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EXHIBIT 4.12
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REGISTRATION RIGHTS AGREEMENT
Dated as of April 24, 1997
among
K N ENERGY, INC.,
K N CAPITAL TRUST I
and
SALOMON BROTHERS INC
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.,
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED,
as Initial Purchasers
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REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (the "Agreement") is made
and entered into as of April 24, 1997 among K N ENERGY, INC., a Kansas
corporation (the "Company"), K N CAPITAL TRUST I, a business trust formed under
the laws of the state of Delaware (the "Trust"), and SALOMON BROTHERS INC
("Salomon Brothers") and ▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO., ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ &
▇▇▇▇▇ Incorporated (together with Salomon Brothers, the "Initial Purchasers").
This Agreement is made pursuant to the Purchase Agreement
dated April 17, 1997 (the "Purchase Agreement"), among the Company, as issuer
of the 8.56% Series A Junior Subordinated Deferrable Interest Debentures due
April 15, 2027 (the "Series A Debentures"), the Trust and the Initial
Purchasers, which provides for among other things, the sale by the Trust to the
Initial Purchasers of 100,000 of the Trust's 8.56% Series A Capital Trust
Pass-through Securities(SM)(1) liquidation amount $1,000 per Capital Trust
Pass-through Security (the "Series A Capital Securities") the proceeds of which
will be used by the Trust to purchase Series A Debentures. The Series A
Capital Securities, together with the Series A Debentures and the Company's
guarantee of the Series A Capital Securities (the "Series A Capital Securities
Guarantee") are collectively referred to as the "Series A Securities". In
order to induce the Initial Purchasers to enter into the Purchase Agreement,
the Company and the Trust have agreed to provide to the Initial Purchasers and
their direct and indirect transferees the registration rights set forth in this
Agreement. The execution and delivery of this Agreement is a condition to
closing under the Purchase Agreement.
In consideration of the foregoing, the parties hereto agree as
follows:
1. Definitions. As used in this Agreement, the
following capitalized defined terms shall have the following meanings:
"Advice" shall have the meaning set forth in the last paragraph of
Section 3 hereof.
"Applicable Period" shall have the meaning set forth in Section 3(t)
hereof.
"Business Day" means any day other than a Saturday, a Sunday, or a day
on which banking institutions in New York, New York or Wilmington, Delaware are
authorized or required by law or executive order to close.
"Closing Time" shall mean the Closing Time as defined in the Purchase
Agreement.
"Company" shall have the meaning set forth in the preamble to this
Agreement and also includes the Company's successors and permitted assigns.
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(1) Salomon Brothers Inc has filed an application with the
United States Patent and Trademark Office for the registration of the "Capital
Trust Pass-through Securities" service ▇▇▇▇.
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"Declaration" or "Declaration of Trust" shall mean the Amended and
Restated Declaration of Trust, dated as of April 24, 1997, by the trustees
named therein and the Company as sponsor.
"Depositary" shall mean The Depository Trust Company, or any other
depositary appointed by the Trust; provided, however, that such depositary must
have an address in the Borough of Manhattan, in The City of New York.
"Effectiveness Period" shall have the meaning set forth in Section
2(b) hereof.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time.
"Exchange Offer" shall mean the offer by the Company and the Trust to
the Holders to exchange all of the Registrable Securities (other than Private
Exchange Securities) for a like liquidation or principal amount of Exchange
Securities pursuant to Section 2(a) hereof.
"Exchange Offer Registration" shall mean a registration under the
Securities Act effected pursuant to Section 2(a) hereof.
"Exchange Offer Registration Statement" shall mean an exchange offer
registration statement on Form S-4 (or, if applicable, on another appropriate
form), and all amendments and supplements to such registration statement, in
each case including the Prospectus contained therein, all exhibits thereto and
all material incorporated by reference therein.
"Exchange Period" shall have the meaning set forth in Section 2(a)
hereof.
"Exchange Securities" shall mean (i) with respect to the Series A
Debentures, the 8.56% Series B Junior Subordinated Deferrable Interest
Debentures due April 15, 2027 (the "Exchange Debentures") containing terms
identical to the Series A Debentures (except that they will not contain terms
with respect to the transfer restrictions under the Securities Act, and will
not provide for any increase in the interest rate thereon as a result of a
failure to effect an exchange of such securities upon consummation of an
exchange offer similar to the Exchange Offer), (ii) with respect to the Series
A Capital Securities, the Trust's 8.56% Series B Capital Trust Pass-through
Securities, liquidation amount $1,000 per Capital Trust Pass-through Security
(the "Exchange Capital Securities"), which will have terms identical to the
Series A Capital Securities (except they will not contain terms with respect to
transfer restrictions under the Securities Act and will not provide for any
increase in the distribution rate thereon as a result of a failure to effect an
exchange of such securities upon consummation of an exchange offer similar to
the Exchange Offer) and (iii) with respect to the Series A Capital Securities
Guarantee, the Company's guarantee (the "Exchange Capital Securities
Guarantee") of the Exchange Capital Securities which will have terms identical
to the Series A Capital Securities Guarantee.
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"Holder" shall mean the Initial Purchasers, for so long as they own
any Registrable Securities, and each of its respective successors, assigns and
direct and indirect transferees who become registered owners of Registrable
Securities under the Indenture or Declaration of Trust.
"Indenture" shall mean the Indenture relating to the Series A
Debentures and the Exchange Debentures dated as of April 24, 1997 between the
Company, as issuer, and Wilmington Trust Company, as trustee, as the same may
be amended from time to time in accordance with the terms thereof.
"Initial Purchasers" shall have the meaning set forth in the preamble
to this Agreement.
"Inspectors" shall have the meaning set forth in Section 3(n) hereof.
"Issue Date" shall mean the date of original issuance of the Series A
Securities.
"Liquidated Damages" shall have the meaning set forth in Section 2(e)
hereof.
"Majority Holders" shall mean the Holders of a majority of the
aggregate liquidation or principal amount of outstanding Series A Securities or
Exchange Securities.
"Material Event" shall have the meaning set forth in Section 3(e)
hereof.
"Participating Broker-Dealer" shall have the meaning set forth in
Section 3(t) hereof.
"Person" shall mean an individual, partnership, corporation, trust or
unincorporated organization, limited liability company, or a government or
agency or political subdivision thereof.
"Private Exchange" shall have the meaning set forth in Section 2(a)
hereof.
"Private Exchange Securities" shall have the meaning set forth in
Section 2(a) hereof.
"Prospectus" shall mean the prospectus included in a Registration
Statement, including any preliminary prospectus, and any such prospectus as
amended or supplemented by any prospectus supplement, including a prospectus
supplement with respect to the terms of the offering of any portion of the
Registrable Securities covered by a Shelf Registration Statement, and by all
other amendments and supplements to a prospectus, including post-effective
amendments, and in each case including all material incorporated by reference
therein.
"Purchase Agreement" shall have the meaning set forth in the preamble
to this Agreement.
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"Records" shall have the meaning set forth in Section 3(n) hereof.
"Registrable Securities" shall mean the Series A Securities and, if
issued, the Private Exchange Securities; provided, however, that Series A
Securities or Private Exchange Securities, as the case may be, shall cease to
be Registrable Securities when (i) a Registration Statement with respect to
such Series A Securities or Private Exchange Securities for the exchange or
resale thereof, as the case may be, shall have been declared effective under
the Securities Act and such Series A Securities or Private Exchange Securities,
as the case may be, shall have been disposed of pursuant to such Registration
Statement, (ii) such Series A Securities or Private Exchange Securities, as the
case may be, shall have been sold to the public pursuant to Rule 144 (or any
similar provision then in force, but not Rule 144A) under the Securities Act,
(iii) such Series A Securities or Private Exchange Securities, as the case may
be, shall have ceased to be outstanding or (iv) with respect to the Series A
Securities, such Series A Securities have been exchanged for Exchange
Securities upon consummation of the Exchange Offer and are thereafter freely
tradeable by the holder thereof (other than an affiliate of the Company).
