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Exhibit 4.5
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT, dated as of September 29, 2000 (the
"Agreement"), by and between CoreComm Limited , a Delaware corporation formerly
known as ATX Telecommunications Services, Inc. (the "Company"), and each of
▇▇▇▇▇▇▇ ▇▇▇▇ ("▇▇▇▇"), ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ("▇▇▇▇▇▇▇▇▇"), ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ("▇▇▇▇▇▇▇")
and The ▇▇▇▇▇▇▇▇ ▇▇▇▇ Trust (the "Trust"). Each of Karp, Buruchian, ▇▇▇▇▇▇▇ and
the Trust is referred to as a "Stockholder").
WHEREAS, pursuant to a Recapitalization Agreement and Plan of Merger,
dated as of March 9, 2000, as amended (the "Recapitalization and Merger
Agreement"), by and among the Company, CoreComm Limited, a Bermuda corporation
("CoreComm"), and, with respect to certain provisions thereof, the Stockholders,
ATX Merger Sub, Inc. ("ATX Merger Sub") and CoreComm Merger Sub, Inc. ("CoreComm
Merger Sub") (i) CoreComm has been merged with and into CoreComm Merger Sub
(with each issued and outstanding share of CoreComm's common stock converted
into a share of common stock of CoreComm Merger Sub) (the "Domestication
Merger"); (ii) CoreComm Merger Sub is being merged with and into the Company
(the "Merger"); and (iii) the Company is being recapitalized by exchanging each
pre-recapitalization share of the Company's common stock for 12,398,334 shares
of the Company's post-recapitalization common stock, par value $.01 per share
(the "Common Stock"), 250,000 shares of the Company's Series B Senior
Convertible Exchangeable Preferred Stock, par value $.01 per share (the
"Preferred Stock"), and $150 million in cash and Senior Notes (as defined in the
Recapitalization and Merger Agreement) with a possible issuance of up to $110
million in notes (the "Recapitalization").
WHEREAS, the Stockholders are the holders of all of the outstanding
pre-recapitalization shares of the Company's common stock and it is a condition
to the consummation of the recapitalization and the other transactions
contemplated by the Recapitalization and Merger Agreement that the Company grant
to the Stockholders the registration rights and other rights set forth herein;
and
In consideration of the mutual covenants and agreements set forth
herein and for good and valuable consideration, the receipt of which is hereby
acknowledged, the parties hereto agree as follows:
1. General; Securities Subject to this Agreement.
1.1 Grant of Rights. The Company hereby grants registration
rights to the Stockholders upon the terms and subject to the conditions set
forth in this Agreement. Capitalized terms used herein and not defined shall
have the meanings assigned to such terms in the Recapitalization and Merger
Agreement.
1.2 Registrable Securities. For the purposes of this Agreement,
"Registrable Securities" means, each of the following: (a) any shares of Common
Stock issued to the Stockholders pursuant to the Recapitalization and Merger
Agreement, (b) any shares of Preferred Stock issued to the Stockholders pursuant
to the Recapitalization and Merger Agreement, (c) any shares of Common Stock
issued upon conversion of, or as
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payment of dividends on, or in exchange for shares of the Preferred Stock issued
pursuant to the Recapitalization and Merger Agreement, and (d) any shares of
Common Stock issued in payment of a dividend on the Senior Notes (as defined in
the Recapitalization and Merger Agreement); provided, however, that shares shall
cease to be Registrable Securities for purposes of this Agreement when a
registration statement covering such Registrable Securities has been declared
effective under the Securities Act by the SEC and all such Registrable
Securities have been disposed of pursuant to such effective registration
statement.
1.3 Stockholders of Registrable Securities. A Person is deemed to
be a holder of Registrable Securities whenever such Person (i) is a party to
this Agreement (or a permitted transferee thereof) and (ii) owns of record
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 may act upon the basis of the instructions,
notice or election received from the registered owner of such Registrable
Securities.
