EXHIBIT 20.1.7
EXHIBIT A
EXCHANGE NOTES REGISTRATION RIGHTS AGREEMENT
EXCHANGE NOTES REGISTRATION RIGHTS AGREEMENT (this "Agreement"), dated as
of March 15, 2002, by and among Imperial Credit Industries, Inc., a California
corporation (the "Company"), and the Stephen Adams Living Trust (the "Holder").
WITNESSETH:
WHEREAS, the Company and the Holder have entered into a Restructuring
Agreement, dated as of February 19, 2002 (the "Restructuring Agreement"),
pursuant to which the Holder will acquire $6,382,877 in principal amount of the
Company's Senior Secured Notes - Series B due 2002 (the "Senior Secured Notes"),
$2,000,000 in principal amount of the Company's 12% Senior Secured Notes due
2005 (the "Exchange Notes"), and shares of common stock of the Company (the
"Shares");
WHEREAS, to induce the Holder to execute and deliver the Restructuring
Agreement, the Company has agreed to provide certain registration rights under
the Securities Act (this, and other capitalized terms used herein and not
otherwise defined herein are defined in Section 1 hereof) and under applicable
state securities laws;
NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Holder hereby
agree as follows:
1. DEFINITIONS.
-----------
As used in this Agreement, the following terms shall have the
following meanings:
(a) "Closing Date" means the date of this Agreement.
(b) "Holder" means the Stephen Adams Living Trust and any transferee
or assignee of the Senior Secured Notes or the Exchange Notes to whom any Holder
assigns its rights under this Agreement as permitted by the terms hereof and who
agrees to become bound by the provisions of this Agreement in accordance with
Section 9.
(c) "Person" means a corporation, a limited liability company, an
association, a partnership, an organization, a business, an individual, an
entity, a governmental or political subdivision or a governmental agency.
(d) "Register," "registered," and "registration" refer to a
registration effected by preparing and filing one or more Registration
Statements in compliance with the Securities Act and pursuant to Rule 415 under
the Securities Act or any successor rule providing for
offering securities on a continuous basis ("Rule 415"), and the declaration or
ordering of effectiveness of such Registration Statement(s) by the United States
Securities and Exchange Commission (the "SEC").
(e) "Registrable Securities" means the Exchange Notes and the Shares
issuable to the Holder pursuant to the Restructuring Agreement.
(f) "Registration Statement" means a registration statement of the
Company filed under the Securities Act.
2. REGISTRATION.
------------
(a) Mandatory Registration. The Company shall prepare, and, on or
----------------------
prior to 60 days after the Closing Date, file with the SEC a Registration
Statement or Registration Statements on Form S-3 (or, if such form is not
available for such a registration, on such other form as is available for such a
registration, at the request of the Holder) covering the resale of all of the
Registrable Securities. The Company shall use its best efforts to have the
Registration Statement declared effective by the SEC within 120 days after the
Closing Date.
(b) Counsel and Investment Bankers. Subject to Section 5 hereof, in
------------------------------
connection with any offering pursuant to this Section 2, the Holder shall have
the right to select legal counsel and an investment banker or bankers and
manager or managers to administer its interest in the offering, which investment
banker or bankers or manager or managers shall be reasonably satisfactory to the
Company. The Company shall reasonably cooperate with any such counsel and
investment bankers.
(c) Eligibility for Form S-3. The Company has filed and shall use its
------------------------
best efforts to file all reports required to be filed by the Company with the
SEC in a timely manner. In the event that Form S-3 is not available for sale by
the Holder of the Registrable Securities, then (i) the Company, at the request
of the Holder, shall register the sale of the Registrable Securities on another
appropriate form and (ii) the Company shall undertake to register the
Registrable Securities on Form S-3 as soon as such form is available, provided
that the Company shall maintain the effectiveness of the Registration Statement
then in effect until such time as a Registration Statement on Form S-3 covering
the Registrable Securities has been declared effective by the SEC.
3. RELATED OBLIGATIONS.
-------------------
At such time as the Company is obligated to file a Registration
Statement with the SEC pursuant to Section 2(a), the Company will use its best
efforts to effect the registration of the Registrable Securities in accordance
with the intended method of disposition thereof and, pursuant thereto, the
Company shall have the following obligations:
(a) The Company shall promptly prepare and file with the SEC a
Registration Statement with respect to the Registrable Securities (on or prior
to the 60/th/ day after the Closing Date and solely (unless otherwise consented
to in writing by the Holder) for the registration of Registrable Securities
pursuant to Section 2(a)) and use its best efforts to cause such Registration
2
Statement(s) relating to Registrable Securities to become effective as soon as
possible after such filing and keep the Registration Statement(s) effective
pursuant to Rule 415 at all times until the earlier of (i) six months after the
date as of which the Holder may sell all of the Registrable Securities without
restriction pursuant to Rule 144(k) promulgated under the Securities Act (or
successor thereto) or (ii) the date on which the Holder shall have sold all the
Registrable Securities (the "Registration Period"), which Registration
Statement(s) (including any amendments or supplements thereto and prospectuses
contained therein) shall not contain any 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 in which they were
made, not misleading.
