Exhibit 10.21
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made and
entered into as of ________________, 1998 by and among (i) Crestline Capital
Corporation, a Maryland corporation (the "Company"), and (ii) those entities
specified on Schedule 1 to that certain Contribution Agreement dated as of April
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16, 1998 among Host Marriott Corporation ("HMC"), Host Marriott, L.P. (the
"Operating Partnership") and the entities specified on Schedule 1 thereto (the
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"Contribution Agreement"), including their permitted successors, assigns and
transferees (each such entity and its permitted successors, assigns and
transferees, separately, a "Contributor" and collectively, the "Contributors").
Unless otherwise defined, capitalized terms used herein shall have the
respective meanings ascribed to them in the Contribution Agreement.
WHEREAS, pursuant to the Contribution Agreement, each of the
Contributors is transferring (by means of contribution) certain of its assets
(the "Contribution") to the Operating Partnership in exchange for certain
consideration, including, but not limited to, shares of common stock of the
Company ("Shares");
WHEREAS, in connection with the Contribution and pursuant to the
Contribution Agreement, HMC agreed to cause the Company to grant to Contributors
the Registration Rights (as defined in Section 1 hereof) with respect to the
Registrable Shares (as defined in Section 1 hereof);
NOW, THEREFORE, the parties hereto, in consideration of the
foregoing, the mutual covenants and agreements hereinafter set forth, and other
good and valuable consideration, the receipt and sufficiency of which hereby are
acknowledged, hereby agree as follows:
Section 1. Registration Rights
A Contributor shall be entitled to offer for sale pursuant to a
shelf registration statement or, in certain other circumstances, as provided by
Section 1.3 hereof, subject to the terms and conditions set forth herein (the
"Registration Rights") (i) up to 50% of the Shares received by such Contributor
in connection with the Contribution beginning July 1, 1999, (ii) an additional
25% of such Shares beginning October 1, 1999 and (iii) the remaining 25%
beginning January 1, 2000 (such Shares on and after such dates are referred to
herein as the "Registrable Shares"). Shares shall cease to be Registrable Shares
at such time as they have been sold pursuant to an offering registered under the
Securities Act (as defined below) or pursuant to Rule 144 under the Securities
Act.
1.1 Shelf Registration Rights.
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(a) Shelf Registration Statement. No later than April 30, 1999,
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the Company shall file with the Securities and Exchange Commission ("SEC") a
registration statement for an offering to be made on a continuous basis pursuant
to Rule 415 under the Securities Act of 1933, as amended (the "Securities Act"),
covering all of the Registrable Shares (the "Registration Statement"; and the
related prospectus (including any preliminary prospectus) is referred to as the
"Prospectus"). The Registration
Statement shall be on the appropriate form, and shall otherwise comply as to
form in all material respects with the requirements of the Securities Act and
the rules and regulations promulgated thereunder, permitting registration of
such Registrable Shares for resale by Contributors in the manner or manners
designated by them (including, without limitation, one or more underwritten
public offerings). The Company will use its commercially reasonable efforts to
cause the Registration Statement to be declared effective by the SEC as promptly
as practicable (and in any event by no later than July 1, 1999) and will notify
each Contributor when such Registration Statement has become effective. The
Company agrees (subject to Section 1.2 hereof) to use its commercially
reasonable efforts to keep the Registration Statement effective (including the
preparation and filing of any amendments and supplements necessary for that
purpose) until the earlier of (i) the date on which the Contributors shall have
sold all of the Registrable Shares, or (ii) the date on which all of the
Registrable Shares are eligible for sale pursuant to Rule 144(k) (or any
successor provision) or in a single transaction pursuant to Rule 144(e) (or any
successor provision) under the Securities Act (such period, the "Effective
Period"). Each Contributor seeking to offer and sell its Registrable Shares upon
exercise of a Registration Right agrees to provide in a timely manner
information regarding the proposed distribution by such Contributor of the
Registrable Shares and such other information reasonably requested by the
Company in connection with the preparation of and for inclusion in the
Registration Statement. The Company agrees to provide to each such Contributor a
reasonable number of copies of the final Prospectus and any amendments or
supplements thereto. If the Registration Statement ceases to be effective for
any reason at any time during the Effective Period (other than because of the
sale of all of the securities registered thereunder or as permitted by Section
1.3 hereof), the Company shall use its commercially reasonable efforts to obtain
the prompt withdrawal of any order suspending the effectiveness thereof.
