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Exhibit 4.2
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT, dated as of July 25, 1997 (the
"Agreement"), among Prime Hospitality Corp., a Delaware corporation (the
"Company"), and each of the other parties signatory hereto (the "Holders").
RECITALS
WHEREAS, pursuant to an Agreement and Plan of Merger, dated as of July 25,
1997 (the "Merger Agreement"), among the Company, PH Sub Corporation ("PH Sub")
and Homegate Hospitality, Inc. ("Homegate"), pursuant to which PH Sub will merge
with and into Homegate (the "Merger"), the Holders will receive shares of common
stock, par value $.01 per share, of the Company (the "Company Shares") in
exchange for their shares of Common Stock, par value $.01 per share, of Homegate
(the "Homegate Shares");
NOW, THEREFORE, in consideration of the mutual promises and agreements set
forth herein and other valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto hereby agree as follows:
1. Definitions. For purposes of this Agreement, the following terms
have the following meanings when used herein with initial capital letters:
Pooling Restriction Termination Date: The date on which there is
first published by the Company financial results reflecting 30 days of combined
operations of the Company and Homegate.
Prospectus: The prospectus included in any Registration Statement
(including, without limitation, a prospectus that discloses information
previously omitted from a prospectus filed as part of an effective registration
statement in reliance upon Rule 430A promulgated under the Securities Act), as
amended or supplemented by any prospectus supplement, with respect to the terms
of the offering of any portion of the Registrable Securities covered by such
Registration Statement and all other amendments and supplements to the
prospectus, including post-effective amendments, and all material incorporated
by reference or deemed to be incorporated by reference in such prospectus.
Registrable Securities: The Company Shares to be issued to the
Holders upon conversion of their Homegate Shares, excluding (A) any Company
Shares that have been disposed of
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pursuant to a Registration Statement relating to the sale thereof that has
become effective under the Securities Act and (B) any Company Shares eligible to
be sold pursuant to Rule 144(k) or Rule 145(d)(2) under the Securities Act.
Registrable Securities shall also include any Company Shares or other securities
(or Company Shares underlying such other securities) that may be received by the
Holders (x) as a result of a stock dividend on or stock split of Registrable
Securities or (y) on account of Registrable Securities in a recapitalization of
or other transaction involving the Company.
Registration Statement: Any registration statement of the Company
under the Securities Act that covers any of the Registrable Securities pursuant
to the provisions of this Agreement, including the related Prospectus, all
amendments and supplements to such registration statement (including
post-effective amendments), all exhibits and all material incorporated by
reference or deemed to be incorporated by reference in such registration
statement.
SEC: The Securities and Exchange Commission.
Securities Act: The Securities Act of 1933, as amended.
2. Shelf Registration of Resales.
(a) Registration of Resales. The Company agrees to use commercially
reasonable efforts (i) to cause the Holders' offering and resale of their
Registrable Securities to be registered under the Securities Act on a
Registration Statement (the "Resale Registration Statement") to be filed by the
Company on or before January 31, 1998 on a form permitted to be used by the
Company for the registration under the Securities Act of the Holders' offering
and resale of Registrable Securities (in accordance with the intended methods of
distribution); and (ii) to cause the Resale Registration Statement to be
declared effective by the Pooling Restriction Termination Date or as soon as
practicable thereafter.
(b) Maintenance of Effectiveness. The Company agrees to use
commercially reasonable efforts to keep the Resale Registration Statement
effective for a period from the effective date thereof until the Company
determines in good faith that there are no more Registrable Securities; provided
that in no event shall the Company be required to keep the Resale Registration
Statement effective after the first anniversary of the effectiveness of the
Merger.
