REGISTRATION RIGHTS AGREEMENT
Dated as of February 23, 1998
among
WELLSFORD REAL PROPERTIES, INC.
and
FRANKLIN MUTUAL ADVISERS, INC.
and
ANGELO, GORDON & CO., L.P.
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT, dated as of February __, 1998,
among the Company (as hereinafter defined) and Franklin Mutual Advisers,
Inc., a Delaware corporation, and Angelo, Gordon & Co., L.P., a Delaware
limited partnership.
This Registration Rights Agreement is made pursuant to the Merger
Agreement (as hereinafter defined). The execution of this Registration
Rights Agreement is a condition to the closing of the transactions
contemplated by the Merger Agreement.
The parties hereto hereby agree as follows:
1. Definitions. Capitalized terms used herein without definition
shall have the meanings given such terms in the Merger Agreement. As used
in this Agreement, the following terms shall have the following meanings:
Affiliate: of any specified person shall mean any other person
directly or indirectly controlling or controlled by or under direct or
indirect common control with such specified person. For the purposes of
this definition, "control," when used with respect to any person, means the
power to direct the management and policies of such person, directly or
indirectly, whether through the ownership of voting securities, by contract
or otherwise; and the terms of "affiliated," "controlling" and "controlled"
have meanings correlative to the foregoing.
Agreement: This Registration Rights Agreement, as the same may
be amended, supplemented or modified from time to time in accordance with
the terms hereof.
Common Shares: The Company's shares of Common Stock, par value
$.01 per share.
Company: Wellsford Real Properties, Inc., a Maryland
corporation, and any successor entity thereto.
Effectiveness Date: The 120th day following the Closing Date
under the Merger Agreement.
Effectiveness Period: As defined in Section 2(a) hereof.
Exchange Act: The Securities Exchange Act of 1934, as amended,
and the rules and regulations of the SEC promulgated pursuant thereto.
Filing Date: As soon as practicable following the Closing Date
under the Merger Agreement.
Indemnified Party: As defined in Section 7(c) hereof.
Indemnifying Party: As defined in Section 7(c) hereof.
Losses: As defined in Section 7(a) hereof.
Merger: The merger of Merger Subsidiary with and into VPT
pursuant to the terms of the Merger Agreement.
Merger Agreement: The Agreement and Plan of Merger, dated as of
September 18, 1997, among VPT, the Company and Merger Subsidiary pursuant
to which at the Effective Time the Merger will be consummated.
Merger Subsidiary: Wellsford Capital Corporation, a Maryland
corporation and wholly owned subsidiary of the Company.
Offering Notice: As defined in Section 4(a) hereof.
Piggyback Offering Rights: The rights of the Shareholders to
have their Registrable Securities offered and sold to the underwriters
concurrently with an Underwritten Company Offering by the Company with
respect to the sale of Securities by the Company or by any other
securityholders of the Company in accordance with the provisions of Section
4 hereof.
Proceeding: An action, claim, suit or proceeding (including,
without limitation, an investigation or partial proceeding, such as a
deposition), whether commenced or threatened.
Prospectus: The prospectus included in the Registration
Statement (including, without limitation, a prospectus that includes any
information previously omitted from a prospectus filed as part of an
effective registration statement in reliance upon Rule 430A promulgated
pursuant to 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 the 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 Common Shares acquired by the
Shareholders as their pro rata portion of the Merger Consideration in
connection with the Merger, upon original issuance thereof, and at all
times subsequent thereto, until, in the case of any such Common Shares, (i)
it has been registered pursuant to the Securities Act and disposed of in
accordance with the Registration Statement covering it, (ii) it is sold by
the holder thereof pursuant to Rule 144 (or any similar provisions then in
effect) or (iii) it ceases to be outstanding.
Registration Statement: The registration statement, contemplated
by Section 2(a) hereof, including the Prospectus, amendments and
supplements to such registration statement or Prospectus, including pre-
and post-effective amendments, all exhibits thereto, and all material
incorporated by reference or deemed to be incorporated by reference in such
registration statement.
Rule 144: Rule 144 promulgated by the SEC pursuant to the
Securities Act, as such Rule may be amended from time to time, or any
similar rule or regulation hereafter adopted by the SEC having
substantially the same effect as such Rule.
Rule 415: Rule 415 promulgated by the SEC pursuant to the
Securities Act, as such Rule may be amended from time to time, or any
similar rule or regulation hereafter adopted by the SEC having
substantially the same effect as such Rule.
SEC: The Securities and Exchange Commission.
Securities Act: The Securities Act of 1933, as amended, and the
rules and regulations promulgated by the SEC thereunder.
Shareholders: Franklin Mutual Advisers, Inc., a Delaware
corporation, on behalf of certain of its advisory clients set forth on
Exhibit A hereto, and Angelo, Gordon & Co., L.P., a Delaware limited
partnership, and certain of its affiliates set forth on Exhibit B hereto.
Special Counsel: Any special counsel to the holders of
Registrable Securities of whom the Company has been notified in writing.
UCO Registration Statement: As defined in Section 7(a) hereof.
Underwriter's Representative: As defined in Section 4(a)
hereof.
Underwritten Company Offering: As defined in Section 3(a)(iii).
Underwritten registration or underwritten offering: A
registration in connection with which securities of the Company are sold to
an underwriter for reoffering to the public pursuant to an effective
registration statement.
VPT: Value Property Trust, a Maryland real estate investment
trust.