(b) The Company shall prepare and file with the SEC such amendments
(including post-effective amendments) and supplements to the Registration
Statement(s) and the prospectus(es) used in connection with the Registration
Statement(s), which prospectus(es) are to be filed pursuant to Rule 424
promulgated under the Securities Act, as may be necessary to keep the
Registration Statement(s) effective at all times during the Registration Period,
and, during such period, comply with the provisions of the Securities Act with
respect to the disposition of all Registrable Securities of the Company covered
by the Registration Statement(s) until such time as all of such Registrable
Securities shall have been disposed of in accordance with the intended methods
of disposition by the seller or sellers thereof as set forth in the Registration
Statement(s).
(c) The Company shall furnish to the Holder and its legal counsel
without charge (i) promptly after the same is prepared and filed with the SEC,
at least one copy of the Registration Statement and any amendment thereto,
including financial statements and schedules, all documents incorporated therein
by reference and all exhibits, the prospectus(es) included in such Registration
Statement(s) (including each preliminary prospectus) and, with regard to the
Registration Statement, any correspondence by or on behalf of the Company to the
SEC or the staff of the SEC and any correspondence from the SEC or the staff of
the SEC to the Company or its representatives, (ii) upon the effectiveness of
any Registration Statement, ten copies of the prospectus included in such
Registration Statement and all amendments and supplements thereto (or such other
number of copies as the Holder may reasonably request) and (iii) such other
documents, including any preliminary prospectus, as the Holder may reasonably
request in order to facilitate the disposition of the Registrable Securities
owned by the Holder. The Company will promptly respond to any and all comments
received from the SEC, with a view toward causing any Registration Statement or
any amendment thereto to be declared effective by the SEC as soon as practicable
and shall, subject to Section 3(h), promptly file an acceleration request as
soon as practicable following the resolution or clearance of all SEC comments
or, if applicable, following notification by the SEC that the Registration
Statement or any amendment thereto will not be subject to review.
(d) The Company shall use its best efforts to (i) register and
qualify the Registrable Securities covered by the Registration Statement(s)
under such other securities or "blue sky" laws of such jurisdictions in the
United States as the Holder reasonably requests, (ii) prepare and file in those
jurisdictions, such amendments (including post-effective amendments) and
supplements to such registrations and qualifications as may be necessary to
maintain the
3
effectiveness thereof during the Registration Period, (iii) take such other
actions as may be necessary to maintain such registrations and qualifications in
effect at all times during the Registration Period, and (iv) take all other
actions reasonably necessary or advisable to qualify the Registrable Securities
for sale in such jurisdictions; provided, however, that the Company shall not be
required in connection therewith or as a condition thereto to (x) qualify to do
business in any jurisdiction where it would not otherwise be required to qualify
but for this Section 3(d), (y) subject itself to general taxation in any such
jurisdiction, or (z) file a general consent to service of process in any such
jurisdiction. The Company shall promptly notify the Holder of the receipt by the
Company of any notification with respect to the suspension of the registration
or qualification of any of the Registrable Securities for sale under the
securities or "blue sky" laws of any jurisdiction in the United States or its
receipt of actual notice of the initiation or threatening of any proceeding for
such purpose.
(e) In the event the Holder selects underwriters for the offering
reasonably satisfactory to the Company, the Company shall, subject to Section
2(b) hereof, enter into and perform its obligations under an underwriting
agreement, in usual and customary form, including, without limitation, customary
indemnification and contribution obligations, with the underwriters of such
offering.
(f) As promptly as practicable after becoming aware of such event,
the Company shall notify the Holder in writing of the happening of any event as
a result of which the prospectus included in a Registration Statement, as then
in effect, includes an untrue statement of a material fact or omission 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 promptly prepare a supplement or amendment to the
Registration Statement to correct such untrue statement or omission, and deliver
ten copies of such supplement or amendment to the Holder (or such other number
of copies as the Holder may reasonably request). The Company shall also promptly
notify the Holder in writing (i) when a prospectus or any prospectus supplement
or post-effective amendment has been filed, and when a Registration Statement or
any post-effective amendment has become effective (notification of such
effectiveness shall be delivered to the Holder by facsimile on the same day of
such effectiveness and by overnight mail), (ii) of any request by the SEC for
amendments or supplements to a Registration Statement or related prospectus or
related information, and (iii) of the Company's reasonable determination that a
post-effective amendment to a Registration Statement would be appropriate.