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3. Registration Procedures. In connection with the Company's
registration obligation pursuant to Section 2 hereof, the Company will as
expeditiously as possible, and in each case to the extent applicable:
(a) Prepare and file with the SEC such amendments and post-effective
amendments to the Resale Registration Statement as may be necessary to keep such
Registration Statement continuously effective for the applicable period
specified in Section 2; cause the related Prospectus to be supplemented by any
required Prospectus supplement, and as so supplemented to be filed pursuant to
Rule 424 (or any similar provisions then in force) under the Securities Act; and
comply with the provisions of the Securities Act with respect to the disposition
of all securities covered by such Registration Statement during the applicable
period in accordance with the intended methods of disposition by the sellers
thereof set forth in such Registration Statement as so amended or in such
Prospectus as so supplemented.
(b) Notify the selling Holders promptly, (i) when a Prospectus or
any Prospectus supplement or post-effective amendment has been filed, and, with
respect to a Registration Statement or any post-effective amendment, when the
same has become effective, (ii) of any requests by the SEC or any other federal
or state governmental authority for amendments or supplements to a Registration
Statement or related Prospectus or for additional information, (iii) of the
issuance by the SEC or any other federal or state governmental authority of any
stop order suspending the effectiveness of a Registration Statement or the
initiation of any proceedings for that purpose, (iv) of the receipt by the
Company of any notification with respect to the suspension of the qualification
or exemption from qualification of any of the Registrable Securities for sale in
any jurisdiction or the initiation or threatening of any proceeding for such
purpose, (v) of the occurrence of any event which makes any statement made in
such Registration Statement or related Prospectus or any document incorporated
or deemed to be incorporated therein by reference untrue in any material respect
or which requires the making of any changes in a Registration Statement,
Prospectus or any such document so that, in the case of the Registration
Statement, it will not contain any untrue statement of a material fact or omit
to state any material fact required to be stated or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading, and (vi) of the Company's reasonable determination that a
post-effective amendment to a Registration Statement would be appropriate.
(c) Use every reasonable effort to obtain the withdrawal of any
order suspending the effectiveness of a
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Registration Statement, or the lifting of any suspension of the qualification
(or exemption from qualification) of any of the Registrable Securities for sale
in any jurisdiction, at the earliest possible moment.
(d) If requested by Holders holding a majority of the Registrable
Securities being registered, (i) promptly incorporate in a Prospectus supplement
or post-effective amendment such information as such Holders agree should be
included therein as may be required by applicable law and (ii) make all required
filings of such Prospectus supplement or such post-effective amendment as soon
as practicable after the Company has received notification of the matters to be
incorporated in such Prospectus supplement or post-effective amendment;
provided, however, that the Company will not be required to take any actions
under this Section 3(d) that are not, in the opinion of counsel for the Company,
in compliance with and required by applicable law.
(e) Furnish to each selling Holder without charge, at least one
conformed copy of the Registration Statement and any post-effective amendment
thereto, including financial statements (but excluding schedules, all documents
incorporated or deemed incorporated therein by reference and all exhibits,
unless requested in writing by such holder, counsel or underwriter).
(f) Deliver to each selling Holder as many copies of the Prospectus
or Prospectuses relating to such Registrable Securities (including each
preliminary prospectus) and any amendment or supplement thereto as such persons
may reasonably request; and the Company hereby consents to the use of such
Prospectus or each amendment or supplement thereto by each of the selling
Holders in connection with the offering and sale of the Registrable Securities
covered by such Prospectus or any amendment or supplement thereto.
(g) Prior to any public offering of Registrable Securities, to
register or qualify or cooperate with the selling Holders and their counsel in
connection with the registration or qualification (or exemption from such
registration or qualification) of such Registrable Securities for offer and sale
under the securities or blue sky laws of such jurisdictions within the United
States as any seller reasonably requests in writing; use all reasonable efforts
to keep such registration or qualification (or exemption therefrom) effective
during the period the applicable Registrable Statement is required to be kept
effective and do any and all other acts or things necessary or advisable to
enable the disposition in each such jurisdiction of the Registrable Securities
covered by the applicable Registration Statement; provided, however, that the
Company will not be required to (i) qualify to do business in any jurisdiction
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in which it is not then so qualified or (ii) take any action that would subject
it to service of process in any such jurisdiction in which it is not then so
subject.