2. Shelf Registration.
(a) The Company shall prepare and file a "shelf" registration
statement with respect to all Registrable Securities then issued on any
appropriate form for an offering to be made on a continuous basis pursuant
to Rule 415 on or prior to the Filing Date and shall use its reasonable
best efforts to cause such Registration Statement to be declared effective
by the SEC on or prior to the Effectiveness Date and take all other
reasonable actions necessary to keep such Registration Statement
continuously effective under the Securities Act until the date which is two
years after the Closing Date under the Merger Agreement, or in the event
that a holder or holders of not less than such number of Registrable
Securities equal to 7.9% of all of the Registrable Securities originally
subject to this Agreement so request in writing not less than 30 days prior
to the termination of such two-year period, until the date which is five
years after such Closing Date, or such shorter period ending when all
Registrable Securities covered by such Registration Statement have been
sold (the "Effectiveness Period"). The holders of Registrable Securities
may withdraw all or part of such securities from the Registration Statement
prior to or after the effective date of the Registration Statement.
(b) If the holders of a majority of the Registrable Securities
so elect, an offering of Registrable Securities pursuant to the
Registration Statement may be effected in the form of an underwritten
offering. In such event, and if the managing underwriters advise the
Company and the holders of Registrable Securities proposed to be sold in
such offering in writing that in their opinion the amount of Registrable
Securities proposed to be sold in such offering exceeds the amount of
Registrable Securities which can be sold in such offering, there shall be
included in such underwritten offering the amount of such Registrable
Securities which in the opinion of such underwriters can be sold, and such
amount shall be allocated pro rata among the holders of such Registrable
Securities on the basis of the number of shares of Registrable Securities
requested to be included by such holders.
(c) If any of the Registrable Securities are to be sold in an
underwritten offering, the investment banker or investment bankers and
manager or managers that will administer the offering will be selected by
the holders of a majority of the Registrable Securities included in such
offering. No person may participate in any underwritten offering hereunder
unless such person (i) agrees to sell such person's Registrable Securities
on the basis provided in any underwriting agreements approved by the
persons entitled hereunder to approve such arrangements and (ii) completes
and executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents required under the terms of
such underwriting arrangements.
3. Hold-Back Agreements
(a) Restrictions on Public Sale by Holders of Registrable
Securities. Subject to paragraph (b) of this Section 3, the registration
rights of the Shareholders pursuant to Section 2 of this Agreement and the
ability to offer and sell Registrable Securities pursuant to the
Registration Statement are subject to the following conditions and
limitations, and each Shareholder agrees with the Company that:
(i) If the Company determines in its good faith judgment
that the filing of the Registration Statement under Section 2 hereof
or the use of any Prospectus would require the disclosure of
information which the Company has a bona fide business purpose for
preserving as confidential or the disclosure of which would impede the
Company's ability to consummate a significant transaction, upon
written notice of such determination by the Company, the rights of the
Shareholders to offer, sell or distribute any Registrable Securities
pursuant to the Registration Statement or to require the Company to
take action with respect to the registration or sale of any
Registrable Securities pursuant to the Registration Statement
(including any action contemplated by Section 5 hereof) will for up
to 90 days in any 12-month period be suspended until the date upon
which the Company notifies the holders of Registrable Securities in
writing that suspension of such rights for the grounds set forth in
this Section 3(a)(i) is no longer necessary.
(ii) If all reports required to be filed by the Company
pursuant to the Exchange Act have not been filed by the required date
without regard to any extension, or if consummation of any business
combination by the Company has occurred or is probable for purposes of
Rule 3-05 or Article 11 of Regulation S-X under the Securities Act,
with respect to a business combination upon not less than 10 days
written notice thereof and otherwise reasonable notice thereof by the
Company to the Shareholders, the rights of the Shareholders to offer,
sell or distribute any Registrable Securities pursuant to the
Registration Statement or to require the Company to take action with
respect to the registration or sale of any Registrable Securities
pursuant to the Registration Statement (including any action
contemplated by Section 4 hereof) will for up to 90 days in any 12-
month period be suspended until the date on which the Company has
filed such reports or obtained the financial information required by
Rule 3-05 or Article XI of Regulation S-X to be included in the
Registration Statement; provided, however, that in the event that such
rights of the Shareholders are so suspended hereunder as a result of
the Company's failure to so file all reports required to be filed
pursuant to the Exchange Act, then such failure to so file shall be
deemed a breach by the Company of this Agreement entitling the
Shareholders to seek to recover their damages, if any, resulting from
such suspension.
(iii) Subject to Section 4 hereof, in the case of the
registration of any underwritten primary equity offering initiated by
the Company (other than any registration by the Company on Form S-4 or
Form S-8, or a successor or substantially similar form, of (A) an
employee share option, share purchase, share incentive or compensation
plan or of securities issued or issuable pursuant to any such plan, or
(B) a dividend reinvestment plan) (an "Underwritten Company
Offering"), each Shareholder agrees, if requested in writing by the
managing underwriter or underwriters administering such offering, not
to effect any offer, sale or distribution of Registrable Securities
(or any option or right to acquire Registrable Securities) during the
period commencing on the 20th day prior to the effective date of the
registration statement covering such underwritten primary equity
offering and ending on the date specified by such managing underwriter
in such written request to such Shareholder but in any event not later
than the 90th day following such effective date.
