Exhibit 9
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REGISTRATION RIGHTS AGREEMENT
among
VIATEL HOLDING (BERMUDA) LIMITED
and
THE INVESTORS NAMED HEREIN
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Dated as of April 21, 2004
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TABLE OF CONTENTS
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ARTICLE I
DEFINITIONS
Section 1.1. Definitions..................................................1
ARTICLE II
REGISTRATION UNDER THE SECURITIES ACT
Section 2.1. Required Registration and Priority...........................5
Section 2.2. Incidental Registration......................................8
Section 2.3. Expenses....................................................10
Section 2.4. Effective Registration Statement; Suspension................10
Section 2.5. Selection of Underwriters...................................10
ARTICLE III
RESTRICTIONS ON PUBLIC SALE
Section 3.1. Public Sale or Distribution.................................11
Section 3.2. Transfers by Holders........................................11
ARTICLE IV
REGISTRATION PROCEDURES
Section 4.1. Procedures..................................................12
Section 4.2. Information to be Provided by Holders.......................16
Section 4.3. Additional Obligations of Holders...........................16
Section 4.4. Additional Obligations of Company and Holders...............17
ARTICLE V
INDEMNIFICATION/CONTRIBUTION
Section 5.1. Indemnification and Contribution............................17
ARTICLE VI
MISCELLANEOUS
Section 6.1. No Inconsistent Agreements..................................20
Section 6.2. Amendments and Waivers......................................20
Section 6.3. Notices.....................................................20
Section 6.4. Successors and Assigns......................................21
Section 6.5. Recapitalizations, Exchanges, etc., Affecting Registrable
Securities.................................................21
Section 6.6. Counterparts................................................22
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Section 6.7. Descriptive Headings, Etc...................................22
Section 6.8. Severability................................................22
Section 6.9. Governing Law; Jurisdiction; Waiver of Jury Trial...........22
Section 6.10. Specific Performance........................................23
Section 6.11. Additional Documents........................................23
Section 6.12. No Third-Party Beneficiaries................................24
Section 6.13. Entire Agreement............................................24
Section 6.13. Termination of Obligations With Respect to Registrable
Notes ....................................................24
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REGISTRATION RIGHTS AGREEMENT (the "Agreement") dated as of April 21,
2004, by and among Viatel Holding (Bermuda) Limited, a company organized under
the laws of Bermuda (the "Company"), the Investors (as hereinafter defined),
▇▇▇▇ ▇▇▇▇▇ and any other Person that shall from and after the date hereof
acquire or otherwise be the transferee of any Registrable Securities (herein
referred to collectively as the "Holders" and individually as a "Holder",
subject to Section 2.2(c)).
WHEREAS, on April 21, 2004, the Company, ▇▇▇▇ ▇▇▇▇▇ and the Investors
entered into an Investment and Note Purchase Agreement (the "Investment
Agreement") pursuant to which, under the terms and subject to the conditions
contained therein, ▇▇▇▇ ▇▇▇▇▇ and each Investor shall purchase 8% Convertible
Senior Secured Notes Due 2014 of the Company (the "Notes") and the Special
Share Purchaser shall purchase the Special Share (as such terms are defined in
the Investment Agreement).
WHEREAS, in order to induce the Purchasers (as defined in the
Investment Agreement) to complete the transactions contemplated by the
Investment Agreement, the Company has agreed to provide registration rights on
the terms and subject to the conditions provided herein.
WHEREAS, the execution and delivery of this Agreement is a condition
to the obligations of the Purchasers set forth in Article VI of the Investment
Agreement.
NOW, THEREFORE, in consideration of the premises and the
representations, warranties and agreements contained herein, and for other good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, and intending to be legally bound hereby, the parties hereto
agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1. Definitions. (a) As used in this Agreement, the
following terms shall have the following meanings:
"Affiliate" shall have the meaning set forth in Rule 12b-2
promulgated under the Exchange Act.
"Closing Date" shall have the meaning set forth in the
Investment Agreement.
"Common Shares" means the Common Shares of the Company, par value
$0.01 per share.
"Company" shall have the meaning set forth in the preamble and shall
also include the Company's successors, including by means of a Solvent
Reorganization.
"Conversion Shares" the meaning set forth in the Investment
Agreement.
"Demand Registration" shall have the meaning set forth in Section
2.1(a)(i).
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time and the rules and regulations promulgated thereunder.
"Holder" shall have the meaning set forth in the preamble.
"Incidental Registration" shall have the meaning set forth in Section
2.2(a).
"Incidental Registration Statement" shall have the meaning set forth
in Section 2.2(a).
"Indenture" shall have the meaning set forth in Section 4.4.
"Investor Notes" shall have the meaning set forth in the Investment
Agreement, but shall exclude, for purposes of this Agreement, the Investor
Notes issued or issuable to ▇▇▇▇ ▇▇▇▇▇.
"Investors" means each of the Purchasers (as defined in the
Investment Agreement) other than ▇▇▇▇ ▇▇▇▇▇.
"Majority Conversion Date" shall mean the date that a majority in
principal amount of the Notes issued on the Closing Date has been converted
into Common Shares.
"Notes" shall have the meaning set forth in the recitals to this
Agreement.
"Notes Request" shall have the meaning set forth in Section
2.1(a)(i).
"Person" means an individual, a partnership, a corporation, a limited
liability company, an association, a joint stock company, a trust, a joint
venture, an unincorporated organization and a governmental entity or any
department, agency or political subdivision thereof.
"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 with respect to the terms
of the offering of any portion of the Registrable Securities and by all other
amendments and supplements to such Prospectus, including post-effective
amendments, and in each case including all material incorporated by reference
therein.
"Registrable Notes" shall mean the Investor Notes and any securities
of the Company issued or issuable directly or indirectly with respect to or in
exchange, or substitution for, or conversion of such Investor Notes by way of
dividend or distribution, recapitalization, merger, consolidation, exchange or
other reorganization.
"Registrable Securities" shall mean the Registrable Notes and the
Registrable Shares. As to any particular Registrable Securities, such
securities shall cease to be Registrable Securities when they have been
distributed to the public pursuant to an offering registered under
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the Securities Act or sold to the public in compliance with Rule 144 under the
Securities Act (or any similar rule then in force).
"Registrable Shares" means the Common Shares into which the
Registrable Notes may be converted pursuant to their terms and any securities
of the Company issued or issuable directly or indirectly with respect to or in
exchange, or substitution for, or conversion of such Common Shares by way of
dividend or distribution, recapitalization, merger, consolidation, exchange or
other reorganization. With respect to any Person that is a Holder (without
reference to this sentence), Registrable Shares also includes any other Common
Shares, or other securities of the Company issued or issuable directly or in
exchange, or substitution for or conversion of Common Shares, held by such
Holder by way of dividend or distribution, recapitalization, merger,
consolidation, exchange or other reorganization.