"Registration Expenses" shall mean any and all expenses incident to
performance of or compliance by the Company with this Agreement, including
without limitation: (i) all SEC or National Association of Securities Dealers,
Inc. (the "NASD") registration and filing fees, including, if applicable, the
fees and expenses of any "qualified independent underwriter" (and its counsel)
that is required to be retained by any Holder of Registrable Securities in
accordance with the rules and regulations of the NASD, (ii) all fees and
expenses incurred in connection with compliance with state securities or blue
sky laws (including reasonable fees and disbursements of counsel for any
underwriters or Holders in connection with blue sky qualification of any of the
Exchange Securities or Registrable Securities) and compliance with the rules of
the NASD, (iii) all expenses of any Persons in preparing or assisting in
preparing, word processing, printing and distributing any Registration
Statement, any Prospectus and any amendments or supplements thereto, and in
preparing or assisting in preparing, printing and distributing any underwriting
agreements, securities sales agreements and other documents relating to the
performance of and compliance with this Agreement, (iv) all rating agency fees,
(v) the fees and disbursements of counsel for the Company and of the
independent certified public accountants of the Company, including the expenses
of any "cold comfort" letters required by or incident to such performance and
compliance, (vi) the fees and expenses of the Trustees, and any exchange agent
or custodian, (vii) all fees and expenses incurred in connection with the
listing, if any, of any of the Registrable Securities on any securities
exchange or exchanges, and (viii) the reasonable fees and expenses of any
special experts retained by the Company in connection with any Registration
Statement.
"Registration Statement" shall mean any registration statement of the
Company and the Trust which covers any of the Exchange Securities or
Registrable Securities pursuant to the provisions of this Agreement, and all
amendments and supplements to any such Registration Statement, including
post-effective amendments, in each case including the Prospectus contained
therein, all exhibits thereto and all material incorporated by reference
therein.
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"Rule 144(k) Period" shall mean the period of three years (or such
shorter period as may hereafter be referred to in Rule 144(k) under the
Securities Act (or similar successor rule)) commencing on the Issue Date.
"SEC" shall mean the Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933, as amended
from time to time.
"Series A Securities" shall have the meaning set forth in the preamble
to this Agreement.
"Shelf Registration" shall mean a registration effected pursuant to
Section 2(b) hereof.
"Shelf Registration Event" shall have the meaning set forth in Section
2(b) hereof.
"Shelf Registration Event Date" shall have the meaning set forth in
Section 2(b) hereof.
"Shelf Registration Statement" shall mean a "shelf" registration
statement of the Company and the Trust pursuant to the provisions of Section
2(b) hereof which covers all of the Registrable Securities or all of the
Private Exchange Securities, as the case may be, on an appropriate form under
Rule 415 under the Securities Act, or any similar rule that may be adopted by
the SEC, and all amendments and supplements to such registration statement,
including post-effective amendments, in each case including the Prospectus
contained therein, all exhibits thereto and all material incorporated by
reference therein.
"TIA" shall have the meaning set forth in Section 3(l) hereof.
"Trust Securities" shall mean the Series A Capital Securities and the
Common Securities (as defined in the Declaration).
"Trustees" shall mean any and all trustees with respect to (i) the
Series A Capital Securities under the Declaration, (ii) the Series A Debentures
under the Indenture and (iii) the Series A Capital Securities Guarantee.
"underwritten offering" or "underwritten registration" shall mean an
offering or registration in which securities of an issuer are sold to an
underwriter for reoffering to the public.
2. Registration Under the Securities Act.
(a) Exchange Offer. To the extent not prohibited by any
applicable law or applicable interpretation of the staff of the SEC, the
Company and the Trust shall, for the benefit of the Holders, at the Company's
cost, use their best efforts to (i) cause to be filed with the SEC within 150
days after the Issue Date an Exchange Offer Registration Statement on an
appropriate
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form under the Securities Act covering the Exchange Offer, (ii) cause such
Exchange Offer Registration Statement to be declared effective under the
Securities Act by the SEC not later than the date which is 180 days after the
Issue Date, and (iii) keep such Exchange Offer Registration Statement effective
for not less than 30 calendar days (or longer if required by applicable law)
after the date notice of the Exchange Offer is mailed to the Holders.
Notwithstanding the foregoing, in the event that the Company shall determine in
good faith that there is a reasonable likelihood that, or a material
uncertainty as to whether, consummation of the Exchange Offer would result in
an adverse tax consequence to the Company (a "Tax Contingency"), the Trust and
the Company may elect, in lieu of the commencement of the Exchange Offer, to
file and cause to be declared effective a Shelf Registration Statement covering
resales of the Series A Securities as provided in Section 2(b) hereof. Upon
the effectiveness of the Exchange Offer Registration Statement, the Company and
the Trust shall promptly commence the Exchange Offer, it being the objective of
such Exchange Offer to enable each Holder eligible and electing to exchange
Registrable Securities for a like principal amount of Exchange Debentures or a
like liquidation amount of Exchange Capital Securities, together with the
Exchange Guarantee, as applicable (assuming that such Holder is not an
affiliate of the Company within the meaning of Rule 405 under the Securities
Act and is not a broker-dealer tendering Registrable Securities acquired
directly from the Company for its own account, acquires the Exchange Securities
in the ordinary course of such Holder's business and has no arrangements or
understandings with any Person to participate in the Exchange Offer for the
purpose of distributing the Exchange Securities) to transfer such Exchange
Securities from and after their receipt without any limitations or restrictions
under the Securities Act and under state securities or blue sky laws.
In connection with the Exchange Offer, the Company and the
Trust shall:
(i) mail to each Holder a copy of the Prospectus forming part of
the Exchange Offer Registration Statement, together with an appropriate letter
of transmittal and related documents;
(ii) keep the Exchange Offer open for acceptance for a period of
not less than 30 days after the date notice thereof is mailed to the Holders
(or longer if required by applicable law) (such period referred to herein as
the "Exchange Period");
(iii) utilize the services of the Depositary for the Exchange Offer;
(iv) permit Holders to withdraw tendered Series A Securities at
any time prior to the close of business, New York time, on the last Business
Day of the Exchange Period by sending to the institution specified in the
notice, a telegram, telex, facsimile transmission or letter setting forth the
name of such Holder, the principal amount of Series A Securities delivered for
exchange, and a statement that such Holder is withdrawing his election to have
such Series A Securities exchanged;
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(v) notify each Holder that any Series A Security not tendered by
such Holder in the Exchange Offer will remain outstanding and continue to
accrue interest or accumulate distributions, as the case may be, but will not
retain any rights under this Agreement (except in the case of the Initial
Purchasers and Participating Broker-Dealers as provided herein); and
(vi) otherwise comply in all respects with all applicable laws
relating to the Exchange Offer.
If any Initial Purchaser determines upon advice of its outside
counsel that it is not eligible to participate in the Exchange Offer with
respect to the exchange of Securities constituting any portion of an unsold
allotment in the initial distribution, as soon as practicable upon receipt by
the Company and the Trust of a written request from such Initial Purchaser, the
Company and the Trust, as applicable, shall issue and deliver to such Initial
Purchaser in exchange (the "Private Exchange") for the Series A Securities held
by such Initial Purchaser, a like liquidation amount of Capital Securities of
the Trust, together with the Exchange Guarantee, or a like principal amount of
the Series A Debentures of the Company, as applicable, that are identical
(except that such securities may bear a customary legend with respect to
restrictions on transfer pursuant to the Securities Act) to the Exchange
Securities (the "Private Exchange Securities") and which are issued pursuant to
the Indenture, the Declaration or the Guarantee (which provides that the
Exchange Securities will not be subject to the transfer restrictions set forth
in the Indenture or the Declaration, as applicable, and that the Exchange
Securities, the Private Exchange Securities and the Series A Securities will
vote and consent together on all matters as one class and that neither the
Exchange Securities, the Private Exchange Securities nor the Series A
Securities will have the right to vote or consent as a separate class on any
matter). The Private Exchange Securities shall be of the same series as the
Exchange Securities and the Company and the Trust will seek to cause the CUSIP
Service Bureau to issue the same CUSIP Numbers for the Private Exchange
Securities as for the Exchange Securities issued pursuant to the Exchange
Offer.
As soon as practicable after the close of the Exchange Offer
and, if applicable, the Private Exchange, the Company and the Trust, as the
case requires, shall:
(i) accept for exchange all Series A Securities or portions
thereof tendered and not validly withdrawn pursuant to the Exchange Offer or
the Private Exchange;
(ii) deliver, or cause to be delivered, to the applicable Trustee
for cancellation all Series A Securities or portions thereof so accepted for
exchange by the Company and the Trust; and
(iii) issue, and cause the applicable Trustee under the Indenture,
the Declaration or the Guarantee, as applicable, to promptly authenticate and
deliver to each Holder, new Exchange Securities or Private Exchange Securities,
as applicable, equal in principal amount to the
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principal amount of the Series A Debentures or equal in liquidation amount to
the liquidation amount of the Series A Capital Securities (together with the
guarantee thereof) as are surrendered by such Holder.
