EXHIBIT 10.3
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SCHEDULE 2.10(F)
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REGISTRATION RIGHTS AGREEMENT
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THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement"), is made and
entered into as of December 31, 2001, by and among WestCoast Hospitality
Corporation, a Washington corporation (the "Company") and Doubletree
Corporation, a Delaware corporation ("Doubletree").
RECITALS
WHEREAS, the Company, Doubletree and Hilton Hotels Corporation, a
Delaware corporation, are parties to that certain Purchase Agreement dated as of
December 21, 2001 (the "Purchase Agreement"), pursuant to which Doubletree has
acquired 303,771 shares of the Company's Series B Preferred Stock (the "Series B
Shares"); and
WHEREAS, in connection with the purchase and sale of the Series B
Shares, the Company has agreed, on the terms and conditions set forth herein, to
register the Series B Shares as set forth below.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements herein contained, and intending to be legally bound hereby, the
parties hereto hereby agree as follows:
1. Definitions.
For purposes of this Agreement, the following terms have the
following meanings when used herein with initial capital letters:
"Demand Notice" shall have the meaning set forth in Section 3 hereof.
"Demand Registration" shall have the meaning set forth in Section 3
hereof.
"Notice" shall have the meaning set forth in Section 2 hereof.
"Piggyback Registration" shall have the meaning set forth in Section
2 hereof.
"Prospectus" shall mean the prospectus included in any Registration
Statement (including without limitation a prospectus that discloses information
previously omitted from a prospectus filed as part of an effective Registration
Statement in reliance upon Rule 430A promulgated under the Securities Act), as
amended or supplemented by any prospectus supplement, with respect to the terms
of the offering of any portion of the Registrable Securities covered by such
Registration Statement and all other amendments and supplements to the
prospectus, including post-effective amendments, and any
material incorporated by reference or deemed to be incorporated by reference in
such Prospectus.
"Registrable Securities" shall mean the Series B Shares, net of any
such shares that are returned to the Company pursuant to the purchase price
adjustment provisions of the Purchase Agreement, plus any other securities
issued or issuable with respect to the Series B Shares by way of a stock
dividend or stock split or in connection with an exchange or combination of
shares, recapitalization, merger, consolidation or other reorganization
"Registration Expenses" shall have the meaning set forth in Section 5
hereof.
"Registration Statement" shall mean any registration statement of the
Company under the Securities Act that covers any of the Registrable Securities
pursuant to the provisions of this Agreement, including the related Prospectus,
all amendments and supplements to such registration statement (including
post-effective amendments), all exhibits and all material incorporated by
reference or deemed to be incorporated by reference in such registration
statement.
"Rule 145" shall mean Rule 145 promulgated by the SEC under the
Securities Act, as such rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the SEC.
"SEC" shall mean the Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Underwritten Offering" shall mean a sale of securities of the
Company to an underwriter for re-offering to the public pursuant to a
Registration Statement.
1. Piggyback Registration.
(a) Right to Piggyback. If, at any time after January 1,
2003 and during the term of this Agreement, the Company proposes to file a
registration statement under the Securities Act with respect to a primary or
secondary offering of any of its securities pursuant to a registration statement
on which it is permissible to register the Registrable Securities for sale to
the public under the Securities Act (other than a registration statement (i) on
Form S-4, S-8 or any successor form thereto, (ii) filed in connection with an
exchange offer, Rule 145 or an offering of securities solely to the Company's
existing shareholders, or (iii) filed in connection with an offering made solely
to employees of the Company), then the Company will give prompt written notice
(the "Notice") of such proposed filing to Doubletree. Such notice will offer
Doubletree the opportunity to register on such registration statement (a
"Piggyback Registration") such number of Registrable Securities as Doubletree
may request ("Piggyback Rights"). Such request must be received at the offices
of the Company within ten (10) business days of mailing the Notice. Subject to
Section 2(b) hereof, the Company will use its reasonable best efforts to include
in such Piggyback Registration all Registrable Securities that Doubletree has so
requested to be included in the Registration Statement; provided,
however, if, at any time after giving written notice of its intention to
register securities and prior to the effective date of the Registration
Statement filed in connection with such registration, the Company shall
determine for any reason not to proceed with the registration, the Company may,
at its election, give written notice of such determination to Doubletree, and
thereupon, shall be relieved of its obligation to register any Registrable
Securities in connection with such registration. If such registration involves
an Underwritten Offering, Doubletree must sell its Registrable Securities to the
underwriters on the same terms and conditions as apply to the Company, with such
differences as may be customary or appropriate in combined primary and secondary
offerings.