"Registration Expenses" shall mean (i) all registration, listing,
qualification and filing fees (including any NYSE or NASD filing fees), (ii)
fees and disbursements of counsel for the Company, (iii) accounting fees
incident to any such registration, (iv) blue sky fees and expenses (including
counsel fees in connection with the preparation of a Blue Sky Memorandum and
legal investment survey), (v) all reasonable expenses of any Persons incurred
on behalf of the Holders or the Company in preparing or assisting in preparing,
printing, distributing, mailing and delivering any Registration Statement, any
Prospectus, any underwriting agreements, transmittal letters, securities sales
agreements, securities certificates and other documents relating to the
performance of and compliance with this Agreement, (vi) the expenses incurred
in connection with making road show presentations and holding meetings with
potential investors to facilitate the distribution and sale of Registrable
Securities which are customarily borne by the issuer, (vii) all internal
expenses of the Company (including all salaries and expenses of officers and
employees performing legal or accounting duties) and (viii) the reasonable fees
and expenses of the Holders incurred in connection with the sale of Registrable
Securities (including reasonable fees and expenses of counsel for the Holders);
provided, however, that Registration Expenses shall not include any Selling
Expenses.
"Registration Statement" shall mean any registration statement of the
Company which covers any Registrable Securities 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.
"Request" shall mean a Shares Request or a Notes Request.
"Required Registration" shall mean a registration required to be
effected pursuant to Section 2.1.
"Required Registration Statement" shall mean a Registration Statement
which covers the Registrable Securities requested to be included therein
pursuant to the provisions of Section 2.1 on an appropriate form pursuant to
the Securities Act (other than pursuant to Rule 415 thereof), and which form
shall be available for the sale of the Registrable Securities in accordance
with the intended method or methods of distribution thereof, and all amendments
and supplements to such Registration Statement, including post-effective
amendments, in each case
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including the Prospectus contained therein, all exhibits thereto and all
material incorporated by reference therein.
"Required Shelf Registration Statement" shall mean a Registration
Statement which covers the Registrable Securities requested to be included
therein pursuant to the provisions of Section 2.1 on an appropriate form or any
similar successor or replacement form (in accordance with Section 4.1 hereof)
pursuant to Rule 415 of the Securities Act, and which form shall be available
for the sale of the Registrable Securities in accordance with the intended
method or methods of distribution thereof, 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.
"SEC" shall mean the United States Securities and Exchange
Commission.
"Securities Act" shall mean the Securities Act of 1933, as amended
from time to time.
"Selling Expenses" shall mean underwriting discounts, selling
commissions and stock transfer taxes applicable to the securities registered by
the Holders.
"Shares Request" shall have the meaning set forth in Section
2.1(a)(i).
"Shelf Registration" shall have the meaning set forth in Section
2.1(a)(i).
"Solvent Reorganization" means any solvent reorganization of the
Company, including by merger, consolidation, recapitalization, Transfer or sale
of shares or assets, or contribution of assets and/or liabilities, or any
liquidation, exchange of securities, conversion of entity, migration of entity,
formation of new entity, or any other transaction or group of related
transactions (in each case other than to or with an unaffiliated third party),
in which:
(i) all holders of the same class of equity
securities of the Company are offered the same consideration in
respect of such equity securities,
(ii) the Holders' pro rata indirect economic
interests in the Company, relative to each other and all other holders
of equity securities of the Company, are preserved and
(iii) the rights of the Holders under this
Registration Rights Agreement and the Investment Agreement are
preserved in all material respects.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. Section
77aaa-77bbbb) as in effect on the date of the Indenture.
"Transfer" means any direct or indirect sale, transfer, pledge or
other disposition of any economic, voting or other rights of or with respect to
any Notes or Common Shares.
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"Triggering Registration" shall mean the first Required Registration
or Incidental Registration prior to which, or as a result of which, ▇▇▇▇▇▇
▇▇▇▇▇▇▇ shall have sold or otherwise disposed of (a) 20% or more of the Notes
issued to it on the Closing Date or (b) a number of Conversion Shares equal to
the number of Conversion Shares issuable upon conversion of 20% of the Notes
issued to it on the Closing Date.
"Trustee" shall have the meaning set forth in Section 4.4.
"Underwriter" means a Person who participates as an underwriter in
connection with a sale or offering.
"Underwritten Offering" shall mean a sale of securities of the
Company to an Underwriter or Underwriters for reoffering to the public.
(b) Capitalized terms used herein and not otherwise defined shall
have the meanings assigned such terms in the Investment Agreement.
ARTICLE II
REGISTRATION UNDER THE SECURITIES ACT
Section 2.1. Required Registration and Priority.
(a) Required Registration. (i) At any time from and after the Closing
Date and prior to the Majority Conversion Date, upon the written request of
holders of a majority of the principal amount of the Notes issued to the
Investors on the Closing Date, one or more Holders shall have the right to
request in writing (a "Notes Request") (which Notes Request shall specify the
Registrable Notes intended to be disposed, the identity of the Holders
intending to dispose of the Registrable Notes, and the intended method of
distribution thereof) that the Company register all or a portion of the
Registrable Notes held by such Holder(s) by filing with the SEC (x) a Required
Registration Statement (a "Demand Registration") or (y) if the Notes Request
shall specify, a Required Shelf Registration Statement (a "Shelf
Registration").
(ii) At any time from and after the Closing Date, upon the written
request of:
(x) if, at the time of the request, the Company is
subject to the provisions of the Exchange Act,
Holders directly or indirectly owning 10% or
more of the outstanding Common Shares, and
(y) if, at the time of the request, the Company is
not subject to the provisions of the Exchange
Act, Holders directly or indirectly owning at
least a majority of the outstanding Common
Shares,
one or more holders of Registrable Shares shall have the right to request in
writing (a "Shares Request") (which Shares Request shall specify the
Registrable Shares intended to be disposed, the identity of the Holders
intending to dispose of Registrable Shares, and the intended method of
distribution thereof) that the Company register all or a portion of the
Registrable Shares held
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by such Holder(s) by filing with the SEC (a) a Demand Registration or (b) if
the Request shall specify, a Shelf Registration.