Distributions on each Exchange Capital Security and Private
Exchange Security and interest on each Exchange Debenture and Private Exchange
Security issued pursuant to the Registered Exchange Offer and in the Private
Exchange will accumulate or accrue, as the case may be, from the last date on
which a distribution or interest was paid on the Series A Capital Security or
the Series A Debenture surrendered in exchange therefor or, if no distribution
or interest has been paid on such Series A Capital Security or Series A
Debenture, from the Issue Date. To the extent not prohibited by any law or
applicable interpretation of the staff of the SEC, the Company and the Trust
shall use their best efforts to complete the Exchange Offer as provided above,
and shall comply with the applicable requirements of the Securities Act, the
Exchange Act and other applicable laws in connection with the Exchange Offer.
The Exchange Offer shall not be subject to any conditions, other than that the
Exchange Offer does not violate applicable law or any applicable interpretation
of the staff of the SEC and that, with respect to any Series A Security
tendered for exchange, a Tax Contingency shall not have occurred prior to the
date such security is exchanged. Each Holder of Registrable Securities who
wishes to exchange such Registrable Securities for Exchange Securities in the
Exchange Offer will be required to make certain customary representations in
connection therewith, including, in the case of any Holder of Series A Capital
Securities and/or Series A Debentures, representations that (i) it is not an
affiliate of the Trust or the Company, (ii) the Exchange Securities to be
received by it were acquired in the ordinary course of its business and (iii)
at the time of the Exchange Offer, it has no arrangement with any Person to
participate in the distribution (within the meaning of the Securities Act) of
the Exchange Capital Securities. The Company and the Trust shall inform the
Initial Purchasers, after consultation with the Trustee, of the names and
addresses of the Holders to whom the Exchange Offer is made, and the Initial
Purchasers shall have the right to contact such Holders and otherwise
facilitate the tender of Registrable Securities in the Exchange Offer.
Upon consummation of the Exchange Offer in accordance with
this Section 2(a), the provisions of this Agreement shall continue to apply,
mutatis mutandis, solely with respect to Registrable Securities that are
Private Exchange Securities and Exchange Securities held by Participating
Broker-Dealers, and the Company and the Trust shall have no further obligation
to register the Registrable Securities (other than Private Exchange Securities)
pursuant to Section 2(b) of this Agreement.
(b) Shelf Registration. In the event that (i) the
Company, the Trust or the Majority Holders reasonably determine, after
conferring with counsel (which may be in-house counsel), that the Exchange
Offer Registration provided in Section 2(a) above is not available because of
any change in law or in currently prevailing interpretations of the staff of
the SEC, (ii) the Exchange Offer Registration Statement is not declared
effective within 180 days of the
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Issue Date, (iii) upon the request of any Initial Purchaser with respect to any
Registrable Securities held by it, if such Initial Purchaser is not permitted,
in the reasonable opinion of Shearman & Sterling, pursuant to applicable law or
applicable interpretations of the staff of the SEC, to participate in the
Exchange Offer and thereby receive securities that are freely tradeable without
restriction under the Securities Act and applicable blue sky or state
securities laws (any of the events specified in (i) - (iii) being a "Shelf
Registration Event" and the date of occurrence thereof, the "Shelf Registration
Event Date"), the Company and the Trust shall, at their cost, use their best
efforts to cause to be filed, within 180 days after the Issue Date, or within
45 days after any Shelf Registration Event Date, whichever first occurs, a
Shelf Registration Statement providing for the sale by the Holders of all of
the Registrable Securities, and shall use their best efforts to have such Shelf
Registration Statement declared effective by the SEC within 210 days of the
Issue Date, or as soon thereafter as practicable. In addition, if the Company
determines in good faith that a Tax Contingency has occurred and elects to file
and cause to be declared a Shelf Registration Statement providing for sale by
the Holders of all the Registrable Securities in lieu of commencing an Exchange
Offer, the Company shall, at their cost, cause to be filed within 180 days
after the Issue Date or as promptly thereafter as practicable, such Shelf
Registration Statement and cause such Shelf Registration Statement to be
declared effective within 210 days of the Issue Date, or as soon thereafter as
practicable. No Holder of Registrable Securities shall be entitled to include
any of its Registrable Securities in any Shelf Registration pursuant to this
Agreement unless and until such Holder agrees in writing to be bound by all of
the provisions of this Agreement applicable to such Holder and furnishes to the
Company and the Trust in writing, within 15 days after receipt of a request
therefor, such information as the Company and the Trust may, after conferring
with counsel with regard to information relating to Holders that would be
required by the SEC to be included in such Shelf Registration Statement or
Prospectus included therein, reasonably request for inclusion in any Shelf
Registration Statement or Prospectus included therein. Each Holder as to which
any Shelf Registration is being effected agrees to furnish to the Company and
the Trust all information with respect to such Holder necessary to make the
information previously furnished to the Company by such Holder not materially
misleading.
The Company and the Trust agree to use their best efforts to
keep the Shelf Registration Statement continuously effective for the Rule
144(k) Period (subject to extension pursuant to the last paragraph of Section 3
hereof) or for such shorter period which will terminate when all of the
Registrable Securities covered by the Shelf Registration Statement have been
sold pursuant to the Shelf Registration Statement or cease to be outstanding
(the "Effectiveness Period"). The Company and the Trust shall not permit any
securities other than Registrable Securities to be included in the Shelf
Registration. The Company and the Trust will, in the event a Shelf
Registration Statement is declared effective, provide to each Holder a
reasonable number of copies of the Prospectus which is part of the Shelf
Registration Statement, notify each such Holder when the Shelf Registration has
become effective and use its best efforts to take all other actions required to
permit resales of the Registrable Securities. The Company and the Trust
further agree, if necessary, to supplement or amend the Shelf Registration
Statement, if required
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by the rules, regulations or instructions applicable to the registration form
used by the Company for such Shelf Registration Statement or by the Securities
Act or by any other rules and regulations thereunder for shelf registrations,
and the Company and the Trust agree to furnish to the Holders of Registrable
Securities copies of any such supplement or amendment promptly after its being
used or filed with the SEC.
(c) Expenses. The Company shall pay all Registration
Expenses in connection with the registration pursuant to Section 2(a) or 2(b)
hereof and will reimburse the Initial Purchasers for the reasonable fees and
disbursements of Shearman & Sterling, counsel for the Initial Purchasers,
incurred in connection with the Exchange Offer and, if applicable, the Private
Exchange Offer, and either Shearman & Sterling or any one other counsel
designated in writing by the Majority Holders to act as counsel for the Holders
of the Registrable Securities in connection with a Shelf Registration
Statement, which other counsel shall be reasonably satisfactory to the Company.
Except as provided herein, each Holder shall pay all expenses of its counsel,
underwriting discounts and commissions and transfer taxes, if any, relating to
the sale or disposition of such Holder's Registrable Securities pursuant to the
Shelf Registration Statement.
(d) Effective Registration Statement. An Exchange Offer
Registration Statement pursuant to Section 2(a) hereof or a Shelf Registration
Statement pursuant to Section 2(b) hereof will not be deemed to have become
effective unless it has been declared effective by the SEC; provided, however,
that if, after such Registration Statement has been declared effective, the
offering of Registrable Securities pursuant to a Shelf Registration Statement
is interfered with by any stop order, injunction or other order or requirement
of the SEC or any other governmental agency or court, such Registration
Statement will be deemed not to have been effective during the period of such
interference, until the offering of Registrable Securities pursuant to such
Registration Statement may legally resume. The Company and the Trust will be
deemed not to have used their best efforts to cause the Exchange Offer
Registration Statement or the Shelf Registration Statement, as the case may be,
to become, or to remain, effective during the requisite period if either of
them voluntarily takes any action that would result in any such Registration
Statement not being declared effective or in the Holders of Registrable
Securities covered thereby not being able to exchange or offer and sell such
Registrable Securities during that period unless such action is required by
applicable law.