(g) The Company shall use its best efforts to prevent the issuance of
any stop order or other suspension of effectiveness of a Registration Statement,
or the suspension of the qualification of any of the Registrable Securities for
sale in any jurisdiction and, if such an order or suspension is issued, to
obtain the withdrawal of such order or suspension at the earliest possible
moment and to notify the Holder who holds Registrable Securities being sold
(and, in the event of an underwritten offering, the managing underwriters) of
the issuance of such order and the resolution thereof or its receipt of actual
notice of the initiation or threat of any proceeding for such purpose.
4
(h) The Company shall permit the Holder and a single firm of counsel,
initially Kaplan, Strangis and Kaplan, P.A. or such other counsel as may
thereafter be designated as counsel by the Holder, to review and comment upon
the Registration Statement(s) and all amendments and supplements thereto at
least four business days prior to their filing with the SEC, and not file any
document in a form to which such counsel reasonably objects. The Company shall
not submit a request for acceleration of the effectiveness of a Registration
Statement(s) or any amendment or supplement thereto without the prior approval
of such counsel, which consent shall not be unreasonably withheld.
(i) At the request of the Holder, the Company shall furnish, on the
date that Registrable Securities are delivered to an underwriter, if any, for
sale in connection with the Registration Statement (i) if required by an
underwriter, a letter, dated such date, from the Company's independent certified
public accountants in form and substance as is customarily given by independent
certified public accountants to underwriters in an underwritten public offering,
addressed to the underwriters, and (ii) an opinion, dated as of such date, of
counsel representing the Company for purposes of such Registration Statement, in
form, scope and substance as is customarily given in an underwritten public
offering, addressed to the underwriters and the Holder.
(j) The Company shall make available for inspection by (i) the
Holder, (ii) any underwriter participating in any disposition pursuant to a
Registration Statement, (iii) one firm of attorneys and one firm of accountants
retained by the Holder, and (iv) one firm of attorneys retained by all such
underwriters (collectively, the "Inspectors") all such pertinent financial and
other records, and pertinent corporate documents and properties of the Company
(collectively, the "Records"), as shall be reasonably deemed necessary by each
Inspector to enable each Inspector to exercise its due diligence responsibility,
and cause the Company's officers, directors and employees to supply all
information which any Inspector may reasonably request for purposes of such due
diligence; provided, however, that each Inspector shall agree to, and shall,
hold in strict confidence and shall not make any disclosure (except to the
Holder) or use of any Record or other information which the Company determines
in good faith to be confidential, and of which determination the Inspectors are
so notified, unless (a) the disclosure of such Records is necessary to avoid or
correct a misstatement or omission in any Registration Statement or is otherwise
required under the Securities Act, (b) the release of such Records is ordered
pursuant to a final, non-appealable subpoena or order from a court or government
body of competent jurisdiction, or (c) the information in such Records has been
made generally available to the public other than by disclosure in violation of
this or any other agreement. The Holder agrees that it shall, upon learning that
disclosure of such Records is sought in or by a court or governmental body of
competent jurisdiction or through other means, give prompt notice to the Company
and allow the Company, at its expense, to undertake appropriate action to
prevent disclosure of, or to obtain a protective order for, the Records deemed
confidential. Nothing herein (or in any other confidentiality agreement between
the Company and the Holder) shall be deemed to limit the Holder's ability to
sell Registrable Securities in a manner which is otherwise consistent with
applicable laws and regulations.
(k) The Company shall hold in confidence and not make any disclosure
of information concerning the Holder provided to the Company unless (i)
disclosure of such
5
information is necessary to comply with federal or state securities laws, (ii)
the disclosure of such information is necessary to avoid or correct a
misstatement or omission in any Registration Statement, (iii) the release of
such information is ordered pursuant to a subpoena or other final,
non-appealable order from a court or governmental body of competent
jurisdiction, or (iv) such information has been made generally available to the
public other than by disclosure in violation of this or any other agreement. The
Company agrees that it shall, upon learning that disclosure of such information
concerning the Holder is sought in or by a court or governmental body of
competent jurisdiction or through other means, give prompt written notice to the
Holder and allow the Holder, at the Holder's expense, to undertake appropriate
action to prevent disclosure of, or to obtain a protective order for, such
information.