2. Demand Registration Rights.
2.1 Shelf; Demand; and Resale Registrations.
(a) Within 15 days following the Closing (as defined in the
Merger Agreement), the Company shall cause to be filed with the Securities and
Exchange Commission a Registration Statement registering under Rule 415 under
the Securities Act all Registrable Securities (the "Shelf Registration"). The
Company shall use its reasonable best efforts to cause such Shelf Registration
to be declared effective under the Securities Act as soon as practicable
following the filing thereof, and shall use its reasonable best efforts to cause
such Shelf Registration to remain continuously effective under the Securities
Act until such time as the securities which have been issued to the Stockholders
at the Closing (as defined in the Recapitalization and Merger Agreement) may be
freely sold without regard to the volume limitations under Rule 144 of the
Securities Act by a Stockholder who is not otherwise an Affiliate of the Company
within the meaning of Rule 144 (or such shorter period that will terminate when
all Registrable Securities covered by the Shelf Registration have been sold).
Subject to the provisions of Section 2.1(e), the Company agrees, if necessary,
to supplement or make amendments to the Shelf Registration, if required by the
registration form used by the Company for the Shelf Registration or by the
instructions applicable to such registration form or by the Securities Act or
the rules or regulations thereunder.
(b) At any time on or after the Closing, the Stockholders
may make a written request (specifying the intended method of disposition) (such
Stockholders, the "Initiating Common Stockholders") for one additional
registration under the Securities Act (a "Demand Common Registration") of all or
part of the shares of Common Stock which constitute such Initiating
Stockholders' Registrable Securities;provided, however, that, (i) the number of
shares of Common Stock proposed to be registered by the Initiating Common
Stockholders in any Demand Common Registration shall not be less than
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1,500,000 shares (subject to appropriate adjustments to reflect stock splits,
stock dividends, corporate recapitalizations or similar transactions) as of the
date of the request, and (ii) the Initiating Common Stockholders shall be the
holders as of the date of the request of at least 25% of the then outstanding
shares of Common Stock that constitute Registrable Securities hereunder;
provided, however, that such Demand Common Registration may be requested by
Initiating Common Stockholders owning less than 25% of the then outstanding
shares of Common Stock that constitute Registrable Securities hereunder so long
as such Initiating Common Stockholders are the holders as of the date of the
request of at least 10% of the then outstanding shares of Common Stock that
constitute Registrable Securities hereunder.
(c) At any time on or after the Closing, the Stockholders may
make a written request (specifying the intended method of disposition) (such
Stockholders, the "Initiating Preferred Stockholders") for one additional
registration under the Securities Act (a "Demand Preferred Registration") of all
or part of the shares of Preferred Stock which constitute such Initiating
Stockholders' Registrable Securities;provided, however, that, (i) the face value
of the shares of Preferred Stock proposed to be registered by the Initiating
Stockholders shall not be less than $80,000,000 as of the date of the request,
and (iv) the Initiating Preferred Stockholders shall be the holders as of the
date of the request of at least 25% of the then outstanding shares of Preferred
Stock that constitute Registrable Securities hereunder.
(d) If the Company elects to pay any dividends on the shares
of Preferred Stock in the form of shares of Common Stock, or to make any
interest payment on the Senior Notes in the form of shares of Common Stock, in
each such case in accordance with the instruments governing such securities,
and, in accordance with the instruments governing such securities the
Corporation is obligated to file and have effective under the Securities Act a
Resale Registration Statement in connection with such payment, the Company shall
use its reasonable efforts to keep such registration statement current and
effective for a period of at least 365 days following the date on which such
dividend or interest payment in the form of shares of Common Stock is made.
Subject to the provisions of Section 2.1(e), the Company agrees, if necessary,
to supplement or make amendments to the Shelf Registration, if required by the
registration form used by the Company for any such Resale Registration Statement
or by the instructions applicable to such registration form or by the Securities
Act or the rules or regulations thereunder.