(e) Liquidated Damages. In the event that (i) (A)
neither the Exchange Offer Registration Statement nor a Shelf Registration
Statement is filed with the SEC on or prior to the applicable required filing
date or (B) notwithstanding that the Company and the Trust have consummated or
will consummate an Exchange Offer, the Company and the Trust are required to
file a Shelf Registration Statement and such Shelf Registration Statement is
not filed on or prior to the date required by Section 2(b) hereof, then
commencing on the day after the applicable required filing date, additional
interest shall accrue on the principal amount of the Series A Debentures, and
additional distributions shall accumulate on the liquidation amount of the
Trust Securities, each at a rate of 0.25% per annum; or
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(ii) (A) neither the Exchange Offer Registration Statement nor a
Shelf Registration Statement is declared effective by the SEC on or prior to
the 30th day after the applicable required filing date or (B) notwithstanding
that the Company and the Trust have consummated or will consummate an Exchange
Offer, the Company and the Trust are required to file a Shelf Registration
Statement and such Shelf Registration Statement is not declared effective by
the SEC on or prior to the 30th day after such Shelf Registration Statement was
required to be filed, then, commencing on the 31st day after the applicable
required filing date, additional interest shall accrue on the principal amount
of the Series A Debentures, and additional distributions shall accumulate on
the liquidation amount of the Trust Securities, each at a rate of 0.25% per
annum; or
(iii) either (A) the Trust has not exchanged an Exchange Capital
Security for each Series A Capital Security or the Company has not exchanged an
Exchange Capital Securities Guarantee or Exchange Debenture for each Series A
Capital Securities Guarantee or Series A Debenture validly tendered, in
accordance with the terms of the Exchange Offer on or prior to the 45th day
after the date on which the Exchange Offer Registration Statement was declared
effective or (B) if applicable, the Shelf Registration Statement has been
declared effective and such Shelf Registration Statement ceases to be effective
at any time prior to expiration of the Rule 144(k) Period (other than after
such time as all Series A Capital Securities have been disposed of thereunder
or otherwise cease to be Registrable Securities within the meaning of this
Agreement), then additional interest shall accrue on the principal amount of
Series A Debentures, and additional distributions shall accumulate on the
liquidation amount of the Trust Securities, each at a rate of 0.25% per annum
commencing on (x) the 46th day after such effective date, in the case of (A)
above, or (y) the day such Shelf Registration Statement ceases to be effective
in the case of (B) above; provided that if, in the case of (B) above, such
Shelf Registration Statement ceases to be effective as a result of a Material
Event, neither Additional Distributions nor Additional Interest shall
accumulate or accrue so long as such Shelf Registration Statement again becomes
effective within 60 days of the date notice of such Material Event was received
by holders of Series A Capital Securities, the Series A Capital Securities
Guarantee and Series A Debentures; and provided, further, that if such Shelf
Registration Statement does not again become effective within such 60-day
period, Additional Interest shall accrue and Additional Distributions shall
accumulate, each at a rate of 0.25% per annum, commencing on the 61st day after
such Shelf Registration Statement ceases to be effective.
Notwithstanding the foregoing, neither the additional interest
rate on the Series A Debentures, nor the additional distributions rate on the
liquidation amount of the Trust Securities may exceed 0.25% per annum; provided
that (1) upon the filing of the Exchange Offer Registration Statement or a
Shelf Registration Statement (in the case of clause (i) above), (2) upon the
effectiveness of the Exchange Offer Registration Statement or a Shelf
Registration Statement (in the case of clause (ii) above), or (3) upon the
exchange of the Exchange Capital Securities, Exchange Capital Securities
Guarantee and Exchange Debentures for all Series A Capital Securities, the
Series A Capital Securities Guarantee and Series A Debentures tendered
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(in the case of clause (iii)(A) above), or, upon the effectiveness of the Shelf
Registration Statement which had ceased to remain effective (in the case of
clause (iii)(B) above), additional interest on the Series A Debentures, and
additional distributions on the liquidation amount of the Trust Securities as a
result of such clause (or the relevant subclause thereof), as the case may be,
shall cease to accrue or accumulate, as the case may be.
Any amounts of additional interest and additional
distributions due pursuant to Section 2(e)(i), (ii) or (iii) above ("Liquidated
Damages") will be payable, as liquidated damages, in cash on the next
succeeding April 15 or October 15, as the case may be, to holders on the
relevant record dates for the payment of interest and distributions pursuant to
the Indenture and the Declaration, respectively.
3. Registration Procedures. In connection with the
obligations of the Company and the Trust with respect to the Registration
Statements pursuant to Sections 2(a) and 2(b) hereof, the Company and the Trust
shall use their best efforts to:
(a) prepare and file with the SEC a Registration
Statement or Registration Statements as prescribed by Sections 2(a)
and 2(b) hereof within the relevant time period specified in Section 2
hereof on the appropriate form under the Securities Act, which form
(i) shall be selected by the Company and the Trust, (ii) shall, in the
case of a Shelf Registration, be available for the sale of the
Registrable Securities by the selling Holders thereof and (iii) shall
comply as to form in all material respects with the requirements of
the applicable form and include (or incorporate by reference) all
financial statements required by the SEC to be included therein; and
use its best efforts to cause such Registration Statement to become
effective and remain effective in accordance with Section 2 hereof;
provided, however, that if (1) such filing is pursuant to Section
2(b), or (2) a Prospectus contained in an Exchange Offer Registration
Statement filed pursuant to Section 2(a) is required to be delivered
under the Securities Act by any Participating Broker-Dealer who seeks
to sell Exchange Securities, before filing any Registration Statement
or Prospectus or any amendments or supplements thereto, the Company
and the Trust shall furnish to and afford the Holders of the
Registrable Securities and each such Participating Broker-Dealer who
has delivered to the Company the notice referred to in Section 3(e),
as the case may be, covered by such Registration Statement, their
counsel and the managing underwriters, if any, a reasonable
opportunity to review copies of all such documents (including copies
of any documents to be incorporated by reference therein and all
exhibits thereto) proposed to be filed. The Company and the Trust
shall not file any Registration Statement or Prospectus or any
amendments or supplements thereto in respect of which the Holders must
be afforded an opportunity to review prior to the filing of such
document if the Majority Holders or such Participating Broker-Dealer,
as the case may be, their counsel or the managing underwriters, if
any, shall reasonably object;
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(b) prepare and file with the SEC such amendments and
post-effective amendments to each Registration Statement as may be
necessary to keep such Registration Statement effective for the
Effectiveness Period or the Applicable Period, as the case may be; and
cause each Prospectus to be supplemented, if so determined by the
Company or the Trust or requested by the SEC, by any required
prospectus supplement and as so supplemented to be filed pursuant to
Rule 424 (or any similar provision then in force) under the Securities
Act, and comply with the provisions of the Securities Act, the
Exchange Act and the rules and regulations promulgated thereunder
applicable to it with respect to the disposition of all securities
covered by each Registration Statement during the Effectiveness Period
or the Applicable Period, as the case may be, in accordance with the
intended method or methods of distribution by the selling Holders
thereof described in this Agreement (including sales by any
Participating Broker-Dealer);
(c) in the case of a Shelf Registration, (i) notify each
Holder of Registrable Securities included in the Shelf Registration
Statement, at least three Business Days prior to filing, that a Shelf
Registration Statement with respect to the Registrable Securities is
being filed and advising such Holder that the distribution of
Registrable Securities will be made in accordance with the method
selected by the Majority Holders; and (ii) furnish to each Holder of
Registrable Securities included in the Shelf Registration Statement
and to each underwriter of an underwritten offering of Registrable
Securities, if any, without charge, as many copies of each Prospectus,
including each preliminary Prospectus, and any amendment or supplement
thereto and such other documents as such Holder or underwriter may
reasonably request, in order to facilitate the public sale or other
disposition of the Registrable Securities; and (iii) consent to the
use of the Prospectus or any amendment or supplement thereto by each
of the selling Holders of Registrable Securities included in the Shelf
Registration Statement in connection with the offering and sale of the
Registrable Securities covered by the Prospectus or any amendment or
supplement thereto;
(d) in the case of a Shelf Registration, register or
qualify the Registrable Securities under all applicable state
securities or "blue sky" laws of such jurisdictions by the time the
applicable Registration Statement is declared effective by the SEC as
any Holder of Registrable Securities covered by a Registration
Statement and each underwriter of an underwritten offering of
Registrable Securities shall reasonably request in writing in advance
of such date of effectiveness, and do any and all other acts and
things which may be reasonably necessary or advisable to enable such
Holder and underwriter to consummate the disposition in each such
jurisdiction of such Registrable Securities owned by such Holder;
provided, however, that the Company and the Trust shall not be
required to (i) qualify as a foreign corporation or as a dealer in
securities in any jurisdiction where it would not otherwise be
required to qualify but for this Section 3(d), (ii) file any general
consent to service of process in any jurisdiction where it would
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not otherwise be subject to such service of process or (iii) subject
itself to taxation in any such jurisdiction if it is not then so