(l) The Company shall use its best efforts to cause all the
Registrable Securities covered by a Registration Statement to be listed on each
securities exchange on which securities of the same class or series issued by
the Company are then listed, if any, if the listing of such Registrable
Securities is then permitted under the rules of such exchange. The Company shall
pay all fees and expenses in connection with satisfying its obligation under
this Section 3(l).
(m) The Company shall cooperate with the Holder and, to the extent
applicable, any managing underwriter or underwriters, to facilitate the timely
preparation and delivery of certificates (not bearing any restrictive legend)
representing the Registrable Securities to be offered pursuant to a Registration
Statement and enable such certificates to be in such denominations or amounts,
as the case may be, as the managing underwriter or underwriters, if any, or, if
there is no managing underwriter or underwriters, the Holder may reasonably
request and registered in such names as the managing underwriter or
underwriters, if any, or the Holder may request. Not later than the date on
which any Registration Statement registering the resale of Registrable
Securities is declared effective, the Company shall deliver to the Exchange
Notes Indenture Trustee instructions, accompanied by any reasonably required
opinion of counsel, that permit sales of unlegended securities in a timely
fashion that complies with then mandated applicable securities settlement
procedures.
(n) The Company shall provide a CUSIP number for the Registrable
Securities not later than the effective date of such Registration Statement.
(o) If requested by the managing underwriters or the Holder, the
Company shall immediately incorporate in a prospectus supplement or
post-effective amendment such information as the managing underwriters and the
Holder agree should be included therein relating to the sale and distribution of
Registrable Securities, including, without limitation, information with respect
to the number of Registrable Securities being sold to such underwriters, the
purchase price being paid therefor by such underwriters and with respect to any
other terms of the underwritten (or best efforts underwritten) offering of the
Registrable Securities to be sold in such offering; make all required filings of
such prospectus supplement or post-effective amendment as soon as notified of
the matters to be incorporated in such prospectus supplement or post-effective
amendment; and supplement or make amendments to any Registration Statement if
requested by a shareholder or any underwriter of such Registrable Securities.
6
(p) The Company shall use its best efforts to cause the Registrable
Securities covered by the applicable Registration Statement to be registered
with or approved by such other governmental agencies or authorities as may be
necessary to consummate the disposition of such Registrable Securities.
(q) The Company shall otherwise use its best efforts to comply with
all applicable rules and regulations of the SEC in connection with any
registration hereunder.
4. OBLIGATIONS OF THE HOLDER.
-------------------------
(a) At least seven days prior to the first anticipated filing date of
the Registration Statement, the Company shall notify the Holder or its counsel
in writing of the information the Company requires from the Holder if the Holder
elects to have any of the Registrable Securities included in the Registration
Statement. It shall be a condition precedent to the obligations of the Company
to complete the registration pursuant to this Agreement with respect to the
Registrable Securities that the Holder shall furnish to the Company such
information as may be requested in writing by the Company regarding itself, the
Registrable Securities held by it and the intended method of disposition of the
Registrable Securities held by it as shall be reasonably required to effect the
registration of such Registrable Securities and shall execute such documents in
connection with such registration as the Company may reasonably request.
(b) The Holder by its acceptance of the Registrable Securities agrees
to cooperate with the Company as reasonably requested by the Company in
connection with the preparation and filing of the Registration Statement(s)
hereunder, unless the Holder has notified the Company in writing of the Holder's
election to exclude all of the Registrable Securities from the Registration
Statement.
(c) The Holder agrees that, upon receipt of any notice from the
Company of the happening of any event of the kind described in Section 3(g) or
the first sentence of 3(f), the Holder will immediately discontinue disposition
of Registrable Securities pursuant to the Registration Statement(s) covering
such Registrable Securities until the Holder's receipt of the copies of the
supplemented or amended prospectus contemplated by Section 3(g) or the first
sentence of 3(f) and, if so directed by the Company, the Holder shall deliver to
the Company (at the expense of the Company) or destroy all copies in the
Holder's possession, of the prospectus covering such Registrable Securities
current at the time of receipt of such notice.
(d) The Holder may not participate in any underwritten registration
hereunder unless the Holder (i) agrees to sell the Registrable Securities on the
basis provided in any underwriting arrangements approved by the Holder entitled
hereunder to approve such arrangements and (ii) completes and executes all
questionnaires, powers of attorney, indemnities, underwriting agreements and
other documents reasonably required under the terms of such underwriting
arrangements.