(iii) Upon the receipt of a valid Shares Request, the Company shall,
by the fifth Business Day (as defined in the Investment Agreement) thereafter,
give written notice of such requested registration to all Holders of
Registrable Shares, and, not later than the 30th (or in the case of clause
(a)(ii)(y) above, the 60th) calendar day after the receipt of such a Request by
the Company, the Company will cause to be filed with the SEC a Required
Registration Statement or Required Shelf Registration Statement, as the case
may be, covering the Registrable Shares that the Company has been so requested
to register in such Request and all other Registrable Shares that the Company
has been requested to register by Holders thereof other than the Holder(s) who
initiated the Request, by written request given to the Company within ten (10)
Business Days after the giving of such written notice by the Company (which
requests may be withdrawn prior to effectiveness of the relevant registration
statement), providing for the registration under the Securities Act of the
Registrable Shares that the Company has been so requested to register by all
such Holders, to the extent necessary to permit the disposition of such
Registrable Shares so to be registered in accordance with the intended methods
of distribution thereof specified in such Request or further requests, and
shall use all reasonable efforts to have such Required Registration Statement
or Required Shelf Registration Statement, as the case may be, declared
effective by the SEC as soon as practicable thereafter and to keep such
Required Registration Statement continuously effective for a period of at least
(x) 60 calendar days, in the case of a Demand Registration (or, in the case of
an Underwritten Offering, such period as the Underwriters shall reasonably
require) following the date on which such Required Registration Statement is
declared effective (or such shorter period which will terminate when all of the
Registrable Securities covered by such Required Registration Statement have
been sold pursuant thereto) or (y) 180 calendar days, in the case of a Shelf
Registration, following the date on which such Required Shelf Registration
Statement is declared effective (or such shorter period which will terminate
when all of the Registrable Securities covered by such Required Shelf
Registration Statement have been sold pursuant thereto), including, in either
case, if necessary, by filing with the SEC a post-effective amendment or a
supplement to the Required Registration Statement or Required Shelf
Registration Statement or the related Prospectus or any document incorporated
therein by reference or by filing any other required document or otherwise
supplementing or amending the Required Registration Statement or Required Shelf
Registration Statement, if required by the rules, regulations or instructions
applicable to the registration form used by the Company for such Required
Registration Statement or Required Shelf Registration Statement or by the
Securities Act, the Exchange Act, any state securities or blue sky laws, or any
rules and regulations thereunder.
(iv) Upon the receipt of a valid Notes Request, the Company shall, by
the fifth Business Day thereafter, give written notice of such requested
registration to all Holders of Registrable Notes, and, not later than the 60th
calendar day after the receipt of such a Notes Request by the Company, the
Company will cause to be filed with the SEC a Required Registration Statement
or Required Shelf Registration Statement, as the case may be, covering the
Registrable Notes that the Company has been so requested to register in such
Notes Request and all other Registrable Notes that the Company has been
requested to register by Holders thereof other than the Holder(s) who initiated
the Notes Request, by written request given to the Company within ten (10)
Business Days after the giving of such written notice by the Company
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(which requests may be withdrawn prior to effectiveness of the relevant
registration statement), providing for the registration under the Securities
Act of the Registrable Notes that the Company has been so requested to register
by all such Holders, to the extent necessary to permit the disposition of such
Registrable Notes so to be registered in accordance with the intended methods
of distribution thereof specified in such Request or further requests, and
shall use all reasonable efforts to have such Required Registration Statement
or Required Shelf Registration Statement, as the case may be, declared
effective by the SEC as soon as practicable thereafter and to keep such
Required Registration Statement continuously effective for a period of at least
(x) 60 calendar days, in the case of a Demand Registration (or, in the case of
an Underwritten Offering, such period as the Underwriters shall reasonably
require) following the date on which such Required Registration Statement is
declared effective (or such shorter period which will terminate when all of the
Registrable Securities covered by such Required Registration Statement have
been sold pursuant thereto) or (y) 180 calendar days, in the case of a Shelf
Registration, following the date on which such Required Shelf Registration
Statement is declared effective (or such shorter period which will terminate
when all of the Registrable Securities covered by such Required Shelf
Registration Statement have been sold pursuant thereto), including, in either
case, if necessary, by filing with the SEC a post-effective amendment or a
supplement to the Required Registration Statement or Required Shelf
Registration Statement or the related Prospectus or any document incorporated
therein by reference or by filing any other required document or otherwise
supplementing or amending the Required Registration Statement or Required Shelf
Registration Statement, if required by the rules, regulations or instructions
applicable to the registration form used by the Company for such Required
Registration Statement or Required Shelf Registration Statement or by the
Securities Act, the Exchange Act, any state securities or blue sky laws, or any
rules and regulations thereunder.
(v) The Company shall not be required to effect, pursuant to this
Section 2.1, (a) more than one Shelf Registration or Demand Registration with
respect to the Registrable Notes, (b) more than two Demand Registrations
requested by any single Holder with respect to Registrable Shares, (c) more
than a total of four Demand Registrations with respect to Registrable Shares
and (d) a Demand Registration with respect to Registrable Shares which covers
Registrable Shares having a value of less than $10 million in the aggregate.
(vi) A Request may be withdrawn prior to the filing of the Required
Registration Statement or Required Shelf Registration Statement by the Holder
that made such Request (a "Withdrawn Request") and a Required Registration
Statement or Required Shelf Registration Statement may be withdrawn prior to
the effectiveness thereof by the Holders of a majority of the Registrable
Securities included therein (a "Withdrawn Required Registration"), and, in
either such event, such withdrawal shall not be treated as a Required
Registration for purposes of the immediately preceding paragraph, unless the
Withdrawn Registration Statement is withdrawn after its having been filed with
the SEC and the requesting Holders have not reimbursed the Company for the
reasonable expenses incurred in connection therewith, in which case it shall be
treated as a Required Registration.
(vii) Notwithstanding the foregoing, the Company may delay the filing
of a registration statement required pursuant to this Section 2.1 if the Board
of Directors of the Company determines that such action is in the best
interests of the Company's stockholders and only for a period not to exceed 90
days (a "Blackout Period"); provided that after any initial
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Blackout Period the Company may not invoke a subsequent Blackout Period until
12 months elapse from the end of any previous Blackout Period.
(viii) The registration rights granted pursuant to the provisions of
this Section 2(a)(i) shall be in addition to the registration rights granted
pursuant to the other provisions of this Section 2.1.
(b) Priority in Required Registrations. If a Required Registration
pursuant to this Section 2.1 involves an Underwritten Offering, and the sole
Underwriter or the lead managing Underwriter, as the case may be, of such
Underwritten Offering shall advise the Company in writing (with a copy to each
Holder requesting registration) on or before the date 2 days prior to the date
then scheduled for the pricing of such offering that, in its opinion, the
amount of Registrable Securities requested to be included in such Required
Registration exceeds the amount that can be sold in such offering without
adversely affecting the distribution of the Registrable Securities being
offered, the Company will include in such Required Registration only the amount
of Registrable Securities that the Company is so advised can be sold in such
offering without adversely affecting the distribution of the Registrable
Securities being offered. The reduced number of Registrable Securities to be
included in the Required Registration shall be allocated pro rata among the
Holders participating in the Offering, based on the number of Registrable
Securities beneficially owned by each participating Holder.
Section 2.2. Incidental Registration.