subject;
(e) in the case of (1) a Shelf Registration or (2)
Participating Broker-Dealers from whom the Company or the Trust has
received prior written notice that they will be utilizing the
Prospectus contained in the Exchange Offer Registration Statement as
provided in Section 3(t) hereof, are seeking to sell Exchange
Securities and are required to deliver Prospectuses, notify each
Holder of Registrable Securities, or such Participating
Broker-Dealers, as the case may be, their counsel and the managing
underwriters, if any, promptly and promptly confirm such notice in
writing (i) when a Registration Statement has become effective and
when any post-effective amendments and supplements thereto become
effective, (ii) of any request by the SEC or any state securities
authority for amendments and supplements to a Registration Statement
or Prospectus or for additional information after the Registration
Statement has become effective, (iii) of the issuance by the SEC or
any state securities authority of any stop order suspending the
effectiveness of a Registration Statement or the qualification of the
Registrable Securities or the Exchange Securities to be offered by any
Participating Broker-Dealer in any jurisdiction described in Section
3(d) hereof or the initiation of any proceedings for that purpose,
(iv) in the case of a Shelf Registration, if between the effective
date of a Registration Statement and the closing of any sale of
Registrable Securities covered thereby, the representations and
warranties of the Company and the Trust contained in any purchase
agreement, securities sales agreement or other similar agreement, if
any, cease to be true and correct in all material respects, and (v) of
the happening of any event or the failure of any event to occur or the
discovery of any facts or otherwise (each a "Material Event"), during
the Effectiveness Period which makes any statement made in such
Registration Statement or the related Prospectus untrue in any
material respect or which causes such Registration Statement or
Prospectus to omit to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they
were made, not misleading, and (vi) the Company's and the Trust's
reasonable determination that a post-effective amendment to the
Registration Statement would be appropriate;
(f) obtain the withdrawal of any order suspending the
effectiveness of a Registration Statement at the earliest possible
moment;
(g) in the case of a Shelf Registration, furnish to each
Holder of Registrable Securities included within the coverage of such
Shelf Registration Statement, without charge, at least one conformed
copy of each Registration Statement relating to such Shelf
Registration and any post-effective amendment thereto (without
documents incorporated therein by reference or exhibits thereto,
unless requested);
(h) in the case of a Shelf Registration, cooperate with
the selling Holders of Registrable Securities to facilitate the timely
preparation and delivery of certificates
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representing Registrable Securities to be sold and not bearing any
restrictive legends and in such denominations (consistent with the
provisions of the Indenture and the Declaration) and registered in
such names as the selling Holders or the underwriters may reasonably
request at least two Business Days prior to the closing of any sale of
Registrable Securities pursuant to such Shelf Registration Statement;
(i) in the case of a Shelf Registration or an Exchange
Offer Registration, upon the occurrence of any circumstance
contemplated by Section 3(e)(ii), 3(e)(iii), 3(e)(v) or 3(e)(vi)
hereof, prepare a supplement or post-effective amendment to a
Registration Statement or the related Prospectus or any document
incorporated therein by reference or file any other required document
so that, as thereafter delivered to the purchasers of the Registrable
Securities, such Prospectus will not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they
were made, not misleading; and notify each Holder to suspend use of
the Prospectus as promptly as practicable after the occurrence of such
an event, and each Holder hereby agrees to suspend use of the
Prospectus until the Company has amended or supplemented the
Prospectus to correct such misstatement or omission;
(j) in the case of a Shelf Registration, a reasonable
time prior to the filing of any document which is to be incorporated
by reference into a Registration Statement or a Prospectus after the
initial filing of a Registration Statement, provide a reasonable
number of copies of such document to the Holders; and make such of the
representatives of the Company and the Trust as shall be reasonably
requested by the Holders of Registrable Securities or the Initial
Purchasers on behalf of such Holders available for discussion of such
documents;
(k) obtain a CUSIP number for all Exchange Capital
Securities (and if the Trust has made a distribution of the Series A
Debentures to the Holders of the Series A Capital Securities, the
Exchange Debentures), as the case may be, prior to the original
issuance thereof, and provide the Property Trustee (as defined in the
Declaration) with one or more certificates for the Exchange Securities
or the Registrable Securities, as the case may be, in a form eligible
for deposit with the Depositary;
(l) cause the Indenture, the Declaration, the Guarantee
and the Exchange Guarantee to be qualified under the Trust Indenture
Act of 1939, as amended (the "TIA"), in connection with the
registration of the Exchange Securities or Registrable Securities, as
the case may be, and effect such changes to such documents as may be
required for them to be so qualified in accordance with the terms of
the TIA and execute, and use its best efforts to cause the relevant
trustee to execute, all documents as may be required to affect such
changes, and all other forms and documents required to be filed with
the SEC to enable such documents to be so qualified in a timely
manner;
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(m) in the case of a Shelf Registration, (i) enter into
such agreements (including, with respect to any underwritten offering,
underwriting agreements) as are customary and take all such other
appropriate actions as are reasonably requested in order to expedite
or facilitate the registration or the disposition of the Registrable
Securities covered thereby (including, without limitation, preparing
at the expense of the Company a supplement to the Shelf Registration
Statement and obtaining opinions of counsel to the Company and the
Trust and updates thereof (which may be in the form of a reliance
letter) in form and substance reasonably satisfactory to the managing
underwriters (if any) and the Holders of a majority in principal or
liquidation amount, as applicable, of the Registrable Securities being
sold, addressed to each selling Holder and the underwriters (if any)
covering the matters customarily covered in opinions requested in such
shelf offerings (it being agreed that the matters to be covered by
such opinion may be subject to customary qualifications and
exceptions)), and (ii) in connection with any underwritten offering of
Registrable Securities pursuant to a Shelf Registration Statement, if
requested by the managing underwriters of such underwritten offering,
at the closing under the applicable underwriting agreement: (A) make
such representations and warranties to the underwriters with respect
to the business of the Trust, the Company and its subsidiaries as then
conducted and the Registration Statement, Prospectus and documents, if
any, incorporated or deemed to be incorporated by reference therein,
in each case, as are customarily made by issuers to underwriters in
underwritten offerings, and confirm the same if and when requested;
(B) obtain opinions of counsel to the Company and the Trust and
updates thereof (which may be in the form of a reliance letter) in
form and substance reasonably satisfactory to the managing
underwriters, addressed to the underwriters covering the matters
customarily covered in opinions requested in underwritten offerings
and such other matters as may be reasonably requested by such
underwriters (it being agreed that the matters to be covered by such
opinion may be subject to customary qualifications and exceptions);
(C) obtain "cold comfort" letters and updates thereof in form and
substance reasonably satisfactory to the managing underwriters from
the independent certified public accountants of the Company and the
Trust (and, if necessary, any other independent certified public
accountants of any subsidiary of the Company and the Trust or of any
business acquired by the Company and the Trust for which financial
statements and financial data are, or are required to be, included in
the Registration Statement), addressed to each of the underwriters,
such letters to be in customary form and covering matters of the type
customarily covered in "cold comfort" letters in connection with
underwritten offerings and such other matters as reasonably requested
by such underwriters in accordance with Statement on Auditing
Standards No. 72; and (D) if an underwriting agreement is entered
into, the same shall contain indemnification provisions and procedures
no less favorable than those set forth in Section 4 hereof (or such
other provisions and procedures acceptable to the managing
underwriters) with respect to all parties to be indemnified pursuant
to said Section (including, without limitation, such underwriters and
selling Holders);
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(n) if (1) a Shelf Registration is filed pursuant to
Section 2(b) or (2) a Prospectus contained in an Exchange Offer
Registration Statement filed pursuant to Section 2(a) is required to
be delivered under the Securities Act by any Participating
Broker-Dealer who seeks to sell Exchange Securities during the
Applicable Period, make reasonably available for inspection by any
selling Holder of such Registrable Securities being sold, or each such
Participating Broker-Dealer, as the case may be, any underwriter
participating in any such disposition of Registrable Securities, if
any, and any attorney, accountant or other agent retained by any such
selling Holder or each such Participating Broker-Dealer, as the case
may be, or underwriter (collectively, the "Inspectors"), at the
offices where normally kept, during reasonable business hours, all
financial and other records, pertinent corporate documents and
properties of the Trust, the Company and its subsidiaries
(collectively, the "Records") as shall be reasonably necessary to
enable them to exercise any applicable due diligence responsibilities,
and cause the officers, directors and employees of the Trust, the
Company and its subsidiaries to supply all relevant information in
each case reasonably requested by any such Inspector in connection
with such Registration Statement; provided, however, that the
foregoing inspection and information gathering shall be coordinated on
behalf of the Holders by the Initial Purchasers and on behalf of the
other parties, by one counsel designated by the Initial Purchasers.