(e) If, so long as the Shelf Registration is in effect or a
Resale Registration Statement is in effect or at the time a demand for a Demand
Registration (as defined below) is received by the Company, the Company is
engaged in, or within 90 days plans to engage in a registered public offering
for its own account or any other activity which, in the good faith determination
of the Board of Directors of the Company, would (i) be required to be disclosed
in a Demand Registration or which, under applicable law would require an
amendment of or supplement to the Shelf Registration or the Resale Registrations
Statement, and (ii) be materially and adversely affected by the proceeding with
any such Demand Registration or amending or supplementing the Shelf Registration
or the Resale Registration Statement (each, a "Company Event"), then the Company
may at its option direct that sales under the Shelf Registration or a Resale
Registration Statement be
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suspended, and requests for a Demand Registration be delayed for a reasonable
period of time not in excess of three (3) months from the effective date of such
offering or the date of completion of such other activity, as the case may be,
such right to delay a Demand Registration or to suspend sales under the Shelf
Registration or a Resale Registration Statement to be exercised by the Company
not more than once in any 365-day period; provided, however, that if the Company
receives a written request from Initiating Common Stockholders or the Initiating
Preferred Stockholders (the "Initiating Stockholders") to register the
Registrable Securities of such Stockholders prior to the occurrence of a Company
Event, then such registration shall not be delayed by any registration statement
thereafter effected by the Company. In addition, the Company shall not be
required to effect any Demand Registration within three (3) months after the
effective date of any other registration statement of the Company (other than
the Shelf Registration). Within ten days after receipt of a request for a Demand
Common Registration or a Demand Preferred Registration (each, a "Demand
Registration"), the Company shall give written notice (the "Notice") of such
request to all other Stockholders holding the class of stock to which such
Demand Registration relates and shall include in such registration all
Registrable Securities of that class that the Company has received written
requests for inclusion therein within 15 days after the Notice is given.
Thereafter, in the case of Demand Common Registration, the Company may elect to
include in such registration additional shares of Common Stock issued by the
Company. All requests made pursuant to this Section 2.1 (other than the Shelf
Registration), shall specify the class and aggregate number of Registrable
Securities to be registered.
2.2 Effective Demand Registration. The Company shall use
reasonable commercial efforts to cause any Demand Registration to become
effective not later than ninety (90) days after it receives a request under
Section 2.1 of this Agreement and to remain effective for the lesser of (i) the
period during which all Registrable Securities registered in the Demand
Registration are sold and (ii) one hundred and twenty (120) days; provided,
however, that if the Initiating Stockholders request the Company to withdraw
such registration, other than as the result of a breach by the Company, it shall
constitute a Demand Registration unless the Initiating Stockholders promptly pay
all of the costs and expenses incurred by the Company in connection with such
registration.
2.3 Underwriting Procedures.
(a) The offering of Registrable Securities pursuant to a
Demand Registration shall be in the form of a firm commitment underwritten
offering and the managing underwriter and other underwriters selected for such
offering shall be selected by the Initiating Stockholders, provided that the
managing underwriter and other underwriters are reasonably acceptable to the
Company (having due regard to the experience and relationship with the Company
of the managing underwriter and the other underwriters) (the "Approved Demand
Underwriter"). In such event, if the Approved Demand Underwriter advises the
Company in writing that in its opinion the aggregate amount of such Registrable
Securities requested to be included in such offering is sufficiently large to
have a material adverse effect on the success of such offering, the Company
shall include in such registration only the aggregate amount of Registrable
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Securities that in the opinion of the Approved Demand Underwriter may be sold
without any such material adverse effect and shall reduce pro rata based on the
number of Registrable Securities included in the request for Demand
Registration, the amount of Registrable Securities to be included by each
Stockholder in such registration.
(b) An offering of Registrable Securities under the Shelf
Registration may, but need not be, pursuant to an underwritten offering.
However, if any such offering is to be pursuant to an underwritten offering, the
Stockholder or Stockholders intending to sell Registrable Securities in such
underwritten offering shall give the Company written notice of their desire to
proceed with an underwritten offering under the Shelf Registration. Only one
underwritten offering under the Shelf Registration shall be permitted, and any
such offering must be for at least 1,500,000 shares of Common Stock (subject to
appropriate adjustments to reflect stock splits, stock dividends, corporate
recapitalizations or similar transactions) or at least $80,000,000 face amount
of Preferred Stock. The managing underwriter and other underwriters selected for
such offering shall be selected by the Stockholders seeking to sell such shares
through such underwriter, provided that the managing underwriter and other
underwriters are reasonably acceptable to the Company (having due regard to the
experience and relationship with the Company of the managing underwriter and the
other underwriters) (the "Approved Shelf Underwriter" and together with an
Approved Demand Underwriter, an "Approved Underwriter").
(c) An offering of Registrable Securities under a Resale
Registration Statement may not be pursuant to an underwritten offering.
(d) Distribution by Underwriters. The managing underwriter
or underwriters selected for any underwritten offering shall enter into an
agreement with the Company and the Stockholders whereby the underwriters shall
be prohibited from (i) distributing 5% or greater of the Registrable Securities
to any Person in connection with the initial placement of the Registrable
Securities for the offering and from (ii) distributing 5% or greater of the
Registrable Securities to any Person for 90 days after such initial placement.