(a) Right to Include Registrable Securities. If at any time from and
after the Closing Date the Company proposes to register any of its Notes or
Common Shares under the Securities Act (other than (A) any registration of
public sales or distributions solely by and for the account of the Company of
securities issued (x) pursuant to any employee benefit or similar plan or any
dividend reinvestment plan or (y) in any acquisition by the Company or (B)
pursuant to Section 2.1 hereof), either in connection with a primary offering
for cash for the account of the Company or a secondary offering for the account
of any holders of the Company's securities (in each case, an "Incidental
Registration"), the Company shall, each time it intends to effect such a
registration, give written notice to all Holders of Registrable Securities at
least ten (10) but no more than thirty (30) Business Days prior to the expected
initial filing of a registration statement with the SEC pertaining thereto (an
"Incidental Registration Statement"), informing such Holders of its intent to
file such Incidental Registration Statement, the expected filing date, and of
the Holders' rights to request the registration of certain Registrable
Securities held by the Holders under this Section 2.2 (the "Company Notice").
Upon the written request of any Holder made within seven (7) Business Days
after any such Company Notice is given (which request shall specify the
Registrable Securities intended to be disposed of by such Holder and the
intended method of distribution thereof), the Company will use all reasonable
efforts to effect the registration under the Securities Act of all Registrable
Shares (and, if the Company proposes or is required pursuant to another section
of this Agreement to register Notes in such offering, all other Registrable
Securities) that the Company has been so requested to register by such Holders
to the extent required to permit the disposition (in accordance with the
intended methods of distribution thereof or, in the case of a registration
which is intended to effect a primary offering for cash for the account of the
Company, in accordance with the Company's intended method of distribution) of
the Registrable Securities so requested to be registered, including, if
necessary,
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by filing with the SEC a post-effective amendment or a supplement to
the Incidental Registration Statement or the related Prospectus or any document
incorporated therein by reference or by filing any other required document or
otherwise supplementing or amending the Incidental Registration Statement, if
required by the rules, regulations or instructions applicable to the
registration form used by the Company for such Incidental Registration
Statement or by the Securities Act, any state securities or blue sky laws, or
any rules and regulations thereunder; provided, however, that if, at any time
after giving written notice of its intention to register any securities and
prior to the effective date of the Incidental Registration Statement filed in
connection with such registration, the Company shall determine for any reason
not to register or to delay registration of such securities, the Company may,
at its election, give written notice of such determination to each Holder of
Registrable Securities and, thereupon, (A) in the case of a determination not
to register, the Company shall be relieved of its obligation to register any
Registrable Securities in connection with such registration (but not from its
obligation to pay the Registration Expenses incurred in connection therewith),
and (B) in the case of a determination to delay such registration, the Company
shall be permitted to delay registration of any Registrable Securities
requested to be included in such Incidental Registration Statement for the same
period as the delay in registering such other securities.
The registration rights granted pursuant to the provisions of this
Section 2.2 shall be in addition to the registration rights granted pursuant to
the other provisions of this Section.
(b) Priority in Incidental Registrations. If a registration pursuant
to this Section 2.2 involves an Underwritten Offering of the securities so
being registered, whether or not for sale for the account of the Company, and
the sole Underwriter or the lead managing Underwriter, as the case may be, of
such Underwritten Offering shall advise the Company in writing (with a copy to
each Holder of Registrable Securities requesting registration) on or before the
date 5 days prior to the date then scheduled for such offering that, in its
opinion, the amount of securities (including Registrable Securities) requested
to be included in such registration exceeds the amount that can be sold in (or
during the time of) such offering without adversely affecting the distribution
of the securities being offered, then the Company shall be required to include
in such registration, unless the managing Underwriter shall otherwise specify
(which specification may not adversely affect any Holder relative to any other
Holder), first, all the securities entitled to be sold pursuant to such
Incidental Registration Statement without reference to the incidental
registration rights of any holder (including Holders), and second a number of
Registrable Securities to be allocated pro rata on the basis of the number of
Registrable Securities beneficially owned at that time by all the Holders
requesting to participate in the Underwritten Offering and included in such
request (based on fully diluted Common Shares represented by or that may be
acquired upon exercise of such Registrable Securities) or on such other basis
as shall be agreed among the Holders; provided, however, that in the event the
Company will not, by virtue of this paragraph, include in any such registration
all of the Registrable Securities of any Holder requested to be included in
such registration, such Holder may, upon written notice to the Company given
within three (3) days of the time such Holder first is notified of such matter,
reduce the amount of Registrable Securities it desires to have included in such
registration, whereupon only the Registrable Securities, if any, it desires to
have included will be so included and the Holders not so reducing shall be
entitled to a corresponding increase in the amount of Registrable Securities to
be included in such registration. Notwithstanding the foregoing, if the
Underwritten Offering pertains solely to Registrable Shares, at the
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request of such Underwriter, all Registrable Securities that are not
Registrable Shares may be excluded from the Incidental Registration Statement
prior to exclusion of any other Registrable Securities.
(c) With respect to the Triggering Registration and each Required
Registration or Incidental Registration thereafter (for so long as she
continues to beneficially own any Conversion Shares), for purposes of Sections
2.1, 2.2(a), 2.2(b), 2.3, 2.4, 2.5, 4.1, 4.2 and 4.3 hereof and Article V
hereof, (i) ▇▇▇▇ ▇▇▇▇▇ shall be deemed to be a "Holder" and shall have the
rights and obligations of a Holder under such Sections with respect to
Registrable Shares and (ii) the Conversion Shares that ▇▇▇▇ ▇▇▇▇▇ beneficially
owns shall be deemed to be "Registrable Shares". Notwithstanding anything to
the contrary herein, from and after the date hereof, ▇▇▇▇ ▇▇▇▇▇ shall be deemed
to be a "Holder" and shall be subject to the obligations thereof under Sections
3.2 and 4.4 hereof and Article VI hereof.
Section 2.3. Expenses. The Company agrees to pay all Registration
Expenses in connection with each of the registrations requested pursuant to
Section 2.1 and Section 2.2. All Selling Expenses relating to securities
registered on behalf of Holders shall be borne by the Holders of securities
included in such registration pro rata on the basis of the number of
Registrable Shares so registered or issuable upon conversion of the Registrable
Notes so registered, as the case may be.
Section 2.4. Effective Registration Statement; Suspension. Subject to
Section 2.1 (a)(vi), a Registration Statement pursuant to Section 2.1 shall not
be deemed to have become effective (and the related registration will not be
deemed to have been effected) unless it has been declared effective by the SEC
or in the case of a Required Shelf Registration Statement unless Registrable
Securities have been disposed of pursuant thereto, prior to a request by the
Holders of a majority of the Registrable Securities included in such
registration that such Registration Statement be withdrawn; provided, however,
that if, after it has been declared effective, the offering of any Registrable
Securities pursuant to such 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 shall be deemed not
to have become effective and the related registration will not be deemed to
have been effected.