(h) Cooperate with the selling Holders to facilitate the timely
preparation and delivery of certificates representing Registrable Securities to
be sold.
(i) Use all reasonable efforts to cause the Registrable Securities
covered by the applicable Registration Statement to be registered with or
approved by such other governmental agencies or authorities within the United
States except as may be required solely as a consequence of the nature of any
selling Holder's business, in which case the Company will cooperate in all
reasonable respects with the filing of such Registration Statement and the
granting of such approvals as may be necessary to enable the seller or sellers
thereof or the underwriters, if any, to consummate the disposition of such
Registrable Securities.
(j) Upon the occurrence of any event contemplated by Section 3(b)(v)
or 3(b)(vi) hereof, promptly prepare and file an amendment or post-effective
amendment to each Registration Statement or a supplement to the related
Prospectus or any document incorporated therein by reference or file any other
required document so that, as thereafter delivered to the purchasers of the
Registrable Securities being sold thereunder, such Prospectus will not contain
an untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading.
The Company may require each seller of the Registrable Securities as
to which any registration is being effected to furnish to the Company such
information regarding the distribution of such Registrable Securities as the
Company may, from time to time, reasonably request in writing and the Company
may exclude from such registration the Registrable Securities of any seller who
unreasonably fails to furnish such information within a reasonable time after
receiving such request.
Each Holder will be deemed to have agreed by virtue of its
acquisition of Registrable Securities that, upon receipt of any notice from the
Company of the occurrence of any event of the kind described in Section
3(b)(ii), 3(b)(iii), 3(b)(v) or 3(b)(vi) hereof ("Suspension Notice"), such
Holder will forthwith discontinue disposition of such Registrable Securities
covered by such Registration Statement or Prospectus (a "Black-Out") until such
Holder's receipt of the copies of the supplemented or
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amended Prospectus contemplated by Section 3(j) hereof, or until it is advised
in writing (the "Advice") by the Company that the use of the applicable
Prospectus may be resumed, and such Holder has received copies of any additional
or supplemental filings that are incorporated or deemed to be incorporated by
reference in such Prospectus.
4. Registration Expenses. The Company will pay or cause to be paid, the
following fees and expenses directly related to the performance of or compliance
with this Agreement by the Company: (i) one-half of the SEC registration fee
applicable to the Registrable Securities the sale of which is registered on the
Resale Registration Statement and (ii) fees and disbursements of counsel for the
Company incurred by the Company. The Company also will pay its internal expenses
(including without limitation all salaries and expenses of their officers and
employees performing legal or accounting duties), the expense of any annual
audit, and the fees and expenses incurred in connection with the listing of the
securities to be registered on any securities exchange on which similar
securities issued by the Company are then listed. The Holders will pay (i) the
other one-half of the SEC registration fee applicable to the Registrable
Securities the sale of which is registered on the Resale Registration Statement
and (ii) the fees and expenses of its counsel and accountants, if any.
