Document:

EX-4.16 Stock Purchase Warrant

 

Exhibit 4.16

THE SECURITIES REPRESENTED BY THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON
EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”),
AND MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
ACT OR AN EXEMPTION FROM REGISTRATION THEREUNDER.

UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR WARRANTS IN DEFINITIVE FORM, THIS WARRANT
MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A
NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY OR BY THE
DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITORY.
THE DEPOSITORY TRUST COMPANY (“DTC”) (55 WATER STREET, NEW YORK, NEW YORK) SHALL ACT AS THE
DEPOSITORY UNTIL A SUCCESSOR SHALL BE APPOINTED BY THE COMPANY. UNLESS THIS CERTIFICATE IS
PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF DTC TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO.
OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

 

TOUSA, INC.

STOCK PURCHASE WARRANT

			
	Date of Issuance: July 31, 2007
	 	Certificate No. W-000001

     FOR VALUE RECEIVED, TOUSA, Inc., a Delaware corporation (the “Company”), hereby grants
to Cede & Co. or its registered assigns (the “Holder”) the right to purchase from the
Company, subject to Section 15 hereof, the Calculated Amount of shares of the Company’s Common
Stock (the “Warrant Shares”) at a price per share equal to the Exercise Price (as adjusted
from time to time in accordance herewith). Certain capitalized terms used herein are defined in
Section 5 hereof. The amount and kind of securities obtainable pursuant to the rights
granted hereunder and the purchase price for such securities are subject to adjustment pursuant to
the provisions contained in this Warrant.

1. Exercise of Warrant.

     1.1 Exercise Period. The Holder may exercise, in whole or in part, the purchase rights
represented by this Warrant at any time after the date on which the Exercise Price is established
to and including July 31, 2012 (the “Exercise Period”).

     1.2 Exercise. The Warrant may be exercised in full by the Holder hereof by delivery of an
original or facsimile copy of the form of subscription attached as Exhibit A hereto (the
“Subscription Form”) duly executed by such Holder and surrender of the original Warrant within four
(4) days of exercise to the Company at its principal office. The method of payment of the Exercise
Price shall be chosen by the Company pursuant to Section 1.4 hereof.

          (a) This Warrant shall be deemed to have been exercised and such certificate or certificates
representing the Warrant Shares to be issued in connection with such exercise shall be deemed to
have been issued, and the Holder or any other person so designated to be named therein shall be
deemed to have become the Holder of record of such Warrant Shares for all purposes, as of the date
the Warrant has been exercised in accordance with the terms hereof, notwithstanding that the stock
transfer books of the Company shall then be closed or that certificates representing such Warrant
Shares shall not then be physically delivered to the Holder. No deduction shall be made from the
amount paid by the Holder for any commissions, discounts or other expenses incurred by the Company
for any underwriting of the issue or otherwise in connection therewith

          (b) The Company shall pay all documentary stamp taxes attributable to the issuance of Warrant
Shares underlying this Warrant upon the exercise as provided herein; provided, however, that the
Company shall not be required to pay any tax which may be payable
in respect of any transfer involved in the registration of any certificate for Warrant Shares
underlying this Warrant in a name other that of the Holder. The Holder is responsible for all

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other tax liability that may arise as a result of holding or transferring this Warrant or receiving
shares of Common Stock underlying this Warrant upon exercise hereof.

     1.3 Partial Exercise. The Warrant may be exercised in part (but not for a fractional
share) by delivery of an original or facsimile copy of the Subscription Form duly executed by such
Holder and surrender of this Warrant in the manner and at the place provided in subsection 1.2
except that the amount payable by the Holder on such partial exercise shall be the amount obtained
by multiplying (a) the number of whole Warrant Shares designated by the Holder in the Subscription
Form by (b) the Exercise Price then in effect as selected by such Holder. On any such partial
exercise, the Company, at its expense, will forthwith issue and deliver to or on the order of the
Holder hereof a new Warrant of like tenor representing the unexercised Calculated Amount with an
appropriate allocation of the two different Exercise Prices, if applicable, in the name of the
Holder hereof or as such Holder (upon payment by such Holder of any applicable transfer taxes) may
request, the whole number of Warrant Shares for which such Warrant may still be exercised. Upon
partial exercise, the Holder shall specify the Calculated Amount being exercised and the associated
Exercise Price as set forth in the Subscription Form.

     1.4 Delivery of Stock Certificates and/or Cash, etc. on Exercise. The Company agrees that
the Warrant Shares purchased upon exercise of this Warrant shall be deemed to be issued to the
Holder hereof as the record owner of such shares as of the close of business on the date on which
this Warrant shall have been surrendered and payment made for such shares as provided herein. As
soon as practicable after the exercise of the Warrant in full or in part, and in any event within
ten (10) Business Days thereafter, the Company will at its option (i) deliver cash equal to the
Sale Price of the Common Stock to be delivered less the Exercise Price; (ii) pay such amount in
Common Stock rather than cash; (iii) deliver shares of Common Stock upon receiving the Exercise
Price per share therefor (which may be paid in cash, wire transfer of immediately available funds
or by certified or official bank check payable to the order of the Company); or (iv) any
combination of the foregoing. Each certificate shall have the legend contained on the first page
of this Warrant, if appropriate.

     2. Adjustment of Exercise Price and Number of Warrant Shares. The Exercise Price in effect
and the number and kind of securities purchasable upon the exercise of this Warrant shall be
subject to adjustment from time to time upon the happening of certain events as provided in this
Section 2.

          (a) If after the Issue Date, the Company: (1) pays a dividend or makes a distribution on its
Common Stock in shares of its Common Stock; (2) subdivides its outstanding shares of Common Stock
into a greater number of shares; and (3) combines its outstanding shares of Common Stock into a
smaller number of shares, then the Exercise Price in effect immediately prior to such action shall
be adjusted to the number obtained by multiplying the Exercise Price by a fraction, the numerator
which shall be the number of shares of Common Stock outstanding immediately prior to such action, and the denominator which shall be the
number of shares of Common Stock outstanding immediately following such action.

          (b) If the Company issues any shares of its Common Stock at a price below the Exercise Price,
the Exercise Price shall be adjusted as follows:

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	X

	 	=
	 	Number of shares of Common Stock (i) outstanding immediately prior
to the issuance, and (ii) then issuable upon exercise of any of the
Company’s outstanding securities including, options, warrants and
shares of Series A Preferred Stock
	YA

	 	=
	 	Exercise Price immediately prior to the announcement of the issuance
	ZB

	 	=
	 	$ amount of capital raised in new financing
	YB

	 	=
	 	New financing price per share (which shall be the price to the
public in an underwritten offering)
	YAB

	 	=
	 	New Exercise Price
	YAB

	 	=
	 	YA ( (X + ZB/YA ) / (X + ZB/YB) )

          (c) If the Company issues Common Stock below the Market Price (in excess of a 6% discount from
Market Price), the Exercise Price shall be adjusted as follows: by multiplying the existing
Exercise Price by 1.00 – (A * B).

