses, claims, damages, liabilities (or proceedings in respect
thereof) and expenses, joint or several, in each case, under the Securities Act
or common law or otherwise, resulting from:
(a) any violation by the Company of the provisions of
the Securities Act;
(b) any untrue statement or alleged untrue statement of a
material fact contained in any registration statement or amendment
thereto or prospectus (and as amended or supplemented if amended or
supplemented) or any preliminary prospectus or caused by any omission
or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein (in the case
of any prospectus, in light of the circumstances under which they were
made) not misleading, whether or not, in each such case, the
registration statement or amendment thereto or prospectus (or amendment
or supplement thereto) or preliminary prospectus related or relates to
any offering or sale of Registrable Securities by an Holder; and
(c) any other untrue statement or alleged untrue statement of
a material fact or omission or alleged omission to state a material
fact necessary to make the statements in any document issued or
delivered to any purchaser or potential purchaser or filed with the SEC
pursuant to Section 13 or Section 15(d) of the Exchange Act (in light
of the circumstances under which they were made) not misleading, in
each case, in connection with any offering or sale of Securities of the
Company by any Person, whether or not such Securities offered or
sold are or were registered or required to be registered under the
Securities Act;
in each such case, to the extent that such losses, claims, damages, liabilities
(or proceedings in respect thereof) and expenses, joint or several, are alleged
to result from or exist by virtue of the fact that any Holder controls or is
alleged to control (within the meaning of section 15 of the Securities Act or
section 20 of the Exchange Act) the Company or any Subsidiary or Affiliate,
whether such claim or allegation arises under section 15 of the Securities Act
or section 20 of the Exchange Act or otherwise; PROVIDED, HOWEVER, that such
indemnification shall not extend to losses, claims, damages, liabilities (or
proceedings in respect thereof) or expenses caused by any untrue statement or
alleged untrue statement contained in or by any omission or alleged omission
from information furnished in writing to the Company by such Holder expressly
for use therein, or from any such information provided by an underwriter
selected by the Holders or any of them.
2.3 CONTROL OF DEFENSE. Any Person entitled to indemnification under
the provisions of this Section shall give prompt notice to the indemnifying
party of any claim with respect to which it seeks indemnification and unless in
such indemnified party's reasonable judgment a conflict of interest between such
indemnified and indemnifying parties exists in respect of such claim, permit
such indemnifying party to assume the defense of such claim, with counsel
reasonably satisfactory to the indemnified party; and if such defense is so
assumed, such indemnifying party shall not enter into any settlement without the
consent of the indemnified party (which consent shall not be unreasonably
withheld) if such settlement attributes liability to the indemnified party and
such indemnifying party shall not be subject to any liability for any settlement
made without its consent (which shall not be unreasonably withheld); and any
underwriting agreement entered into with respect to any registration statement
provided for under
13
Section shall so provide if the underwriter or underwriters so require. In the
event an indemnifying party shall not be entitled, or elects not, to assume the
defense of a claim, such indemnifying party shall not be obligated to pay the
fees and expenses of more than one counsel or firm of counsel for all parties
indemnified by such indemnifying party in respect of such claim, unless in the
reasonable judgment of any such indemnified party a conflict of interest exists
between such indemnified party and any other of such indemnified parties in
respect to such claim.
2.4 CONTRIBUTION. If for any reason any indemnity contemplated by this
Section is unavailable, then the indemnifying party shall contribute to the
amount paid or payable by the indemnified party as a result of such losses,
claims, damages, liabilities or expenses:
(a) in such proportion as is appropriate to reflect the
relative benefits received by the indemnifying party on the one hand
and the indemnified party on the other; or
(b) if the allocation provided by clause (a) above is not
permitted by applicable law or provides a lesser sum to the indemnified
party than the amount hereinafter calculated, in such proportion as is
appropriate to reflect not only the relative benefits received by the
indemnifying party on the one hand and the indemnified party on the
other but also the relative fault of the indemnifying party and the
indemnified party as well as any other relevant equitable
considerations.