5. Indemnification.
(a) Indemnification by the Company. The Company will, without
limitation as to time, indemnify and hold harmless, to the fullest extent
permitted by law, each Holder holding Registrable Securities registered pursuant
to this Agreement, the officers, directors and agents and employees of each of
them, each person who controls such a Holder (within the meaning of Section 15
of the Securities Act or Section 20 of the Exchange Act) and the officers,
directors, agents and employees of any such controlling person, from and against
all losses, claims, damages, liabilities, costs (including without limitation
the costs of investigation and attorneys' fees) and expenses (collectively,
"Losses"), as incurred, arising out of or based upon any untrue or alleged
untrue statement of a material fact contained in any Registration Statement,
Prospectus or form of Prospectus or in any amendment or supplement thereto or in
any preliminary prospectus, or arising out of or based upon any omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, except insofar as
the same are based solely upon information furnished in writing to the Company
by such Holder expressly for use therein; provided, however, that the Company
will not be liable to any Holder to the extent that
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any such Losses arise out of or are based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in any Registration
Statement, Prospectus or preliminary prospectus if either (A)(i) such Holder
failed to send or deliver a copy of the Prospectus with or prior to the delivery
of written confirmation of the sale by such Holder of a Registrable Security to
the person asserting the claim from which such Losses arise and (ii) the
Prospectus would have completely corrected such untrue statement or alleged
untrue statement or such omission or alleged omission; or (B) such untrue
statement or alleged untrue statement, omission or alleged omission is
completely corrected in an amendment or supplement to the Prospectus previously
furnished by or on behalf of the Company with copies of the Prospectus, and such
Holder thereafter fails to deliver such Prospectus as so amended or supplemented
prior to or concurrently with the sale of a Registrable Security to the person
asserting the claim from which such Losses arise.
(b) Indemnification by Holders. In connection with any Registration
Statement in which a Holder is participating, such Holder will furnish to the
Company in writing such information as the Company reasonably requests for use
in connection with any Registration Statement, Prospectus or preliminary
prospectus and will indemnify, to the fullest extent permitted by law, the
Company, its directors and officers, agents and employees, each person who
controls the Company (within the meaning of Section 15 of the Securities Act and
Section 20 of the Exchange Act), and the directors, officers, agents or
employees of such controlling persons, from and against all Losses arising out
of or based upon any untrue statement of a material fact contained in any
Registration Statement, Prospectus or preliminary prospectus or arising out of
or based upon any omission of a material fact required to be stated therein or
necessary to make the statements therein not misleading, to the extent, but only
to the extent, that such untrue statement or omission is contained in any
information so furnished in writing by such Holder to the Company expressly for
use in such Registration Statement, Prospectus or preliminary prospectus and was
relied upon by the Company in the preparation of such Registration Statement,
Prospectus or preliminary prospectus. In no event will the liability of any
selling Holder hereunder be greater in amount than the dollar amount of the
proceeds (net of payment of all expenses) received by such Holder upon the sale
of the Registrable Securities giving rise to such indemnification obligation.
(c) Conduct of Indemnification Proceedings. If any person shall
become entitled to indemnity hereunder (an "indemnified party"), such
indemnified party shall give prompt notice to the party from which such
indemnity is sought (the
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"indemnifying party") of any claim or of the commencement of any action or
proceeding with respect to which such indemnified party seeks indemnification or
contribution pursuant hereto; provided, however, that the failure to so notify
the indemnifying party will not relieve the indemnifying party from any
obligation or liability except to the extent that the indemnifying party has
been prejudiced materially by such failure. All fees and expenses (including any
fees and expenses reasonably incurred in connection with investigating or
preparing to defend such action or proceeding) will be paid to the indemnified
party, as incurred, within 20 calendar days of written notice thereof to the
indemnifying party (subject to reimbursement if it is ultimately determined that
an indemnified party is not entitled to indemnification hereunder). The
indemnifying party will not consent to entry of any judgment or enter into any
settlement or otherwise seek to terminate any action or proceeding in which any
indemnified party is or could be party and as to which indemnification or
contribution could be sought by such indemnified party under this Section 5,
unless such judgment, settlement or other termination includes as an
unconditional term thereof the giving by the claimant or plaintiff to such
indemnified party of a release, in form and substance reasonably satisfactory to
the indemnified party, from all liability in respect of such claim or litigation
for which such indemnified party would be entitled to indemnification hereunder.
(d) Contribution. If the indemnification provided for in this
Section 5 is unavailable to an indemnified party under Section 5(a) or 5(b)
hereof in respect of any Losses or is insufficient to hold such indemnified
party harmless, then each applicable indemnifying party, in lieu of indemnifying
such indemnified party, will, severally but not jointly, contribute to the
amount paid or payable by such indemnified party as a result of such Losses, in
such proportion as is appropriate to reflect the relative fault of the
indemnifying party or indemnifying parties, on the one hand, and such
indemnified party, on the other hand, in connection with the actions, statements
or omissions that resulted in such Losses as well as any other relevant
equitable considerations. The relative fault of such indemnifying party or
indemnifying parties, on the one hand, and such indemnified party, on the other
hand, will be determined by reference to, among other things, whether any action
in question, including any untrue or alleged untrue statement of a material fact
or omission or alleged omission of a material fact, has been taken or made by,
or related to information supplied by, such indemnifying party or indemnified
party, and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such action, statement or omission. The amount
paid or payable by a party as a result of any Losses will
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be deemed to include any legal or other fees or expenses incurred by such party
in connection with any action or proceeding.
The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 5(d) were determined by pro rata
allocation or by any other method of allocation that does not take into account
the equitable considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section 5(d), an indemnifying party that
is a selling Holder will not be required to contribute any amount in excess of
the amount by which the total price at which the Registrable Securities sold by
such indemnifying party and distributed to the public were offered to the public
exceeds the amount of any damages which such indemnifying party has otherwise
been required to pay by reason of such 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) will be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
The indemnity, contribution and expense reimbursement obligations of
the Company hereunder will be in addition to any liability the Company may
otherwise have hereunder or otherwise. The provisions of this Section 5 will
survive so long as Registrable Securities remain outstanding, notwithstanding
any permitted transfer of the Registrable Securities by any Holder thereof or
any termination of this Agreement.
6. Miscellaneous.
(a) Remedies. In the event of a breach by the Company of its
obligations under this Agreement, each Holder, in addition to being entitled to
exercise all rights granted by law, including recovery of damages, will be
entitled to specific performance of its rights under this Agreement. The Company
agrees that monetary damages would not be adequate compensation for any loss
incurred by reason of a breach by it of any provision of this Agreement and
hereby further agrees that, in the event of any action for specific performance
in respect of such breach, it will waive the defense that a remedy at law would
be adequate.
(b) Amendments and Waivers. The provisions of this Agreement may not
be amended, modified or supplemented without the prior written consent of the
Company, and Holders holding in excess of 50% of the Registrable Securities in
respect of which Registrable Securities are issuable.
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(c) Notices. Except as set forth below, all notices and other
communications provided for or permitted hereunder shall be in writing and shall
be deemed to have been duly given if delivered personally or sent by telex or
telecopier, registered or certified mail (return receipt requested), postage
prepaid or courier or overnight delivery service to the Company at the following
address and to a Holder at the address set forth on his or her signature page to
this Agreement (or at such other address for any party as shall be specified by
like notice, provided that notices of a change of address shall be effective
only upon receipt thereof):
If to the Company: Prime Hospitality Corp.
000 Xxxxx 00 Xxxx
Xxxxxxxxx, Xxx Xxxxxx 00000-0000
Attn: Xxxxxx X. Xxxxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
With a copy to: Xxxxxxx Xxxx & Xxxxxxxxx
One Citicorp Center
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxx X. Xxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
(d) Successors and Assigns. This Agreement will inure to the benefit
of and be binding upon the successors and assigns of the Company. This Agreement
may not be assigned by any Holder, except to a constituent partner or
shareholder of such Holder, unless the proposed transferee or assignee of such
Holder (a "Holder Transferee") agrees in a writing reasonably acceptable to the
Company to be bound by the terms of this Agreement, and executes any and all
documents reasonably requested by the Company to bind such Holder Transferee to
the terms of the Voting Agreement (if the Merger shall not have already
occurred). Except as otherwise expressly permitted herein, any attempted
assignment hereof by any Holder will be void and of no effect and shall
terminate all obligations of the Company with respect to such Holder.