3. Incidental or "Piggy-Back" Registration Rights.
3.1 Notice of Registration. If, at any time or from time to time
prior to the fourth anniversary of the date hereof, the Company shall determine
to register any of its Common Stock for sale in an Underwritten Offering for its
own account (other than a registration relating to (i) a registration of an
employee compensation plan or arrangement adopted in the ordinary course of
business on Form S-8 (or any successor form) or any dividend reinvestment plan
or (ii) a registration of securities on Form S-4 (or any successor form)
including, without limitation, in connection with a proposed issuance in
exchange for securities or assets of, or in connection with a merger or
consolidation with another corporation) (a "Company Registration"), or shall
register any of its Common Stock pursuant to a demand request for registration
by any holder of the Company' s Common Stock other than the Stockholders (a
"Third Party Demand Registration"), it
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being understood that a Resale Registration Statement shall not be deemed to be
either a Company Registration or a Third Party Demand Registration for purposes
hereof, the Company will promptly give to the Stockholders written notice
thereof, and include in such registration (subject to Section 3.2) all the
Common Stock Registrable Securities specified in a written request made by any
one or more of the Stockholders within ten days after such Stockholder's
receipt of such written notice from the Company ("Incidental Registration"). The
right of the Stockholder to have Common Stock Registrable Securities included in
a registration pursuant to this Section 3.1 shall be conditioned upon such
Stockholder entering into (together with the Company and/or the other holders,
if any, distributing their securities through such underwriting) an underwriting
agreement in customary form with the managing underwriter or underwriters
selected for such underwriting by the Company or by the stockholders who have
demanded such registration (the "Company Underwriter").
3.2 Cutback. If the lead managing underwriter of an offering
covered by Section 3.1 shall advise the Company in writing on or before the date
five days prior to the date then scheduled for such offering that, in its
opinion, the amount of Common Stock (including Common Stock Registrable
Securities) requested to be included in such registration exceeds the amount
which can be sold in such offering without adversely affecting the distribution
of the Common Stock being offered, then the Company will include in such
registration:
(i) in the case of a Company Registration, first, any shares
proposed to be offered by the Company; second, Registrable Securities
requested to be registered by the Stockholders and any other shares
requested by other stockholders of the Company, including the
Stockholders, to be included in such registration, allocated, if
necessary, pro rata among the Stockholders and such other holders
requesting such registration on the basis of the number of the shares
Beneficially Owned at the time; and
(ii) in the case of a Third Party Demand Registration, first, any
shares proposed to be offered by the stockholder or stockholders
exercising their right to cause the Company to proceed with such Third
Party Demand Registration (the "Initiating Third Party Holders"),
second, any shares proposed to be offered by the Company, and third,
Registrable Securities requested to be registered by the Stockholders
and any other shares requested by other stockholders of the Company,
including the Stockholders but excluding the Initiating Third Party
Holders, to be included in such registration, allocated, if necessary,
pro rata among the Stockholders and such other holders requesting such
registration on the basis of the number of the shares Beneficially
Owned at the time;
provided,however, that in the event the Company will not, by virtue of the
foregoing cutback mechanism, include in any such registration all of the Common
Stock Registrable Securities requested to be included in such registration, the
Stockholders may, upon written notice to the Company given within three days of
the time the Stockholders first are notified
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of such matter, reduce the amount of Registrable Securities they desire to have
included in such registration, whereupon only the Registrable Securities, if
any, they desire to have included will be considered for such inclusion.
3.3 Right of Termination. The Company shall have the right to
terminate or withdraw any registration initiated by it under Section 3.2 prior
to the effectiveness of such registration whether or not the Stockholders have
elected to include Registrable Securities in such registration.
4. Provisions Applicable to Shelf, Demand, Resale and Piggy-Back
Registrations.
4.1 Expenses. The Company shall pay all Registration Expenses
(as defined in Section 6 hereof) incurred in connection with any registration
pursuant to Section 2 or 3 hereto, unless registration fails to become effective
as a result of the fault of one or more Stockholders, in which case the Company
will not be required to pay the Registration Expenses incurred with respect to
the offering of such Stockholder's or Stockholders' Registrable Securities. The
Registration Expenses incurred with respect to the offering of such
Stockholder's or Stockholders' Registrable Securities shall be the product of
(a) the aggregate amount of all Registration Expenses incurred in connection
with such registration and (b) the ratio that the number of such Registrable
Securities bears to the total number of Registrable Securities included in the
registration.