Section 2.5. Selection of Underwriters. At any time or from time to
time, the Holders of a majority (based on fully diluted Common Shares
represented by or that may be acquired upon exercise of such Registrable
Securities) of the Registrable Securities covered by a Required Registration
Statement may elect to have such Registrable Securities sold in an Underwritten
Offering and may select the investment banker or investment bankers and manager
or managers that will serve as lead and co-managing Underwriters with respect
to the offering of such Registrable Securities, subject to the consent of the
Company which shall not be unreasonably withheld. No Holder may participate in
any Underwritten Offering hereunder unless such Holder (a) agrees to sell such
Holder's securities on the basis provided in any underwriting arrangements
approved by (i) in the context of a Demand Registration or Shelf Registration,
the Holders of such a majority of Registrable Securities to be covered by the
Registration Statement, or (ii) in the context of an Incidental Registration,
the Company, and (b) completes and executes all questionnaires, powers of
attorney, custody agreements, indemnities, underwriting agreements and other
documents required under the terms of such Underwritten Offering. The
10
underwriting agreement entered into with the lead Underwriter in connection
with an Underwritten Offering shall contain such representations, warranties,
indemnities and agreements then customarily included in underwriting or
purchase agreements by such lead Underwriter with respect to secondary
distributions of securities; provided, however, that a Holder's indemnity
obligations thereunder shall be limited to the proceeds received by such Holder
in the related offering.
ARTICLE III
RESTRICTIONS ON PUBLIC SALE
Section 3.1. Public Sale or Distribution. If requested by the sole
Underwriter or lead managing Underwriter(s) in an Underwritten Offering being
made pursuant to Section 2.1 of this Agreement, the Company agrees not to
effect any sale or distribution (other than, in the case of the Company, sales
or distributions solely by and for the account of the Company of securities
issued pursuant to any employee benefit or similar plan or any dividend
reinvestment plan) of any equity or equity-linked securities during the period
commencing on the date the Company receives a Request from any Holder and
continuing until 180 days after the effective date of any Underwritten Offering
(or for such shorter period as the sole or lead managing Underwriter shall
request) unless earlier terminated by the sole Underwriter or lead managing
Underwriter(s) in such Underwritten Offering.
Section 3.2. Transfers by Holders. If requested by the sole
Underwriter or lead managing Underwriter(s) in an Underwritten Offering, the
Holders shall not sell or otherwise transfer or dispose of any securities of
the Company held by the Holders (other than those included in the registration)
during the 90-day period following the effective date of any Underwritten
Offering, or such shorter period as the sole Underwriter or lead managing
Underwriter(s) may request, of a registration statement of the Company filed
under the Securities Act; provided, however, that the obligations described in
this Section 3.2 shall not apply to a registration relating solely to the sale
of securities to employees of the Company pursuant to a stock option, stock
purchase or similar plan or Rule 145 or similar transaction. The Company may
impose stop-transfer instructions with respect to securities subject to the
foregoing restriction until the end of said 90-day period. With respect to any
agreement entered into after the date of this Agreement pursuant to which the
Company issues or agrees to issue any privately placed securities, the Company
shall use all reasonable efforts to include in each such agreement a provision
under which holders of such securities agree not to effect any sale or
distribution of any such securities during the period referred to in the first
sentence of this Section 3.2, including any sale pursuant to Rule 144 under the
Securities Act (except as part of such registration, if permitted).
ARTICLE IV
REGISTRATION PROCEDURES
Section 4.1. Procedures. In connection with the obligations of the
Company pursuant to Article II, the Company shall use all reasonable efforts to
effect or cause to be effected the registration of the Registrable Securities
under the Securities Act to permit the sale of such
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Registrable Securities by the Holders in accordance with their intended method
or methods of distribution, and the Company shall:
(a) (i) prepare and file a Registration Statement with the SEC
which (x) shall be on Form S-3 (or any successor to such form), if
available, (y) shall be available for the sale or exchange of the
Registrable Securities in accordance with the intended method or
methods of distribution by the selling Holders thereof, and (z) shall
comply as to form with the requirements of the applicable form and
include all financial statements required by the SEC to be filed
therewith and all other information reasonably requested by the lead
managing Underwriter or sole Underwriter, if applicable, to be
included therein, (ii) use all reasonable efforts to cause such
Registration Statement to become effective and remain effective in
accordance with Article II, (iii) use all reasonable efforts to not
take any action that would cause a Registration Statement to contain
a material misstatement or omission or to be not effective and usable
for resale of Registrable Securities during the period that such
Registration Statement is required to be effective and usable, and
(iv) cause each Registration Statement and the related Prospectus and
any amendment or supplement thereto, as of the effective date of such
Registration Statement, amendment or supplement (x) to comply in all
material respects with any requirements of the Securities Act and the
rules and regulations of the SEC and (y) not to contain any untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading;
(b) subject to paragraph (j) of this Section 4.1, prepare and
file with the SEC such amendments and post-effective amendments to
each such Registration Statement, as may be necessary to keep such
Registration Statement effective for the applicable period; cause
each such Prospectus to be supplemented by any required prospectus
supplement, and as so supplemented to be filed pursuant to Rule 424
under the Securities Act; and comply with the provisions of the
Securities Act with respect to the disposition of all securities
covered by each Registration Statement during the applicable period
in accordance with the intended method or methods of distribution by
the selling Holders thereof, as set forth in such registration
statement;
(c) furnish to each Holder of Registrable Securities 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; the Company hereby consents to the use
of the Prospectus, including each preliminary Prospectus, by each
Holder of Registrable Securities and each Underwriter of an
Underwritten Offering of Registrable Securities, if any, in
connection with the offering and sale of the Registrable Securities
covered by the Prospectus or the preliminary Prospectus;
(d) (i) use all reasonable efforts to register or qualify the
Registrable Securities, no later than the time the applicable
Registration Statement is declared effective by the SEC, under all
applicable state securities or "blue sky" laws of such jurisdictions
as each Underwriter, if any, or any Holder of Registrable Securities
covered by a
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Registration Statement, shall reasonably request; (ii) use all
reasonable efforts to keep each such registration or qualification
effective during the period such Registration Statement is required
to be kept effective; and (iii) do any and all other acts and things
which may be reasonably necessary or advisable to enable each such
Underwriter, if any, and Holder to consummate the disposition in each
such jurisdiction of such Registrable Securities owned by such
Holder; provided, however, that the Company shall not be obligated to
qualify as a foreign corporation or as a dealer in securities in any
jurisdiction in which it is not so qualified or to consent to be
subject to general service of process (other than service of process
in connection with such registration or qualification or any sale of
Registrable Securities in connection therewith) in any such
jurisdiction;
(e) notify each Holder of Registrable Securities promptly, and,
if requested by such Holder, confirm such advice in writing, (i) when
a Registration Statement has become effective and when any
post-effective amendments and supplements thereto become effective,
(ii) of the issuance by the SEC or any state securities authority of
any stop order, injunction or other order or requirement suspending
the effectiveness of a Registration Statement or the initiation of
any proceedings for that purpose, (iii) if, between the effective
date of a Registration Statement and the closing of any sale of
securities covered thereby pursuant to any agreement to which the
Company is a party, the representations and warranties of the Company
contained in such agreement cease to be true and correct in all
material respects or if the Company receives any notification with