(b) Expenses. The Company will pay all Registration
Expenses incurred by the Company in connection with registration of its
Registrable Securities and will not charge Doubletree a pro rata portion of such
expenses incurred by the Company even though Registrable Securities held by
Doubletree are included in such registration under the Piggyback Rights;
provided, however, that the Company will pay no portion of any Registration
Expenses incurred by Doubletree or underwriting discount or selling commission
attributable to the Registrable Securities of Doubletree.
2. Demand Registration.
(a) Request for Registration. Doubletree will have the
right (the "Demand Right") exercisable by written notice delivered to the
Company (a "Demand Notice") to require the Company to register (a "Demand
Registration") Registrable Securities under and in accordance with the
provisions of the Securities Act on an unlimited number of occasions, provided,
however, that the Demand Notice shall specify that at least 50,000 Registrable
Securities are to be registered and that the Demand Registration shall be an
Underwritten Offering; and provided, further, that the Company shall not be
obligated to register Registrable Securities pursuant to the exercise of Demand
Rights on more than one occasion unless the Company is eligible to satisfy its
obligations pursuant to this Section 3(a) by registering the Registrable
Securities on Form S-3. In an Underwritten Offering under this Section 3(a),
Doubletree shall have the right to select the investment banker or underwriter,
which shall be subject to the reasonable approval of the Company.
(b) Filing and Effectiveness. The Company will use its
reasonable best efforts to file a Registration Statement relating to a Demand
Registration for any Registrable Securities as soon as reasonably practicable
and will use reasonable efforts to cause the same to be declared effective by
the SEC within 120 calendar days.
(c) Postponement and Termination of Demand Registration.
The Company will be entitled to postpone the filing period of any Demand
Registration for a reasonable period of time, not to exceed one hundred eighty
(180) days, if the Company determines, in the good faith exercise of the
judgment of its Board of Directors, that such registration and offering could
have a material adverse effect on the Company's business, prospects or financial
condition. If the Company postpones the filing of a Registration Statement, it
will promptly notify Doubletree in writing when events or circumstances
permitting such postponement have ended in the exercise of the good faith
judgment of its Board of Directors and then proceed with the Demand
Registration.
(d) Expenses. The Company will pay all Registration
Expenses incurred by the Company in connection with registration of its
Registrable Securities and will not charge Doubletree a pro rata portion of such
expenses incurred by the Company even though Registrable Securities held by
Doubletree are included in such registration under the Demand Rights; provided,
however, that the Company will pay no portion of any Registration Expenses
incurred by Doubletree or underwriting discount or selling commission
attributable to the Registrable Securities of Doubletree.
3. Registration Procedures.
(a) If and whenever the Company is required to use its
reasonable best efforts to effect or cause the registration of any Registrable
Securities under the Securities Act as provided in this Agreement, the Company
will:
(i) prepare and file with the SEC a Registration
Statement with respect to such Registrable Securities and use its reasonable
best efforts to cause such Registration Statement to become effective; provided,
however, that the Company may discontinue any registration of its securities
that is being effected pursuant to Section 2 at any time prior to the effective
date of the Registration Statement relating thereto;
(ii) prepare and file with the SEC such
amendments and supplements to such Registration Statement and the Prospectus
used in connection therewith as may be necessary;
(iii) furnish to Doubletree such number of copies
of such Registration Statement and of each amendment and supplement thereto (in
each case including all exhibits), such number of copies of the Prospectus
included in such Registration Statement (including each preliminary Prospectus
and summary Prospectus), in conformity with the requirements of the Securities
Act, and such other documents as Doubletree may reasonably request in order to
facilitate the disposition of the Registrable Securities by Doubletree;
(iv) use its reasonable best efforts to register
or qualify such Registrable Securities covered by such Registration Statement
under such other securities or blue sky laws of such jurisdictions as Doubletree
reasonably requests, and do any and all other acts and things that may be
reasonably necessary or advisable, except that the Company shall not for any
such purpose be required to qualify generally to do business as a foreign
corporation in any jurisdiction where, but for the requirements of this clause
(iv), it would not be obligated to be so qualified, to subject itself to
taxation in any such jurisdiction, or to consent to general service of process
in any such jurisdiction;
(v) use its reasonable best efforts to cause such
Registrable Securities covered by such Registration Statement to be registered
with or approved by such other governmental agencies or authorities as may be
necessary to enable Doubletree to consummate the disposition of such Registrable
Securities;
(vi) notify Doubletree, within the required time
period under the Securities Act, of the Company's becoming aware that the
Prospectus included in such Registration Statement, as then in effect, includes
an untrue statement of a material fact or omits to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading in the light of the circumstances then existing, and at the request
of Doubletree, prepare and furnish to Doubletree a reasonable number of copies
of an amended or supplemented Prospectus as may be necessary so that, as
thereafter delivered to the purchasers of such Registrable Securities, such
Prospectus shall not include an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances then
existing;
(vii) otherwise use its reasonable best efforts
to comply with all applicable rules and regulations of the SEC; and
(viii) enter into such customary agreements
(including an underwriting agreement in customary form) and take such other
actions as Doubletree or the underwriters, if any, reasonably request in order
to expedite or facilitate the disposition of such Registrable Securities.
(b) The Company may require Doubletree to furnish the
Company with such information pertinent to the disclosure requirements relating
to the registration and the distribution of such securities as the Company may
from time to time reasonably request in writing.
(c) Doubletree agrees that, upon receipt of any notice from
the Company of the happening of any event of the kind described in clause (vi)
of this Section 5, Doubletree will forthwith discontinue disposition of
Registrable Securities pursuant to the Registration Statement covering such
Registrable Securities until Doubletree's receipt of the copies of the
supplemented or amended Prospectus contemplated by clause (vi) of this Section
5, and, if so directed by the Company, Doubletree will deliver to the Company
(at the Company's expense) all copies, other than permanent file copies then in
Doubletree's possession, of the Prospectus covering such Registrable Securities
current at the time of receipt of such notice.
4. Registration Expenses. The Registration Expenses of the Company
are all fees and expenses incident to the performance of or compliance with this
Agreement by the Company, which include without limitation: (i) all registration
and filing fees (including without limitation fees and expenses (x) with respect
to filings required to be made with the National Association of Securities
Dealers, Inc. and the New York Stock Exchange, and (y) of compliance with
securities or "blue sky" laws (including without limitation fees and
disbursements 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 as the managing
underwriters, if any, of the Registrable Securities being sold may designate)),
(ii) printing expenses (including without limitation expenses of printing
certificates for Registrable Securities and of printing Prospectuses if the
printing of Prospectuses is requested by Doubletree, (iii)
messenger, telephone and delivery expenses, (iv) fees and disbursements of
counsel for the Company, (v) any fees and expenses of any "qualified independent
underwriter" or other independent appraiser participating in an offering
pursuant to Section 3 of Schedule E to the By-laws of the National Association
of Securities Dealers, Inc., (vi) Securities Act liability insurance if the
Company so desires such insurance, (vii) fees and expenses of all other persons
retained by the Company, and (viii) fees and expenses incurred in connection
with the listing of securities on any securities exchange. The Company will pay
its internal expenses (including without limitation all salaries and expenses of
its officers and employees performing legal or accounting duties) and the
expense of any annual audit. In no event, however, will the Company be
responsible for any underwriting discount or selling commission with respect to
any sale of Registrable Securities pursuant to this Agreement or any expense
incurred by Doubletree (except for a Registration Expense of Company paid by
Doubletree due to the Company's failure to comply with this Agreement).
5. Indemnification.
(a) Indemnification by the Company. In the event of any
registration of any securities of the Company under the Securities Act pursuant
to Section 2 or Section 3, the Company will, and it hereby does, indemnify and
hold harmless, to the extent permitted by law, Doubletree, each affiliate of
Doubletree and their respective directors, employees, agents and officers or
members and managers or general and limited partners (and the directors,
officers, affiliates and controlling persons thereof), each other person who
participates as an underwriter in the offering or sale of such securities and
each other person, if any, who controls such seller or any such underwriter
within the meaning of the Securities Act (collectively, the "Indemnified
Parties"), against any and all losses, claims, damages or liabilities, joint or
several, and expenses to which such Indemnified Party may become subject under
the Securities Act, common law or otherwise, insofar as such losses, claims,
damages or liabilities (or actions or proceedings in respect thereof, whether or
not such Indemnified Party is a party thereto) arise out of or are based upon
(a) any untrue statement of any material fact contained in any Registration
Statement under which such securities were registered under the Securities Act,
any preliminary, final or summary Prospectus contained therein, or any amendment
or supplement thereto, or (b) any omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading in the light of the circumstances then existing, and the Company will
reimburse each Indemnified Party for any legal or any other expenses reasonably
incurred by it in connection with investigating or defending any such loss,
claim, liability, action or proceeding; provided, however, that the Company
shall not be liable to any Indemnified Party in any such case to the extent that
any such loss, claim, damage, liability (or action or proceeding in respect
thereof) or expense arises out of or is based upon any untrue statement or
alleged untrue statement or omission or alleged omission made in such
Registration Statement or amendment or supplement thereto or in any such
preliminary, final or summary Prospectus in reliance upon and in conformity with
written information with respect to Doubletree furnished to the Company by
Doubletree for use in the preparation thereof; and provided, further, that the
Company will not be liable to any person who participates as an underwriter in
the offering or sale of Registrable Securities or any other person, if any, who
controls such underwriter within the meaning of the Securities Act, under the
indemnity agreement in this Section 6(a) with respect to any preliminary
Prospectus or the final Prospectus or the final Prospectus as amended or
supplemented, as the case may be, to the extent that any such loss, claim,
damage or liability of such underwriter or controlling person results from the
fact that such underwriter sold Registrable Securities to a person to whom there
was not sent or given, at or prior to the written confirmation of such sale, a
copy of the final Prospectus (including any documents incorporated by reference
therein) or of the final Prospectus as then amended or supplemented (including
any documents incorporated by reference therein), whichever is most recent, if
the Company has previously furnished copies thereof to such underwriter. Such
indemnity shall remain in full force and effect regardless of any investigation
made by or on behalf of Doubletree or any other Indemnified Party and shall
survive the transfer of Registrable Securities by Doubletree.
(b) Indemnification by Doubletree. The Company may require,
as a condition to including any Registrable Securities in any Registration
Statement filed in accordance with Section 5 herein, that the Company shall have
received an undertaking reasonably satisfactory to it from Doubletree and any
underwriter in an Underwritten Offering to indemnify and hold harmless (in the
same manner and to the same extent as set forth in subdivision (a) of this
Section 6) the Company and any other prospective seller or other underwriter
under the Registration Statement, as the case may be, with respect to any
statement in or omission from such Registration Statement, any preliminary,
final or summary Prospectus contained therein, or any amendment or supplement,
if such statement or alleged statement or omission or alleged omission was made
in reliance upon and in conformity with written information with respect to
Doubletree or such underwriter furnished to the Company by Doubletree or such
underwriter for use in the preparation of such Registration Statement,
preliminary, final or summary Prospectus or amendment or supplement, or a
document incorporated by reference into any of the foregoing. Such indemnity
shall remain in full force and effect regardless of any investigation made by or
on behalf of the Company or any other prospective seller or other underwriter,
or any of their respective affiliates, directors, officers or controlling
persons and shall survive the transfer of Registrable Securities by Doubletree.
(c) Notices of Claims, Etc. Promptly after receipt by an
Indemnified Party hereunder of written notice of the commencement of any action
or proceeding with respect to which a claim for indemnification may be made
pursuant to this Section 6, such Indemnified Party will, if a claim in respect
thereof is to be made against an indemnifying party, give written notice to the
latter of the commencement of such action; provided, however, that the failure
of the Indemnified Party to give notice as provided herein shall not relieve the
indemnifying party of its obligations under the preceding subdivisions of this
Section 6, except to the extent that the indemnifying party is actually
prejudiced by such failure to give notice. In case any such action is brought
against an Indemnified Party, unless in such Indemnified Party's reasonable
judgment a conflict of interest between such Indemnified and indemnifying
parties may exist in respect of such claim, the indemnifying party will be
entitled to participate in and to assume the defense thereof, jointly with any
other indemnifying party similarly notified to the extent that it may wish, with
counsel reasonably satisfactory to such Indemnified Party, and after notice from
the indemnifying party to such Indemnified Party of its election so to assume
the defense thereof, the indemnifying party will not be liable to such
Indemnified Party for any legal or other expenses subsequently incurred by the
latter in connection with the defense thereof other than reasonable costs of
investigation. No indemnifying party will consent to entry of any judgment or
enter into any settlement that does not include as an unconditional term
thereof, the giving by the claimant or plaintiff to such Indemnified Party of a
release from all liability in respect to such claim or litigation.