7
5. EXPENSES OF REGISTRATION.
------------------------
All reasonable expenses, including underwriting discounts and
commissions, incurred in connection with registrations, filings or
qualifications pursuant to Sections 2 and 3, including, without limitation, all
registration, listing and qualifications fees, printers and accounting fees, and
fees and disbursements of counsel for the Company and fees and disbursements of
one counsel for the Holder, shall be paid by the Company. In addition, the
Company shall pay all of the Holder's reasonable costs (including legal fees)
incurred in connection with the successful enforcement of the Holder' rights
hereunder.
6. INDEMNIFICATION.
---------------
In the event any Registrable Securities are included in a Registration
Statement under this Agreement:
(a) To the fullest extent permitted by law, the Company will, and
hereby does, indemnify, hold harmless and defend the Holder, the directors,
officers, partners, employees, agents and each Person, if any, who controls the
Holder within the meaning of the Securities Act or the Securities Exchange Act
of 1934, as amended (the "1934 Act"), and any underwriter (as defined in the
Securities Act) for the Holder, and the directors and officers of, and each
Person, if any, who controls, any such underwriter within the meaning of the
Securities Act or the 1934 Act (each, an "Indemnified Person"), against any
losses, claims, damages, liabilities, judgments, fines, penalties, charges,
costs, attorneys' fees, amounts paid in settlement or expenses, joint or several
(collectively, "Claims"), incurred in investigating, preparing for the defense
of or defending any action, claim, suit, inquiry, proceeding, investigation or
appeal taken from the foregoing by or before any court or governmental,
administrative or other regulatory agency, body or the SEC, whether pending or
threatened, to which an indemnified party is or may be a party ("Indemnified
Damages"), to which any of them may become subject insofar as such Claims (or
actions or proceedings, whether commenced or threatened, in respect thereof)
arise out of or are based upon: (i) any untrue statement or alleged untrue
statement of a material fact in a Registration Statement or any post-effective
amendment thereto or in any filing made in connection with the qualification of
the offering under the securities or other "blue sky" laws of any jurisdiction
in which Registrable Securities are offered, or the omission or alleged omission
to state a material fact required to be stated therein or necessary to make the
statements therein not misleading, (ii) any untrue statement or alleged untrue
statement of a material fact contained in any preliminary prospectus if used
prior to the effective date of such Registration Statement, or contained in the
final prospectus (as amended or supplemented, if the Company files any amendment
thereof or supplement thereto with the SEC) or the omission or alleged omission
to state therein any material fact necessary to make the statements made
therein, in light of the circumstances under which the statements therein were
made, not misleading, or (iii) any violation or alleged violation by the Company
of the Securities Act, the 1934 Act, any other law, including, without
limitation, any state securities law, or any rule or regulation thereunder
relating to the offer or sale of the Registrable Securities pursuant to a
Registration Statement (the matters in the foregoing clauses (i) through (iii)
being, collectively, "Violations"). Subject to the restrictions set forth in
Section 6(d) with respect to the number of legal counsel, the Company shall
reimburse the Holder and each such underwriter or controlling person, promptly
as such
8
expenses are incurred and are due and payable, for any legal fees or other
reasonable expenses incurred by them in connection with investigating or
defending any such Claim. Notwithstanding anything to the contrary contained
herein, the indemnification agreement contained in this Section 6(a) and the
agreement with respect to contribution contained in Section 7: (i) shall not
apply to a Claim arising out of or based upon a Violation which occurs in
reliance upon and in conformity with information furnished in writing to the
Company by any Indemnified Person or underwriter for such Indemnified Person
expressly for use in connection with the preparation of the Registration
Statement or any such amendment thereof or supplement thereto, if such
prospectus was timely made available by the Company pursuant to Section 3(c);
(ii) with respect to any preliminary prospectus, shall not inure to the benefit
of any such person from whom the person asserting any such Claim purchased the
Registrable Securities that are the subject thereof (or to the benefit of any
person controlling such person) if the untrue statement or omission of material
fact contained in the preliminary prospectus was corrected in the prospectus, as
then amended or supplemented, if such prospectus was timely made available by
the Company pursuant to Section 3(c), and the Indemnified Person was promptly
advised in writing not to use the incorrect prospectus prior to the use giving
rise to a Violation and such Indemnified Person, notwithstanding such advice,
used it; and (iii) shall not apply to amounts paid in settlement of any Claim if
such settlement is effected without the prior written consent of the Company,
which consent shall not be unreasonably withheld. Such indemnity shall remain in
full force and effect regardless of any investigation made by or on behalf of
the Indemnified Person and shall survive the transfer of the Registrable
Securities by the Holder pursuant to Section 9.