(iv) In the event that the Company plans to repurchase or
bid for securities of the Company in the open market, on a private
solicited basis or otherwise, and the Board of Directors of the
Company determines, in its good faith judgment and based upon the
advice of counsel to the Company, that any such repurchase or bid may
not, under Regulation M under the Exchange Act, or any successor or
similar rule ("Regulation M"), be commenced or consummated due to the
existence or the possible commencement of a "distribution" (within the
meaning of Regulation M) as a result of any offers or sales by
Shareholders of any Common Shares under the Registration Statement,
the Company shall be entitled, for a period not to exceed 90 days in
any 12-month period, to request that Shareholders suspend or postpone
such distribution pursuant to the Registration Statement (a
"Regulation M Election"). The Company shall, as promptly as
practicable, give such Shareholder or Shareholders written notice of
such Regulation M Election. The Shareholders agree to comply with any
such request in a Regulation M Election by the Company. As promptly
as practicable following the determination by the Board of Directors
that the Shareholder or Shareholders may commence or recommence their
distribution pursuant to the Registration Statement without causing
the Company to be in violation of Regulation M, the Company shall give
such Shareholder or Shareholders written notice of such determination
(but in any event no later than the 90th day of the continuance of any
Regulation M Election occurring during the most recent 12 months). In
addition, the Company shall, not less than five days prior to the
commencement of any such repurchase or bid for securities, give each
Shareholder written notice thereof.
(b) Limitation on Blackouts. Notwithstanding the provisions of
paragraph (a) above or the last paragraph of Section 5, the aggregate
number of days (whether or not consecutive) during which the Company may
delay the effectiveness of the Registration Statement or prevent offerings,
sales or distributions by the Shareholders pursuant to paragraph (a) or the
last paragraph of Section 5 shall in no event exceed 120 days during any
12-month period. Notwithstanding the number of days during which the
Company may delay such effectiveness pursuant to paragraph (a)(i), (ii),
(iii) and (iv) above, no such delay shall exceed such number of days that
the Company determines in good faith to be reasonably necessary. Nothing
in this Section 3 shall be deemed to grant the Company the right to delay
its obligation to prepare and file a "shelf" registration statement on or
prior to the Filing Date pursuant to Section 2.
4. Piggyback Offering Rights.
(a) If, at any time during the Effectiveness Period, the Company
proposes to commence an Underwritten Company Offering, the Company shall,
not later than 20 days prior to the date of such proposed offering, give
written notice (an "Offering Notice") of such proposed offering to the
Shareholders, which notice shall describe in detail the proposed plan of
distribution. During the Effectiveness Period, Shareholders may elect, by
written notice to the Company (which notice shall specify the aggregate
number of Registrable Securities proposed to be offered and sold by such
Purchaser to the underwriters concurrently with the Underwritten Company
Offering) given within 15 days after receipt of the Offering Notice from
the Company, to have any and all of the Registrable Securities owned by it
included as selling shareholders with the shares to be sold by the Company
to the underwriters in connection with the Underwritten Company Offering,
and the Company shall use its best efforts to cause the underwriters to so
purchase such Registrable Securities. If the representative of the
managing underwriters (the "Underwriter's Representative") should
reasonably determine that the inclusion of such Registrable Securities
would adversely affect the offering as contemplated by the Company, and
based on such determination recommends inclusion in such offering of fewer
or none of the Registrable Securities proposed to be sold by all
Shareholders, then (x) the number of Registrable Securities of the
Shareholders included in such offering shall be reduced pro-rata among such
Shareholders (based upon the number of Registrable Securities requested to
be included in the offering), if the Company after consultation with the
Underwriter's Representative recommends the inclusion of fewer Registrable
Securities, or (y) none of the Registrable Securities of the Shareholders
shall be included in such offering, if the Company after consultation with
the Underwriter's Representative recommends the inclusion of none of such
Registrable Securities; provided, however, that if Securities are being
offered for the account of other persons or entities as well as the
Company, such reduction shall not represent a greater fraction of the
number of Registrable Securities intended to be offered by the Shareholders
than the fraction of similar reductions imposed on such other persons or
entities (other than the Company).
(b) Each Shareholder so proposing to sell Registrable Securities
to the underwriters in an Underwritten Company Offering pursuant to this
Section 4 shall execute and deliver to an underwriting agreement and such
other documents and instruments in form and substance satisfactory to the
Underwriter's Representative. In addition, each Shareholder selling
Registrable Securities to such underwriters shall be liable for any and all
underwriting discounts and commissions with respect to its Registrable
Securities included in such offering.
(c) The rights of the Shareholders under this Section 4 are
solely piggyback in nature, and nothing in this Section 4 shall prevent
the Company from reversing a decision to consummate an Underwritten Company
Offering.
5. Registration Procedures. In connection with the Company's
registration obligations hereunder, the Company shall:
(a) Prepare and file with the SEC a Registration Statement on
the appropriate form available for the sale of the Registrable Securities
by the holders thereof in accordance with the method or methods of
distribution thereof as specified by the holders thereof, and cause the
Registration Statement to become effective and remain effective as provided
herein; provided, however, that no less than three days prior to the filing
of the Registration Statement or any related Prospectus or any amendment or
supplement thereto (including any document that would be incorporated or
deemed to be incorporated therein by reference), the Company shall furnish
to the holders of the Registrable Securities, their Special Counsel and the
managing underwriters, if any, copies of all such documents proposed to be
filed, which documents (other than those incorporated or deemed to be
incorporated by reference) will be subject to the review of such holders,
their Special Counsel and such underwriters, if any; the Company shall not
file the Registration Statement or any such Prospectus or any amendments or
supplements thereto to which the holders of a majority of the Registrable
Securities, their Special Counsel or the managing underwriters, if any,
shall reasonably object, in writing, on a timely basis, and the Company
shall use its best efforts to satisfy any such objection and thereafter
make such filing.