respect to the suspension of the qualification of the Registrable
Securities for sale in any jurisdiction or the initiation of any
proceeding for such purpose, and (iv) of the happening of any event
during the period a Registration Statement is effective as a result
of which such Registration Statement or the related Prospectus
contains any 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 not misleading;
(f) furnish counsel for each such Underwriter, if any, and for
the Holders of Registrable Securities copies of any request by the
SEC or any state securities authority for amendments or supplements
to a Registration Statement and Prospectus or for additional
information;
(g) use all reasonable efforts to obtain the withdrawal of any
order suspending the effectiveness of a Registration Statement at the
earliest possible time;
(h) upon request, furnish to the sole Underwriter or lead
managing Underwriter of an Underwritten Offering of Registrable
Securities, if any, without charge, at least one signed copy of each
Registration Statement and any post-effective amendment thereto,
including financial statements and schedules, all documents
incorporated therein by reference and all exhibits; and furnish to
each Holder of Registrable Securities, without charge, at least one
conformed copy of each Registration Statement and any post-effective
amendment thereto (without documents incorporated therein by
reference or exhibits thereto, unless requested);
(i) cooperate with the selling Holders of Registrable Securities
and the sole Underwriter or lead managing Underwriter of an
Underwritten Offering of Registrable
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Securities, if any, to facilitate the timely preparation and delivery
of certificates representing Registrable Securities to be sold and
not bearing any restrictive legends; and enable such Registrable
Securities to be in such denominations (consistent with the
provisions of the governing documents thereof) and registered in such
names as the selling Holders or the sole Underwriter or lead managing
Underwriter of an Underwritten Offering of Registrable Securities, if
any, may reasonably request at least three Business Days prior to any
sale of Registrable Securities;
(j) upon the occurrence of any event contemplated by paragraph
(e)(iv) of this Section, use all reasonable efforts to 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 required to be stated therein or
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
(k) enter into customary agreements (including, in the case of
an Underwritten Offering, underwriting agreements in customary form,
and including provisions with respect to indemnification and
contribution in customary form and consistent with the provisions
relating to indemnification and contribution contained herein) and
take all other customary and appropriate actions in order to expedite
or facilitate the disposition of such Registrable Securities and in
connection therewith:
(1) make such representations and warranties to the Holders
of such Registrable Securities and the Underwriters, if any, in
form, substance and scope as are customarily made by issuers to
underwriters in similar underwritten offerings;
(2) obtain opinions of counsel to the Company and updates
thereof (which counsel and opinions (in form, scope and
substance) shall be reasonably satisfactory to the lead managing
Underwriter, if any, or, if no Underwriter, the majority Holders
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 sales of
securities or underwritten offerings and such other matters as
may be reasonably requested by such Holders and Underwriters;
(3) obtain "cold comfort" letters and updates thereof from
the Company's independent certified public accountants addressed
to the selling Holders of Registrable Securities, if
permissible, and the Underwriters, if any, which letters shall
be customary in form and shall cover matters of the type
customarily covered in "cold comfort" letters to underwriters in
connection with primary underwritten offerings;
(4) to the extent requested and customary for the relevant
transaction, enter into a securities sales agreement with the
Holders providing for,
14
among other things, the appointment of such representative as
agent for the selling Holders for the purpose of soliciting
purchases of Registrable Securities, which agreement shall be
customary in form, substance and scope and shall contain
customary representations, warranties and covenants not more
onerous than those provided in the relevant underwriting
agreement(s), if any; and
(5) deliver such customary documents and certificates as
may be reasonably requested by the majority Holders of the
Registrable Securities being sold or by the managing
Underwriters, if any.
The above shall be done (i) at the effectiveness of such Registration
Statement (and each post-effective amendment thereto) in connection with
any registration, and (ii) at each closing under any underwriting or
similar agreement as and to the extent required thereunder;
(l) in the event the Company is required to register the sale or
disposition of any Registrable Notes pursuant to a Registration Statement
required by this Agreement, the Company shall (i) cause the Indenture (as
defined below) to be qualified under the TIA not later than the effective
date of such Registration Statement and, in connection therewith,
cooperate with the Trustee (as defined below) and the Holders to effect
such changes to the Indenture as may be required for such Indenture to be
so qualified in accordance with the terms of the TIA and (ii) execute, and
use all reasonable efforts to cause the Trustee to execute, all documents
that may be required to effect such changes and all other forms and
documents required to be filed with the SEC to enable the Indenture to be
so qualified in a timely manner.
(m) make available for inspection by representatives of the Holders
of the Registrable Securities and any Underwriters participating in any
disposition pursuant to a Registration Statement and any counsel or
accountant retained by such Holders or Underwriters, all relevant
financial and other records, pertinent corporate documents and properties
of the Company and cause the respective officers, directors and employees
of the Company to supply all information reasonably requested by any such
representative, Underwriter, counsel or accountant in connection with a
Registration Statement;
(n) (i) within a reasonable time prior to the filing of any
Registration Statement, any Prospectus, any amendment to a Registration
Statement or amendment or supplement to a Prospectus, provide copies of
such document to the Holders of Registrable Securities and to counsel to
such Holders and to the Underwriter or Underwriters of an Underwritten
Offering of Registrable Securities, if any; fairly consider such
reasonable changes in any such document prior to or after the filing
thereof as the counsel to the Holders or the Underwriter or the
Underwriters may request and not file any such document in a form to which
the majority Holders of Registrable Securities being registered or any
Underwriter shall reasonably object; and make such of the representatives
of the Company as shall be reasonably requested by the Holders of
Registrable Securities being registered or any Underwriter available for
discussion of such document;
15
(ii) within a reasonable time prior to the filing of any document
that is to be incorporated by reference into a Registration Statement or a
Prospectus, provide copies of such document to counsel for the Holders;
fairly consider such reasonable changes in such document prior to or after
the filing thereof as counsel for such Holders or such Underwriter shall
request; and make such of the representatives of the Company as shall be
reasonably requested by such counsel available for discussion of such
document;
(o) cause all Registrable Securities to be qualified for inclusion in
or listed on The New York Stock Exchange, Inc. or any securities exchange
or the NASDAQ National Market on which securities of the same class issued
by the Company are then so qualified or listed if so requested by the
majority Holders of Registrable Securities covered by a Registration
Statement, or if so requested by the Underwriter or Underwriters of an
Underwritten Offering of Registrable Securities, if any;
(p) otherwise use all reasonable efforts to comply with all
applicable rules and regulations of the SEC, including making available to
its security holders an earnings statement covering at least twelve (12)
months which shall satisfy the provisions of Section 11(a) of the
Securities Act and Rule 158 thereunder;
(q) cooperate and assist in any filings required to be made with
regulatory agencies (including stock markets) and in the performance of
any due diligence investigation by any Underwriter in an Underwritten
Offering; and
(r) use all reasonable efforts to facilitate the distribution and
sale of any Registrable Securities to be offered pursuant to this
Agreement, including without limitation, upon reasonable request of the
Underwriter(s), by making road show presentations, holding meetings with
potential investors and taking such other actions as shall be requested by
the majority Holders of Registrable Securities covered by a Registration
Statement or the lead managing Underwriter of an Underwritten Offering.
Section 4.2. Information to be Provided by Holders. Each selling
Holder of Registrable Securities as to which any registration is being effected
pursuant to this Agreement agrees, as a condition to the registration
obligations with respect to such Holder provided herein, to furnish in writing
to the Company such information regarding such Holder required to be included
in the Registration Statement, the ownership of Registrable Securities by such
Holder and the proposed distribution by such Holder of such Registrable
Securities as the Company may from time to time reasonably request in writing.
Section 4.3. Additional Obligations of Holders. Each Holder agrees
that, upon receipt of any notice from the Company of the happening of any event
of the kind described in paragraph (e)(iv) of Section 4.1, such Holder will
forthwith discontinue disposition of Registrable Securities pursuant to the
affected Registration Statement until such Holder's receipt of the copies of
the supplemented or amended Prospectus, contemplated by paragraph (j) of this
Section, and, if so directed by the Company, such Holder will deliver to the
Company (at the expense of the Company), all copies in its possession, other
than permanent file copies then in
16
such Holder's possession, of the Prospectus covering such Registrable
Securities which was current at the time of receipt of such notice.
Section 4.4. Additional Obligations of Company and Holders. The
Company and each Holder agrees that, in the event of a Notes Request, it shall
cooperate and use all reasonable efforts in good faith to agree upon a form of
indenture that reflects the terms and conditions of the Notes, which complies
with the terms of the Trust Indenture Act, and permits the Notes to be
registered as contemplated hereby (in each case, the "Indenture"). Such Persons
shall also cooperate in good faith to select a trustee (the "Trustee") for such
indenture. All fees and expenses of the Company, the Trustee and the Holders in
connection with the negotiation of the form of Indenture (and all related
qualifications) and of retaining the Trustee shall be borne by the Company.
ARTICLE V
INDEMNIFICATION/CONTRIBUTION
Section 5.1. Indemnification and Contribution.
(a) The Company agrees to indemnify and hold harmless each Holder,
each Person, if any, who controls any Holder within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act, and each
affiliate of any Holder within the meaning of Rule 405 under the Securities Act
from and against any and all losses, claims, damages and liabilities
(including, without limitation, any legal or other expenses reasonably incurred
in connection with defending or investigating any such action or claim) caused
by any untrue statement or alleged untrue statement of a material fact
contained in any Registration Statement or any amendment thereof, any
preliminary prospectus or any Prospectus (as amended or supplemented if the
Company shall have furnished any amendments or supplements thereto), caused by
any omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading,
except insofar as such losses, claims, damages or liabilities are caused by any
such untrue statement or omission or alleged untrue statement or omission based
upon information relating to any Holder furnished to the Company in writing by
such Holder expressly for use therein; provided that the foregoing indemnity
shall not inure to the benefit of any Holder (or to the benefit of any Person
controlling such Holder) from whom the Person asserting such losses, claims or
liabilities purchased the Registrable Securities, if a copy of the Prospectus
(as then amended or supplemented if the Company shall have furnished any
amendments or supplements thereto) was not sent or given by or on behalf of
such Holder to such Person, if required by law so to have been delivered at or
prior to the written confirmation of the sale of the Registrable Securities to
such Person, and if the Prospectus (as so amended or supplemented) would have
cured the defect giving rise to such losses, claims, damages or liabilities,
unless such failure is the result of noncompliance by the Company with Section
4.1(j) hereof.
(b) Each Holder agrees severally and not jointly to indemnify and
hold harmless the Company and its directors, its officers who sign any
Registration Statement and each Person, if any, who controls the Company
(within the meaning of either Section 15 of the Securities Act or Section 20 of
the Exchange Act) or any other Holder, to the same extent as the
17
foregoing indemnity from the Company to such Holder, but only with reference to
information relating to such Holder furnished to the Company in writing by such
Holder expressly for use in such Registration Statement or Prospectus or
amendment or supplement thereto. In no event shall the liability of any Holder
hereunder be greater in amount than the dollar amount of the gross proceeds
from the sale by such Holder upon the sale of the Registrable Securities
pursuant to the Registration Statement giving rise to such indemnification
obligation.
(c) In case any proceeding (including any governmental investigation)
shall be instituted involving any Person in respect of which indemnity may be
sought pursuant to Sections 5.1(a) or (b) hereof, such Person (the "indemnified
party") shall promptly notify the Person against whom such indemnity may be
sought (the "indemnifying party") in writing and the indemnifying party, upon
request of the indemnified party, shall retain counsel reasonably satisfactory
to the indemnified party to represent the indemnified party and any others the
indemnifying party may designate in such proceeding and shall pay the
reasonable fees and disbursements of such counsel related to such proceeding.
In any such proceeding, any indemnified party shall have the right to retain
its own counsel, but the fees and expenses of such counsel shall be at the
expense of such indemnified party unless i) the indemnifying party and the
indemnified party shall have mutually agreed to the retention of such counsel
or ii) the named parties to any such proceeding (including any impleaded
parties) include both the indemnifying party and the indemnified party and
representation of both parties by the same counsel would be inappropriate due
to actual or potential differing interests between them. It is understood that
the indemnifying party shall not, in respect of the legal expenses of any
indemnified party in connection with any proceeding or related proceedings in
the same jurisdiction, be liable for the fees and expenses of more than one
separate firm (in addition to any local counsel) for all such indemnified
parties and that all such fees and expenses shall be reimbursed as they are
incurred. Such firm shall be designated in writing by, in the case of parties
indemnified pursuant to Section 5.1(a), the Holders of a majority of the
Registrable Securities covered by the Registration Statement held by Holders
that are indemnified parties pursuant to Section 5.1(a) and, in the case of
parties indemnified pursuant to Section 5.1(b), the Company. The indemnifying
party shall not be liable for any settlement of any proceeding effected without
its written consent (which shall not be unreasonably withheld), but if settled
with such consent or if there be a final judgment for the plaintiff, the
indemnifying party agrees to indemnify the indemnified party from and against
any loss or liability by reason of such settlement or judgment. Notwithstanding
the foregoing sentence, if at any time an indemnified party shall have
requested an indemnifying party to reimburse the indemnified party for fees and
expenses of counsel as contemplated by the second and third sentences of this
paragraph, the indemnifying party agrees that it shall be liable for any
settlement of any proceeding effected without its written consent if (i) such
settlement is entered into more than 30 days after receipt by such indemnifying
party of the aforesaid request and (ii) such indemnifying party shall not have
reimbursed the indemnified party in accordance with such request prior to the
date of such settlement. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened proceeding in respect of which any indemnified party is or could
have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release of
such indemnified party from all liability on claims that are the subject matter
of such proceeding.