(b) In connection with any Registration Statement in which the Holder
is participating, the Holder agrees to indemnify, hold harmless and defend, to
the same extent and in the same manner as is set forth in Section 6(a), the
Company, each of its directors, each of its officers who signs the Registration
Statement, each Person, if any, who controls the Company within the meaning of
the Securities Act or the 1934 Act (collectively and together with an
Indemnified Person, an "Indemnified Party"), against any Claim or Indemnified
Damages to which any of them may become subject, under the Securities Act, the
1934 Act or otherwise, insofar as such Claim or Indemnified Damages 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 to the Company by such Holder expressly for use in
connection with such Registration Statement; and, subject to Section 6(d), such
Holder will reimburse any legal or other expenses reasonably incurred by them in
connection with investigating or defending any such Claim; provided, however,
that the indemnity agreement contained in this Section 6(b) and the agreement
with respect to contribution contained in Section 7 shall not apply to amounts
paid in settlement of any Claim if such settlement is effected without the prior
written consent of such Holder, which consent shall not be unreasonably
withheld; provided, further, however, that the Holder shall be liable under this
Section 6(b) for only that amount of a Claim or Indemnified Damages as does not
exceed the net proceeds to such Holder as a result of the sale of Registrable
Securities pursuant to such Registration Statement. Such indemnity shall remain
in full force and effect regardless of any investigation made by or on behalf of
such Indemnified Party and shall survive the transfer of the Registrable
Securities by the Holder pursuant to Section 9. Notwithstanding anything to the
contrary contained herein, the
9
indemnification agreement contained in this Section 6(b) with respect to any
preliminary prospectus shall not inure to the benefit of any Indemnified Party
if the untrue statement or omission of material fact contained in the
preliminary prospectus was corrected on a timely basis in the prospectus, as
then amended or supplemented.
(c) The Company shall be entitled to receive indemnities from
underwriters, selling brokers, dealer managers and similar securities industry
professionals participating in any distribution, to the same extent as provided
above, with respect to information such persons so furnished in writing
expressly for inclusion in the Registration Statement.
(d) Promptly after receipt by an Indemnified Person or Indemnified
Party under this Section 6 of notice of the commencement of any action or
proceeding (including any governmental action or proceeding) involving a Claim,
such Indemnified Person or Indemnified Party shall, if a Claim in respect
thereof is to be made against any indemnifying party under this Section 6,
deliver to the indemnifying party a written notice of the commencement thereof,
and the indemnifying party shall have the right (at its expense) to participate
in, and, to the extent the indemnifying party so desires, jointly with any other
indemnifying party similarly noticed, to assume control of the defense thereof
with counsel mutually satisfactory to the indemnifying party and the Indemnified
Person or the Indemnified Party, as the case may be; provided, however, that
such indemnifying party shall diligently pursue such defense and that an
Indemnified Person or Indemnified Party shall have the right to retain its own
counsel with the fees and expenses to be paid by the indemnifying party, if, in
the reasonable opinion of counsel retained by the Indemnified Person or
Indemnified Party, as the case may be, the representation by such counsel of the
Indemnified Person or Indemnified Party and the indemnifying party would be
inappropriate due to actual or potential differing interests between such
Indemnified Person or Indemnified Party and any other party represented by such
counsel in such proceeding. The Company shall pay reasonable fees for only one
separate legal counsel for the Holder, and such legal counsel shall be selected
by the Holder holding a majority in interest of the Registrable Securities
included in the Registration Statement to which the Claim relates. The
Indemnified Party or Indemnified Person shall cooperate fully with the
indemnifying party in connection with any negotiation or defense of any such
action or claim by the indemnifying party and shall furnish to the indemnifying
party all information reasonably available to the Indemnified Party or
Indemnified Person which relates to such action or claim. The indemnifying party
shall keep the Indemnified Party or Indemnified Person fully apprised at all
times as to the status of the defense or any settlement negotiations with
respect thereto. No indemnifying party shall be liable for any settlement of any
action, claim or proceeding effected without its written consent, provided,
however, that the indemnifying party shall not unreasonably withhold, delay or
condition its consent. No indemnifying party shall, without the consent of the
Indemnified Party or Indemnified Person, consent to entry of any judgment or
enter into any settlement or other compromise which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
Indemnified Party or Indemnified Person of a release from all liability in
respect to such claim or litigation. Following indemnification as provided for
hereunder, the indemnifying party shall be subrogated to all rights of the
Indemnified Party or Indemnified Person with respect to all third parties, firms
or corporations relating to the matter for which indemnification has been made.