(b) Prepare and file with the SEC such amendments, including
post-effective amendments, to the Registration Statement as may be
necessary to keep the Registration Statement continuously effective for the
applicable time period; 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 and
the Exchange Act with respect to the disposition of all securities covered
by the Registration Statement during such period in accordance with the
intended methods of disposition by the sellers thereof set forth in the
Registration Statement as so amended or in such Prospectus as so
supplemented;
(c) Notify the holders of Registrable Securities to be sold,
their Special Counsel and the managing underwriters, if any, promptly (and
in the case of (i) (A) below, in no event less than three days prior to
such filing) and (if requested by any such person) confirm such notice in
writing no later than one Business Day following the day (i) (A) when a
Prospectus or any Prospectus supplement or post-effective amendment to the
Registration Statement is proposed to be filed and, (B) with respect to the
Registration Statement or any post-effective amendment, when the same has
become effective, (ii) of the issuance by the SEC of any stop order
suspending the effectiveness of the Registration Statement covering any or
all of the Registrable Securities or the initiation of any proceedings for
that purpose, (iii) 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 within the United States, or the initiation or threatening of
any proceeding for such purpose and (iv) upon the occurrence of any event
which makes any statement in the Registration Statement or Prospectus
untrue in any material respect;
(d) If requested by the managing underwriters, if any, or the
holders of a majority of the Registrable Securities being sold in
connection with an underwritten offering, (i) promptly incorporate in a
Prospectus supplement or post-effective amendment to the Registration
Statement such information as the managing underwriters, if any, and such
holders reasonably agree should be included therein, 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
shall not be required to take any action pursuant to this Section 5(d)
that would, in the opinion of counsel for the Company, violate applicable
law;
(e) Furnish to each holder of Registrable Securities, their
Special Counsel, each managing underwriter, if any, and each exchange on
which the Common Shares are traded, without charge, such number of
conformed copies as such persons or entities may reasonably request, of
each Registration Statement and each amendment or supplement thereto,
including financial statements and schedules, all documents incorporated or
deemed to be incorporated therein by reference, and all exhibits to the
extent requested by such person (including those previously furnished or
incorporated by reference) as soon as practicable after the filing of such
documents with the SEC;
(f) Deliver to each holder of Registrable Securities, their
Special Counsel, and the underwriters, if any, without charge, as many
copies of the Prospectus or Prospectuses (including each form of
prospectus) and each amendment or supplement thereto as such persons
reasonably request; and the Company hereby consents to the use of such
Prospectus and each amendment or supplement thereto by each of the selling
holders of Registrable Securities and the underwriters, if any, in con-
nection with the offering and sale of the Registrable Securities covered by
such Prospectus and any amendment or supplement thereto;
(g) Prior to any public offering of Registrable Securities, use
its best efforts to register or qualify or cooperate with the holders of
Registrable Securities to be sold, the underwriters, if any, and their
respective 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 all
jurisdictions within the United States; keep each such registration or
qualification (or exemption therefrom) effective during the Effectiveness
Period and do any and all other acts or things necessary or advisable to
enable the disposition in such jurisdictions of the Registrable Securities
covered by a Registration Statement; provided, however, that the Company
shall not be required to qualify generally to do business in any
jurisdiction where it is not then so qualified or to take any action that
would subject it to general service of process in any such jurisdiction
where it is not then so subject or subject the Company to any tax in any
such jurisdiction where it is not then so subject;
(h) Cooperate with the holders of Registrable Securities and the
managing underwriters, if any, to facilitate the timely preparation and
delivery of certificates representing Registrable Securities to be sold and
to enable such Registrable Securities to be in such denominations and
registered in such names as the managing underwriters, if any, or holders
may request at least two Business Days prior to any sale of Registrable
Securities;
(i) Promptly file all documents required to be filed under
Section s 13(a), 13(c), 14 or 15(d) of the Exchange Act during any period
when the Prospectus is required to be delivered under the Securities Act;
(j) If the Prospectus contains 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, in light of the circumstances
under which they were made, not misleading, prepare a supplement or
amendment, including a post-effective amendment, to the Registration
Statement or a supplement to the related Prospectus or any document
incorporated or deemed to be incorporated therein by reference, and file
any other required document so that, as thereafter delivered, 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;
(k) Cause all Registrable Securities relating to such
Registration Statement to be listed on each securities exchange, if any, on
which similar securities issued by the Company are then listed and make all
other necessary or appropriate filings with each such securities exchange;
(l) Enter into such agreements (including an underwriting
agreement in form, scope and substance as is customary in underwritten
offerings) and take all such other actions in connection therewith
(including those reasonably requested by the managing underwriters, if any,
or the holders of a majority of the Registrable Securities being sold) in
order to expedite or facilitate the disposition of such Registrable
Securities, and in such connection in the event of an underwritten offer-
ing, whether or not an underwriting agreement is entered into, (i) make
such representations and warranties to the holders of such Registrable
Securities and the underwriters, if any, with respect to the business of
the Company, its subsidiaries, and the Registration Statement, Prospectus
and documents, if any, incorporated or deemed to be incorporated by
reference therein, in each case, in form, substance and scope as are
customarily made by issuers to underwriters in underwritten offerings, and
confirm the same if and when requested; (ii) obtain opinions of counsel to
the Company and updates thereof (which counsel and opinions, in form, scope
and substance, shall be reasonably satisfactory to the managing
underwriters, if any, and Special Counsel to the holders of the Registrable
Securities being sold), addressed to each selling holder of Registrable
Securities and each of the underwriters, if any, covering the matters
customarily covered in opinions requested in underwritten offerings and
such other matters as may be reasonably requested by such Special Counsel
and underwriters; (iii) obtain "cold comfort" letters and updates thereof
from the independent certified public accountants of the Company (and, if
necessary, any other independent certified public accountants of any sub-
sidiary of the Company or of any business acquired by the Company for which
financial statements and financial data is, or is required to be, included
in the Registration Statement), addressed to each selling holder of
Registrable Securities and each of the underwriters, if any, such letters
to be in customary form and covering matters of the type customarily
covered in "cold comfort" letters in connection with underwritten
offerings; (iv) if an underwriting agreement is entered into, the same
shall contain indemnification provisions and procedures no less favorable
to the selling holders and the underwriters, if any, than those set forth
in Section 6 hereof (or such other provisions and procedures acceptable to
holders of a majority of Registrable Securities participating in such
underwritten offering and the managing underwriters, if any); and (v)
deliver such documents and certificates as may be reasonably requested by
the holders of a majority of the Registrable Securities being sold, their
Special Counsel and the managing underwriters, if any, to evidence the
continued validity of the representations and warranties made pursuant to
clause (i) above and to evidence compliance with any customary conditions
contained in the underwriting agreement or other agreement entered into by
the Company;
(m) After filing any document incorporated by reference into a
Registration Statement deliver a copy of such document to each holder of
Registrable Securities upon request during the period the Company is
obligated to maintain an effective Registration Statement hereunder;
(n) Make reasonably available to a representative of the holders
of Registrable Securities being sold, any underwriter participating in any
such disposition of Registrable Securities, if any, and any attorney,
accountant, auditor or investment advisor retained by such selling holders
or underwriters that information which such parties would customarily
require to satisfy their due diligence obligations with respect to the
offering and sale of the Registrable Securities; provided, however, that
any information that is designated by the Company in writing as
confidential at the time of delivery of such information shall be kept
confidential by such persons (and each such holder or underwriter, as the
case may be, shall be liable for any such person's failure to so keep such
information confidential), unless (i) disclosure of such information is
required by court or administrative order or is necessary to respond to
inquiries of regulatory authorities or self-regulatory organizations, (ii)
disclosure of such information, in the opinion of counsel to such person,
is required by law or pursuant to this Agreement, (iii) such information
becomes generally available to the public other than as a result of a
disclosure or failure to safeguard by such person, or (iv) such information
becomes available to such person from a source other than the Company and
such source is not bound by a confidentiality agreement; and
(o) Comply with all applicable rules and regulations of the SEC
and make generally available to its securityholders earning statements
satisfying the provisions of Section 11(a) of the Securities Act and Rule
158 thereunder (or any similar rule promulgated under the Securities Act),
no later than 45 days after the end of any 12-month period (or 90 days
after the end of any 12-month period if such period is a fiscal year) (i)
commencing at the end of any fiscal quarter in which Registrable Securities
are sold to underwriters in a firm commitment or best efforts underwritten
offering and (ii) if not sold to underwriters in such an offering,
commencing on the first day of the first fiscal quarter of the Company
after the effective date of the Registration Statement, which statement
shall cover said 12-month period, or shorter periods as is consistent with
the requirements of Rule 158.
The Company may require each seller of Registrable Securities to
furnish to the Company such information regarding the distribution of such
Registrable Securities as is required by law to be disclosed in the
Registration Statement 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 of Registrable Securities agrees that such holder
will not offer or sell any Registrable Securities or exercise such holder's
rights hereunder in violation of any foreign or domestic, federal, state or
local law, order, rule or ordinance, other than such violations as a result
of any breach by the Company with any of its obligations hereunder.
Each holder of Registrable Securities agrees by acquisition of
such Registrable Securities that, upon receipt of any notice from the
Company of the happening of any event of the kind described in Section
5(c)(ii), 5(c)(iii) or 5(c)(iv) hereof or any other event as a result of
which the Company has determined that the holders of Registrable Securities
should discontinue disposition thereof, such holder will forthwith discon-
tinue disposition of such Registrable Securities pursuant to the applicable
Prospectus until such holder is advised in writing by the Company that the
use of the applicable Prospectus may be resumed, and, in either case, has
received copies of any additional or supplemental filings that are incorpo-
rated or deemed to be incorporated by reference in such Prospectus or
Registration Statement.
6. Registration Expenses. All fees and expenses incident to the
performance of or compliance with this Agreement by the Company shall be
borne by the Company whether or not the Registration Statement is filed or
becomes effective and whether or not any Registrable Securities are sold
pursuant to the Registration Statement. The fees and expenses referred to
in the foregoing sentence shall include, without limitation, (i) all
registration and filing fees (including, without limitation, fees and
expenses (A) with respect to filings required to be made with the SEC, the
National Association of Securities Dealers, Inc. and any securities
exchange and (B) in compliance with state securities or Blue Sky laws
(including, without limitation, reasonable and customary fees and
disbursements of counsel for the underwriters or holders in connection with
Blue Sky qualifications of the Registrable Securities and determination of
the eligibility of the Registrable Securities for investment under the laws
of such jurisdictions in the United States of America as the managing
underwriters, if any, or holders of a majority of Registrable Securities
may designate)), (ii) printing expenses (including, without limitation,
expenses of printing certificates for Registrable Securities and of
printing a reasonable number of prospectuses if the printing of prospec-
tuses is requested by the managing underwriters, if any, of the Registrable
Securities included in the Registration Statement), (iii) fees and
disbursements of counsel for the Company, (iv) fees and disbursements of
all independent certified public accountants referred to in Section
5(l)(iii) hereof (including, without limitation, the expenses of any
special audit and "cold comfort" letters required by or incident to such
performance), (v) fees and expenses of all other persons retained by the
Company and (vi) fees and disbursements of counsel to all of the holders of
Registrable Securities in an amount not to exceed $10,000 in the aggregate.
In addition, the Company shall pay the fees and expenses incurred in
connection with the listing of the Registrable Securities on the American
Stock Exchange. Except as provided above, the holders of Registrable
Securities shall pay all of their own fees and expenses in connection with
the transaction referred to in or contemplated by this Agreement, including
without limitation, all legal and advisory fees and expenses and all
discounts, commissions, fees and expenses of underwriters (including
underwriters' counsel) involved in the offer and sale of Registrable
Securities whether in an Underwritten Company Offering or otherwise.
7. Indemnification
(a) Indemnification by the Company. The Company shall,
notwithstanding termination of this Agreement and without limitation as to
time, indemnify and hold harmless each holder of Registrable Securities,
the officers, directors, agents, investment advisors and employees of each
of them, each person who controls any such 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 each such controlling
person, to the fullest extent lawful, from and against any and all losses,
claims, damages, liabilities, costs (including, without limitation, costs
of preparation and reasonable attorneys' fees) and expenses (collectively,
"Losses"), arising out of or based upon any untrue or alleged untrue
statement of a material fact contained in the Registration Statement, any
Prospectus, any form of Prospectus or in any preliminary Prospectus, or the
registration statement in connection with an Underwritten Company Offering
(the "UCO Registration Statement"), any prospectus included therein, any
form of such prospectus or in any such preliminary prospectus, or arising
out of or based upon any omission or alleged omission of a material fact
required to be stated therein or necessary to make the statements therein
(in the case of any such prospectus or form of prospectus or supplement
thereto, in light of the circumstances under which they were made) not mis-
leading, except to the extent, that such are based upon information
regarding such holder furnished in writing to the Company by or on behalf
of such holder or any underwriter expressly for use therein, which
information was reasonably relied on by the Company in the preparation
thereof or upon information reviewed and expressly approved in writing by
such holder or underwriter expressly for use therein.
(b) Indemnification by Holder of Registrable Securities. In
connection with the Registration Statement and each UCO Registration
Statement, each holder of Registrable Securities shall furnish to the
Company in writing such information as the Company reasonably requests for
use in connection with the Registration Statement or any Prospectus and the
UCO Registration Statement and any prospectus included therein and agrees,
severally and not jointly, to indemnify and hold harmless the Company, its
directors, officers, agents and employees, each person who controls the
Company (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 each such controlling person, to the fullest extent lawful, from and
against all Losses arising out of or based upon any untrue or alleged
untrue statement of a material fact contained in the Registration
Statement, any Prospectus, any form of Prospectus or any preliminary
Prospectus, or any UCO Registration Statement, any prospectus included
therein, any form of such prospectus or any such preliminary prospectus, or
arising out of or based upon any omission or alleged omission of a material
fact required to be stated therein or necessary to make the statements
therein not misleading to the extent that such untrue or alleged untrue
statement or omission or alleged omission is contained in any information
so furnished in writing to the Company by or on behalf of such holder
included in the Registration Statement, such Prospectus, any form of
Prospectus or any preliminary Prospectus, or any UCO Registration
Statement, any prospectus included therein, any form of such prospectus or
any such preliminary prospectus, or to the extent that such information
relates to such holder or such holder's proposed method of distribution of
Registrable Securities and was reviewed and expressly approved in writing
by such holder expressly for use in the Registration Statement, such
Prospectus, such form of Prospectus or such preliminary Prospectus, or any
UCO Registration Statement, any prospectus included therein, any form of
such prospectus or any such preliminary prospectus; provided, however, that
such holder shall not be obligated to provide such indemnification to the
extent liability resulted from the Company's failure to amend or take
action promptly to correct or supplement the Registration Statement, such
Prospectus, any form of Prospectus or any preliminary Prospectus, or any
UCO Registration Statement, any prospectus included therein, any form of
such prospectus or any such preliminary prospectus, after receiving written
notice from such holder of such untrue or alleged untrue statement or
omission or alleged omission. In no event shall the liability of any
selling holder of Registrable Securities hereunder be greater in amount
than the dollar amount of the proceeds received by such holder upon the
sale of the Registrable Securities giving rise to such indemnification
obligation.
(c) Conduct of Indemnification Proceedings. If any Proceeding
shall be brought or asserted against any person entitled to indemnity
hereunder (an "Indemnified Party"), such Indemnified Party promptly shall
so notify the person from whom indemnity is sought (the "Indemnifying
Party") in writing, and the Indemnifying Party shall assume the defense
thereof, including the employment of counsel reasonably satisfactory to the
Indemnified Party and the payment of all fees and expenses incurred in
connection with defense thereof; provided that the failure of any
Indemnified Party to give prompt notice shall not relieve the Indemnifying
Party of its obligations pursuant to this Agreement, except to the extent
that it shall be finally determined by a court of competent jurisdiction
(which determination is not subject to appeal or further review) that such
failure shall have prejudiced the Indemnifying Party.
Any such Indemnified Party shall have the right to employ
separate counsel in any such action, claim or proceeding and to participate
in the defense thereof, but the fees and expenses of such counsel shall be
at the expense of such Indemnified Party or Parties unless: (1) the
Indemnifying Party has agreed to pay such fees and expenses; or (2) the
Indemnifying Party shall have failed to assume the defense of such action,
claim or proceeding; or (3) the named parties to any such action, claim or
proceeding (including any impleaded parties) include both such Indemnified
Party and the Indemnifying Party, and such Indemnified Party shall have
been advised by counsel that a conflict of interest is likely to exist if
the same counsel were to represent such Indemnified Party and the Indem-
nifying Party (in which case, if such Indemnified Party notifies the
Indemnifying Party in writing that it elects to employ separate counsel at
the expense of the Indemnifying Party, the Indemnifying Party shall not
have the right to assume the defense thereof and such counsel shall be at
the expense of the Indemnifying Party), it being understood, however, that,
the Indemnifying Party shall not, in connection with any one such action or
proceeding or separate but substantially similar or related actions or
proceedings in the same jurisdiction arising out of the same general
allegations or circumstances, be liable for the fees and expenses of more
than one separate firm of attorneys (in addition to any local counsel) at
any time for all Indemnified Parties (other than counsel for which the
Indemnifying Party has agreed to pay under clause (1) above), which firm
shall be designated in writing by the Indemnified Parties. The
Indemnifying Party shall not be liable for any settlement of any such
Proceeding effected without its prior written consent. No Indemnifying
Party shall, without the prior written consent of the Indemnified Party,
effect any settlement of any pending proceeding in respect of which any
Indemnified Party is a party and is entitled to indemnity hereunder, unless
such settlement includes an unconditional release of such Indemnified Party
from all liability on claims that are the subject matter of such
proceeding.
(d) Contribution. If a claim by an Indemnified Party for
indemnification under Section 7(a) or 7(b) hereof is found unenforceable
by a court of competent jurisdiction (even though the express provisions
hereof provide for indemnification in such case), then each applicable
Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall
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 and Indemnified Party 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 and Indemnified Party shall be
determined by reference to, among other things, whether any action in ques-
tion, 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 relates 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
shall be deemed to include, subject to the limitations set forth in Section
7(c), any legal or other fees or expenses reasonably incurred by such party
in connection with any investigation or Proceeding.
The parties hereto agree that it would not be just and equitable
if contribution pursuant to this Section 7(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 7(d),
an Indemnifying Party that is a holder of Registrable Securities shall not
be required to contribute any amount in excess of the amount of the
proceeds actually received by such Indemnifying Party from the sale of the
Registrable Securities subject to the Proceeding. 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.
\E Rule 144. The Company shall use its reasonable best efforts to
file the reports required to be filed by it under the Securities Act and
the Exchange Act in a timely manner and, if at any time the Company is not
required to file such reports, they will, upon the request of any holder of
Registrable Securities, make publicly available other information so long
as necessary to permit sales of its securities pursuant to Rule 144. The
Company further covenants that it will take such further action as any
holder of Registrable Securities may reasonably request, all to the extent
required from time to time to enable such holder to sell Registrable
Securities without registration under the Securities Act within the
limitation of the exemptions provided by Rule 144.
9. Miscellaneous
(a) Remedies. In the event of a breach by the Company or by a
holder of Registrable Securities, of any of their obligations under this
Agreement, each holder of Registrable Securities or the Company, as the
case may be, 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 and each
holder of Registrable Securities agree that monetary damages would not be
adequate compensation for any loss incurred by reason of a breach by it of
any of the provisions of this Agreement and hereby further agrees that, in
the event of any action for specific performance in respect of such breach,
it shall waive the defense that a remedy at law would be adequate.
(b) Amendments and Waivers. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions
hereof may not be given, unless the same shall be in writing and signed by
the Company and the holders of at least a majority of the then outstanding
Registrable Securities. Notwithstanding the foregoing, (i) a waiver or
consent to depart from the provisions hereof with respect to a matter that
relates exclusively to the rights of holders of Registrable Securities and
that does not directly or indirectly affect the rights of other holders of
Registrable Securities may be given by holders of at least a majority of
the Registrable Securities to which such waiver or consent relates;
provided, however, that the provisions of this sentence may not be amended,
modified, or supplemented except in accordance with the provisions of the
immediately preceding sentence, and (ii) so long as any Shareholder holds
not less than 50% of the number of Registrable Securities acquired by such
Shareholder in the Merger and subject to this Agreement, without the
consent of such Shareholder, which consent shall not be unreasonably
withheld or delayed, this Agreement may not be amended, modified or
supplemented and no waiver or consent shall be given so as to adversely
affect in any material respect any of the rights of such Shareholder.
(c) Notices. All notices and other communications provided for
herein shall be made in writing by hand-delivery, next-day air courier,
certified first class mail, return receipt requested, or facsimile to:
(i) If to the Company, at 610 Fifth Avenue, New York, New
York 10020, Attn: Edward Lowenthal, President, (telecopier no.:
(212) 333-2323) with a copy to: Robinson Silverman Pearce Aronsohn &
Berman LLP, 1290 Avenue of the Americas, New York, New York 10104,
Attn: Alan S. Pearce, Esq. (telecopier no.: (212) 541-4630);
(ii) If to a Shareholder, at the address specified below its
name on the signature pages hereof; or
(iii) If to any other person who is then the registered
holder of any Registrable Securities, to the address of such holder as
it appears in the stock transfer books of the Company.
Except as otherwise provided in this Agreement, all such
communications shall be deemed to have been duly given: when delivered by
hand, if personally delivered; one Business Day after being delivered to a
reputable overnight delivery service for delivery on the next Business Day;
five Business Days after being deposited in the mail, postage prepaid, if
mailed; and when receipt is acknowledged by the recipient's telecopier
machine, if telecopied.