4.2 Holdback Agreements. Each Stockholder agrees not to effect
any public sale or distribution of any Registrable Securities being registered
or of any securities convertible into or exchangeable or exercisable for such
Registrable Securities, including a sale pursuant to Rule 144 under the Act,
during the ninety (90) day period beginning on the effective date of any Demand
Registration or Incidental Registration or other underwritten offering in which
such Stockholder is participating (except as part of such registration), if and
to the extent requested by any other Stockholders, in the case of a
non-underwritten public offering, or if and to the extent requested by the
Company Underwriter, in the case of an under-written public offering.
5. Registration Procedures.
In connection with any registration statement filed pursuant to
this Agreement, the Company will, as expeditiously as possible:
(a) in connection with a request pursuant to this Agreement,
prepare and file with the Commission, after receipt of a request to file a
registration statement with respect to Registrable Securities, a registration
statement on any form for which the Company then qualifies or which counsel for
the Company shall deem appropriate and which form shall be available for the
sale of such Registrable Securities in accordance with the intended method of
distribution thereof and, if the offering is an underwritten offering, shall be
reasonably satisfactory to the Approved Underwriters, and use its best efforts
to cause such registration statement to become effective; provided, however,
that
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before filing a registration statement or prospectus or any amendments or
supplements thereto, the Company shall (i) furnish to the counsel selected by
the Stockholder or Stockholders making the demand, if any, copies of all such
documents proposed to be filed, and (ii) notify such counsel and each seller or
prospective seller of Registrable Securities of any stop order issued or
threatened by the Commission and take all reasonable actions required to prevent
the entry of such stop order or to remove it if entered;
(b) in connection with a registration pursuant to this Agreement
(other than the Shelf Registration and a Resale Registration Statement), prepare
and file with the Commission such amendments and supplements to such
registration statement and the prospectus used in connection therewith as may be
necessary to keep such registration statement effective for a period of not more
than one hundred and twenty (120) days (or such shorter period that will
terminate when all Registrable Securities covered by such registration statement
have been disposed of);
(c) furnish to each seller of Registrable Securities such number
of copies of the registration statement, each amendment and supplement thereto
(in each case including all exhibits thereto), the prospectus included in such
registration statement (including each preliminary prospectus) and such other
documents as each seller may reasonably request in order to facilitate the
disposition of the Registrable Securities owned by such seller;
(d) use reasonable efforts to register or qualify such Registrable
Securities under such other securities or "blue sky" laws of such jurisdictions
as any seller or underwriter reasonably requests in writing and to do any and
all other acts and things that may be reasonably necessary or advisable to
register or qualify for sale in such jurisdictions the Registrable Securities
owned by such seller; provided, however, that the Company shall not be required
to (i) qualify generally to do business in any jurisdiction where it is not then
so qualified, (ii) subject itself to taxation in any such jurisdiction, (iii)
consent to general service of process in any such jurisdiction or (iv) provide
any undertaking required by such other securities or "blue sky" laws or make any
change in its charter or by-laws that the Board of Directors of the Company
determines in good faith to be contrary to the best interest of the Company and
its Stockholders;
(e) use reasonable efforts to cause the Registrable Securities
covered by such registration statement to be registered with or approved by such
other governmental agencies or authorities as may be necessary by virtue of the
business and operations of the Company to enable the seller or sellers thereof
or the Approved Underwriters, if any, to consummate the disposition of such
Registrable Securities;
(f) notify each seller of such Registrable Securities at any time
when a prospectus relating thereto is required to be delivered under the
Securities Act of the happening of any event as a result of which the prospectus
included in such registration statement contains an untrue statement of a
material fact or omits to state any material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, and prepare and file with the
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Commission as soon thereafter as practicable, after consultation with the
Initiating Stockholders and subject to the provisions of Section 2.1(e), a
supplement or amendment to such prospectus so that, as thereafter delivered to
the purchasers of such Registrable Securities, such prospectus will not contain
an untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading;
(g) enter into customary agreements (including, in the case of a
Demand Registration or a single underwritten offering under the Shelf
Registration by Approved Shelf Underwriters an underwriting agreement in
customary form) and take such other actions as are reasonably required in order
to expedite or facilitate the disposition of such Registrable Securities in the
manner permitted hereby;
(h) in the case of either a Demand Registration or a single
underwritten offering under the Shelf Registration by Approved Shelf Underwriter
(but not in the case of a Resale Registration Statement), causing its officers
to be available at reasonable times to participate in "road shows" and other
information meetings organized by the managing Approved Demand Underwriter;
(i) otherwise use reasonable efforts to comply with all applicable
rules and regulations of the Commission; and
(j) use reasonable efforts to cause all Registrable Securities
covered by the registration statement to be listed on each securities exchange
or market, if any, on which similar securities issued by the Company are then
listed, provided that the applicable listing requirements are satisfied.
The Company may require each seller or prospective seller of
Registrable Securities as to which any registration is being effected to furnish
to the Company such information regarding the distribution of such securities
and other matters as may be required to be included in the registration
statement.
Each holder of Registrable Securities agrees that, upon receipt of any
notice from the Company of the happening of any event of the kind described in
paragraph (f) of this Section 5, such holder shall forthwith discontinue
disposition of Registrable Securities pursuant to the registration statement
covering such Registrable Securities until such holder's receipt of the copies
of the supplemented or amended prospectus contemplated by paragraph (f) of this
Section 5 and, if so directed by the Company, such holder shall deliver to the
Company all copies, other than permanent file copies then in such holder's
possession or copies delivered to prospective purchasers, of the prospectus
covering such Registrable Securities current at the time of receipt of such
notice. If the Company shall give any such notice, the Company shall extend the
period during which such registration statement shall be maintained effective
pursuant to this Agreement (including the period referred to in paragraph (b) of
this Section 5) by the number of days during the period from and including the
date of the giving of such notice pursuant to paragraph (f) of this Section 5 to
and including the date when each seller of Registrable Securities covered by
such registration statement
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shall have received the copies of the supplemented or amended prospectus
contemplated by paragraph (f) of this Section 5.
6. Registration Expenses. The Company shall pay all expenses incident
to its performance of or compliance with this Agreement; provided, however, that
the Company shall not pay the costs and expenses of any Stockholder relating to
underwriters' commissions and discounts relating to Registrable Securities to be
sold by such Stockholder, brokerage fees, transfer taxes or the fees or expenses
of any counsel, accountants or other representatives retained by the
Stockholders, individually or in the aggregate. All of the expenses described in
this Section 6 that are to be paid by the Company are herein called the
"Registration Expenses."
7. Indemnification; Contribution.
7.1 Indemnification by the Company. The Company agrees to
indemnify, in the case of any registration statement filed pursuant to this
Agreement, each seller of any Registrable Securities covered by such
registration statement, each other person who participates as an underwriter in
the offering or sale of such securities, and each person, if any, who controls
such seller or any such underwriter within the meaning of the Securities Act
(collectively, the "Indemnified Parties") against any losses, claims, damages or
liabilities to which such Indemnified Party may become subject under the
Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in any registration statement
under which such securities were registered under the Securities Act, any
preliminary prospectus, final prospectus or summary prospectus contained
therein, or any amendment or supplement thereto, or any omission or alleged
omission to state a material fact required to be stated therein or necessary to
make the statements therein in light of the circumstances in which they were
made not misleading, or any violation by the Company of the Securities Act or
any rule or regulation thereunder applicable to the Company; provided, however,
that the Company shall not be liable to the extent that any loss, claim, or
liability arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in such registration statement,
any such preliminary prospectus, final prospectus, summary prospectus, amendment
or supplement in reliance upon and in conformity with written information
furnished to the Company by or on behalf of such Indemnified Party expressly for
use in the Registration Statement; provided, further, that the Company shall not
be liable to any seller of Registrable Securities (or to any person who acts as
an underwriter in such sale or who controls such seller) to the extent that any
loss, claim, or liability arises out of an untrue statement, alleged untrue
statement, omission, or alleged omission made in any preliminary prospectus if
either (a)(i) such seller failed to send or deliver a copy of the prospectus
with or prior to written confirmation of the sale by such seller to the person
asserting the claim and (ii) the prospectus would have corrected such untrue
statement, alleged untrue statement, omission or alleged omission; or (b)(x)
such untrue statement, alleged untrue statement, omission or alleged omission is
corrected in an amendment or supplement to the prospectus and (y) having been
furnished by or on behalf of the Company with copies of the prospectus as so
amended or supplemented, such seller fails to deliver such prospectus as so
amended or
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supplemented, with or prior to the written confirmation of the sale by such
seller to the person asserting the claim.