The failure to deliver written notice to the indemnifying party within a
reasonable time of the commencement of any such action shall not relieve such
10
indemnifying party of any liability to the Indemnified Person or Indemnified
Party under this Section 6, except to the extent that the indemnifying party is
prejudiced in its ability to defend such action.
(e) The indemnification required by this Section 6 shall be made by
periodic payments of the amount thereof during the course of the investigation
or defense, as and when bills are received or Indemnified Damages are incurred.
(f) The indemnity agreements contained herein shall be in addition to
(i) any cause of action or similar right of the Indemnified Party or Indemnified
Person against the indemnifying party or others, and (ii) any liabilities the
indemnifying party may be subject to pursuant to the law.
7. CONTRIBUTION.
------------
To the extent any indemnification by an indemnifying party is
prohibited or limited by law, the indemnifying party agrees to make the maximum
contribution with respect to any amounts for which it would otherwise be liable
under Section 6 to the fullest extent permitted by law; provided, however, that:
(i) no contribution shall be made under circumstances where the maker would not
have been liable for indemnification under the fault standards set forth in
Section 6; (ii) no seller of Registrable Securities guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any seller of Registrable Securities who
was not guilty of fraudulent misrepresentation; and (iii) contribution by any
seller of Registrable Securities shall be limited in amount to the net amount of
proceeds received by such seller from the sale of such Registrable Securities.
8. REPORTS UNDER THE 1934 ACT.
--------------------------
With a view to making available to the Holder the benefits of Rule 144
promulgated under the Securities Act or any other similar rule or regulation of
the SEC that may at any time permit the Holder to sell securities of the Company
to the public without registration ("Rule 144"), the Company agrees to:
(a) make and keep public information available, as those terms are
understood and defined in Rule 144;
(b) file with the SEC in a timely manner all reports and other
documents required of the Company under the Securities Act and the 1934 Act so
long as the Company remains subject to such requirements (it being understood
that nothing herein shall limit the Company's obligations under Section 5.8 of
the Master Restructuring Agreement) and the filing of such reports and other
documents is required for the applicable provisions of Rule 144; and
(c) furnish to the Holder so long as the Holder owns Registrable
Securities, promptly upon request, (i) a written statement by the Company that
it has complied with the reporting requirements of Rule 144, the Securities Act
and the 1934 Act, (ii) a copy of the most recent annual or quarterly report of
the Company and such other reports and documents so filed
11
by the Company, and (iii) such other information as may be reasonably requested
to permit the Holder to sell such securities pursuant to Rule 144 without
registration.
9. ASSIGNMENT OF REGISTRATION RIGHTS.
---------------------------------
The rights to have the Company register Registrable Securities
pursuant to this Agreement shall be assignable by the Holder to any Person (a
"Transferee") of all or any portion of Registrable Securities if: (i) the Holder
agrees in writing with the Transferee to assign such rights, and a copy of such
agreement is furnished to the Company within a reasonable time after such
assignment; (ii) the Company is, within a reasonable time after such transfer or
assignment, furnished with written notice of (a) the name and address of such
Transferee, and (b) the securities with respect to which such registration
rights are being transferred or assigned; (iii) immediately following such
transfer or assignment the further disposition of such securities by the
Transferee is restricted under the Securities Act and applicable state
securities laws; (iv) at or before the time the Company receives the written
notice contemplated by clause (ii) of this sentence the Transferee agrees in
writing with the Company to be bound by all of the provisions contained herein;
(v) such Transferee shall be an "accredited investor" as that term is defined in
Rule 501 of Regulation D promulgated under the Securities Act; and (vi) in the
event the assignment occurs subsequent to the date of effectiveness of the
Registration Statement required to be filed pursuant to Section 2(a), the
Transferee agrees to pay all reasonable expenses of amending or supplementing
such Registration Statement to reflect such assignment.
10. AMENDMENT OF REGISTRATION RIGHTS.
--------------------------------
Provisions of this Agreement may be amended and the observance thereof
may be waived (either generally or in a particular instance and either
retroactively or prospectively), only with the written consent of the Company
and the Holder. Any amendment or waiver effected in accordance with this Section
10 shall be binding upon the Holder and the Company.
11. MISCELLANEOUS.
-------------
(a) A person or entity is deemed to be a holder of Registrable
Securities whenever such person or entity owns of record such Registrable
Securities. If the Company receives conflicting instructions, notices or
elections from two or more persons or entities with respect to the same
Registrable Securities, the Company shall act upon the basis of instructions,
notice or election received from the registered owner of such Registrable
Securities.