(d) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and permitted assigns of each
of the parties. If any transferee of Registrable Securities shall acquire
Registrable Securities in accordance with applicable securities law, such
Registrable Securities shall be held subject to all of the terms and
conditions of this Agreement and shall receive all of the benefits 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 shall be deemed to be an original and, all of which
taken together shall constitute one and the same Agreement.
(f) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AS APPLIED
TO CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT
REGARD TO PRINCIPLES OF CONFLICTS OF LAW. By execution of this Agreement,
each Shareholder agrees for the benefit of the Company that any action or
proceeding relating to this Agreement or the Common Shares shall be brought
in the courts of the State of New York or of the United States sitting in
New York City, the Borough of Manhattan, and each Shareholder agrees to
submit to the jurisdiction of such courts in any such action or proceeding.
(g) Severability. The remedies provided herein are cumulative
and not exclusive of any remedies provided by law. If any term, provision,
covenant or restriction of this Agreement is held by a court of competent
jurisdiction to be invalid, illegal, void or unenforceable, the remainder
of the terms, provisions, covenants and restrictions set forth herein shall
remain in full force and effect and shall in no way be affected, impaired
or invalidated, and the parties hereto shall use their reasonable 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 that
may be hereafter declared invalid, illegal, void or unenforceable.
(h) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(i) Further Assurances. From and after the date hereof, the
Company and each of the Shareholders each covenants and agrees to execute
and deliver all such agreements, instruments and documents and to take all
such further actions as any such respective party may reasonably deem
necessary from time to time (at the requesting party's expense) to carry
out the intent and purposes of this Agreement and to consummate and fully
effect the transactions contemplated hereby.
(j) Entire Agreement; Integration. This Agreement contains the
entire agreement of the parties hereto with respect to its subject matter
and there are no promises or undertakings with respect thereto relative to
the subject matter hereof not expressly set forth or referred to in this
Agreement.
(k) Enforceability. The Company hereby represents that it is
not a party to any agreement which would adversely affect the legality,
validity or enforceability of this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
WELLSFORD REAL PROPERTIES, INC.
By:/s/ Gregory F. Hughes
--------------------------------------
Name: Gregory F. Hughes
Title: Chief Financial Officer
FRANKLIN MUTUAL ADVISERS, INC.
By: /s/ E.N. Cohernour
------------------------------
Name: E.N. Cohernour
Title: Vice President &
General Counsel
Address: 51 John F. Kennedy Parkway
Short Hill, NJ 07078
Attn: Bradley Takahashi
Telephone: 973-912-2152
Telecopy: 973-912-0646
ANGELO, GORDON & CO., L.P.
By AG Partners, L.P., its general
partner
By:/s/ John M. Angelo
------------------------------_
John M. Angelo, Chief
Executive Officer
Address: 245 Park Avenue, 26th Fl.
New York, NY 10167
Attn.: Michael L. Gordon
Telephone: 212-692-2000
Telecopy: 212-867-6448
Exhibit A
Certain advisory clients of
Franklin Mutual Advisers, Inc.
Advisory Client/ Nominee Name for
Beneficial Owner Physical Shares Record
Owner
Mutual Beacon Fund Erato & Co. CEDE & CO.
Mutual Discovery Fund Launch & Co. CEDE & CO.
Yale University Tellus & Co. CEDE & CO.
Orion Fund Ltd. Gerlach & Co. CEDE & CO.
The Common Fund Bost & Co. CEDE & CO.
Alan L. Gold & Co. PSP Alan L. Gold & Co. PSP CEDE & CO.
Andrew & Lisa Fairclough Andrew & Lisa Fairclough CEDE & CO.
Deborah Milkey Deborah Milkey CEDE & CO.
J.H. Garfunkel Inc. J.H. Garfunkel Inc. CEDE & CO.
Joseph Italiaander Joseph Italiaander CEDE & CO.
Karin Heine Karin Heine CEDE & CO.
Michael R. Grunwald Michael R. Grunwald CEDE & CO.
Steven H. Vendig PSP Steven H. Vendig PSP CEDE & CO.
Exhibit B
Certain affiliates of
Angelo, Gordon & Co., L.P.
Affiliate/ Nominee Name for
Beneficial Owner Physical Shares Record
Owner
AG Arb Partners, L.P. Bear, Stearns Securities Corp. CEDE & CO.
AG Super Fund, L.P. Bear, Stearns Securities Corp. CEDE & CO.
AG Super Fund International Bear, Stearns Securities Corp. CEDE & CO.
Partners, L.P.
Nutmeg Partners, L.P. Bear, Stearns Securities Corp. CEDE & CO.
GAM Special Situations, L.P. Bear, Stearns Securities Corp. CEDE & CO.
AG Eleven Partners, L.P. Bear, Stearns Securities Corp. CEDE & CO.
GAM Arbitrage Investments
Inc. Bear, Stearns Securities Corp. CEDE & CO.
The Common Fund (Equity
Fund) Bear, Stearns Securities Corp. CEDE & CO.
Treetop Partners, L.P. Bear, Stearns Securities Corp. CEDE & CO.
Northern Trust Company, Bear, Stearns Securities Corp. CEDE & CO.
as Master Trustee of the
Teachers'Retirement System
of the State of Illinois
40153 Partnership Bear, Stearns Securities Corp. CEDE & CO.
The Common Fund (Bond Fund) Bear, Stearns Securities Corp. CEDE & CO.
A.G.C.P., L.P. Bear, Stearns Securities Corp. CEDE & CO.
Montrose Corporation Bear, Stearns Securities Corp. CEDE & CO.