     Where A = the percentage difference between the share price before the announcement of the
below Market Price offering and the pro forma share price after the offering (with the percentage
difference calculated off of the share price before announcement), where the pro forma share price
after the offering shall be calculated by adding the amount of money raised in the financing
(amount raised shall be gross proceeds, defined as total proceeds inclusive of gross spread and
other underwriting fees and expenses) to the pre-financing equity market capitalization of the
Company and dividing such number by all of the primary shares outstanding after the offering.

          (d) Where B = the difference between (a) the Total Discount minus (b) 6%, which difference
shall be divided by the Total Discount. The Total Discount shall equal one minus the quotient of
(x) the price of new shares issued divided by (y) the share price before the announcement of the
below market price offering. If the Company pays a dividend to holders of its Common Stock (other
than in shares of Common Stock or rights to purchase Common Stock), the Exercise Price shall be
adjusted by multiplying the Exercise Price in effect immediately prior to the close of business on
the record date for such dividend by a fraction of which (A) the numerator which shall be (1) the
Sale Price per share of Common Stock on the earlier of such record date or the Trading Day
immediately preceding the ex-dividend date for such dividend less (2) the Fair Market Value of such
dividend per share, and (B) the denominator which shall be the Sale Price per share of Common Stock
on the earlier of such record date or the Trading Day immediately preceding the ex-dividend date
for such distribution.

          (e) The adjustment shall become effective immediately after the record date in the case of a
dividend or distribution and immediately after the effective date in the case of a
subdivision, combination or reclassification. If after an adjustment, a Holder of a share of
this Warrant upon conversion of such Warrant may receive shares of two or more classes of Capital
Stock of the Company, the Exercise Price will thereafter be subject to adjustment upon the
occurrence of an action taken with respect to any such class of Capital Stock with respect to the
Common Stock on terms comparable to those applicable to Common Stock described herein.

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          (f) Only one adjustment shall be made with respect to any event causing an adjustment. If an
adjustment is required by Section 2.1(b) and (c) hereof, only the adjustment resulting in the
greatest decrease in the Exercise Price shall be made.

          (g) No adjustment in the Exercise Price need be made unless the adjustment would require an
increase or decrease of at least $0.01 in the Exercise Price. Any adjustments that are not made
shall be carried forward and taken into account in any subsequent adjustment. All calculations
relating to anti-dilution adjustments shall be made to the nearest cent.

          (h) No adjustment need be made for rights to purchase Common Stock except upon the exercise
thereof. In addition, no adjustment need be made for a change in the par value or no par value of
the Common Stock. No adjustment shall be made to the Exercise Price for the issuance of any
Excluded Stock.

          (i) If the Company is a party to a transaction involving a sale of substantially all of the
assets of the Company or a merger or binding share exchange which reclassifies or changes its
outstanding Common Stock, the successor entity will be required to assume the obligations of the
Company with respect to this Warrant. In addition, if the Company in connection with any such
transaction makes a distribution to all holders of its Common Stock of any of its assets, or debt
securities or any rights, warrants or options to purchase securities of the Company, then, from and
after the record date for determining the holders of Common Stock entitled to receive the
distribution, a holder of a share of this Warrant that exercises this Warrant would, upon such
conversion, be entitled to receive, in addition to the shares of Common Stock into which such
Warrant is exercisable, the kind and amount of securities, cash or other assets comprising the
distribution that such holder would have received if such holder had exercised the Warrant
immediately prior to the record date for determining the holders of Common Stock entitled to
receive the distribution.

          (j) Whenever the Exercise Price is adjusted in accordance with this Section 2, the Company
shall: (1) forthwith compute the Exercise Price in accordance with this Section 2 and prepare and
transmit to the Transfer Agent a certificate form an Officer setting forth the Exercise Price, the
method of calculation thereof in reasonable detail, and the facts requiring such adjustment and
upon which such adjustment is based; and (2) as soon as practicable following the occurrence of an
event that requires an adjustment to the Exercise Price pursuant to Section 2 (or if the Company is
not aware of such occurrence, as soon as practicable after becoming so aware), provide a written
notice to the holder of the Warrant of the occurrence of such event and a statement setting forth
in reasonable detail the method by which the adjustment to the Exercise Price was determined and
setting forth the adjusted Exercise Price.

          (k) After an adjustment to the Exercise Price, any subsequent event requiring an adjustment
will cause a subsequent adjustment to the Exercise Price as so adjusted.

          (l) In connection with the exercise of this Warrant, no fractions of shares of Common Stock
shall be issued, but the Company shall, with respect to any fractional interest: (i) pay cash with
respect to the Market Price of such fractional share; or (ii) round up to the next whole share of
Common Stock.

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3. Certificate as to Adjustments. In each case of any adjustment or readjustment in the
Warrant Shares issuable on the exercise of the Warrants, the Company will cause an Officer or other
appropriate designee to compute such adjustment or readjustment in accordance with the terms of the
Warrant and prepare a certificate setting forth such adjustment or readjustment and showing in
detail the facts upon which such adjustment or readjustment is based, including the number of
Warrant Shares to be received upon exercise of this Warrant, in effect immediately prior to such
adjustment or readjustment and as adjusted or readjusted as provided in this Warrant. The Company
will mail a copy of each such certificate to the Holder of the Warrant and to the Transfer Agent.

4. Reservation of Stock, etc. Issuable on Exercise of Warrant. The Company will at all times
reserve and keep available, solely for issuance and delivery on the exercise of the Warrants, a
sufficient number of shares of Common Stock from time to time issuable on the exercise of the
Warrant.

5. Definitions. As used herein, capitalized terms, in addition to the terms defined elsewhere
herein and unless the context otherwise requires, have the following respective meanings:

          (a) “Base Price” means the 20-Trading Day average closing price of the Company’s
common stock commencing 60 calendar days after July 31, 2007, which shall be used in the
Black-Scholes option pricing model when valuing and calculating the number of Warrants.

          (b) “Business Day” shall mean any day other than a Saturday, Sunday or any day on
which banking institutions are authorized to close in New York, New York.

          (c) “Calculated Amount” means the amount determined using the Black-Scholes option
pricing model based on the terms hereafter to achieve a total value of $16.25 million on the
Calculation Date (as defined below); provided, however, that (a) the number of Warrants issued if
the Base Price (as defined below) is less than $4.25 shall be equal to the number of Warrants
issued if the Base Price was $4.25 and (b) the number of Warrants issued if the Base Price is
greater than $6.00 shall be equal to the number of Warrants issued if the Base Price was $6.00. A
50.0% volatility rate shall be used in the Black-Scholes option pricing model when valuing and
calculating the number of Warrants. The Risk Free Rate will be measured at the 5 Year Treasury
Yield on the last day of the 20 Trading Day period commencing 60 calendar days after the Issue
Date.

          (d) “Calculation Date” means the 20th Trading Day that shall occur following the 60th
calendar day after July 31, 2007.

          (e) “Capital Stock” means any and all shares or other equivalents (however designated)
of capital stock, including all common stock and all preferred stock, in the case of a corporation,
partnership interests or other equivalents (however designated) in the case of a partnership,
membership interests or other equivalents (however designated) in the case of a limited liability
company, or common shares of beneficial interest or other equivalents (however designated) in the
case of a trust.

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          (f) “Commission” shall mean the United States Securities and Exchange Commission or
any other federal agency at the time administering the Securities Act.

          (g) “Common Stock” means (i) the Company’s common stock, $0.01 par value per share,
and (ii) any other securities into which or for which any of the securities described in clause (i)
may be converted or exchanged pursuant to a plan of recapitalization, reorganization, merger, sale
of assets or otherwise.

          (h) “Common Stock” means shares of the Common Stock, par value $0.01 per share of the
Company.

          (i) “Exercise Price” means shall be as follows: (i) 50% of the number of warrants to
be issued will have a strike price equal to the Base Price multiplied by 1.25; and (ii) 50% of the
number of warrants to be issued will have a strike price equal to the Base Price multiplied by
1.50; provided, however that in each case the Base Price shall never be (x) lower than $4.25 or (y)
higher than $6.00. Within 3 days of calculating the Exercise Price, the Company shall prepare and
transmit to the Transfer Agent and the Holder a certificate signed by an Officer setting forth the
Exercise Price and the method of calculation thereof in reasonable detail.

          (j) “Excluded Stock” means (A) shares of Common Stock, and options therefor, issued or
granted from time to time to employees, directors and officers of and consultants to the Company
pursuant to agreements, plans or arrangements approved by the Board of Directors; (B) shares of 8%
Series A Convertible Pay-in-Kind Preferred Stock or Common Stock issued upon conversion of shares
of the 8% Series A Convertible Pay-in-Kind Preferred Stock; (C) shares of Common Stock issued by
the Company for which an adjustment has been made pursuant to Section 2; (D) shares of Common Stock
issued upon exercise of warrants to purchase Common Stock pursuant to this Warrant; and (E) shares
issued for the acquisition of property or securities of another entity.

          (k) “Fair Market Value” “Fair Market Value” means (i) with respect to cash, the actual
cash amount and (ii) if the property is not cash, the determination of the “Fair Market Value”
shall be made by the Company’s Board of Directors acting reasonably and in good faith and which
shall be evidenced by a resolution of such Board of Directors.

          (l) “Market Price” means the average of the Sale Prices of the Common Stock for the
five Trading Day period ending on (if the third Business Day prior to the date of exercise of the
Warrant is a Trading Day or, if not, then on the last Trading Day prior to) the third Business Day
prior to the date of exercise of the Warrant, appropriately adjusted to take into account the
occurrence, during the period commencing on the first of such Trading Days during such five Trading
Day period and ending on such exercise date, of certain events that would result in an
adjustment of the Exercise Price. If Sale Prices are not available, the determination of the
“Market Price” shall be made by the Corporation’s Board of Directors acting reasonably and in good
faith and will be evidenced by a resolution of such Board of Directors.

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          (m) “Officer” means the Chairman, any Vice Chairman, the Chief Executive Officer, the
President, the Chief Operating Officer, any Vice President, the Chief Financial Officer, the
Treasurer, or the Secretary of the Company.

          (n) “Sale Price” means the closing per share sale price (or if no closing sale price
is reported, the average of the bid and ask prices or, if more than one in either case, the average
of the average bid and the average ask prices) on such date as reported in composite transactions
for the principal United States securities exchange on which the Common Stock is traded or, if the
Common Stock is not listed on a United States national or regional securities exchange, as reported
by the National Association of Securities Dealers Automated Quotation System or by the National
Quotation Bureau Incorporated.

          (o) “Securities Act” means the U.S. Securities Act of 1933, as amended, or any similar
federal statute and the rules and regulations of the Commission promulgated thereunder, all as the
same shall be in effect from time to time.

          (p) “Trading Day” means a day on which the Common Stock traded on the Company’s
principal national securities exchange or quotation system or in the over-the-counter market was
not suspended from trading on any national or regional securities exchange or association of
over-the-counter market at the close of business on such day.

          (q) “Transfer Agent” means Compushare Investor Services LLC or such other person or
entity designated by the Company as the transfer agent for the Common Stock.

6. Assignment; Exchange of Warrant. Subject to compliance with all applicable securities
laws, this Warrant, and all rights hereunder are assignable or transferable upon the surrender for
exchange of this Warrant with endorsement of the holder of this Warrant proposing to effect the
assignment and the Holder of this Warrant may assign such Warrant (a “Transferor”) in the
form of Exhibit B attached hereto (the “Transferor Endorsement Form”) and, if the
Warrant has not been registered under the Securities Act of 1933, as amended, and as reasonably
requested by the Company together with an opinion of counsel reasonably satisfactory to the Company
that the transfer of this Warrant will be in compliance with all applicable securities laws, the
Company at its expense, but with payment by the Transferor of any applicable transfer taxes, will
issue and deliver to or on the order of the Transferor thereof a new Warrant or Warrants of like
tenor, in the name of the Transferor and/or the transferee(s) specified in such Transferor
Endorsement Form (each, a “Transferee”), calling in the aggregate on the face or faces
thereof for the number of shares of Common Stock called for on the face or faces of the Warrant so
surrendered by the Transferor.

7. Replacement of Warrant. If this Warrant shall be mutilated, lost, stolen or destroyed, the
Company shall issue, in exchange and in substitution for and upon cancellation of the mutilated
Warrant, or in lieu of and substitution for the Warrant lost, stolen or destroyed, a new Warrant of like tenor, but only upon
receipt of evidence of such loss, theft or destruction of such Warrant and indemnity, if requested,
satisfactory to the Company and the Transfer Agent.

8. No Shareholder Rights. This Warrant shall not entitle the Holder hereof to any voting
rights or other rights as a stockholder of the Company.

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9. Transfer on the Company’s Books. Until this Warrant is transferred on the books of the
Company, the Company may treat the Holder hereof as the absolute owner hereof for all purposes,
notwithstanding any notice to the contrary.

10. Representations and Covenants of Holder. The Holder represents and warrants that it is
acquiring the Warrant and the Warrant Shares solely for its account for its own account and not
with a view to or for sale or distribution of said Warrant or Warrant Shares or any part thereof.
The Holder also represents that the entire legal and beneficial interests of the Warrant and
Warrant Shares the Holder is acquiring are being acquired for, and will be held for, the Holder’s
account only.

11. Notices. All notices, demands, requests, consents, approvals, and other communications
required or permitted hereunder shall be in writing and, unless otherwise specified herein, shall
be (i) personally served, (ii) deposited in the mail, registered or certified, return receipt
requested, postage prepaid, (iii) delivered by reputable air courier service with charges prepaid,
or (iv) transmitted by hand delivery, telegram, or facsimile, addressed as set forth below or to
such other address as such party shall have specified most recently by written notice. Any notice
or other communication required or permitted to be given hereunder shall be deemed effective (a)
upon hand delivery or delivery by facsimile, with accurate confirmation generated by the
transmitting facsimile machine, at the address or number designated below (if delivered on a
Business Day during normal business hours where such notice is to be received), or the first
Business Day following such delivery (if delivered other than on a Business Day during normal
business hours where such notice is to be received) or (b) on the second Business Day following the
date of mailing by express courier service, fully prepaid, addressed to such address, or upon
actual receipt of such mailing, whichever shall first occur. The addresses for such communications
shall be: (i) if to the Company to: TOUSA, Inc., 4000 Hollywood Blvd., Suite 500-N, Hollywood,
Florida 33021, Attention: General Counsel, Telecopier No.: 954-364-4037.

12. Descriptive Headings. The description headings of the several sections and paragraphs of
this Warrant are inserted for convenience only, do not constitute a part of this Warrant, and shall
not limit or otherwise affect any of the terms hereof.

13. Governing Law; Dispute Resolution. This Warrant shall be construed and enforced in
accordance with, and the rights of the parties shall be governed by, the laws of the State of New
York, without regard to its conflicts of law principles. The Company and the Holder hereby agree
that any dispute arising out of or relating to this Warrant, or any action for recognition or
enforcement of any judgment, shall be adjudicated by any New York State court or federal court of
the United States sitting in New York City, and any appellate court from any thereof.

14. Miscellaneous. This Warrant and any term hereof may be changed, waived, discharged or
terminated only by an instrument in writing by the Company and the Holder. The invalidity or
unenforceability of any provision hereof shall in no way affect the validity or enforceability of
any other provision.

15. Conversion Limitation. A holder of this Warrant shall not have the right to exercise this
Warrant, to the extent (but only to the extent) that after giving effect to such conversion, such
holder would become the beneficial owner on its own or with members of a “group” ((as such

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term is
used in Sections 13(d) and 14(d) of the Securities and Exchange Act of 1934 (the “Exchange Act”),
as amended, or any successor provisions to either of the preceding), including any group acting
for the purpose of acquiring, holding, voting or disposing of securities within the meaning of Rule
13d-5(b)(1) under the Exchange Act)) of that number of shares of Common Stock that would exceed or
equal the greater of (i) 39.99% of the shares of Common Stock then outstanding immediately after
giving effect to such conversion or (ii) the lowest number of shares of Common Stock that would
constitute a Change of Control (as such term is defined in any agreement to which the Company is
then a party including any of its credit facilities or indentures) of the number of shares of
Common Stock outstanding immediately after giving effect to such conversion. Except as set forth in
the preceding sentence, for purposes of this Section 15, beneficial ownership shall be calculated
in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended. For any
reason at any time, upon the written or oral request of the holder, the Company shall within one
Trading Day confirm orally and in writing to the holder the number of shares of Common Stock then
outstanding. In any case, the number of outstanding shares of Common Stock shall be determined
after giving effect to the conversion or exercise of securities of the Company by the holder or its
Affiliates.

16. Amendment. The Company and the Holder agree that this Warrant may be amended by them upon
mutual agreement, including, without limitation, to facilitate transfers of interests in this
Warrant and the appointment of a warrant agent.

* * * * * * *

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     IN WITNESS WHEREOF, the Company has executed this Warrant as of the date first written above.

	 	 	 	 	 
	 	TOUSA, INC.

 	 
	 	By:  	/s/ Stephen M. Wagman
 	 
	 	 	Name:  	Stephen M. Wagman 	 
	 	 	Title:  	Chief Financial Officer 	 
	 

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Exhibit A

FORM OF SUBSCRIPTION

(to be signed only on exercise of Warrant)

TO: TOUSA, INC.

(1) Payment. (a) The undersigned, pursuant to the provisions set forth in the attached Warrant
(No.                     ), hereby irrevocably elects to purchase                                 shares of Common Stock of TOUSA. Inc.
(the “Company”) covered by such Warrant, and promises to tender payment of the full
exercise price for such shares at the price provided for pursuant to clause (i) of the definition
of the Exercise Price (a strike price equal to the Base Price multiplied by 1.25), and subject to
the adjustment as provided in, such Warrant, together with all applicable transfer taxes, if any.
The Company shall determine the method of payment of the Exercise Price pursuant to the attached
Warrant.

(b) The undersigned, pursuant to the provisions set forth in the attached Warrant (No.                     ),
hereby irrevocably elects to purchase                                 shares of Common Stock of TOUSA. Inc. (the
“Company”) covered by such Warrant, and promises to tender payment of the full exercise
price for such shares at the price provided for pursuant to clause (ii) of the definition of the
Exercise Price (a strike price equal to the Base Price multiplied by 1.50), and subject to the
adjustment as provided in, such Warrant, together with all applicable transfer taxes, if any. The
Company shall determine the method of payment of the Exercise Price pursuant to the attached
Warrant.

	 	 	 	 	 
	(2) The undersigned requests that the certificates for said shares of Common Stock be issued in the name of, and delivered to ________	 	 
	 	 	 
	whose address is
	 	 	 	 
	 	 	 
	 
	 	 	 	 
	 	 	 

The undersigned represents and warrants that all offers and sales by the undersigned of the
securities issuable upon exercise of the within Warrant shall be made pursuant to registration of
the Common Stock under the Securities Act of 1933, as amended (the “Securities Act”), or
pursuant to an exemption from registration under the Securities Act.

	 	 	 	 	 	 	 
	Dated:
	 	 	 	 	 	 
	 

	 	 

	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	 	 	(Signature must conform to name of holder as specified on the face of the Warrant)
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 

 

 

(Address)

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Exhibit B

FORM OF TRANSFEROR ENDORSEMENT

(To be signed only on transfer of Warrant)

     For value received, the undersigned hereby sells, assigns, and transfers unto the person(s)
named below under the heading “Transferees” the right represented by the within Warrant to purchase
the percentage and number of shares of Common Stock of TOUSA, INC. to which the within Warrant
relates specified under the headings “Percentage Transferred”, “Number Transferred,” and “Exercise
Price” respectively, opposite the name(s) of such person(s) and appoints each such person Attorney
to transfer its respective right on the books of TOUSA, INC. with full power of substitution in the
premises.

	 	 	 	 	 	 	 
	Transferees	 	Percentage Transferred	 	Number Transferred	 	Exercise Price
	 

	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 

	 	 	 	 	 	 	 	 	 
	Dated:
	 	 	, 	 	 	 	 	 
	 

	 	 
	 	 
	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	(Signature must conform to name of holder as
	 

	 	 	 	 	 	 	 	specified on the face of the warrant)
	 	 	 	 
	Signed in the presence of: 
	 	 	 
	 	 	 	 	 
	 

	 	 	 	(Name)	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	ACCEPTED AND AGREED:	 	 	 	 
	[TRANSFEREE]	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	(address)
	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	(address)EX-4.17 Registration Rights Agreement

 

Exhibit 4.17

REGISTRATION RIGHTS AGREEMENT

     REGISTRATION RIGHTS AGREEMENT (this “Agreement”), dated as of July 31, 2007, by and
among TOUSA, Inc., a Delaware corporation (the “Company”) and the undersigned Lenders.

WHEREAS:

     A. The Company, certain of its subsidiaries, Deutsche Bank Trust Company Americas, Deutsche
Bank Securities Inc., other entities party thereto, and the lenders (the “Lenders”) party to that
certain $137,500,000 Senior Mezzanine Credit Agreement, dated as August 1, 2005 by and among
TE/TOUSA Mezzanine, LLC and the other parties thereto have agreed to a global settlement, as set
forth in the Settlement and Release Agreement dated June 29, 2007 (the “Settlement
Agreement”), which shall be effected in the manner and subject to the conditions set forth
therein.

     B. In connection with the Settlement Agreement, the Company has agreed, upon the terms and
subject to the conditions set forth in the Settlement Agreement, to issue to each Lender shares of
the Company’s 8% Series A Convertible Pay-in-Kind Preferred Stock (the “Preferred Shares”),
the terms of which are set forth in the certificate of designation, powers, preferences and rights
for such series of preferred shares dated July 31, 2007 and filed by the Company with the Secretary
of State of the State of Delaware (the “Certificate of Designation”) which, among other
things, is convertible into shares of the Company’s common stock, par value $.01 per share (the
“Common Stock”) (as converted, the “Conversion Shares”).

     C. In accordance with the terms of the Settlement Agreement, the Company has agreed to provide
certain registration rights for the Preferred Shares and Conversion Shares under the Securities Act
of 1933, as amended, and the rules and regulations thereunder, or any similar successor statute
(collectively, the “1933 Act”), and 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 each of the Investors hereby agree as follows:

1. Definitions.

     As used in this Agreement, the following terms shall have the following meanings:

	 	(a)	 	“Business Day” means any day other than Saturday, Sunday or any other
day on which commercial banks in the City of New York are authorized or required by law
to remain closed.
	 
	 	(b)	 	“Closing Date” means the date hereof.
	 
	 	(c)	 	“Effective Date” means the date that the Registration Statement has
been declared effective by the SEC.

 

 

	 	(d)	 	“Effectiveness Deadline” means the date which is two-hundred and
seventy (270) days after the Closing Date.
	 
	 	(e)	 	“Filing Deadline” means the date that is one-hundred and twenty (120)
days after the Closing Date.
	 
	 	(f)	 	“Investor” means a Lender or any transferee or assignee thereof to whom
a Lender assigns its rights under this Agreement and who agrees to become bound by the
provisions of this Agreement in accordance with Section 9 and any transferee or
assignee thereof to whom a transferee or assignee assigns its rights under this
Agreement and who agrees to become bound by the provisions of this Agreement in
accordance with Section 9.
	 
	 	(g)	 	“Person” means an individual, a limited liability company, a
partnership, a joint venture, a corporation, a trust, an unincorporated organization
and a government or any department or agency thereof.
	 
	 	(h)	 	“register,” “registered,” and “registration” refer to a
registration effected by preparing and filing one or more Registration Statements in
compliance with the 1933 Act and pursuant to Rule 415 and the declaration or ordering
of effectiveness of such Registration Statement(s) by the SEC.
	 
	 	(i)	 	“Registrable Securities” means (i) the Preferred Shares, (ii) the
Conversion Shares issued or issuable upon conversion of the Preferred Shares, and (iii)
any capital stock or other securities of the Company issued or issuable, with respect
to the Preferred Shares or the Conversion Shares, as a result of any stock split, stock
dividend, recapitalization, exchange or similar event or otherwise.
	 
	 	(j)	 	“Registration Statement” means a registration statement or registration
statements of the Company filed under the 1933 Act covering the Registrable Securities.
	 
	 	(k)	 	“Required Holders” means the holders of at least a majority of the
Registrable Securities.
	 
	 	(l)	 	“Required Registration Amount” means (i) all of the Preferred Shares
issued or issuable pursuant to the Certificate of Designation and (ii) the number of
Conversion Shares issued and issuable pursuant to the Certificate of Designation, as of
the trading day immediately preceding the applicable date of determination.
	 
	 	(m)	 	“Rule 415” means Rule 415 under the 1933 Act or any successor rule
providing for offering securities on a continuous or delayed basis.
	 
	 	(n)	 	“SEC” means the United States Securities and Exchange Commission.

2. Registration.

	 	(a)	 	Mandatory Registration. The Company shall prepare and use its
commercially reasonable efforts to file no later than the Filing Deadline with the SEC
the

2

 

	 	 	 	Registration Statement on Form S-3, or such other appropriate form if Form S-3 is
then unavailable, covering the resale of all of the Registrable Securities by the
Investors party hereto from time to time. The Registration Statement prepared
pursuant hereto shall register for resale the Registrable Securities in amounts at
least equal to the Required Registration Amount. The Registration Statement shall
contain (except if otherwise directed by the Required Holders) the “Plan of
Distribution” section with at least that information substantially the form attached
hereto as Exhibit A, to the extent permitted by the rules, regulations, and
form requirements promulgated by the SEC, except to the extent revised pursuant to
comments received from the staff of the SEC. The Company shall use its commercially
reasonable efforts to have the Registration Statement declared effective by the SEC
as soon as practicable, but in no event later than the Effectiveness Deadline. By
9:30 am (New York City time) on the second Business Day following the Effective
Date, the Company shall file with the SEC in accordance with Rule 424 under the 1933
Act the final prospectus to be used in connection with sales pursuant to such
Registration Statement.
	 
	 	(b)	 	Piggy-Back Registration Rights. Unless a registration statement with
respect to the Registrable Securities has already been declared effective by the SEC,
if the Company files a registration statement covering the resale of equity or
equity-linked securities prior to the Effectiveness Deadline, (i) the Investors shall
receive fifteen (15) days prior notice thereof, and (ii) such registration statement
shall also cover the Registrable Securities to the extent the Investors elect to have
their Registrable Securities included therein.
	 
	 	(c)	 	Effect of Failure to Obtain Effectiveness of Registration Statement.
If a Registration Statement covering all of the Registrable Securities in amounts at
least equal to the Required Registration Amount is not declared effective by the SEC on
or before the Effectiveness Deadline or once effective, does not remain effective,
other than during a Grace Period (each a “Registration Default”) then, as full
liquidated damages to any holder by reason of any such Registration Default (which
remedy shall be the exclusive remedy available at law or in equity), the dividend rate
applicable to the Preferred Shares shall increase by 0.25% per annum (the
“Registration Default Additional Dividends”) from and including the date of the
Registration Default to and excluding the date on which the Registration Default is
cured. Following the cure of all Registration Default, the accrual or accretion of
Registration Default Additional Dividends shall cease and the interest rate will revert
to the original rate. The Registration Default Additional Dividends shall be paid, at
the Company’s option, in (i) cash, (ii) additional shares of Preferred Shares, or (iii)
a combination thereof.

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 commercially reasonable 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:

3

 

	 	(a)	 	The Company shall use its commercially reasonable efforts to keep the
Registration Statement effective pursuant to Rule 415 at all times until the earlier of
(i) the expiration of two years; or (ii) the date upon which the Registrable Securities
have been sold pursuant to the registration statement and/or Rule 144 (as defined
below) (the “Registration Period”). The Company shall ensure that each
Registration Statement (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 the case of prospectuses, in the light of the
circumstances in which they were made) not misleading, other than with respect to any
information provided to the Company in writing by an Investor for inclusion therein.
	 
	 	(b)	 	The Company shall use its commercially reasonable efforts to prepare and file
with the SEC such amendments (including post-effective amendments) and supplements to a
Registration Statement and the prospectus used in connection with such Registration
Statement, which prospectus is to be filed pursuant to Rule 424 promulgated under the
1933 Act, as may be necessary to keep such Registration Statement effective at all
times during the Registration Period, and, during such period, comply with the
provisions of the 1933 Act with respect to the disposition of all Registrable
Securities of the Company covered by such Registration Statement 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 such
Registration Statement. In the case of amendments and supplements to a Registration
Statement which are required to be filed pursuant to this Agreement (including pursuant
to this Section 3(b)) by reason of the Company filing a report on Form 10-Q, Form 8-K,
Form 10-K or any analogous report under the Securities Exchange Act of 1934, as amended
(the “1934 Act”), the Company shall have incorporated such report by reference
into such Registration Statement, if applicable, or shall file such amendments or
supplements with the SEC within three (3) Business Days from the date on which the 1934
Act report is filed which created the requirement for the Company to amend or
supplement such Registration Statement.
	 
	 	(c)	 	The Company shall notify each Investor in writing of the happening of any
event, as promptly as practicable after becoming aware of such event, as a result of
which 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 the light of the circumstances under which
they were made, not misleading (provided that in no event shall such notice contain any
material, nonpublic information), and promptly prepare a supplement or amendment to
such Registration Statement to correct such untrue statement or omission. The Company
shall also promptly notify each Investor in writing (i) when a prospectus or any
prospectus supplement (solely to the extent it does more than add a selling
securityholder) or post-effective amendment has been filed, and when a Registration
Statement or any post-effective amendment has

4

 

	 	 	 	become effective and (ii) of the Company’s reasonable determination that a
post-effective amendment to a Registration Statement would be appropriate.
	 
	 	(d)	 	The Company shall use its commercially reasonable 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 in the United States to the extent reasonably requested by
an Investor and, if such an order or suspension is issued, to obtain the withdrawal of
such order or suspension at the earliest possible moment and shall notify each Lender
which holds Registrable Securities being sold 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.
	 
	 	(e)	 	The Company shall use its commercially reasonable efforts to cause all of the
Conversion Shares 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 Conversion Shares 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(e).
	 
	 	(f)	 	If reasonably requested by an Investor, the Company shall as soon as
practicable (i) incorporate in a prospectus supplement or post-effective amendment such
information as such Investor reasonably requests to 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 offered or sold,
the purchase price being paid therefor and any other terms of the offering of the
Registrable Securities to be sold in such offering; (ii) make all required filings of
such prospectus supplement or post-effective amendment after being notified of the
matters to be incorporated in such prospectus supplement or post-effective amendment;
and (iii) supplement or make amendments to any Registration Statement if reasonably
requested by an Investor holding any Registrable Securities, provided that the Company
shall not be required to assist in any underwritten offerings.
	 
	 	(g)	 	The Company shall otherwise use its commercially reasonable efforts to comply
with all applicable rules and regulations of the SEC in connection with any
registration hereunder.
	 
	 	(h)	 	Notwithstanding anything to the contrary herein, at any time after the
Effective Date, the Company may suspend the use of the Registration Statement if
required by applicable law or for valid business reasons (which does not include
avoidance of the Company’s obligations in this Agreement) (a “Grace Period”);
provided, that the Company shall promptly (i) notify the Investors in writing of the
existence of such Grace Period and the date on which the Grace Period will begin, and
(ii) notify the Investors in writing of the date on which the Grace Period ends; and,
provided further, that such Grace Periods shall not exceed an aggregate of seventy-five
(75) days in any 365 day period. For purposes of determining the

5

 

	 	 	 	length of a Grace Period above, the Grace Period shall begin on and include the date
the Investors receive the notice referred to in clause (i) and shall end on and
include the later of the date the Investors receive the notice referred to in clause
(ii) and the date referred to in such notice.
	 
	 	(i)	 	The Company shall, during the Registration Period, deliver to each holder of
Registrable Securities, without charge, as many copies of the Prospectus (including
each preliminary Prospectus) included in the Registration Statement and any amendment
or supplement thereto as such Holder may reasonably request. The Company, subject to
the terms hereof, consents to the use of the Prospectus or any amendment or supplement
thereto by each of the Investors in connection with the offering and sale of the
Registrable Securities covered by the Prospectus, or any amendment or supplement
thereto, included in the Registration Statement.
	 
	 	(j)	 	The Company shall cooperate with the holders of Registrable Securities to
facilitate the timely preparation and delivery of certificates representing the
Conversion Shares to be issued or sold pursuant to any Registration Statement free of
any restrictive legends and in such denominations and registered in such names as
holders may request.
	 
	 	(k)	 	Not later than the effective date of the Registration Statement, the Company
shall provide a CUSIP number for the Registrable Securities registered under such
Registration Statement.

4. Obligations of the Investors.

	 	(a)	 	At least fifteen (15) Business Days prior to the first anticipated filing date
of a Registration Statement, the Company shall notify each Investor in writing of the
information the Company requires from each such Investor if such Investor elects to
have any of such Investor’s Registrable Securities included in such 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 of a particular Investor that such Investor shall furnish to the Company
such information 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 and maintain the effectiveness of the registration of
such Registrable Securities and shall execute such documents in connection with such
registration as the Company may reasonably request.
	 
	 	(b)	 	Each Investor, by such Investor’s 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 any Registration Statement hereunder,
unless such Investor has notified the Company in writing of such Investor’s election to
exclude all of such Investor’s Registrable Securities from such Registration Statement.

6

 

	 	(c)	 	Each Investor agrees that, upon receipt of any notice from the Company of a
Grace Period, such Investor will immediately discontinue disposition of Registrable
Securities pursuant to any Registration Statement(s) covering such Registrable
Securities until such Investor’s receipt that such Grace Period has expired.
	 
	 	(d)	 	Each Investor covenants and agrees that it will comply with the prospectus
delivery requirements of the 1933 Act as applicable to it or an exemption therefrom in
connection with sales of Registrable Securities pursuant to the Registration Statement.
	 
	 	(e)	 	Notwithstanding anything contained herein, in order to have its Registrable
Securities included in the Registration Statement, an Investor will have to confirm in
writing its obligations hereunder.

5. Expenses of Registration.

     All reasonable expenses, other than underwriting discounts and commissions, if any, incurred
by the Company in connection with registrations, filings or qualifications pursuant to Sections 2
and 3, including, without limitation, all registration, listing and qualifications fees, and
accounting fees, and fees and disbursements of counsel for the Company shall be paid by the
Company.

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 each Investor, the directors, officers, members,
partners, employees, agents, representatives of, and each Person, if any, who controls
any Investor within the meaning of the 1933 Act or the 1934 Act (each, an
“Indemnified Person”), against any losses, claims, damages, liabilities,
judgments, fines, penalties, charges, costs, reasonable attorneys’ fees, amounts paid
in settlement or expenses, joint or several (collectively, “Claims”), incurred
in investigating, preparing 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, whether or not an indemnified party is or may be a party thereto
(“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 any untrue statement or alleged untrue
statement of a material fact in a Registration Statement or any post-effective
amendment thereto, 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, or contained in the final prospectus (as amended or supplemented, if the
Company files any amendment thereof or

7

 

	 	 	 	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 (each
a “Violation”). Notwithstanding anything to the contrary contained herein,
the indemnification agreement contained in this Section 6(a): (i) shall not apply to
a Claim by an Indemnified Person 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 such Indemnified Person for such Indemnified Person expressly for use
in connection with the preparation of the Registration Statement or any such
amendment thereof or supplement thereto; and (ii) 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 or delayed.
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 Investors pursuant to Section 9.
	 
	 	(b)	 	In connection with any Registration Statement in which an Investor is
participating, each such Investor agrees to severally and not jointly 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 and each Person,
if any, who controls the Company within the meaning of the 1933 Act or the 1934 Act
(each, an “Indemnified Party”), against any Claim or Indemnified Damages to
which any of them may become subject, under the 1933 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 Investor expressly for use in connection with such Registration
Statement; and, subject to Section 6(c), such Investor will reimburse any legal or
other expenses reasonably incurred by an Indemnified Party 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 Investor, which
consent shall not be unreasonably withheld or delayed. 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
Investors pursuant to Section 9. Notwithstanding anything to the contrary contained
herein, each Investor shall be liable under this Section 6(b) for only that amount as
does not exceed the proceeds to such Investor as a result of the sale of Registrable
Securities pursuant to such Registration Statement.
	 
	 	(c)	 	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

8

 

	 	 	 	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 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 an Indemnified Person or Indemnified Party shall
have the right to retain its own counsel with the fees and expenses of not more than
one counsel for all such Indemnified Person or Indemnified Party to be paid by the
indemnifying party, if, in the reasonable opinion of counsel retained by the
indemnifying party, 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. In the case of
an Indemnified Person, legal counsel referred to in the immediately preceding
sentence shall be selected by the Investors holding at least 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
reasonably 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 prior written consent, provided, however, that the
indemnifying party shall not unreasonably withhold, delay or condition its consent.
No indemnifying party shall, without the prior written 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, and such settlement shall not include any admission as to fault on the
part of the Indemnified Party. 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 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.
	 
	 	(d)	 	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.

9

 

	 	(e)	 	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 Person involved in the sale of Registrable Securities which Person
is guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933 Act) in
connection with such sale shall be entitled to contribution from any Person involved in such sale
of Registrable Securities who was not guilty of fraudulent misrepresentation; and (ii) 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 pursuant to such Registration
Statement.

8. Reports Under the 1934 Act.

     With a view to making available to the Investors the benefits of Rule 144 promulgated under
the 1933 Act or any other similar rule or regulation of the SEC that may at any time permit the
Investors 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; or
	 
	 	(b)	 	file with the SEC in a timely manner all reports and other documents required
of the Company under the 1933 Act and the 1934 Act so long as the Company remains
subject to such requirements and the filing of such reports and other documents is
required for the applicable provisions of Rule 144.

9. Assignment of Registration Rights.

     The rights under this Agreement shall be automatically assignable by the Investors to any
transferee of all or any portion of such Investor’s Registrable Securities if: (i) the Investor
agrees in writing with the transferee or assignee to assign such rights, and a copy of such
agreement is furnished to the Company within a reasonable time, but no later than fifteen (15) days
after such assignment; (ii) the Company is, within such time, furnished with written notice of (a)
the name and address of such transferee or assignee, 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 or assignee is
restricted under the 1933 Act or applicable state securities laws; and (iv) at or before the time
the Company receives the written notice contemplated by clause (ii) of this sentence the transferee
or assignee agrees in writing with the Company to be bound by all of the provisions contained
herein.

10

 

	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 Required Holders. Any amendment or waiver effected in
accordance with this Section 10 shall be binding upon each Investor and the Company. No such
amendment shall be effective to the extent that it applies to less than all of the holders of the
Registrable Securities. No consideration shall be offered or paid to any Person to amend or
consent to a waiver or modification of any provision of this Agreement unless the same
consideration also is offered to all of the parties to this Agreement.

11. Miscellaneous.

	 	(a)	 	A Person is deemed to be a holder of Registrable Securities whenever such
Person owns or is deemed to own of record such Registrable Securities. If the Company
receives conflicting instructions, notices or elections from two or more Persons with
respect to the same Registrable Securities, the Company shall act upon the basis of
instructions, notice or election received from such record 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 confirmation of transmission is mechanically or
electronically generated and kept on file by the sending party); or (iii) one Business
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:

If to the Company:

Attn: Antonio B. Mon

Attn: Paul Berkowitz

TOUSA, Inc.

4000 Hollywood Boulevard

Suite 500N

Hollywood, FL 33021

Facsimile: (954) 364-4010

with copies to:

Attn: Christian O. Nagler, Esq.

Kirkland & Ellis LLP

153 E. 53rd Street

New York, NY 10022-4611

Facsimile: (212) 446-4900

11

 

If to the Lenders:

Attn: Mark B. Cohen

Deutsche Bank Trust Company Americas

60 Wall Street

11th Floor

New York, NY 10005

Facsimile: (212) 797-5696

with copies to:

Attn: Sandeep Qusba, Esq.

White & Case LLP

1155 Avenue of the Americas

New York, NY 10036-2787

Facsimile: (212) 354-8113

     If to an Investor, to the address set forth in the records of the Company, it being each
Investor’s obligation hereunder to provide notice instructions to the Company at the address set
forth above which must include an email address and facsimile number.

     If to a Lender, to its address and facsimile number set forth on the Schedule of Lenders
attached hereto, with copies to such Lender’s representatives as set forth on the Schedule of
Lenders, or to such other address and/or facsimile number and/or to the attention of such other
Person as the recipient party has specified by written notice given to each other party five (5)
days prior to the effectiveness of such change. Written confirmation of receipt (A) given by the
recipient of such notice, consent, waiver or other communication, (B) mechanically or
electronically generated by the sender’s facsimile machine containing the time, date, recipient
facsimile number and an image of the first page of such transmission or (C) provided by a courier
or overnight courier service shall be rebuttable evidence of personal service, receipt by facsimile
or receipt from a nationally recognized overnight delivery service in accordance with clause (i),
(ii) or (iii) above, respectively.

	 	(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)	 	All questions concerning the construction, validity, enforcement and
interpretation of this Agreement shall be governed by the internal laws of the State of
New York, without giving effect to any choice of law or conflict of law provision or
rule (whether of the State of New York or any other jurisdictions) that would cause the
application of the laws of any jurisdictions other than the State of New York. Each
party hereby irrevocably submits to the exclusive jurisdiction of the state and federal
courts sitting in The City of New York, Borough of Manhattan, for the adjudication of
any dispute hereunder or in connection herewith or with any transaction contemplated
hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in
any suit, action

12

 

	 	 	 	or proceeding, any claim that it is not personally subject to the jurisdiction of
any such court, that such suit, action or proceeding is brought in an inconvenient
forum or that the venue of such suit, action or proceeding is improper. Each party
hereby irrevocably waives personal service of process and consents to process being
served in any such suit, action or proceeding by mailing a copy thereof to such
party at the address for such notices to it under this Agreement and agrees that
such service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right to
serve process in any manner permitted by law. 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 constitutes the entire agreement among the parties hereto with
respect to the subject matter hereof. There are no restrictions, promises, warranties
or undertakings, other than those set forth or referred to herein and therein. This
Agreement and the instruments referenced herein 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 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.
	 
	 	(i)	 	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 any 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.
	 
	 	(j)	 	This Agreement is intended for the benefit of the parties hereto and their
respective permitted successors and assigns, and is not for the benefit of, nor may any
provision hereof be enforced by, any other Person.
	 
	 	(k)	 	The obligations of each Investor hereunder are several and not joint with the
obligations of any other Investor, and no provision of this Agreement is intended to
confer any obligations on any Investor vis-à-vis any other Investor. Nothing

13

 

	 	 	 	contained herein, and no action taken by any Investor pursuant hereto, shall be
deemed to constitute the Investors as a partnership, an association, a joint venture
or any other kind of entity, or create a presumption

     that the Investors are in any way acting in concert or as a group with respect to such obligations
or the transactions contemplated herein.

* * * * * *

[Signature Page Follows]

14

 

     IN WITNESS WHEREOF, each Lender and the Company have caused their respective signature page to
this Registration Rights Agreement to be duly executed as of the date first written above.

	 	 	 	 	 
	 	COMPANY:

TOUSA, INC.

 	 
	 	By:  	/s/ Stephen M. Wagman
 	 
	 	 	Name:  	Stephen M. Wagman 	 
	 	 	Title:  	Chief Financial Officer 	 
	 

 

 

     IN WITNESS WHEREOF, each Lender and the Company have caused their respective signature page to
this Registration Rights Agreement to be duly executed as of the date first written above.

	 	 	 	 	 
	 	        LENDERS:

        DEUTSCHE BANK TRUST COMPANY AMERICAS

        as Senior Mezzanine Administrative Agent

 	 
	 	By:  	/s/ Dusan Lazarov
 	 
	 	 	Name:  	Dusan Lazarov 	 
	 	 	Title:  	Vice President 	 
	 
	 	        DEUTSCHE BANK SECURITIES INC.

        as Sole Lead Arranger and Sole Book Running

        Manager

 	 
	 	By:  	/s/ Linda Wang
 	 
	 	 	Name:  	Linda Wang 	 
	 	 	Title:  	Director 	 
	 

 

 

IN WITNESS WHEREOF, the Lender hereto has caused to be duly executed and delivered
this Agreement as of the date first above written.

	 	 	 	 	 	 	 
	 	 	LENDER

DEUTSCHE BANK TRUST COMPANY

AMERICAS	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Mark B. Cohen
 

Mark B. Cohen
	 	 
	 

	 	Title:
	 	Managing Director	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Dusan Lazarov
 

Dusan Lazarov
	 	 
	 

	 	Title:
	 	Vice President	 	 

 

 

Exhibit A

     We are registering (i) the shares of common stock issuable upon conversion of the shares of 8%
Series A Convertible Pay-in-Kind Preferred Stock and (ii) 8% PIK Convertible Preferred Stock to
permit the resale of such securities. We will not receive any of the proceeds from the sale by the
selling securityholder of the securities.

     The selling securityholder may sell all or a portion of the securities beneficially owned by
it and offered hereby from time to time directly or through one or more underwriters,
broker-dealers or agents. If the securities are sold through underwriters or broker-dealers, the
selling securityholder will be responsible for underwriting discounts or commissions or agent’s
commissions. The securities may be sold in one or more transactions at fixed prices, at prevailing
market prices at the time of the sale, at varying prices determined at the time of sale, or at
negotiated prices. These sales may be effected in transactions, which may involve crosses or block
transactions,

	•	 	on any national securities exchange or quotation service on which the securities may be listed or quoted at the time of
sale;
	 
	•	 	in the over-the-counter market;
	 
	•	 	in transactions otherwise than on these exchanges or systems or in the over-the-counter market;
	 
	•	 	through the writing of options, whether such options are listed on an options exchange or otherwise;
	 
	•	 	ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers;
	 
	•	 	block trades in which the broker-dealer will attempt to sell the shares as agent but may position and resell a portion
of the block as principal to facilitate the transaction;
	 
	•	 	purchases by a broker-dealer as principal and resale by the broker-dealer for its account;
	 
	•	 	an exchange distribution in accordance with the rules of the applicable exchange;
	 
	•	 	privately negotiated transactions;
	 
	•	 	short sales;
	 
	•	 	sales pursuant to Rule 144;
	 
	•	 	broker-dealers may agree with the selling securityholder to sell a specified number of such shares at a stipulated
price per share;
	 
	•	 	a combination of any such methods of sale; and
	 
	•	 	any other method permitted pursuant to applicable law.

18

 

     If the selling securityholders effect such transactions by selling shares of common stock to
or through underwriters, broker-dealers or agents, such underwriters, broker-dealers or agents may
receive commissions in the form of discounts, concessions or commissions from the selling
securityholders or commissions from purchasers of the securities for whom they may act as agent or
to whom they may sell as principal (which discounts, concessions or commissions as to particular
underwriters, broker-dealers or agents may be in excess of those customary in the types of
transactions involved). In connection with sales of the securities, the selling securityholders may
enter into hedging transactions with broker-dealers, which may in turn engage in short sales of the
shares of common stock in the course of hedging in positions they assume. The selling
securityholder may also sell securities short and deliver securities covered by this prospectus to
close out short positions and to return borrowed shares in connection with such short sales. The
selling securityholder may also loan or pledge securities to broker-dealers that in turn may sell
such securities.

     The selling securityholders and any broker-dealer participating in the distribution of the
securities may be deemed to be “underwriters” within the meaning of the Securities Act of 1933, and
any commission paid, or any discounts or concessions allowed to, any such broker-dealer may be
deemed to be underwriting commissions or discounts under the Securities Act of 1933. At the time a
particular offering of the securities is made, a prospectus supplement, if required, will be
distributed which will set forth the aggregate amount of shares of securities being offered and the
terms of the offering, including the name or names of any broker-dealers or agents, any discounts,
commissions and other terms constituting compensation from the selling securityholders and any
discounts, commissions or concessions allowed or reallowed or paid to broker-dealers.

     There can be no assurance that the selling securityholders will sell any or all of the
securities pursuant to the shelf registration statement, of which this prospectus forms a part.

     We will pay all expenses of the registration of the securities pursuant to the registration
rights agreement, including, without limitation, Securities and Exchange Commission filing fees;
provided, however, that the selling security holders will pay all underwriting discounts and
selling commissions, if any. We will indemnify the selling security holders against liabilities,
including some liabilities under the Securities Act of 1933, in accordance with the registration
rights agreements, or the selling securityholders will be entitled to contribution. We may be
indemnified by the selling securityholders against civil liabilities, including liabilities under
the Securities Act of 1933, that may arise from any written information furnished to us by the
selling securityholders specifically for use in this prospectus, in accordance with the related
registration rights agreement, or we may be entitled to contribution.

     Once sold under the registration statement, of which this prospectus forms a part, the
securities will be freely tradable in the hands of persons other than our affiliates.

19

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