(b) Any notices consents, waivers or other communications required
or permitted to be given under the terms of this Agreement must be in writing
and will be deemed to have been delivered (i) upon receipt, when delivered
personally; (ii) upon receipt, when sent by facsimile, provided a copy is mailed
by U.S. certified mail, return receipt requested; (iii) three days after being
sent by U.S. certified mail, return receipt requested; or (iv) one day after
deposit with a nationally recognized overnight delivery service, in each case
properly addressed to the party to receive the same. The addresses and facsimile
numbers for such communications shall be:
12
if to the Company: Imperial Credit Industries, Inc.
23550 Hawthorne Boulevard
Building 1, Suite 110
Torrance, California 90505
if to the Holder: The Stephen Adams Living Trust
2575 Vista Del Mar Drive
Ventura, California 93001
Each party shall provide five days prior notice to the other party of any
change in address, phone number or facsimile number.
(c) Failure of any party to exercise any right or remedy under this
Agreement or otherwise, or delay by a party in exercising such right or remedy,
shall not operate as a waiver thereof.
(d) This Agreement shall be governed by and interpreted in
accordance with the laws of the State of California without regard to the
principles of conflict of laws. If any provision of this Agreement shall be
invalid or unenforceable in any jurisdiction, such invalidity or
unenforceability shall not affect the validity or enforceability of the
remainder of this Agreement in that jurisdiction or the validity or
enforceability of any provision of this Agreement in any other jurisdiction.
(e) This Agreement, the Restructuring Agreement and all documents,
instruments and agreements referred to therein (including all schedules and
exhibits thereto) constitute the entire agreement among the parties hereto with
respect to the subject matter hereof and thereof. There are no restrictions,
promises, warranties or undertakings, other than those set forth or referred to
herein and therein. The aforementioned documents supersede all prior agreements
and understandings among the parties hereto with respect to the subject matter
hereof and thereof.
(f) Subject to the requirements of Section 9, this Agreement shall
inure to the benefit of and be binding upon the permitted successors and assigns
of each of the parties hereto.
(g) The headings in this Agreement are for convenience of reference
only and shall not limit or otherwise affect the meaning hereof.
(h) This Agreement may be executed in two or more identical
counterparts, each of which shall be deemed an original but all of which shall
constitute one and the same agreement. This Agreement, once executed by a party,
may be delivered to the other party hereto by facsimile transmission of a copy
of this Agreement bearing the signature of the party so delivering this
Agreement provided that an original is promptly delivered thereafter to the
other party.
(i) Any legal action, suit or proceeding brought against the Company
with respect to this Agreement may be brought in any federal court of the
Central District of
13
California or any state court located in the State of California, and by
execution and delivery of this Agreement, the Company hereby irrevocably and
unconditionally waives any claim (by way of motion, as a defense or otherwise)
of improper venue, that it is not subject personally to the jurisdiction of such
court, that such courts are an inconvenient forum or that this Agreement or the
subject matter may not be enforced in or by such court. The Company hereby
irrevocably and unconditionally consents to the service of process of any of the
aforementioned courts in any such action, suit or proceeding by the mailing of
copies thereof by registered or certified mail, postage prepaid, at its address
set forth or provided for in Section 11, such service to become effective 10
days after such mailing. Nothing herein contained shall be deemed to affect the
right of any party to serve process in any manner permitted by law or commence
legal proceedings or otherwise proceed against any other party in any other
jurisdiction to enforce judgments obtained in any action, suit or proceeding
brought pursuant to this Section. The Company irrevocably submits to the
exclusive jurisdiction of the aforementioned courts in such action, suit or
proceeding. THE COMPANY HEREBY IRREVOCABLY WAIVES TRIAL BY JURY IN ANY ACTION,
SUIT, OR PROCEEDING, WHETHER AT LAW OR EQUITY, BROUGHT BY IT OR AN HOLDER IN
CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
(j) Each party shall do and perform, or cause to be done and performed,
all such further acts and things, and shall execute and deliver all such other
agreements, certificates, instruments and documents, as the other party may
reasonably request in order to carry out the intent and accomplish the purposes
of this Agreement and the consummation of the transactions contemplated hereby.
[the balance of this page is intentionally left blank]
14
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
IMPERIAL CREDIT INDUSTRIES, INC.
By: _____________________________
Name:
Title:
THE STEPHEN ADAMS LIVING TRUST:
By: _____________________________
Name:
Title: