AMERICAN REAL ESTATE PARTNERS, L.P.
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT is made as of the __ day of August,
1997 by and between AMERICAN REAL ESTATE PARTNERS, L.P., a Delaware limited
partnership (the "Partnership"), and HIGH COAST LIMITED PARTNERSHIP, a Delaware
limited partnership ("High Coast").
In consideration of the mutual promises contained herein, the parties
hereto, intending to be legally bound, do hereby agree as follows:
1. Registration Rights.
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The Partnership covenants and agrees as follows:
1.1. Definitions.
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(a) The terms "register," "registered," and "registration"
refer to a registration effected by preparing and filing a registration
statement or similar document in compliance with the Securities Act of 1933, as
amended (the "1933 Act"), and the declaration or ordering of effectiveness of
such registration statement or document.
(b) The term "Registration Rights" means rights to cause the
registration of Registrable Securities.
(c) The term "Registrable Securities" means all of those
depositary units representing limited partnership interests in the Partnership
(the "Depositary Units") and 5% cumulative pay-in-kind redeemable preferred
units representing limited partner interests in the Partnership (the "Preferred
Units"), which Holder now owns or hereinafter acquires. Registrable Securities
will cease to be such when (x) a registration statement covering such
Registrable Securities has been declared effective and they have been disposed
of pursuant to such effective registration statement; (y) they are sold,
transferred or distributed to the public pursuant to Rule 144 (or any similar
provision then in force under the 1933 Act); or (z) they are not required to be
sold pursuant a registration statement.
(d) The term "Holder" means High Coast and its Affiliates.
(e) The terms "Form S-3", "Form S-4" and "Form S-8" mean such
respective forms under the 1933 Act as in effect on the date hereof or any
successor registration forms to Form ▇-▇, ▇▇▇▇ ▇-▇
and Form S-8, respectively, under the 1933 Act subsequently adopted by the
Securities and Exchange Commission (the "Commission").
(f) "Affiliate" shall mean, with respect to any Person, any
other Person which directly or indirectly controls, or is controlled by, or is
under common control with, such Person. The term "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, and the term "controlled" shall have a
meaning correlative to the foregoing.
1.2. Request for Registration.
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(a) If the Partnership shall receive at any time a written
request from Holder that the Partnership effect the registration under the 1933
Act, then the Partnership agrees to, within five days of the receipt thereof,
subject to the limitations of this Section 1.2, use its best efforts to effect
such a registration as soon as practicable and in any event to file within 90
days of the receipt of such request a registration statement under the 1933 Act
covering all the Registrable Securities which Holder shall request in such
written request and to use its best efforts to have such registration statement
promptly become effective.
(b) If Holder submits a registration request hereunder and
intends to distribute the Registrable Securities covered by a registration
statement filed pursuant to that request by means of an underwriting, it shall
so advise the Partnership as a part of its request made pursuant to this Section
1.2. In such event, the right of Holder to include its Registrable Securities in
such registration shall be conditioned upon its participation in such
underwriting and the inclusion of its Registrable Securities in the underwriting
to the extent provided herein. Holder shall (together with the Partnership as
provided in subsection 1.4(e)) enter into an underwriting agreement with the
underwriter or underwriters selected for such underwriting by Holder and
reasonably satisfactory to the Partnership.
(c) Notwithstanding the foregoing, (i) the Partnership shall
not be obligated to effect the filing of a registration statement pursuant to
this Section 1.2 during the shorter of (x) 120 days following the filing of and
(y) 90 days following the effective date of a registration statement pertaining
to an underwritten public offering of securities for the account of the
Partnership, provided the Partnership is at all times during such period
diligently pursuing an offering pursuant to such registration, and (ii) if the
Partnership shall furnish to Holder requesting a registration statement pursuant
to Section 1.2(a) a certificate signed by American Property Investors, Inc., a
Delaware corporation and the general partner of the Partnership (the "General
Partner") stating that in the judgment of the General Partner on behalf of the
Partnership, it would not be in the best
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interests of the Partnership and its limited partners generally for such
registration statement to be filed, the Partnership shall have the right to
defer such filing for a period of not more than 210 days after receipt of the
request of Holder; provided, however, that the Partnership may not utilize the
right set forth in this subsection (d)(ii) more than once in any twelve-month
period.