(b) Offerings and Sales. At any time and from time to time after
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the date that any Shares become Registrable Shares, subject to Sections 1.1(c)
(in the case of any underwritten public offering) and Section 1.2 (in the case
of all offerings hereunder), each Contributor may exercise its Registration
Rights hereunder with respect to such Registrable Shares. If any Contributor
desires to offer and sell such Registrable Shares pursuant to an underwritten
public offering, such Contributor (the "Initiating Contributor") shall deliver
to the Company a written notice (an "Underwritten Registration Notice"), which
notice shall be given at least forty-five (45) days prior to the date on which
such Initiating Contributor desires to consummate the sale of such Registrable
Shares. Any such Underwritten Registration Notice shall in any event be subject
to revocation by such Initiating Contributor by delivery of a subsequent written
notice delivered to the Company by no later than the tenth day prior to the
contemplated offering, provided, however, that a revoked Underwritten
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Registration Notice shall be treated the same as an Underwritten Registration
Notice that is not revoked for purposes of Section 1.1(c) hereof.
Upon receipt of an Underwritten Registration Notice, the Company
shall, within thirty (30) days of receipt of the Underwritten Registration
Notice, give written notice to the other Contributors and any other persons
possessing similar registration rights (a "Company Notice") of the Company's
receipt of the Underwritten Registration Notice. Within fifteen (15) days of
receipt of such a Company Notice, any other Contributor desiring to offer and
sell any of its Registrable Shares in such an offering of the type described in
the Underwritten Registration Notice (each, a "Participating Contributor") shall
give written notice to each of the Company, the Initiating Contributor,
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and the lead managing underwriter, if any, that has been selected, of such a
desire, specifying the number of Registrable Shares which such Participating
Contributor desires to offer and sell. Subject to the provisions of Section 1.2
hereof, the Company shall not be permitted to participate in the offering made
pursuant to an Underwritten Registration Notice without the written consent of
the Initiating Contributor (which consent shall not be unreasonably withheld).
(c) Limitations on Registration Rights for Underwritten Offerings.
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Each exercise of a Registration Right pursuant to an Underwritten Registration
Notice shall be with respect to an underwritten public offering of Registrable
Shares, the minimum aggregate total gross proceeds of which to the Initiating
Contributor and all other Participating Contributors shall be (x) equal to or
greater than Fifteen Million Dollars ($15,000,000), and (y) equal to or less
than Forty Million Dollars ($40,000,000). The Contributors shall not be
permitted to deliver, individually or collectively, more than one Underwritten
Registration Notice in any six-month period; provided, however, that any
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Underwritten Registration Notice relating to an underwritten public offering
which is suspended by the Company pursuant to Section 1.2 hereof, shall not be
counted as an Underwritten Registration Notice for purposes of this sentence
unless such underwritten public offering is concluded following the termination
of such suspension. All offers and sales by each Contributor under the
Registration Statement referred to in this Section 1.1 shall be completed within
the Effective Period, and upon expiration of such period no Contributor will
offer or sell any Registrable Shares under the Registration Statement and no
Contributor shall be entitled to deliver an Underwritten Registration Notice
hereunder. If directed by the Company, each Contributor will return all
undistributed copies of the Prospectus in its possession upon the expiration of
such period.
1.2 Suspension of Offering. At any time during the Effective Period,
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the Company may determine, in the good faith judgment of its Board of Directors,
with the advice of counsel, that offers and sales by the Contributors under the
Registration Statement shall be suspended if (i) a negotiation or consummation
of a transaction by the Company or its subsidiaries is pending or an event has
occurred, which negotiation, consummation or event would require additional
disclosure by the Company in the Registration Statement of material information
which the Company has a bona fide business purpose for keeping confidential and
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the nondisclosure of which in the Registration Statement would reasonably be
expected to cause the Registration Statement to fail to comply with applicable
disclosure requirements, or (ii) in the case of any underwritten public offering
of Registrable Shares pursuant to an Underwritten Registration Notice, the
offering of such Registrable Shares would adversely affect a pending or proposed
public offering of the Company's Shares. Immediately upon making such a
determination, the Company shall give written notice to all Contributors (a
"Materiality Notice"), upon receipt of which each Contributor agrees that it
will immediately discontinue offers and sales of the Registrable Shares under
the Registration Statement until (x) in the case of a Materiality Notice
delivered pursuant to clause (i) above, such Contributor receives copies of a
supplemented or amended Prospectus that corrects the misstatement(s) or
omission(s) referred to above and receives notice that any post-effective
amendment has become effective or (y) in the case of a Materiality Notice
delivered pursuant to clause (ii) above, such Contributor receives a subsequent
notice from the Company that revokes or otherwise withdraws such Materiality
Notice; provided, that the Company may delay, suspend or withdraw the
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Registration Statement for such reason
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for no more than fifteen (15) days after the abandonment or consummation of any
of the foregoing negotiations, transactions, events or offerings or, in any
event, for no more than ninety (90) days after delivery of the Materiality
Notice at any one time (and the Company shall not be entitled to deliver a
Materiality Notice at any time within 180 days of the termination of any
suspension of an offering pursuant to a prior Materiality Notice). If so
directed by the Company, each Contributor will deliver to the Company all copies
of the Prospectus covering the Registrable Shares current at the time of receipt
of a Materiality Notice. If a Materiality Notice is given pursuant to clause
(ii) above, the Company agrees to permit the Initiating and Participating
Contributors to complete an underwritten public offering substantially similar
to the type which was suspended pursuant to clause (ii) within ninety (90) days
of the closing of the Company's public offering or its decision not to undertake
a public offering, as the case may be.
1.3 Piggyback Registration.
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(a) If, at any time during the Effective Period, the Company proposes
to register any of its Shares for sale under the Securities Act, except as
otherwise described in Section 1.1 hereof, whether or not for sale for the
Company's own account, on a form and in a manner that would also permit
registration of Registrable Shares for sale under the Securities Act, the
Company shall give written notice to each Contributor of the Company's intention
to effect such registration at least thirty (30) days prior to the anticipated
filing of such registration statement. If, within twenty (20) days after the
giving of such notice by the Company, any Contributor shall deliver to the
Company a written request specifying the number of Registrable Shares such
Contributor desires to offer and sell, and the intended disposition thereof, the
Company shall use its commercially reasonable efforts to effect the registration
of all such Registrable Shares that the Company has been requested to register,
provided:
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(i) if, at any time after giving written notice of its intention
to register any securities and prior to the effectiveness of the
registration statement filed in connection therewith, the Company shall
determine for any reason not to register any such securities, the Company
may, at its election, give written notice of such determination to each
Contributor who made a request as provided in this Section 1.3, and
thereupon the Company shall be relieved of its obligation to register any
Registrable Shares in connection with such registration (but not from its
obligations under Section 1.4 hereunder), without prejudice, however, to
the Registration Rights of Contributors generally under this Section 1; and
(ii) subject to the provisions of Section 1.6 hereof, if such
registration involves an underwritten public offering, all Contributors
requesting to be included in the Company's registration must sell their
Registrable Shares to the underwriters selected by the Company on the same
terms and conditions as are applicable to the Company.
(b) The Company shall not be obligated to effect any registration of
Registrable Shares under this Section 1.3 as a result of the registration of any
of its
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securities in connection with mergers, acquisitions, exchange offers, dividend
reinvestment plans or option or other employee benefit plans.
1.4 Expenses. The Company shall pay all expenses incident to the
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performance by it of its registration obligations under this Section 1,
including (i) all stock exchange, SEC registration, listing and filing fees,
(ii) all expenses incurred in connection with the preparation, printing and
distribution of the Registration Statement and Prospectus and any other document
or amendment thereto and the mailing and delivery of copies thereof to the
underwriter and dealers, (iii) fees and disbursements of counsel for the Company
and of the independent public accountants and other experts of the Company;
(iv) the cost of printing or producing any agreement(s) among underwriters,
underwriting agreement(s) and blue sky or legal investment memoranda, any
selling agreements and any other documents in connection with the offering, sale
or delivery of Registrable Shares to be disposed of; (v) all expenses in
connection with the qualification of Registrable Shares to be disposed of for
offering and sale under state securities laws, including the fees and
disbursements of counsel for the underwriters in connection with such
qualification and in connection with any blue sky and legal investment surveys
(but not for any other fees or disbursements of counsel for the underwriters);
(vi) the filing fees incident to securing any required review by the National
Association of Securities Dealers, Inc. of the terms of the sale of Registrable
Shares to be disposed of; and (vii) fees and expenses incurred in connection
with the listing of Registrable Shares on each securities exchange or quotation
system on which the Common Shares are then listed. Any Contributor offering and
selling Registrable Shares hereby shall be responsible for the payment of any
brokerage and sales commissions, fees and disbursements of such Contributor's
counsel, and any transfer taxes relating to the sale or disposition of the
Registrable Shares.
1.5 Selection of Underwriters. If Registrable Shares are being
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offered and sold pursuant to an Underwritten Registration Notice, the Initiating
Contributor delivering such notice shall have the right to select the lead
managing underwriter of the offering, which shall be an investment banking firm
of nationally recognized standing reasonably satisfactory to the Company.
1.6 Registration Procedures.
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(a) If and whenever the Company is required to effect the registration
under the Securities Act of Registrable Shares as provided in this Agreement,
the Company will, as expeditiously as possible:
(i) use its commercially reasonable efforts to register or
qualify the Registrable Shares by the time the applicable Registration
Statement is declared effective by the SEC under all applicable state
securities or "blue sky" laws of such jurisdictions as the Contributors
shall reasonably request in writing, to keep each such registration or
qualification effective during the Effective Period, and to do any and all
other acts and things which may be reasonably necessary or advisable to
enable each Contributor to consummate the disposition in each such
jurisdiction of the Registrable Shares owned by such Contributor; provided,
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however, that the Company shall not be required to (x) qualify generally to
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do business in any jurisdiction or to register as a broker or dealer in
such jurisdiction where it
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would not otherwise be required to qualify but for this Section 1.1, (y)
subject itself to taxation in any such jurisdiction, or (z) submit to the
general service of process in any such jurisdiction;
(ii) prepare and file with the SEC such amendments and
supplements to the Registration Statement and the Prospectus as may be
necessary to keep the Registration Statement effective and to comply with
the provisions of the Securities Act with respect to the disposition of all
Registrable Shares until such time as all Registrable Shares have been
disposed of in accordance with the intended methods of disposition by the
Contributors set forth in the Registration Statement;
(iii) furnish to the Contributors and to any underwriter of
such Registrable Shares such number of conformed copies of the Registration
Statement and of each such amendment and supplement thereto (in each case
including all exhibits), such number of copies of the Prospectus included
in the Registration Statement (including each preliminary prospectus and
any summary prospectus), in conformity with the requirements of the
Securities Act, such documents incorporated by reference in the
Registration Statement or Prospectus, and such other documents as the
Contributors or such underwriter may reasonably request;
(iv) cause the Registrable Shares to be listed on each national
securities exchange or quotation system on which the Shares are then
listed, if the listing of such securities is then permitted under the rules
of such exchange;
(v) enter into such customary agreements (including, in the
case of an underwritten public offering, an underwriting agreement), and
the Contributors, on whose behalf Registrable Shares are to be distributed
by such underwriters, shall also be parties to any such underwriting
agreement;
(vi) obtain a "cold comfort" letter or letters from the
Company's independent public accountants and furnish a signed counterpart
of a customary opinion of counsel of the Company, in each case, addressed
to the Contributors (and the underwriters, if any), in customary form and
substance, dated the effective date of the Registration Statement (and, if
such registration includes an underwritten public offering, dated the date
of the closing under the underwriting agreement);
(vii) notify the Contributors immediately upon the happening of
any event as a result of which a Prospectus included in a Registration
Statement, as then in effect, includes an untrue statement of a material
fact or omits to state any material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, and, subject to the provisions
of Section 1.2 hereof, at the request of the Contributors prepare and
furnish to the Contributors as many copies of a supplement to or an
amendment of such Prospectus as the Contributors reasonably request so
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that, as thereafter delivered to the purchasers of such Registrable Shares,
such Prospectus shall not include an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they
were made, not misleading; and
(viii) make available for reasonable inspection by, or give
reasonable access to, any Contributor, by any underwriter participating in
any disposition to be effected pursuant to the Registration Statement and
by any attorney, accountant or other agent retained by any Contributor, all
pertinent financial and other records, pertinent corporate documents and
properties of the Company, and cause the Company's officers, directors and
employees to supply all information reasonably requested by any such
Contributor, underwriter or other person in connection with the offering
thereunder.
(b) In connection with any underwritten public offering of
Registrable Shares, management of the Company shall participate in customary
road show meetings reasonably requested (and reasonable in scope in light of the
size of the offering) upon reasonable prior notice by the lead managing
underwriter of such offering.
(c) The Company may require each Contributor selling Registrable
Shares as to which any registration is being effected to furnish the Company
with such information regarding such Contributor and the distribution of such
securities as required to be included in the Registration Statement as the
Company may from time to time reasonably request in writing.
(d) If a registration pursuant to this Section 1 involves an
underwritten public offering and the lead managing underwriter of such offering
advises the Company (and the Initiating Contributor, if applicable) that, in its
judgment, the number of Shares proposed to be included in such underwritten
public offering by the Company (or the Initiating Contributor, if applicable)
and the Contributors should be limited due to market conditions, then the
Company will promptly so advise each other Contributor which has requested to
offer and sell Registrable Shares in the offering, and the Company (and the
Initiating Contributor, if applicable) and such Contributors will include in
such offering the number of shares which, in the opinion of the lead managing
underwriter can be sold (the "Maximum Offering Amount"). The Maximum Offering
Amount shall be allocated (i) in an offering initiated by the Company as
described in Section 1.3 hereof, first, to the full extent of Shares the Company
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desires to sell, and second, if any Shares remain under the Maximum Offering
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Amount, to each Contributor and to any other persons possessing similar
registration rights to the Registration Rights, pro rata in accordance with each
request for inclusion made by each such Contributor and each such other person,
or (ii) in an offering initiated by an Initiating Contributor as described in
Section 1.1(b) hereof, first, to the Initiating Contributor, to the full extent
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of Shares the Initiating Contributor desires to sell, and second, if any Shares
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remain under the Maximum Offering Amount, to each other Contributor, pro rata in
accordance with each request for inclusion made by each such other Contributor,
and third, if any Shares remain under the Maximum Offering Amount, to any other
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persons possessing similar registration rights to the Registration Rights, pro
rata in accordance with each request for inclusion
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made by each such other person. If the underwriting agreement executed in
connection with such offering provides for an overallotment option to be granted
to the underwriters, and if such option is exercised by the underwriters, the
allocation priority established by clause (i) or clause (ii) above, whichever is
applicable, shall govern the allocation with respect to the sale of any Shares
and Registrable Shares pursuant to such exercise by the underwriters.
(e) If a Contributor exercises its Registration Rights to
offer and sell Registrable Shares in an underwritten public offering initiated
by any other person or persons possessing registration rights similar to those
conveyed upon the Contributors by this Agreement (each such other person
initiating such an underwritten public offering, an "Other Initiating Person"),
the Contributors agree that the allocation priority for such offering shall be
comparable to the allocation priority established by clause (ii) of Section
1.6(d), except that the Contributors shall participate in such offering with the
lowest level of priority described in clause (ii) of Section 1.6(d), pro rata in
accordance with each request for inclusion made by each such Contributor.
Section 2. Indemnification
2.1 Indemnification by the Company. The Company agrees to
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indemnify and hold harmless each Contributor who participates in any offering or
sale of Registrable Shares, each person (if any) who participates as an
underwriter in any offering and sale of Registrable Shares, and each person, if
any, who controls any Contributor or such underwriter within the meaning of
Section 15 of the Securities Act or Section 20 of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and their respective directors, trustees,
officers, partners, agents, employees and affiliates as follows:
(a) against any and all loss, liability, claim, damage and
expense (joint or several) and action or proceeding (whether
commenced or threatened) whatsoever ("Losses"), as incurred, arising
out of or based upon any untrue statement or alleged untrue
statement of a material fact contained in any Registration Statement
(or any amendment thereto) pursuant to which the Registrable Shares
were registered under the Securities Act, including all documents
incorporated therein by reference, or the omission or alleged
omission therefrom of a material fact required to be stated therein
or necessary to make the statements therein not misleading or
arising out of or based upon any untrue statement or alleged untrue
statement of a material fact contained in any Prospectus (or any
amendment or supplement thereto), including all documents
incorporated therein by reference, or the omission or alleged
omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which
they were made, not misleading;
(b) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate
amount paid in settlement of any litigation, or investigation or
proceeding by any governmental agency or body, commenced or
threatened, or of any claim whatsoever based upon any such untrue
statement or omission, or any such alleged untrue statement or
omission, if such settlement is effected with the
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written consent of the Company (which consent will not be unreasonably
withheld); and
(c) against any and all expense whatsoever, as incurred
(including reasonable fees and disbursements of counsel), reasonably
incurred in investigating, preparing or defending against any Losses
or any litigation, or investigation or proceeding by any governmental
agency or body, commenced or threatened, in each case whether or not a
party, or any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission, to the
extent that any such expense is not paid under subparagraph (a) or (b)
above;
provided, however, that the indemnity provided pursuant to this Section 2.1 does
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not apply to any indemnified party with respect to any Loss or expense to the
extent arising out of (i) any untrue statement or omission or alleged untrue
statement or omission made in reliance upon and in conformity with written
information furnished to the Company by such indemnified party expressly for use
in the Registration Statement (or any amendment thereto) or the Prospectus (or
any amendment or supplement thereto), or (ii) such indemnified party's failure
to deliver an amended or supplemental Prospectus if such Loss or expense would
not have arisen had such delivery occurred.
2.2 Indemnification by Contributor. Each Contributor who
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participates in an offering or sale of Registrable Shares (and each permitted
assignee of such a Contributor, on a several basis) agrees to indemnify and hold
harmless the Company, each person (if any) who participates as an underwriter in
any offering and sale of Registrable Shares and each person, if any, who
controls the Company within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act, and their respective directors, trustees,
officers, partners, agents, employees and affiliates, as follows:
(a) against any and all Loss and expense whatsoever, as incurred,
arising out of or based upon any untrue statement or alleged untrue
statement of a material fact contained in any Registration Statement
(or any amendment thereto) pursuant to which the Registrable Shares
were registered under the Securities Act, including all documents
incorporated therein by reference, or the omission or alleged omission
therefrom of a material fact required to be stated therein or
necessary to make the statements therein not misleading or arising out
of or based upon any untrue statement or alleged untrue statement of a
material fact contained in any Prospectus (or any amendment or
supplement thereto), including all documents incorporated therein by
reference, or the omission or alleged omission therefrom of a material
fact necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading;
(b) against any and all Loss and expense whatsoever, as incurred,
to the extent of the aggregate amount paid in settlement of any
litigation, or investigation or proceeding by any governmental agency
or body, commenced or threatened, or of any claim whatsoever based
upon any such untrue statement or omission, or any such alleged untrue
statement or omission, if
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such settlement is effected with the written consent of each such
Contributor (which consent will not be unreasonably withheld); and
(c) against any and all expense whatsoever, as incurred
(including reasonable fees and disbursements of counsel), reasonably
incurred in investigating, preparing or defending against any Loss or
any litigation, or investigation or proceeding by any governmental
agency or body, commenced or threatened, in each case whether or not a
party, or any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission, to the
extent that any such expense is not paid under subparagraph (a) or (b)
above;
provided, however, that the indemnity provided pursuant to this Section 2.1
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shall only apply with respect to any Loss or expense to the extent arising out
of (i) any untrue statement or omission or alleged untrue statement or omission
made in reliance upon and in conformity with written information furnished to
the Company by each such Contributor expressly for use in the Registration
Statement (or any amendment thereto) or the Prospectus (or any amendment or
supplement thereto), or (ii) each such Contributor's failure to deliver an
amended or supplemental Prospectus if such Loss or expense would not have arisen
had such delivery occurred. Notwithstanding the provisions of this Section 2.2,
no Contributor or any permitted assignee shall be required to indemnify the
Company, its indemnified persons hereunder with respect to any amount in excess
of the amount of the total proceeds to each such Contributor or such permitted
assignee, as the case may be, from sales of the Registrable Shares of such
Contributor under the Registration Statement with respect to such offering, and
no Contributor shall be liable under this Section 2.2 for any statements or
omissions of any other Contributor.
2.3 Conduct of Indemnification Proceedings. The indemnified party
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shall give reasonably prompt notice to the indemnifying party of any action or
proceeding commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify the indemnifying party shall not relieve it
from any liability which it may have under the indemnity agreement provided in
Section 2.1 or 2.2 above, unless and to the extent it did not otherwise learn of
such action and the lack of notice by the indemnified party results in the
forfeiture by the indemnifying party of substantial rights and defenses. If the
indemnifying party so elects within a reasonable time after receipt of such
notice, the indemnifying party may assume the defense of such action or
proceeding at such indemnifying party's own expense with counsel chosen by the
indemnifying party and approved by the indemnified party, which approval shall
not be unreasonably withheld; provided, however, that the indemnifying party
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will not settle any such action or proceeding without the written consent of the
indemnified party unless, as a condition to such settlement, the indemnifying
party secures the unconditional release of the indemnified party; and provided
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further, that if the indemnified party reasonably determines that a conflict of
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interest exists where it is advisable for the indemnified party to be
represented by separate counsel or that, upon advice of counsel, there may be
legal defenses available to it which are different from or in addition to those
available to the indemnifying party, then the indemnifying party shall not be
entitled to assume such defense and the indemnified party shall be entitled to
separate counsel at the indemnifying party's expense. If the indemnifying party
is not entitled to assume the defense of such action or proceeding as a result
of the proviso to the preceding sentence, the indemnifying party's counsel shall
be
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entitled to conduct the indemnifying party's defense and counsel for the
indemnified party shall be entitled to conduct the defense of the indemnified
party, it being understood that both such counsel will cooperate with each other
to conduct the defense of such action or proceeding as efficiently as possible.
If the indemnifying party is not so entitled to assume the defense of such
action or does not assume such defense, after having received the notice
referred to in the first sentence of this paragraph, the indemnifying party will
pay the reasonable fees and expenses of counsel for the indemnified party. In
such event, however, the indemnifying party will not be liable for any
settlement effected without the written consent of the indemnifying party (which
consent will not be unreasonably withheld). Except as expressly stated herein,
if an indemnifying party is entitled to assume, and assumes, the defense of such
action or proceeding in accordance with this paragraph, the indemnifying party
shall not be liable for any fees and expenses of counsel for the indemnified
party incurred thereafter in connection with such action or proceeding.
2.4 Contribution. In order to provide for just and equitable
------------
contribution in circumstances in which the indemnity agreement provided for in
this Section 2 is unavailable to an indemnified party, the indemnifying party
shall contribute to the aggregate Losses and expenses of the nature contemplated
by such indemnity agreement incurred by any indemnified party, (i) in such
proportion as is appropriate to reflect the relative fault of the indemnifying
party on the one hand and the indemnified parties on the other, in connection
with the statements or omissions which resulted in such losses, claims, damages,
liabilities or expenses, or (ii) if the allocation provided by clause (i) above
is not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative fault of but also the relative benefits to the
Company on the one hand and each such Contributor on the other, in connection
with the statements or omissions which resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable considerations.
The relative benefits to the indemnifying party and the indemnified party shall
be determined by reference to, among other things, the total proceeds received
by the indemnifying party and the indemnified party in connection with the
offering to which such losses, claims, damages, liabilities or expenses relate.
The relative fault of the indemnifying party and indemnified party shall be
determined by reference to, among other things, whether the action in question,
including any untrue or alleged untrue statement of a material fact or omission
or alleged omission to state a material fact, has been made by, or relates to
information supplied by, the indemnifying party or the indemnified party, and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such action.
The parties hereto agree that it would not be just or equitable if
contribution pursuant to this Section 2.4 were determined by pro rata allocation
or by any other method of allocation which does not take account of the
equitable considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section 2.4, no Contributor shall be
required to contribute any amount in excess of the amount of the total proceeds
to such Contributor from sales of the Registrable Shares of such Contributor
under the Registration Statement.
Notwithstanding the foregoing, 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. For purposes of this Section 2.4, each person, if
any, who controls an
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indemnified party within the meaning of Section 15 of the Securities Act shall
have the same rights to contribution as such indemnified party, and each
director of the Company, each officer of the Company who signed a Registration
Statement and each person, if any, who controls the Company within the meaning
of Section 15 of the Securities Act shall have the same rights to contribution
as the Company.
The indemnity agreements contained in this Section 2 shall be in
addition to any other rights (to indemnification, contribution or otherwise)
which any indemnified party may have pursuant to law or contract and shall
remain operative and in full force and effect regardless of any investigation
made or omitted by or on behalf of any indemnified party and shall survive the
transfer of any Registrable Shares by any Contributor.
Section 3. Rule 144 Compliance
The Company covenants that it will use its best efforts to timely file
the reports required to be filed by the Company under the Securities Act and the
Securities Exchange Act of 1934, as amended, so as to enable each Contributor to
sell Registrable Shares pursuant to Rule 144 under the Securities Act. In
connection with any sale, transfer or other disposition by Contributor of any
Registrable Shares pursuant to Rule 144 under the Securities Act, the Company
shall cooperate with each Contributor to facilitate the timely preparation and
delivery of certificates representing Registrable Shares to be sold and not
bearing any Securities Act legend, and enable certificates for such Registrable
Shares to be for such number of shares and registered in such names as such
Contributor may reasonably request at least ten (10) business days prior to any
sale of Registrable Shares hereunder.
Section 4. Miscellaneous
4.1 Integration; Amendment. This Agreement, together with the
----------------------
Contribution Agreement, constitutes the entire agreement among the parties
hereto with respect to the matters set forth herein and supersedes and renders
of no force and effect all prior oral or written agreements, commitments and
understandings among the parties with respect to the matters set forth herein.
Except as otherwise expressly provided in this Agreement, no amendment,
modification or discharge of this Agreement shall be valid or binding unless set
forth in writing and duly executed by the Company and the Contributors.
4.2 Waivers. No waiver by a party hereto shall be effective unless
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made in a written instrument duly executed by the party against whom such waiver
is sought to be enforced, and only to the extent set forth in such instrument.
Neither the waiver by any of the parties hereto of a breach or a default under
any of the provisions of this Agreement, nor the failure of any of the parties,
on one or more occasions, to enforce any of the provisions of this Agreement or
to exercise any right or privilege hereunder shall thereafter be construed as a
waiver of any subsequent breach or default of a similar nature, or as a waiver
of any such provisions, rights or privileges hereunder.
4.3 Assignment; Successors and Assigns. This Agreement and the
----------------------------------
rights granted hereunder may not be assigned by a Contributor without the
written consent of the
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Company; provided, however, that such Contributor may assign its rights and
-------- -------
obligations hereunder, following at least ten (10) days prior written notice to
the Company, (i) to such Contributor's partners or beneficiaries in connection
with a distribution of the Shares to its partners or beneficiaries, (ii) to a
permitted transferee in connection with a transfer of the Shares (but solely to
the extent that such Contributor was permitted to transfer Units (as defined in
the Contribution Agreement) under the Amended and Restated Agreement of Limited
Partnership of the Operating Partnership) and (iii) to a third party in
connection with a transfer of Shares as security for or in satisfaction of
obligations of any partner of Contributor, if in the case of (i) and (ii) and
(iii) above, such persons or such third party agree in writing to be bound by
all of the provisions hereof. This Agreement shall inure to the benefit of and
be binding upon the parties hereto and their respective heirs, executors,
personal and legal representatives, successors and, subject to this Section 4.3,
assigns.
4.4 Benefits of Registration Rights. Each Contributor and its
-------------------------------
permitted transferees of Registrable Shares may severally or jointly exercise
the Registration Rights hereunder in such proportion as they shall agree among
themselves. No consent of any Contributor shall be required for permitted
transferees to exercise Registration Rights under this Agreement or otherwise to
be entitled to the benefits of this Agreement as applicable to all Contributors.
4.5 Notices. Notices and other communications required by this
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Agreement shall be in writing and delivered by hand against receipt or sent by
recognized overnight delivery service or by certified or registered mail,
postage prepaid, with return receipt requested or by facsimile transmission.
All notices shall be addressed as follows:
If to any Contributor:
Blackstone Real Estate Acquisitions L.L.C.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Senior Managing Director
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
with a copy (which shall not constitute notice) to:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Company:
Crestline Capital Corporation
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
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Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Chairman of the Board, President and
Chief Executive Officer
and
▇▇▇▇▇ ▇. ▇. ▇▇▇▇▇▇
Senior Vice President and
General Counsel
Telephone: (301) 380-_____
(301) 380-_____
with a copy (which shall not constitute notice) to:
▇▇▇▇▇ & ▇▇▇▇▇▇▇ L.L.P.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
Attention: J. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
or such other address as may be designated by a proper notice. Any notice
delivered to the party hereto to whom its is addressed shall be deemed to have
been given and received on the day it was deemed to have been given and received
on the business day next following such day. Any notice sent by facsimile
transmission shall be deemed to have been given and received on the business day
next following the transmission.
4.6 Specific Performance. The parties hereto acknowledge that the
--------------------
obligations undertaken by them hereunder are unique and that there would be no
adequate remedy at law if any party fails to perform any of its obligations
hereunder, and accordingly agree that each party, in addition to any other
remedy to which it may be entitled at law or in equity, shall be entitled to (i)
compel specific performance of the obligations, covenants and agreements of any
other party under this Agreement in accordance with the terms and conditions of
this Agreement and (ii) obtain preliminary injunctive relief to secure specific
performance and to prevent a breach or contemplated breach of this Agreement in
any court of the United States or any State thereof having jurisdiction.
4.7 Governing Law. This Agreement, the rights and obligations of the
-------------
parties hereto, and any claims or disputes relating thereto, shall be governed
by and construed in accordance with the laws of the State of Maryland but not
including the choice of law rules thereof.
4.8 Headings. Section and subsection headings contained in this
--------
Agreement are inserted for convenience of reference only, shall not be deemed to
be a part of this Agreement for any purpose, and shall not in any way define or
affect the meaning, construction or scope of any of the provisions hereof.
4.9 Pronouns. All pronouns and any variations thereof shall be
--------
deemed to refer to the masculine, feminine, neuter, singular or plural, as the
identity of the person or entity may require.
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4.10 Execution in Counterparts. To facilitate execution, this
-------------------------
Agreement may be executed in as many counterparts as may be required. It shall
not be necessary that the signature of or on behalf of each party appears on
each counterpart, but it shall be sufficient that the signature of or on behalf
of each party appears on one or more of the counterparts. All counterparts
shall collectively constitute a single agreement. It shall not be necessary in
any proof of this Agreement to produce or account for more than a number of
counterparts containing the respective signatures of or on behalf of all of the
parties.
4.11 Severability. If fulfillment of any provision of this Agreement,
------------
at the time such fulfillment shall be due, shall transcend the limit of validity
prescribed by law, then the obligation to be fulfilled shall be reduced to the
limit of such validity; and if any clause or provision contained in this
Agreement operates or would operate to invalidate this Agreement, in whole or in
part, then such clause or provision only shall be held ineffective, as though
not herein contained, and the remainder of this Agreement shall remain operative
and in full force and effect.
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IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be duly executed on its behalf as of the date first hereinabove set
forth.
COMPANY:
CRESTLINE CAPITAL CORPORATION
By:
______________________________
Name:
______________________________
Title:
______________________________
CONTRIBUTORS:
By:
______________________________
Name:
______________________________
Title: Attorney-in-Fact
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