(d) Contribution. If for any reason the indemnification
provided for in the preceding clauses (a) and (b) is unavailable to an
Indemnified Party or insufficient to hold it harmless as contemplated by the
preceding clauses (a) and (b), then the indemnifying party shall contribute to
the amount paid or payable by the Indemnified Party as a result of such loss,
claim, damage or liability in such proportion as is appropriate to reflect not
only the relative benefits received by the Indemnified Party and the
indemnifying party, but also the relative fault of the Indemnified Party and the
indemnifying party, as well as any other relevant equitable considerations,
provided, however, that no party shall be required to contribute in an amount
greater than the dollar amount of the proceeds received by such party with
respect to the sale of any securities. 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) Other Indemnification. Indemnification similar to that
specified in the preceding subdivisions of this Section 6 (with appropriate
modifications) shall be given by the Company and Doubletree with respect to any
required registration or other qualification of securities under any federal or
state law or regulation or governmental authority other than the Securities Act.
(f) Non-Exclusivity. The obligations of the parties under
this Section 6 shall be in addition to any liability that any party may
otherwise have to any other party.
6. Miscellaneous.
(a) No Inconsistent Agreements. The Company will not, on or
after the date hereof, enter into any agreement with respect to its securities
that is inconsistent with the rights granted to Doubletree in this Agreement or
otherwise conflicts with the provisions hereof.
(b) Amendments and Waivers. The provisions of this
Agreement, including the provisions of this sentence, may only be amended,
modified or supplemented, and waivers or consents to departures from the
provisions hereof may only be given by written consent of both parties.
(c) Notices. All notices and other communications provided
for hereunder shall be in writing and shall be sent by first class mail,
facsimile or hand delivery:
(i) if to the Company, to:
WestCoast Hospitality Corporation
WHC Building
201 West North River Drive
Spokane, Washington 99201
Attn.: Richard L. Barbieri, Esq.
General Counsel
Telephone:509-459-6018
Fax: 509-325-7324
(ii) if to Doubletree, to:
Doubletree Hotels Corporation
9336 Civic Center Drive
Beverly Hills, California 90210
Attn.: David Sherf
Telephone: 310-205-4692
Fax: 310-205-4092
All such notices and communications shall be deemed to have been
given or made (i) when delivered by hand, (ii) five (5) business days after
being deposited in the mail, postage prepaid, or (iii) when telecopied, receipt
acknowledged.
(d) Counterparts. This Agreement may be executed in any
number of counterparts and by the parties hereto in separate counterparts, each
of which when so executed will be deemed to be an original and all of which
taken together will constitute one and the same instrument.
(e) Headings. The headings in this Agreement are for
convenience of reference only and will not limit or otherwise affect the meaning
hereof.
(f) Governing Law. THIS AGREEMENT WILL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF WASHINGTON, AS APPLIED TO
CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF WASHINGTON, WITHOUT REGARD TO
PRINCIPLES OF CONFLICT OF LAWS.
(g) Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction to be
invalid, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions set forth herein will remain in full force and effect
and will in no way be affected, impaired or invalidated, and the parties hereto
will use their reasonable best efforts to find and employ an alternative means
to achieve the same or substantially the same result as that contemplated by
such term, provision, covenant or restriction. It is hereby stipulated and
declared to be the intention of the parties that they would have executed the
remaining terms, provisions, covenants and restrictions without including any of
such that may be hereafter declared invalid, void or unenforceable.
(h) Entire Agreement. This Agreement is intended by the
parties as a final expression of their agreement and is intended to be a
complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the registration rights granted by the Company with respect to the Registrable
Securities. This Agreement supersedes all prior agreements and understandings
among the parties with respect to such registration rights.
(i) Attorneys' Fees. In the event of any action or
proceeding brought to enforce any provision of this Agreement, or if any
provision hereof is validly asserted as a defense, the prevailing party, as
determined by the court, will be entitled to recover reasonable attorneys' fees
in addition to any other available remedy.
(j) Termination. This Agreement shall terminate, and
thereby become null and void, on the 5th anniversary of the date hereof (the
"Termination Date"); provided, however, that the provisions of Section 6 and
Sections 7(f) and (i) shall survive the termination of this Agreement.
IN WITNESS HEREOF, the parties have executed a counterpart signature page of
this Agreement as of the date first above written.
WESTCOAST HOSPITALITY
CORPORATION
By:_______________________________________
Name: Arthur M. Coffey
Title: Executive Vice President and Chief
Financial Officer
DOUBLETREE CORPORATION
By:_______________________________________
Name:_____________________________________
Title:____________________________________