1.3. Partnership Registration. If (but without any obligation to do so)
the Partnership proposes to register any of its Depositary Units or other
securities, including those held by other persons, under the 1933 Act in
connection with the public offering of such securities solely for cash (other
than a registration on Form S-8 relating solely to the sale of securities to
participants in the Partnership Nonqualified Unit Plan, or a registration on
Form S-4), the Partnership shall, at such time, promptly give Holder written
notice of such registration. Upon the written request of Holder given within 20
days after mailing of such notice by the Partnership, the Partnership shall,
subject to the provisions of Section 1.8, use its best efforts to cause such
registration statement being filed by the Partnership to cover all of the
Registrable Securities that Holder has requested to be registered.
Notwithstanding the foregoing, the Partnership shall be under no obligation to
complete any offering of its securities it proposes to make and shall incur no
liability to Holder for its failure to do so. In addition, the failure of Holder
to respond to the notice delivered by the Partnership pursuant to this Section
1.3 within 20 days after its mailing by the Partnership shall be deemed to
indicate that Holder does not desire to include any Registrable Securities in
such registration statement.
1.4. Obligations of the Partnership. Whenever required under this
Section 1 to use its best efforts to effect the registration of any Registrable
Securities, the Partnership shall, as expeditiously as possible:
(a) Prepare and file with the Commission a registration
statement with respect to such Registrable Securities and use its best
efforts to cause such registration statement to become effective, and,
upon the request of Holder, keep such registration statement effective
for up to 180 days.
(b) Prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in
connection with such registration statement, and use its best efforts
to cause each such amendment to become effective, as may be necessary
to comply with the provisions of the 1933 Act with respect to the
disposition of all Registrable Securities covered by such registration
statement.
(c) Furnish to Holder such reasonable number of copies of a
prospectus, including a preliminary prospectus, in conformity with the
requirements of the 1933 Act, and such other documents as Holder may
reasonably request in writing in
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order to facilitate the disposition of Registrable Securities
owned by it.
(d) Use its best efforts to register or qualify the securities
covered by such registration statement under such other securities or
Blue Sky laws of such jurisdictions as shall be reasonably requested by
Holder in writing, provided that the Partnership shall not be required
in connection therewith or as a condition thereto to qualify to do
business or to file a general consent to service of process in any such
states or jurisdiction.
(e) In the event of any underwritten public offering, enter
into and perform its obligations under an underwriting agreement, in
usual and customary form, with the managing underwriter of such
offering. If Holder participates in such underwriting, it shall also
enter into and perform its obligations under such an agreement,
including furnishing any opinion of counsel or entering into a lock-up
agreement reasonably requested by the managing underwriter.
(f) Notify Holder, whose Registrable Securities are covered by
such registration statement, at any time when a prospectus relating
thereto covered by such registration statement is required to be
delivered under the 1933 Act, of the happening of any event as a result
of which the prospectus included in such registration statement, as
then in effect, includes an untrue statement of a material fact or
omits to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in the light of
the circumstances then existing and promptly file such amendments and
supplements which may be required pursuant to subparagraph (b) of this
Section 1.4 on account of such event and use its best efforts to cause
each such amendment and supplement to become effective; provided,
however, once Holder is notified by the Partnership that there is an
inaccuracy in the Partnership's registration statement or prospectus,
Holder will thereafter immediately discontinue the distribution of such
registration statement or prospectus and the disposition of Registrable
Securities pursuant to such registration statement or prospectus until
such time as Holder has received a copy or copies of an amended or
supplemental registration statement or prospectus, and is so directed
by the Partnership in its notice to Holder. Holder shall deliver to the
Partnership (at the Partnership's expense) all inaccurate copies, other
than permanent file copies, then in its possession of the registration
statement or prospectus covering such Registrable Securities.
(g) Use its best efforts to furnish, at the request of Holder
requesting registration of Registrable Securities pursuant to this
Section 1, on the date that such Registrable Securities are delivered
to the underwriters for sale in connection with a registration pursuant
to this Section 1, if
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such securities are being sold through underwriters, or, if such
securities are not being sold through underwriters on the date that the
registration statement with respect to such securities becomes
effective, (i) an opinion, dated such date, of the counsel representing
the Partnership for the purposes of such registration, in form and
substance as is customarily given by Partnership counsel to the
underwriters in an underwritten public offering, addressed to the
underwriters, if any, and to Holder if Holder requested registration of
Registrable Securities and (ii) a letter dated such date, from the
independent certified public accountant of the Partnership, in form and
substance as is customarily given by independent certified public
accountants to underwriters in an underwritten public offering,
addressed to the underwriters, if any, and to Holder if Holder
requested registration of Registrable Securities.
1.5. Furnish Information. It shall be a condition precedent to the
obligations of the Partnership to take any action pursuant to this Section 1
that Holder shall furnish to the Partnership such information regarding itself,
the Registrable Securities held by it, and the intended method of disposition of
such securities as shall be required to effect the registration of its
Registrable Securities. Holder hereby agrees to notify the Partnership as
promptly as practicable of any inaccuracy or change in or addition to the
information previously furnished by Holder to the Partnership, which results in
any registration statement or prospectus containing an untrue statement of a
material fact regarding Holder or the distribution of such Registrable
Securities or omitting to state any material fact regarding Holder or the
distribution of such Registrable Securities required to be stated therein or
necessary to make the statements therein not misleading in light of the
circumstances then existing.
1.6. Expenses of Demand Registration. All expenses other than
underwriting discounts and commissions relating to Registrable Securities
incurred in connection with three (3) requests for registration, filings or
qualifications pursuant to Section 1.2, including, without limitation, all
registration, filing and qualification fees, printing and accounting fees, fees
and disbursements of counsel for the Partnership, and the reasonable fees and
disbursements of counsel selected by Holder shall be borne by the Partnership.
1.7. Expenses of Partnership Registration. The Partnership shall bear
and pay all expenses incurred in connection with any registration, filing or
qualification of Registrable Securities with respect to the registrations
pursuant to Section 1.3 for Holder, including, without limitation, all
registration, filing and qualification fees, printing and accounting fees,
underwriting discounts and commissions relating to Registrable Securities fees
and disbursements of counsel for the Partnership and the reasonable fees and
disbursements of counsel selected by Holder.
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1.8. Underwriting Requirements. In connection with any offering
involving an underwriting of securities being issued by the Partnership or in
connection with any demand registration made by Holder, the Partnership shall
not be required under Section 1.3 to include any of Holder's securities in such
underwriting unless it accepts the terms of the underwriting as agreed upon
between the Partnership and the underwriters selected by it, and then only in
such quantity, if any, as will not, in the opinion of the underwriters, have a
material adverse effect on the price of the securities being offered by the
Partnership. If the managing underwriter for the offering shall advise the
Partnership or Holder in writing that the total amount of securities, including
Registra-ble Securities, to be included in such offering exceeds the amount of
securities that can be successfully offered, then the Partnership shall be
required to include in the offering only that number of such securities,
including Registrable Securities, which the managing underwriter believes will
not have a material adverse effect on the price of the securities being offered
by the Partnership. If the foregoing provision requires the exclusion of
securities from any offering described in this Section, then such exclusion of
all securities which unitholders other than Holder seek to include in the
offering shall be effected prior to the exclusion of securities which Holder
seeks to register.
1.9. Indemnification. In the event any Registrable Securities
are included in a registration statement under this Section 1:
(a) To the extent permitted by law, the Partnership will
indemnify and hold harmless Holder, the officers, directors, partners,
agents and employees thereof, any underwriter (as defined in the ▇▇▇▇
▇▇▇) therefor and each person, if any, who controls Holder or the
underwriter within the meaning of the 1933 Act or the Securities
Exchange Act of 1934, as amended (the "1934 Act"), against any losses,
claims, damages, or liabilities (joint or several) to which they may
become subject under the 1933 Act, the 1934 Act or other federal or
state law, insofar as such losses, claims, damages, or liabilities (or
actions in respect thereof) arise out of or are based upon any of the
following statements, omissions or violations (a "Violation"): (i) any
untrue statement or alleged untrue statement of a material fact
contained in such registration statement, including any preliminary
prospectus or final prospectus contained therein or any amendments or
supplements thereto, (ii) the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, or (iii) any violation or
alleged violation by the Partnership of the 1933 Act, the 1934 Act, any
state securities law or any rule or regulation promulgated under the
1933 Act, the 1934 Act or any state securities law. The Partnership
will reimburse Holder, officer, director, partner, agent, employee,
underwriter or controlling person for any legal or other expenses
reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage,
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liability, or action. The indemnity agreement contained in this
subsection 1.9(a) shall not apply to amounts paid in settlement of any
loss, claim, damage, liability, or action if such settlement is
effected without the consent of the Partnership (which consent shall
not be unreasonably withheld), nor shall the Partnership be liable to
Holder in any such case for any such loss, claim, damage, liability, or
action (i) to the extent that it arises out of or is based upon a
Violation which occurs in reliance upon and in conformity with written
information furnished expressly for use in connection with such
registration by or on behalf of Holder, underwriter or controlling
person or (ii) in the case of a sale directly by Holder, including a
sale of such Registrable Securities through any underwriter retained by
Holder to engage in a distribution solely on behalf of Holder, such
untrue statement or alleged untrue statement or omission or alleged
omission was contained in a preliminary prospectus and corrected in a
final or amended prospectus, and Holder failed to deliver a copy of the
final or amended prospectus at or prior to the confirmation of the sale
of the Registrable Securities to the person asserting any such loss,
claim, damage or liability in any case where such delivery is required
by the ▇▇▇▇ ▇▇▇.
(b) To the extent permitted by law, Holder will indemnify and
hold harmless the Partnership, each of its partners and officers who
have signed the registration statement, each person, if any, who
controls the Partnership within the meaning of the 1933 Act, each agent
and any underwriter for the Partnership, and any other person selling
securities in such registration statement or any of its directors,
officers, partners, agents or employees or any person who controls such
person or underwriter, against any losses, claims, damages, or
liabilities (joint or several) to which the Partnership or any such
director, officer, controlling person, agent, or underwriter or
controlling person, or other person or director, officer or controlling
person may become subject, under the 1933 Act, the 1934 Act or other
federal or state law, insofar as such losses, claims, damages or
liabilities (or actions in respect thereto) arise out of or are based
upon any Violation, in each case to the extent (and only to the extent)
that such Violation occurs in reliance upon and in conformity with
written information furnished by or on behalf of Holder expressly for
use in connection with such registration; and Holder will reimburse any
legal or other expenses reasonably incurred by the Partnership or any
such director, officer, controlling person, agent or underwriter or
controlling person, or other person selling securities in such
registration or any of its officers, directors, partners, agents,
employees, or controlling persons in connection with investigating or
defending any such loss, claim, damage, liability, or action; provided,
however, that the liability of Holder hereunder shall be limited to the
amount of proceeds received by Holder
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in the offering giving rise to the Violation; and provided further that
the indemnity agreement contained in this subsection 1.9(b) shall not
apply to amounts paid in settlement of any such loss, claim, damage,
liability or action if such settlement is effected without the consent
of Holder, which consent shall not be unreasonably withheld nor, in the
case of a sale directly by the Partnership of its securities (including
a sale of such securities through any underwriter retained by the
Partnership to engage in a distribution solely on behalf of the
Partnership), shall Holder be liable to the Partnership in any case in
which such untrue statement or alleged untrue statement or omission or
alleged omission was contained in a preliminary prospectus and
corrected in a final or amended prospectus, and the Partnership failed
to deliver a copy of the final or amended prospectus at or prior to the
confirmation of the sale of the securities to the person asserting any
such loss, claim, damage or liability in any case where such delivery
is required by the 1933 Act.
(c) Promptly after receipt by an indemnified party under this
Section 1.9 of notice of the commencement of any action (including any
governmental action), such indemnified party will, if a claim in
respect thereof is to be made against any indemnifying party under this
Section 1.9, deliver to the indemnifying party a written notice of the
commencement thereof and the indemnifying party shall have the right to
participate in, and, to the extent the indemnifying party so desires,
jointly with any other indemnifying party similarly noticed, to assume
and control the defense thereof with counsel mutually satisfactory to
the parties; provided, however, that, if representation of such
indemnified party by counsel retained by the indemnifying party would
be inappropriate due to actual or potential differing interests between
such indemnified party and any other party represented in such
proceeding, then (i) if such indemnified party is Holder or any
Affiliate of Holder, Holder and any Affiliate of Holder shall have the
right to retain one counsel to represent Holder and any Affiliates of
Holder, with fees and expenses to be paid by the indemnifying party and
(ii) all other indemnified parties shall have the right to select one
counsel to represent such indemnified parties, with fees and expenses
to be paid by the indemnifying party. The failure to deliver written
notice to the indemnifying party within a reasonable time of the
commencement of any such action, if prejudicial to its ability to
defend such action, shall relieve such indemnifying party of any
liability to the indemnified party under this Section 1.9 to the extent
of such prejudice, but the omission so to deliver written notice to the
indemnifying party will not relieve it of any liability that it may
have to any indemnified party otherwise than under this Section 1.9.
(d) The obligations of the Partnership and Holder under this
Section 1.9 shall survive the completion of any offering
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of Registrable Securities in a registration statement whether under
this Section 1 or otherwise.
1.10. Reports Under Securities Exchange Act of 1934. With a view to
making available to Holder the benefits of Rule 144 promulgated under the 1933
Act and any other rule or regulation of the Commission that may at any time
permit Holder to sell securities of the Partnership to the public without
registration, and with a view to making it possible for Holder to register the
Registrable Securities pursuant to a registration on Form S-3, the Partnership
agrees to:
(a) make and keep public information available, as those terms
are understood and defined in Rule 144, at all times;
(b) take such action, including the voluntary registration of
its securities under Section 12 of the 1934 Act, as is necessary to
enable Holder to utilize Form S-3 for the sale of its Registrable
Securities, such action to be taken as soon as practicable (but not
later than 90 days) after the end of the fiscal year in which the first
registration statement filed by the Partnership for the offering of its
securities to the general public is declared effective;
(c) file with the Commission in a timely manner all reports
and other documents required of the Partnership under the 1933 Act and
the 1934 Act; and
(d) furnish to Holder so long as it owns any Registrable
Securities, forthwith upon request (i) a written statement by the
Partnership that it has complied with the reporting requirements of
Rule 144, the 1933 Act and the 1934 Act, or that it qualifies as a
registrant whose securities may be resold pursuant to Form S-3 (at any
time after it so qualifies), (ii) a copy of the most recent annual or
quarterly report of the Partnership and such other reports and
documents so filed by the Partnership, and (iii) such other information
as may be reasonably requested in availing Holder of any rule or
regulation of the Commission which permits the selling of any such
securities without registration or pursuant to such form.
2. Miscellaneous.
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2.1. Parties in Interest. All covenants, agreements, representations,
warranties and undertakings in this Agreement made by and on behalf of any of
the parties hereto shall bind and inure to the benefit of the respective
successors and assigns of the parties hereto whether so expressed or not.
2.2. Amendments and Waivers. Except as set forth in this Agreement,
changes in or additions to this Agreement may be made or compliance with any
term, covenant, agreement, condition or
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provision set forth herein may be omitted or waived (either generally or in a
particular instance and either retroactively or prospectively), upon the written
consent of the Partnership and Holder.
2.3. Governing Law. This Agreement shall be deemed a contract made
under the laws of the State of New York and, together with the rights of
obligations of the parties hereunder, shall be construed under and governed by
the laws of the State of New York.
2.4. Notices. All notices, requests, demands and other communications
provided for hereunder shall be made in writing (including telegraphic
communication) and mailed, telecopied, telegraphed or delivered:
If to Holder:
High Coast Limited Partnership
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
with a copy to:
▇▇▇▇ ▇▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇ ▇▇▇▇▇▇ Butowsky ▇▇▇▇▇▇▇
Shalov & ▇▇▇▇
▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
If to the Partnership to:
American Real Estate Partners, L.P.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
with a copy to:
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇ & ▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
or at such other address as shall be designated by any party in a written notice
to the other parties complying as to delivery with the terms of this Section
2.4.
All such notices, requests, demands and other communications shall,
when mailed (registered mail, return receipt requested, postage prepaid),
personally delivered, or telegraphed, be effective four days after deposit in
the mails, when personally delivered, or when delivered to the telegraph
Partnership, respectively, addressed as aforesaid, unless otherwise provided
herein and, when telecopied, shall be effective upon actual receipt.
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2.5. Counterparts. This Agreement may be executed in any number of
counterparts, all of which together shall constitute one and the same
instrument.
2.6. Effect of Headings. The section and paragraph headings herein are
for convenience only and shall not affect the construction hereof.
2.7. Entire Agreement. This Agreement constitutes the entire agreement
between the Partnership and Holder with respect to the subject matter hereof.
There are no representations, warranties, covenants or undertakings with respect
to the subject matter hereof other than those expressly set forth herein. This
Agreement supersedes all prior agreements between the parties with respect to
the Registrable Securities described herein and the subject matter hereof.
2.8. Severability. The invalidity or unenforceability of any provision
hereof shall in no way affect the validity or enforceability of any other
provision.
IN WITNESS WHEREOF, this Agreement has been executed as of the date
first above written, by the parties hereto.
AMERICAN REAL ESTATE PARTNERS, L.P.
By: American Property Investors, Inc.,
General Partner
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Name:
Title:
HIGH COAST LIMITED PARTNERSHIP
By: American Property Investors, Inc.,
General Partner
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Name:
Title:
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