Notwithstanding the foregoing, no Holder shall be required to contribute any
amount in excess of the amount such Holder would have been required to pay to an
indemnified party if the indemnity under Section (b) was available. 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 obligation of any Person to
make such contribution shall be several and not joint.
2.5 ADVANCEMENT OF EXPENSES. An indemnifying party shall make payments
of all amounts required to be made pursuant to the foregoing provisions of this
Section 2 to or for the account of the indemnified party from time to time
promptly upon receipt of bills or invoices relating thereto or when otherwise
due or payable. Without limiting the generality of the foregoing, each
indemnifying party, as an interim measure during the pendency of any claim,
action, investigation, inquiry or proceeding arising out of or based upon any
matter or subject for which indemnity (or contribution in lieu thereof) would be
available to any indemnified party under any provision of this Section , it will
promptly reimburse each indemnified party, as often as invoiced therefor (but in
no event more often than monthly), for all reasonable legal or other expenses
incurred in connection with the investigation or defense of any such claim,
action, investigation, inquiry or proceeding, notwithstanding the absence of any
judicial determination as to the propriety or enforceability of the indemnifying
party's obligation to reimburse the indemnified party for such expenses and
notwithstanding the possibility that the obligations to pay such expenses might
later have been held to be improper by a court of competent jurisdiction. To the
extent that any such interim reimbursement is held to be improper, the
indemnified party agrees to promptly return the amount so advanced to the
indemnifying party, together with interest, compounded monthly, at the prime
rate (or other commercial lending rate for borrowers of the highest credit
standing) listed from time to time in The Wall Street Journal which represents
the base rate on corporate loans posted by a substantial majority of the
14
nation's thirty (30) largest banks. Any such interim reimbursement payments
which are not made to the indemnified party within thirty (30) days of a request
therefor shall bear interest at such prime rate from the date of such request to
the extent such reimbursement payments are ultimately determined to be proper
obligations of the indemnifying party. To the extent required by any underwriter
in connection with the execution of any underwriting agreement pursuant to which
the Holders shall be selling any shares of Common Stock, the Company shall agree
to advancement of the expenses of such underwriter to at least the same extent
as provided in this Section .
2.6 SURVIVAL. The indemnity and contribution agreements contained in
this Section shall remain in full force and effect regardless of any
investigation made by or on behalf of a participating Holder of Registrable
Securities, its officers, directors, agents or any Person, if any, who controls
such Holder as aforesaid, and shall survive the transfer of such Securities by
such Holder.
3. TERMINATION.
3.1 TERMINATION WITH RESPECT TO SHARES SOLD IN A PUBLIC OFFERING. The
provisions of Section shall terminate immediately as to any Securities when they
shall cease to be Registrable Securities (but shall remain in force with respect
to any remaining Registrable Securities).
3.2 TERMINATION UPON ABILITY TO FREELY RESELL. The provisions of
Section shall terminate immediately in their entirety with respect to any Holder
(and, with respect to any effective Shelf Registration, the registration
statement may be terminated and all shares of Common Stock held by such Holder
registered thereunder and remaining unsold may be deregistered) if either:
(a) such Holder has notified the Company in writing that all
remaining Registrable Securities may be freely resold by such Holder
without registration and without restriction or limitation (such as the
volume limitations, manner of sale requirements or current public
information requirements applicable under Rule 144 under the Securities
Act) under the Securities Act; or
(b) both:
(i) the aggregate number of shares of Common Stock
owned or held by such Holder, together with the aggregate
number of shares of Common Stock issuable to such Holder upon
the exercise of any rights, warrants or options held by such
Holder, shall equal less than ten percent (10%) of the number
of shares of Common Stock then outstanding, together with the
aggregate number of shares of Common Stock issuable to such
Holder upon the exercise of any rights, warrants or options
held by such Holder (but not any other Holder); and
(ii) the Company has delivered to such Holder an
opinion of Xxxxxx & Watkins, Parker, Xxx, Xxxxx & Xxxxxxxxx
L.L.P. or other nationally recognized securities counsel
reasonably acceptable to such Holder that all remaining
Registrable Securities may be freely resold by such Holder
without registration and
15
without restriction or limitation (such as the volume
limitations, manner of sale requirements or current public
information requirements applicable under Rule 144 under the
Securities Act) under the Securities Act.