Notwithstanding the foregoing, each of the indemnified parties shall be entitled
to enforce the covenants set forth in Section 5 hereof.
(e) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed will constitute one and the same instrument.
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(f) Headings. The headings in this Agreement are for convenience of
reference only and will not limit or otherwise affect the meaning hereof.
(g) Governing Law. This agreement will be governed by and construed
in accordance with the laws of the State of Delaware, as applied to contracts
made and performed within the State of Delaware, without regard to principles of
conflict of laws.
(h) Severability. If any term, provision, covenant or restriction of
this Agreement is held by a court of competent jurisdiction to be invalid, void
or unenforceable, the remainder of the terms, provisions, covenants and
restrictions set forth herein will remain in full force and effect and will in
no way be affected, impaired or invalidated, and the parties hereto will use
their best efforts to find and employ an alternative means to achieve the same
or substantially the same result as that contemplated by such term, provision,
covenant or restriction. It is hereby stipulated and declared to be the
intention of the parties that they would have executed the remaining terms,
provisions, covenants and restrictions without including any of such which may
be hereafter declared invalid, void or unenforceable.
(i) Entire Agreement. This Agreement is intended by the parties as a
final expression of their agreement and intended to be the 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 such subject matter. This Agreement supersedes all prior
agreements and understandings between the parties with respect to such subject
matter.
(j) Attorneys' Fees. In any action or proceeding brought to enforce
any provision of this Agreement, or where any provision hereof is validly
asserted as a defense, the prevailing party, an determined by the court, will be
entitled to recover reasonable attorneys' fees in addition to any other
available remedy.
(k) Effectiveness. This Agreement shall become effective
concurrently with the effectiveness of the Merger. If the Merger Agreement shall
be terminated, this Agreement shall terminate concurrently.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
PRIME HOSPITALITY CORP.
/s/ Xxxx X. Xxxxxx
--------------------------------------
Name: Xxxx X. Xxxxxx
Title: Executive Vice President and
Chief Financial Officer
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Registration Rights Agreement
Holder Signature Pages
CRI/ESH PARTNERS, L.P.
By: Crow Family, Inc.,
its sole general partner
/s/ Xxxxxxx X. Xxxx
__________________________________
Name: Xxxxxxx X. Xxxx
Title: Executive Vice President
CROW HOTEL REALTY INVESTORS, L.P.
By: Crow Family, Inc.,
its sole general partner
/s/ Xxxxxxx X. Xxxx
__________________________________
Name: Xxxxxxx X. Xxxx
Title: Executive Vice President
CROW FAMILY, INC.
/s/ Xxxxxxx X. Xxxx
__________________________________
Name: Xxxxxxx X. Xxxx
Title: Executive Vice President
JMI/GREYSTAR EXTENDED STAY
PARTNERS, L.P.
By: Greystar Holdings, Inc.,
its general partner
/s/ Xxxxxx X. Faith
__________________________________
Name: Xxxxxx X. Faith
Title: President
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JMI/GREYSTAR REALTY PARTNERS, L.P.
By: Greystar Holdings, Inc.,
its general partner
/s/ Xxxxxx X. Faith
__________________________________
Name: Xxxxxx X. Faith
Title: President
XXXXXX X. FAITH
/s/ Xxxxxx X. Faith
______________________________________
DEVELOPER EXTENDED STAY
PARTNERS, L.P.
By: DESP General Partner, L.L.C., its
general partner
By: Greystar Holdings, Inc.,
as a member
/s/ Xxxxxx X. Faith
______________________________
Name: Xxxxxx X. Faith
Title: President
DEVELOPER EXTENDED STAY
PARTNERS, L.P.
By: DESP General Partner, L.L.C., its
general partner
By: Crow Family, Inc.,
as a member
/s/ Xxxxxxx X. Xxxx
_______________________________
Name: Xxxxxxx X. Xxxx
Title: Executive Vice President
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