Records which the Company and the Trust determine, in good faith, to
be confidential and any records which the Company notifies the
Inspectors are confidential shall not be disclosed by the Inspectors
unless (i) the disclosure of such Records is necessary to avoid or
correct a material misstatement or omission in such Registration
Statement, (ii) the release of such Records is ordered pursuant to a
subpoena or other order from a court of competent jurisdiction or is
necessary in connection with any action, suit or proceeding or (iii)
the information in such Records has been made generally available to
the public. Each selling Holder of such Registrable Securities and
each such Participating Broker-Dealer will be required as a condition
to the receipt of such information to agree in writing that
information obtained by it as a result of such inspections shall be
deemed confidential and shall not be used by it as the basis for any
market transactions in the securities of the Trust or the Company
unless and until such is made generally available to the public. Each
selling Holder of such Registrable Securities and each such
Participating Broker-Dealer will be required to further agree in
writing that it will, upon learning that disclosure of such Records is
sought in a court of competent jurisdiction, give notice to the
Company and allow the Company at its expense to undertake appropriate
action to prevent disclosure of the Records deemed confidential;
(o) comply with all applicable rules and regulations of
the SEC so long as any provision of this Agreement shall be applicable
and make generally available to its security holders earning
statements satisfying the provisions of Section 11(a) of the
Securities Act and Rule 158 thereunder (or any similar rule
promulgated under the Securities Act) no later than 45 days after the
end of any 12-month period (or 90 days after the end of any 12-month
period if such period is a fiscal year) (i) commencing at the
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end of any fiscal quarter in which Registrable Securities are sold to
underwriters in a firm commitment or best efforts underwritten
offering and (ii) if not sold to underwriters in such an offering,
commencing on the first day of the first fiscal quarter of the Company
after the effective date of a Registration Statement, which statements
shall cover said 12-month periods;
(p) upon consummation of an Exchange Offer or a Private
Exchange, if requested by a Trustee or if the Indenture so requires,
obtain an opinion of counsel to the Company addressed to the Trustee
for the benefit of all Holders of Registrable Securities participating
in the Exchange Offer or the Private Exchange, as the case may be, and
which includes an opinion that (i) the Company and the Trust, as the
case requires, have duly authorized, executed and delivered the
Exchange Securities and Private Exchange Securities, and (ii) each of
the Exchange Securities or the Private Exchange Securities, as the
case may be, constitutes a legal, valid and binding obligation of the
Company or the Trust, as the case requires, enforceable against the
Company or the Trust, as the case requires, in accordance with its
respective terms (in each case, with customary exceptions);
(q) if an Exchange Offer or a Private Exchange is to be
consummated, upon delivery of the Registrable Securities by Holders to
the Company or the Trust, as applicable (or to such other Person as
directed by the Company or the Trust, respectively), in exchange for
the Exchange Securities or the Private Exchange Securities, as the
case may be, the Company or the Trust, as applicable, shall ▇▇▇▇, or
cause to be marked, on such Registrable Securities delivered by such
Holders that such Registrable Securities are being cancelled in
exchange for the Exchange Securities or the Private Exchange
Securities, as the case may be; in no event shall such Registrable
Securities be marked as paid or otherwise satisfied;
(r) cooperate with each seller of Registrable Securities
covered by any Registration Statement and each underwriter, if any,
participating in the disposition of such Registrable Securities and
their respective counsel in connection with any filings required to be
made with the NASD;
(s) take all other steps necessary to effect the
registration of the Registrable Securities covered by a Registration
Statement contemplated hereby;
(t) in the case of the Exchange Offer Registration
Statement (i) include in the Exchange Offer Registration Statement a
section entitled "Plan of Distribution," which section shall be
reasonably acceptable to the Initial Purchasers or another
representative of the Participating Broker-Dealers identified to the
Company in writing, and which shall contain a summary statement of the
positions taken or policies made by the staff of the SEC with respect
to the potential "underwriter" status of any broker-dealer (a
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"Participating Broker-Dealer") that holds Registrable Securities
acquired for its own account as a result of market-making activities
or other trading activities and that will be the beneficial owner (as
defined in Rule 13d-3 under the Exchange Act) of Exchange Securities
to be received by such broker-dealer in the Exchange Offer, whether
such positions or policies have been publicly disseminated by the
staff of the SEC or such positions or policies, in the reasonable
judgment of the Initial Purchasers or such other representative,
represent the prevailing views of the staff of the SEC, including a
statement that any such broker-dealer who receives Exchange Securities
for Registrable Securities pursuant to the Exchange Offer may be
deemed a statutory underwriter and must deliver a prospectus meeting
the requirements of the Securities Act in connection with any resale
of such Exchange Securities, (ii) furnish to each Participating
Broker-Dealer who has delivered to the Company the notice referred to
in Section 3(e), without charge, as many copies of each Prospectus
included in the Exchange Offer Registration Statement, including any
preliminary Prospectus, and any amendment or supplement thereto, as
such Participating Broker-Dealer may reasonably request (each of the
Company and the Trust hereby consents to the use of the Prospectus
forming part of the Exchange Offer Registration Statement or any
amendment or supplement thereto by any Person subject to the
prospectus delivery requirements of the Securities Act, including all
participating Broker-Dealers, in connection with the sale or transfer
of the Exchange Securities covered by the Prospectus or any amendment
or supplement thereto), (iii) keep the Exchange Offer Registration
Statement effective and amend and supplement the Prospectus contained
therein in order to permit such Prospectus to be lawfully delivered by
all Persons subject to the prospectus delivery requirements of the
Securities Act for such period of time as such Persons must comply
with such requirements under the Securities Act and applicable rules
and regulations in order to resell the Exchange Securities; provided,
however, that such period shall not be required to exceed 90 days (or
such longer period if extended pursuant to the last sentence of
Section 3 hereof) (the "Applicable Period"), and (iv) include in the
transmittal letter or similar documentation to be executed by an
exchange offeree in order to participate in the Exchange Offer (x) the
following provision:
"If the exchange offeree is a broker-dealer holding
Registrable Securities acquired for its own account as a
result of market-making activities or other trading
activities, it will deliver a prospectus meeting the
requirements of the Securities Act in connection with any
resale of Exchange Securities received in respect of such
Registrable Securities pursuant to the Exchange Offer";
and (y) a statement to the effect that by a broker-dealer making the
acknowledgment described in clause (x) and by delivering a Prospectus
in connection with the exchange of Registrable Securities, the
broker-dealer will not be deemed to admit that it is an underwriter
within the meaning of the Securities Act.
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The Company or the Trust may require each seller of
Registrable Securities as to which any registration is being effected to
furnish to the Company or the Trust, as applicable, such information regarding
such seller as may be required by the securities laws or regulations to be
included in a Registration Statement. The Company or the Trust may exclude
from such registration the Registrable Securities of any seller who
unreasonably fails to furnish such information within a reasonable time (which
time shall in no event exceed 15 days) after receiving such request. The
Company shall have no obligation to register under the Securities Act the
Registrable Securities of a seller who so fails to furnish such information.
In the case of (i) a Shelf Registration Statement or (2)
Participating Broker-Dealers who have notified the Company and the Trust that
they will be utilizing the Prospectus contained in the Exchange Offer
Registration Statement as provided in Section 3(t) hereof, are seeking to sell
Exchange Securities and are required to deliver Prospectuses each Holder agrees
that, upon receipt of any notice from the Company or the Trust of the happening
of any event of the kind described in Section 3(e)(ii), 3(e)(iii), 3(e)(v) or
3(e)(vi) hereof, such Holder will forthwith discontinue disposition of
Registrable Securities pursuant to a Registration Statement until such Holder's
receipt of the copies of the supplemented or amended Prospectus contemplated by
Section 3(i) hereof or until it is advised in writing (the "Advice") by the
Company and the Trust that the use of the applicable Prospectus may be resumed,
and, if so directed by the Company and the Trust, such Holder will deliver to
the Company or the Trust (at the Company's or the Trust's expense, as the case
requires) all copies in such Holder's possession, other than permanent file
copies then in such Holder's possession, of the Prospectus covering such
Registrable Securities or Exchange Securities, as the case may be, current at
the time of receipt of such notice of suspension or disposition. If the
Company or the Trust shall give any such notice to suspend the disposition of
Registrable Securities or Exchange Securities, as the case may be, pursuant to
a Registration Statement, the Company and the Trust shall use their best
efforts to file and have declared effective (if an amendment) as soon as
practicable following an amendment or supplement to the Registration Statement
and shall extend the period during which such Registration Statement shall be
maintained effective pursuant to this Agreement by the number of days in the
period from and including the date of the giving of such notice to and
including the date when the Company and the Trust shall have made available to
the Holders (x) copies of the supplemented or amended Prospectus necessary to
resume such dispositions or (y) the Advice.
4. Indemnification and Contribution. (a) In connection
with any Registration Statement, the Company and the Trust agree to jointly and
severally indemnify and hold harmless each Initial Purchaser, each Holder, each
Participating Broker-Dealer and each Person, if any, who controls any of such
parties within the meaning of Section 15 of the Securities Act or Section 20 of
the Exchange Act:
(i) against any and all loss, liability, claim, damage
and expense whatsoever, joint or several, as incurred, arising out of
any untrue statement or alleged untrue statement
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of a material fact contained in any Registration Statement (or any
amendment thereto), covering Registrable Securities or Exchange
Securities, including all documents incorporated therein by reference,
or the omission or alleged omission therefrom of a material fact
required to be stated therein or necessary to make the statements
therein not misleading or arising out of any untrue statement or
alleged untrue statement of a material fact contained in any
Prospectus (or any amendment or supplement thereto) or the omission or
alleged omission therefrom of a material fact necessary in order to
make the statements therein, in the light of the circumstances under
which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage
and expense whatsoever, joint or several, as incurred, to the extent
of the aggregate amount paid in settlement of any litigation, or any
investigation or proceeding by any court or governmental agency or
body, commenced or threatened, or of any claim whatsoever based upon
any such untrue statement or omission, or any such alleged untrue
statement or omission, if such settlement is effected with the prior
written consent of the Company; and
(iii) against any and all expenses whatsoever, as incurred
(including reasonable fees and disbursements of counsel chosen by such
Holder or such Participating Broker-Dealer (except to the extent
otherwise expressly provided in Section 4(c) hereof)), reasonably
incurred in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any court or
governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission, to the extent that any such
expense in not paid under subparagraph (i) or (ii) of this Section
4(a);
provided, however, that (i) this indemnity does not apply to any loss,
liability, claim, damage or expense to the extent arising out of an untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished in writing to the
Company or the Trust by such Holder or Participating Broker-Dealer with respect
to such Holder or Participating Broker-Dealer, as the case may be, expressly
for use in the Registration Statement (or any amendment thereto) or any
Prospectus (or any amendment or supplement thereto) and (ii) the Company and
the Trust shall not be liable to any such Holder, Participating Broker-Dealer
or controlling person, with respect to any untrue statement or alleged untrue
statement or omission or alleged omission in any preliminary Prospectus to the
extent that any such loss, liability, claim, damage or expense of any Holder,
Participating Broker-Dealer or controlling person results from the fact that
such Holder or Participating Broker-Dealer sold Registrable Securities or
Exchange 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
as then amended or supplemented if the Company had previously furnished copies
thereof to such Holder or Participating Broker-Dealer and the loss, liability,
claim, damage or expense of such Holder, Participating Broker-Dealer or
controlling person results from an untrue statement or omission of
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a material fact contained in the preliminary Prospectus which was corrected in
the final Prospectus. Any amounts advanced by the Company or the Trust to an
indemnified party pursuant to this Section 4 shall be returned to the Company
or the Trust if it shall be finally determined by such a court in a judgment
not subject to appeal or final review that such indemnified party was not
entitled to indemnification by the Company or the Trust.
(b) Each Holder agrees, severally and not jointly, to
indemnify and hold harmless the Company, the Trust and the other selling
Holders and each of their respective directors, officers and trustees
(including each director, officer or trustee of the Company and the Trust who
signed the Registration Statement), employees and agents and each Person, if
any, who controls the Company, the Trust or any other selling Holder within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act,
from and against any and all loss, liability, claim, damage and expense
whatsoever described in the indemnity contained in Section 4(a) hereof, as
incurred, but only with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in the Registration Statement (or any
amendment thereto) or any Prospectus (or any amendment or supplement thereto)
in reliance upon and in conformity with written information furnished to the
Company or the Trust by such selling Holder with respect to such Holder
expressly for use in the Registration Statement (or any amendment thereto), or
any such Prospectus (or any amendment thereto); provided, however, that, in the
case of a Shelf Registration Statement, no such Holder shall be liable for any
claims hereunder in excess of the amount of net proceeds received by such
Holder from the sale of Registrable Securities pursuant to such Shelf
Registration Statement.
(c) Each indemnified party shall give prompt notice to
each indemnifying party of any action commenced against it in respect of which
indemnity may be sought hereunder, enclosing a copy of all papers properly
served on such indemnified party, but failure to so notify an indemnifying
party shall not relieve such indemnifying party from any liability which it may
have under this Section 4, except to the extent that it is materially
prejudiced by such failure. An indemnifying party may participate at its own
expense in the defense of such action. If an indemnifying party so elects
within a reasonable time after receipt of such notice, an indemnifying party,
severally or jointly with any other indemnifying parties receiving such notice,
may assume the defense of such action with counsel chosen by it and reasonably
acceptable to the indemnified parties defendant in such action, provided,
however, that if (i) representation of such indemnified party by the same
counsel would present a conflict of interest or (ii) the actual or potential
defendants in, or targets of, any such action include both the indemnified
party and the indemnifying party and any such indemnified party reasonably
determines that there are likely to be legal defenses available to such
indemnified party which are inconsistent or in conflict with those available to
such indemnifying parties, then in the case of clauses (i) and (ii) of this
Section 4(c) such indemnifying party and counsel for each indemnifying party or
parties shall not be entitled to assume such defense. If an indemnifying party
is not entitled to assume the defense of such action as a result of the proviso
to the preceding sentence, counsel for such indemnifying party and counsel for
each indemnified party
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or parties shall be entitled to conduct the defense of such indemnified party
or parties. If an indemnifying party assumes the defense of such action, in
accordance with and as permitted by the provisions of this paragraph, such
indemnifying parties shall not be liable for any fees and expenses of counsel
for the indemnified parties incurred thereafter in connection with such action.
In no event shall the indemnifying parties be liable for the fees and expenses
of more than one counsel (in addition to local counsel), separate from their
own counsel, for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances. No indemnifying party shall,
without the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this Section 4 (whether
or not the indemnified parties are actual or potential parties thereto), unless
such settlement, compromise or consent (i) includes an unconditional written
release in form and substance satisfactory to the indemnified parties of each
indemnified party from all liability arising out of such litigation,
investigation, proceeding or claim and (ii) does not include a statement as to
or an admission of fault, culpability or a failure to act by or on behalf of
any indemnified party.
(d) Notwithstanding the last sentence of Section 4(a), if
at any time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for reasonable fees and expenses of counsel
pursuant to Section 4(a)(iii) above, such indemnifying party agrees that it
shall be liable for any settlement effected without its written consent if (i)
such settlement is entered into more than 45 days after receipt by such
indemnifying party of the aforesaid request, (ii) such indemnifying party shall
have received notice of the terms of such settlement at least 30 days prior to
such settlement being entered into and (iii) such indemnifying party shall not
have reimbursed such indemnified party in accordance with such request prior to
the date of such settlement; provided that an indemnifying party shall not be
liable for any such settlement effected without its consent if such
indemnifying party (1) reimburses such indemnified party in accordance with
such request to the extent it considers reasonable and (2) provides written
notice to the indemnified party substantiating the unpaid balance as
unreasonable, in each case prior to the date of such settlement. [Note: these
provisions track last year's documents almost verbatim.]
(e) In order to provide for just and equitable
contribution in circumstances under which any of the indemnity provisions set
forth in this Section 4 is for any reason held to be unavailable to the
indemnified parties although applicable in accordance with its terms, the
Company, the Trust, and the Holders shall contribute to the aggregate losses,
liabilities, claims, damages and expenses of the nature contemplated by such
indemnity agreement incurred by the Company, the Trust and the Holders, as
incurred; provided that 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 that was not guilty of such fraudulent
misrepresentation. As
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between the Company, the Trust, and the Holders, such parties shall contribute
to such aggregate losses, liabilities, claims, damages and expenses of the
nature contemplated by such indemnity agreement in such proportion as shall be
appropriate to reflect the relative fault of the Company and Trust, on the one
hand, and the Holders, on the other hand, with respect to the statements or
omissions which resulted in such loss, liability, claim, damage or expense, or
action in respect hereof, as well as any other relevant equitable
considerations. The relative fault of the Company and the Trust, on the one
hand, and of the Holders, on the other hand, shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company or the Trust, on the one hand,
or by or on behalf of the Holders, on the other, and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Company, the Trust and the Holders of the
Registrable Securities agree that it would not be just and equitable if
contribution pursuant to this Section 4(e) were to be determined by pro rata
allocation or by any other method of allocation that does not take into account
the relevant equitable considerations. For purposes of this Section 4(e), each
affiliate of a Holder, and each director, officer, employee, agent and Person,
if any, who controls a Holder or such affiliate within the meaning of Section
15 of the Securities Act or Section 20 of the Exchange Act shall have the same
rights to contribution as such Holder, and each director of each of the Company
or the Trust, each officer of each of the Company or the Trust who signed the
Registration Statement, and each Person, if any, who controls each of the
Company or the Trust within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act shall have the same rights to contribution as
each of the Company or the Trust.
5. Participation in Underwritten Registrations. No
Holder may participate in any underwritten registration hereunder unless such
Holder (a) agrees to sell such Holder's Registrable Securities on the basis
provided in any underwriting arrangements approved by the Persons entitled
hereunder to approve such arrangements and (b) completes and executes all
reasonable questionnaires, lock-up letters and other documents reasonably
required under the terms of such underwriting arrangements.
6. Selection of Underwriters. The Holders of
Registrable Securities covered by the Shelf Registration Statement who desire
to do so may sell the securities covered by such Shelf Registration in an
underwritten offering; provided that such securities represent at least 10% of
the aggregate principal or liquidation amount of Registrable Securities
outstanding. In any such underwritten offering, the underwriter or
underwriters and manager or managers that will administer the offering will be
selected by the Holders of a majority in aggregate principal or liquidation
amount of the Registrable Securities included in such underwritten offering;
provided, however, that such underwriters and managers must be reasonably
satisfactory to the Company and the Trust.
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7. Miscellaneous.
(a) Rule 144 and Rule 144A. For so long as the Company
or the Trust is subject to the reporting requirements of Section 13 or 15 of
the Exchange Act and any Registrable Securities remain outstanding, it will use
its best efforts to file the reports or other filings required to be filed by
it under the Securities Act and Section 13(a) or 15(d) of the Exchange Act and
the rules and regulations adopted by the SEC thereunder; provided that if it
ceases to be so required to file such reports or other filings, it will, upon
the request of any Holder of Registrable Securities (a) make publicly available
such information as is necessary to permit sales of its Registrable Securities
pursuant to Rule 144 under the Securities Act, (b) deliver such information to
a prospective purchaser as is necessary to permit sales of its securities
pursuant to Rule 144A under the Securities Act and it will take such further
action as any Holder of Registrable Securities may reasonably request, and (c)
take such further action that is reasonable in the circumstances, in each case,
to the extent required from time to time to enable such Holder to sell its
Registrable Securities without registration under the Securities Act within the
limitation of the exemptions provided by (i) Rule 144 under the Securities Act,
as such rule may be amended from time to time, (ii) Rule 144A under the
Securities Act, as such rule may be amended from time to time, or (iii) any
similar rules or regulations hereafter adopted by the SEC. Upon the request of
any Holder of Registrable Securities, the Company or the Trust, as applicable,
will deliver to such Holder a written statement as to whether it has complied
with such requirements.
(b) No Inconsistent Agreements. The Company or the Trust
has not entered into nor will the Company or the Trust on or after the date of
this Agreement enter into any agreement which is inconsistent with the rights
granted to the Holders of Registrable Securities in this Agreement or otherwise
conflicts with the provisions hereof. The rights granted to the Holders
hereunder do not in any way conflict with the rights granted to the holders of
the Company's or the Trust's other issued and outstanding securities under any
such agreements.
(c) Amendments and Waivers. The provisions of this
Agreement, including the provisions of this sentence, may not be amended,
modified or supplemented, and waivers or consents to departures from the
provisions hereof may not be given unless the Company and the Trust have
obtained the written consent of Holders of at least a majority in aggregate
principal or liquidation amount of the outstanding Registrable Securities
affected by such amendment, modification, supplement, waiver or departure;
provided no amendment, modification or supplement or waiver or consent to the
departure with respect to the provisions of Section 4 hereof shall be effective
as against any Holder of Registrable Securities unless consented to in writing
by such Holder of Registrable Securities. Notwithstanding the foregoing
sentence, (i) this Agreement may be amended, without the consent of any Holder
of Registrable Securities, by written agreement signed by the Company, the
Trust and Salomon Brothers, to cure any ambiguity, correct or supplement any
provision of this Agreement that may be inconsistent with any other provision
of this Agreement or to make any other provisions with respect to matters or
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questions arising under this Agreement which shall not be inconsistent with
other provisions of this Agreement, (ii) this Agreement may be amended,
modified or supplemented, and waivers and consents to departures from the
provisions hereof may be given, by written agreement signed by the Company, the
Trust and Salomon Brothers to the extent that any such amendment, modification,
supplement, waiver or consent is, in their reasonable judgment, necessary or
appropriate to comply with applicable law (including any interpretation of the
Staff of the SEC) or any change therein and (iii) to the extent any provision
of this Agreement relates to the Initial Purchasers, such provision may be
amended, modified or supplemented, and waivers or consents to departures from
such provisions may be given, by written agreement signed by Salomon Brothers,
the Company and the Trust.
(d) Notices. All notices and other communications
provided for or permitted hereunder shall be made in writing by hand-delivery,
registered first-class mail, telex, telecopier, or any courier guaranteeing
overnight delivery (i) if to a Holder, at the most current address given by
such Holder to the Company or the Trust by means of a notice given in
accordance with the provisions of this Section 7(d), which address initially
is, with respect to the Initial Purchasers, the address set forth in the
Purchase Agreement; and (ii) if to the Company or the Trust, initially at the
Company's address set forth in the Purchase Agreement and thereafter at such
other address, notice of which is given in accordance with the provisions of
this Section 7(d).
All such notices and communications shall be deemed to have
been duly given: at the time delivered by hand, if personally delivered; five
Business Days after being deposited in the mail, postage prepaid, if mailed;
when answered back, if telexed; when receipt is acknowledged, if telecopied;
and on the next Business Day, if timely delivered to an air courier
guaranteeing overnight delivery.
Copies of all such notices, demands, or other communications
shall be concurrently delivered by the Person giving the same to the Trustee,
at the address specified in the Indenture.
(e) Successors and Assigns. This Agreement shall inure
to the benefit of and be binding upon the successors, assigns and transferees
of the Initial Purchasers, including, without limitation and without the need
for an express assignment, subsequent Holders; provided, however, that nothing
herein shall be deemed to permit any assignment, transfer or other disposition
of Registrable Securities in violation of the terms of the Purchase Agreement
or the Indenture. If any transferee of any Holder shall acquire Registrable
Securities, in any manner, whether by operation of law or otherwise, such
Registrable Securities shall be held subject to all of the terms of this
Agreement, and by taking and holding such Registrable Securities, such Person
shall be conclusively deemed to have agreed to be bound by and to perform all
of the terms of this Agreement and such Person shall be entitled to receive the
benefits hereof.
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(f) Third Party Beneficiary. Each of the Initial
Purchasers shall be a third party beneficiary of the agreements made hereunder
between the Company and the Trust, on the one hand, and the Holders, on the
other hand, and shall have the right to enforce such agreements directly to the
extent it deems such enforcement necessary or advisable to protect its rights
or the rights of Holders hereunder.
(g) Counterparts. This Agreement may be executed in any
number of counterparts and by the parties hereto in separate counterparts, each
of which when so executed shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement.
(h) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(i) GOVERNING LAW. THIS AGREEMENT SHALL BE DEEMED TO
HAVE BEEN MADE IN THE STATE OF NEW YORK. THE VALIDITY AND INTERPRETATION OF
THIS AGREEMENT, AND THE TERMS AND CONDITIONS SET FORTH HEREIN, SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE
OF NEW YORK. EACH OF THE PARTIES HERETO AGREES TO SUBMIT TO THE NON-EXCLUSIVE
JURISDICTION OF THE COMPETENT COURTS OF THE STATE OF NEW YORK SITTING IN THE
CITY OF NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT.
(j) Severability. In the event that any one or more of
the provisions contained herein, or the application thereof in any
circumstance, is held invalid, illegal or unenforceable, the validity, legality
and enforceability of any such provision in every other respect and of the
remaining provisions contained herein shall not be affected or impaired
thereby.
(k) Securities Held by the Company, the Trust or its
Affiliates. Whenever the consent or approval of Holders of a specified
percentage of Registrable Securities is required hereunder, Registrable
Securities held by the Company, the Trust or its affiliates (as such term is
defined in Rule 405 under the Securities Act) shall not be counted in
determining whether such consent or approval was given by the Holders of such
required percentage.
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IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
K N ENERGY, INC.
By: /s/ E. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-----------------------------------
Name: E. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President and Treasurer
K N CAPITAL TRUST I
By: /s/ E. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
----------------------------------
Name: E. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Administrative Trustee
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Administrative Trustee
Confirmed and accepted as of
the date first above written:
SALOMON BROTHERS INC
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
By: SALOMON BROTHERS INC
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Vice President