4. DEFINED TERMS.
As used herein, the following terms have the respective meanings set
forth below or set forth in the Section hereof following such term:
ACCOUNT -- means, with respect to a Holder who has been engaged to
provide investment management services, each Person on behalf of whom such
Holder provides such services.
AFFILIATE -- means, at any time, a Person (other than a Subsidiary or a
Holder):
(a) that directly or indirectly through one or more
intermediaries controls, or is controlled by, or is under common
control with, the Company;
(b) that beneficially owns or holds ten percent (10%) or more
of any class of the Voting Stock of the Company; or
(c) ten percent (10%) or more of the Voting Stock (or in the
case of a Person that is not a corporation, ten percent (10%) or more
of the equity interest) of which is beneficially owned or held by the
Company or a Subsidiary;
at such time.
As used in this definition,
CONTROL -- means the possession, directly or indirectly, of
the power to direct or cause the direction of the management and
policies of a Person, whether through the ownership of voting
securities, by contract or otherwise.
AGREEMENT -- the introductory paragraph.
BUSINESS DAY -- means a day other than a Saturday, a Sunday or a day on
which banks in the State of New York are required or permitted by law (other
than a general banking moratorium or holiday for a period exceeding four (4)
consecutive days) to be closed.
COMMON STOCK -- means the Common Stock, par value $0.01 per share, of
the Company.
COMPANIES REGISTRATION SCHEME -- means an amendment or amendment to the
Securities Act (whether by statutory amendment, amendment of the rules and
regulations thereunder or both), such as, without limitation, as proposed in the
Report of the Advisory Committee on the Capital Formation and Regulatory
Processes of the Securities and Exchange Commission, dated July 24, 1996,
pursuant to which:
(a) issuers of Securities are permitted to register all
issuances of Securities on an integrated company registration
statement; and
16
(b) under the provisions of such amendment, such registration,
under certain circumstances, would permit sales of the Registrable
Securities by the Holders to be covered by the Companies Registration
Scheme under circumstances in which the Registrable Securities could
not, under existing law, be freely resold without registration.
COMPANY -- the introductory paragraph.
EFFECTIVE DATE -- means the Effective Date of the Plan, as set forth
therein.
EXCHANGE ACT -- means the Securities Exchange Act of 1934, as amended,
and the rules and regulations of the SEC promulgated thereunder.
HOLDERS -- the introductory paragraph.
INCIDENTAL REGISTRATION -- Section (a).
INITIATING HOLDERS -- means, at any time, any Holder or Holders (other
than the Company or any Subsidiary or Affiliate thereof) of at least fifteen
percent (15%) or more (by number of shares) of the Registrable Securities at
such time (excluding any Registrable Securities held directly or indirectly by
the Company or any Subsidiary or Affiliate thereof).
MATERIAL EVENT NOTICE -- Section .
NOTICE OF INTENT -- Section .
NASD -- means the National Association of Securities Dealers, Inc.
NASDAQ -- means the NASDAQ Stock Market, Inc., a subsidiary of the
NASD.
NASDAQ NATIONAL MARKET -- has the meaning ascribed thereto in Rule
4200(r) of the NASDAQ.
PERSON -- means an individual, partnership, corporation, limited
liability company, trust, unincorporated organization, or a government or agency
or political subdivision thereof.
PLAN -- means the Debtors' Joint Plan of Reorganization, dated as of
_________ ___, 1997, of Flagstar Companies, Inc. and Flagstar Corporation (as
predecessors to the Company).
PROPERTY -- means any and all interests in any kind of property or
asset whatsoever, whether real, personal or mixed and whether tangible or
intangible.
PUBLIC OFFERING -- shall mean any sale of shares of Common Stock in a
transaction either registered under, or requiring registration under, section 5
of the Securities Act.
REGISTRABLE SECURITIES -- means, at any time, all shares of Common
Stock issued to any Holder under the Plan.