7.2 Indemnification by Stockholders. In connection with any
registration statement in which a Stockholder is participating, each such
Stockholder shall furnish to the Company in writing such information and
affidavits with respect to such Stockholder as the Company reasonably requests
for use in connection with any such registration statement or prospectus and
agrees to indemnify, to the fullest extent permitted by law, the Company, its
officers, directors and agents and each person, if any, who controls the Company
(within the meaning of the Securities Act) against any and all losses, claims,
damages, and liabilities resulting from any untrue or alleged untrue statement
of a material fact or any omission or alleged omission of a material fact
required to be stated in any registration statement, prospectus or preliminary
prospectus or any amendment thereof or supplement thereto or necessary to make
the statements therein (in the case of a prospectus, in light of the
circumstances under which they were made) not misleading, to the extent that
such untrue or alleged untrue statement or omission is contained in or omitted
from, as the case may be, any information or affidavit with respect to such
Stockholder so furnished in writing by such Stockholder expressly for use in any
such prospectus or preliminary prospectus; provided, however, that the liability
of such Stockholder shall not exceed the net proceeds received by such
Stockholder from the sale of its Registrable Securities. Each Stockholder also
shall indemnify any underwriters of the Registrable Securities, their officers
and directors and each person who controls such underwriters (within the meaning
of the Securities Act) to the same extent as provided above with respect to the
indemnification of the Company; provided, however, that the indemnification of
such Stockholder shall be limited to the net proceeds received by such
Stockholder from the sale of its Registrable Securities.
7.3 Contribution. If the indemnification provided for in this
Section 7 is unavailable to any indemnified party hereunder in respect of any
losses, claims, damages, liabilities or expenses referred to herein, then the
indemnifying party, to the extent such indemnification is unavailable, in lieu
of indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, damages,
liabilities or expenses in such proportion as is appropriate to reflect the
relative fault of the indemnifying party and indemnified parties in connection
with the actions that resulted in such losses, claims, damages, liabilities or
expenses. The relative fault of such indemnifying party and indemnified parties
shall be determined by reference to, among other things, whether any action in
question, including any untrue or alleged untrue statement of a material fact or
omission or alleged omission to state a material fact, has been made by, or
relates to information supplied by, such indemnifying party or indemnified
parties, and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such action.
The parties hereto agree that it would not be just and equitable
if contribution pursuant to this Section 7.3 were determined by pro rata
allocation or by any other method of allocation that does not take account of
the equitable considerations referred to in the immediately preceding paragraph.
No person guilty of fraudulent mis-
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representation (within the meaning of Section 11(f) of the Securities Act) shall
be entitled to contribution from any person.
8. Definitions. As used herein, the following terms shall have the
following respective meanings:
"Beneficial Ownership" shall have the meaning set forth in Rule
13d-3 under the Exchange Act.
"Board of Directors" means the board of directors of the Company.
"Commission" means the Securities and Exchange Commission or any
other federal agency at the time administering the Securities Act.
"Common Stock" means the common stock of the Company or any other
equity securities of the Company into which such securities are converted,
reclassified, reconstituted or exchanged.
"Person" means any individual, firm, corporation, partnership,
trust, incorporated or unincorporated association, joint venture, joint stock
company, government (or an agency or political subdivision thereof) or other
entity of any kind, and shall include any successor (by merger or otherwise) of
any such entity.
"Registration Expenses" shall have the meaning specified in
Section 6 herein.
"Resale Registration Statement" shall mean a registration
statement filed by the Company registering for resale by the holders thereof any
shares of Common Stock issued by the Company to a Stockholder in payment of a
dividend on the shares of the Company' s Preferred Stock or an interest payment
on the Company' s Senior Notes.
"Securities Act" means the Securities Act of 1933, or any
successor federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.
"Underwritten Offering" shall mean a sale of securities of the
Company to an underwriter or underwriters for re-offering to the public, which
shall include a road show and other customary selling efforts.
9. Miscellaneous.
9.1 Limitations on Subsequent Registration Rights. From and after
the date of this Agreement, the Company shall not, without the prior written
consent of the holders of a majority of the Registrable Securities then
outstanding, enter into any agreement with any holder or prospective holder of
any securities of the Company which would allow such holder or prospective
holder (a) to include such securities in any
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registration filed under Section 2.1(b) hereof, unless under the terms of such
agreement, such holder or prospective holder may include such securities in any
such registration only to the extent that the inclusion of such securities will
not reduce the amount of the Registrable Securities of the holders which is
included, or (b) to make a demand registration which could result in such
registration statement being declared effective within ninety (90) days of the
effective date of any registration effected pursuant to Section 2.1(b).
9.2 Assignment. The rights of the Stockholders to have the Company
register Registrable Securities pursuant to this Agreement shall be
automatically assignable by each Stockholder to any transferee (other than the
transferee of such shares in a registered transaction) of all or any portion of
the Registrable Securities if: (i) the Stockholder agrees in writing with the
transferee or assignee to assign such rights, and a copy of such agreement is
furnished to the Company after such assignment, (ii) the Company is 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) the transferee or assignee agrees in writing for
the benefit of the Company to be bound by all of the provisions contained
herein, and (iv) if required under the terms of the Stockholders Agreement, such
transferee enters into the requisite stockholders agreement with the Company as
contemplated by the Stockholders Agreement, of even date herewith, among the
Company and each of Karp, Buruchian, ▇▇▇▇▇▇▇ and the Trust (the "Stockholders
Agreement").
9.3 Amendments and Waivers. Except as otherwise provided herein,
the provisions of this Agreement may not be amended, modified or supplemented,
and waivers or consents to departures from the provisions hereof may not be
given, unless the Company has obtained the written consent of the Stockholders
that own, in the aggregate, 50% or more of the Registrable Securities then
outstanding.
9.4 Notices. Any notice or other communication required or
permitted hereunder shall be in writing and shall be delivered personally,
telecopied (and confirmed) or sent by certified, registered or express mail,
postage prepaid. Any such notice shall be deemed given when so delivered
personally, telecopied (and confirmed) or, if mailed, five days (or, in the case
of express mail, one day) after the date of deposit in the United States mail,
as follows:
(i) if to the Company, to:
CoreComm Limited
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
with copies to:
▇▇
▇▇
▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
1285 Avenue of the Americas
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
(ii) if to any Stockholder, to the most current address of such
Stockholder provided by such Stockholder to the Company
in writing.
with copies to:
Klehr, Harrison, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Any party may by notice given in accordance with this section to the
other parties designate another address or person for receipt of notices
hereunder.
9.5 Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the Stockholders and their permitted successors
and assigns as provided for in Section 9.1 hereof and the successors and assigns
of the Company; provided, however, that such successors and assigns become
parties to this Agreement by executing counterparts thereto and, in the case of
successors and assigns of the Stockholder, there has been compliance with
Section 9.1 hereof.
9.6 Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.
9.7 Headings. The headings in this Agreement are for convenience
of reference only and shall not limit or otherwise affect the meaning hereof.
9.8 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE WITHOUT REGARD TO THE RULES
OF CONFLICT OF LAWS OF THE STATE OF NEW YORK OR ANY OTHER JURISDICTION.
9.9 Severability. If any one or more of the provisions contained
herein, or the application thereof in any circumstances, is held invalid,
illegal or unenforceable in any respect for any reason, the validity, legality
and enforceability of any such provision in every other respect and of the
remaining provisions hereof shall not be in any way impaired.
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9.10 Entire Agreement. This Agreement is entered into and
delivered pursuant to the Recapitalization and Merger Agreement and as such
contains the entire agreements among the parties with respect to the subject
matter hereof and supersedes all prior agreements and understandings, written or
oral, with respect thereto.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed and delivered as of the date first written above.
CORECOMM LIMITED
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Senior Vice President -- Secretary
STOCKHOLDERS:
/a/ ▇▇▇▇▇▇▇ ▇▇▇▇
___________________________________
▇▇▇▇▇▇▇ ▇▇▇▇
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
___________________________________
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
___________________________________
▇▇▇▇▇▇ ▇▇▇▇▇▇▇
THE ▇▇▇▇▇▇▇▇ ▇▇▇▇ TRUST
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Trustee