17
As to any particular Registrable Securities once issued, such
Securities shall cease to be Registrable Securities:
(i) when a registration statement with respect to the sale of
such Securities shall have become effective under the Securities Act
and such Securities shall have been disposed of in accordance with such
registration statement;
(ii) when they shall have been distributed to the public
pursuant to Rule 144 (or any successor provision) under the Securities
Act;
(iii) when they shall have been otherwise transferred and
subsequent disposition of them shall not require registration or
qualification under the Securities Act or any similar state law then in
force;
(iv) when they shall have ceased to be outstanding; or
(v) with respect to Registrable Securities attributable to an
Account, when the investment advisory services provided by the Holder
of such Registrable Securities are terminated by such Account, or by
any statutory, regulatory or bona fide business requirement or
condition.
REGISTRATION -- means the Shelf Registration, each Required
Registration and each Incidental Registration.
REGISTRATION EXPENSES -- means all expenses incident to the Company's
performance of or compliance with Section 1.1 through Section , inclusive,
including, without limitation:
(a) all registration and filing fees;
(b) fees and expenses of compliance with securities or blue
sky laws, to the extent required;
(c) expenses of printing certificates for the Registrable
Securities in a form eligible for deposit with Depositary Trust
Company;
(d) messenger and delivery expenses;
(e) internal Company expenses (including, without limitation,
all salaries and expenses of its officers and employees performing
legal or accounting duties);
(f) fees and disbursements of counsel for the Company and its
independent certified public accountants (including the expenses of any
management review, cold comfort letters or any special audits required
by or incident to such performance and compliance);
(g) securities acts liability insurance (if the Company elects
to obtain such insurance);
18
(h) the reasonable fees and expenses of any special experts
retained by the Company in connection with such registration;
(i) fees and expenses of other Persons retained by the
Company; and
(j) fees and expenses of counsel (including local counsel) for
Holders of Registrable Securities, selected by the Requisite Holders;
but not including any underwriting fees, discounts or commissions attributable
to the sale of Registrable Securities or fees and expenses of more than one
counsel representing the Holders or any other selling expenses, discounts or
commissions incurred in connection with the sale of Registrable Securities.
REQUIRED HOLDERS -- means, at any time, any Holder or Holders (other
than the Company or any Affiliate or Subsidiary) holding more than fifty percent
(50%) of the shares of Common Stock held by the Holders at such time (excluding
any shares held directly or indirectly by the Company or any Subsidiary or
Affiliate).
REQUIRED REGISTRATION -- Section (a).
REQUISITE HOLDERS -- means, with respect to any registration or
proposed registration (or, in the case of the Shelf Registration, any offering
under the Shelf Registration) of Registrable Securities pursuant to Section ,
any Holder or Holders (other than the Company or any Affiliate or Subsidiary)
holding more than fifty percent (50%) of the shares of Registrable Securities
(excluding any shares of Registrable Securities directly or indirectly held by
the Company or any Affiliate or Subsidiary) to be so registered.
SEC -- means, at any time, the Securities and Exchange Commission or
any other federal agency at such time administering the Securities Act.
SECURITIES ACT -- means the Securities Act of 1933, as amended, and the
rules and regulations of the SEC promulgated thereunder.
SECURITY -- means "security" as defined by section 2(1) of the
Securities Act.
SHELF EFFECTIVE DATE-- means the date which is seventy-five (75) days
after the Shelf Filing Date.
SHELF EFFECTIVE PERIOD -- Section .
SHELF FILING DATE -- means the date which is thirty (30) days after the
Effective Date.
SHELF REGISTRATION -- Section .
SUBSIDIARY -- means any corporation in which the Company or one or more
Subsidiaries owns sufficient voting securities to enable it or them (as a group)
ordinarily, in the absence of contingencies, to elect a majority of the
directors (or Persons performing similar functions) of such corporation.
19
VOTING STOCK -- means, with respect to any corporation, any shares of
stock of such corporation whose holders are entitled under ordinary
circumstances to vote for the election of directors of such corporation
(irrespective of whether at the time stock of any other class or classes shall
have or might have voting power by reason of the happening of any contingency).
5. MISCELLANEOUS.
5.1 NOTICES. Notices or demands authorized by this Agreement to be
given or made to the parties hereto shall be sufficiently given or made if sent
by first-class mail, postage prepaid, addressed as follows, or telexed,
telecopied, or delivered by overnight or other courier to the following
addresses:
(a) if to the Company, at:
Flagstar Companies, Inc.
000 Xxxx Xxxx Xxxxxx
Xxxxxxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxx, General Counsel
Fax: 000-000-0000
with a copy to:
Parker, Poe, Xxxxx & Xxxxxxxxx L.L.P.
0000 Xxxxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxx X. Xxxx
Fax: 000-000-0000
or such other addresses as the Company shall designate to each Holder in
writing;
(b) if to any Holder named on Annex 1, at the address or
addresses set forth in Annex 1 hereto for such Holder or, if a
successor or assign of such Holder, then at the address provided to the
Company by such successor or assign or such other address or addresses
as such successor or assign shall designate to the Company in writing.
The Company, upon the written request of any Holder, will promptly supply such
Holder with a list of the names and addresses of each party hereto at such time.
5.2 AMENDMENTS AND WAIVERS. The provisions hereof may be amended,
modified or supplemented only by a writing duly executed by or on behalf of the
Required Holders and the Company; PROVIDED, HOWEVER, that compliance by the
Company with the provisions of Section with respect to any particular
registration, may be waived by the Requisite Holders.
5.3 GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED
IN ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY,
THE INTERNAL LAW OF THE STATE OF NEW YORK.
20
5.4 JURISDICTION; JURY TRIAL. EACH OF THE PARTIES HERETO IRREVOCABLY
SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR NEW
YORK STATE COURT SITTING IN NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF
OR RELATING TO THIS AGREEMENT AND EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY
AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND
DETERMINED IN ANY SUCH COURT. NONE OF THE PARTIES HERETO SHALL SEEK A JURY TRIAL
IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM OR OTHER LITIGATION PROCEDURE BASED
UPON OR ARISING OUT OF OR OTHERWISE RELATED TO THIS AGREEMENT AND EACH OF THE
PARTIES HERETO HEREBY WAIVES ANY AND ALL RIGHT TO ANY SUCH JURY TRIAL AND ANY
RIGHT EACH MAY HAVE TO ASSERT THE DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT
TO VENUE TO THE EXTENT ANY SUCH PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS
SECTION .
5.5 COUNTERPARTS. This Agreement may be executed in any number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and all such counterparts shall together constitute but one and
the same instrument.
5.6 DESCRIPTIVE HEADINGS; SECTIONS. Descriptive headings of the several
sections of this Agreement are inserted for convenience only and shall not
control or affect the meaning or construction of any of the provisions hereof.
References to a "Section" in this Agreement are references to the indicated
section of this Agreement.
5.7 SEVERABILITY. The fact that any given provision of this Agreement
is found to be unenforceable, void or voidable under the laws of any
jurisdiction shall not effect the validity of the remaining provisions of this
Agreement in such jurisdiction, and shall not effect the enforceability of the
entire Agreement under the laws of any other jurisdiction.
[REMAINDER OF PAGE LEFT BLANK INTENTIONALLY; NEXT PAGE IS SIGNATURE PAGE]
21
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered, all as of the date and year first above written.
FLAGSTAR COMPANIES, INC.
By:
---------------------------------------
Name:
Title:
XXXXXX XXXXXX & COMPANY, INC.
By:
---------------------------------------
Name:
Title:
[OTHER HOLDERS OF >10%?]
By:
----------------------------------------
Name:
Title:
ANNEX 1
NAMES AND ADDRESSES OF HOLDERS
Xxxxxx Xxxxxx & Company, Inc.
Xxx Xxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Xxxxxxxxx X. Xxx
Fax: 000-000-0000
with a copy to:
Xxxx & Xxxxxx
Xxx Xxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attn: Xxxx X. Xxxxxxxxxxx
Fax: 000-000-0000
Annex 1-1