18
(d) To the extent that the indemnification provided for in Sections
5.1(a) or (b) is unavailable to an indemnified party or insufficient in respect
of any losses, claims, damages or liabilities referred to therein, then each
indemnifying party under such paragraph, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the indemnifying party or parties on the one hand and the
indemnified party or parties on the other hand or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the indemnifying party or
parties on the one hand and of the indemnified party or parties on the other
hand in connection with the statements or omissions that resulted in such
losses, claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company shall be deemed
to be equal to the greater of the total purchase price received under the
Investment Agreement with respect to the Registrable Securities or the value
received by the Company in connection with the disposition of securities in the
relevant offering. The relative benefits received by any Holder shall be deemed
to be equal to the value received by such Holder in connection with the
disposition of such securities in the relevant offering. The relative fault of
the Holders on the one hand and the Company 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 Holders or by the
Company, and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Holders'
respective obligations to contribute pursuant to this Section 5.1(d) are
several in proportion to the respective number of Registrable Securities they
have sold pursuant to a Registration Statement, and not joint.
The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 5.1(d) were determined by pro rata
allocation or by any other method of allocation that does not take into account
the equitable considerations referred to in the immediately preceding
paragraph. The amount paid or payable by an indemnified party as a result of
the losses, claims, damages or liabilities referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding this Section 5.1(d), no indemnifying party that is a
selling Holder shall be required to contribute any amount in excess of the
amount by which the total price at which the Registrable Securities sold by it
and distributed to the public were offered to the public exceeds the amount of
any damages that such indemnifying party has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. No Person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any Person who was not guilty of such fraudulent misrepresentation.
(e) The remedies provided for in this Section 5.1 are not exclusive
and shall not limit any rights or remedies which may otherwise be available to
an indemnified party at law or in equity, hereunder, under the Investment
Agreement or otherwise.
19
(f) The indemnity and contribution provisions contained in this
Section 5.1 shall remain operative and in full force and effect regardless of
iii) any termination of this Agreement, iv) any investigation made by or on
behalf of any Holder, any Person controlling any Holder or any affiliate of any
Holder or by or on behalf of the Company, its officers or directors or any
Person controlling the Company and v) the sale of any Registrable Securities by
any Holder.
(g) All indemnified parties are third-party beneficiaries of this
Agreement.
ARTICLE VI
MISCELLANEOUS
Section 6.1. No Inconsistent Agreements. The Company will not on or
after the date of this Agreement enter into any agreement that conflicts with
the provisions of this Agreement or that grants registration or similar rights
without the prior written consent of the Holders of a majority of the
Registrable Securities, nor has the Company entered into any such agreement,
except for the agreements set forth on Schedule 3.03(d) of the Investment
Agreement. The rights granted to the Holders hereunder do not in any way
conflict with and are not inconsistent with the rights granted to the holders
of the Company's other issued and outstanding securities under any such
agreements.
Section 6.2. 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 has obtained the prior
written consent of the Holders of a majority of the Registrable Securities then
outstanding (which for this purpose shall be the Registrable Shares outstanding
plus the Registrable Shares issuable upon conversion of the Registrable Notes),
and, if any such amendment, modification, supplement, waiver or consent would
materially adversely affect the rights of any specific group of Holders
hereunder in a different manner or degree than would affect the rights of all
Holders, the written consent of Holders of a majority of the Registrable
Securities so affected shall be obtained, and, if any such amendment,
modification, supplement, waiver or consent would materially adversely affect
the rights of any specific Holders hereunder in a different manner or degree
than would affect the rights of all Holders, the written consent of each such
adversely affected Holder shall be obtained; provided, however, that nothing
herein shall prohibit any amendment, modification, supplement, waiver or
consent the effect of which is limited only to those Holders who have agreed to
such amendment, modification, supplement, waiver or consent.
Section 6.3. Notices. Any notice, demand, request, waiver, or other
communication under this Agreement shall be governed by the terms and
conditions for the giving of notices under Section 9.04 of the Investment
Agreement.
Section 6.4. Successors and Assigns. This Agreement shall inure to
the benefit of and be binding upon the successors, assigns and transferees of
each of the parties, including, without the need for an express assignment,
subsequent Holders other than a Holder which acquires Registrable Notes or
Registrable Shares in a public offer or pursuant to an exemption under Rule
20
144 of the Securities Act; provided the subsequent holder agrees in writing to
be bound by the provisions of this Agreement. If any successor, assignee or
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 and provisions of this
Agreement. The Company shall refuse to register any securities held by any such
transferee until such time as such transferee has duly executed and delivered a
counterpart signature page by which such person agrees to all terms and
conditions of this Agreement. For purposes of this Agreement, "successor" for
any entity other than a natural person shall mean a successor to such entity as
a result of such entity's merger, consolidation, liquidation, dissolution, sale
of substantially all of its assets, or similar transaction.
Section 6.5. Recapitalizations, Exchanges, etc., Affecting
Registrable Securities. The provisions of this Agreement shall apply, to the
full extent set forth herein with respect to the Registrable Securities, to any
and all securities or capital stock of the Company or any successor or assign
of the Company (whether by merger, consolidation, sale of assets or otherwise.
including any Solvent Reorganization) that may be issued in respect of, in
exchange for, or in substitution of such Registrable Securities, by reason of
any dividend, split, issuance, reverse split, combination, recapitalization,
reclassification, merger, consolidation or otherwise.
Section 6.6. Counterparts. This Agreement may be signed in
counterparts (which may include counterparts delivered by any standard form of
telecommunication), each of which shall be an original and all of which
together shall constitute one and the same instrument.
Section 6.7. Descriptive Headings, Etc. The headings in this
Agreement are for convenience of reference only and shall not limit or
otherwise affect the meaning of terms contained herein. Unless the context of
this Agreement otherwise requires: (1) words of any gender shall be deemed to
include each other gender; (2) words using the singular or plural number shall
also include the plural or singular number, respectively; (3) the words
"hereof", "herein" and "hereunder" and words of similar import when used in
this Agreement shall refer to this Agreement as a whole and not to any
particular provision of this Agreement, and Article, Section and paragraph
references are to the Articles, Sections and paragraphs to this Agreement
unless otherwise specified; (4) the word "including" and words of similar
import when used in this Agreement shall mean "including, without limitation,"
unless otherwise specified; (5) "or" is not exclusive; and (6) provisions apply
to successive events and transactions.
Section 6.8. Severability. In the event that any one or more of the
provisions, paragraphs, words, clauses, phrases or sentences 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, paragraph, word, clause, phrase or
sentence in every other respect and of the other remaining provisions,
paragraphs, words, clauses, phrases or sentences hereof shall not be in any way
impaired, it being intended that all rights, powers and privileges of the
parties hereto shall be enforceable to the fullest extent permitted by law.
Section 6.9. GOVERNING LAW; JURISDICTION; WAIVER OF JURY TRIAL. This
Agreement shall be construed in accordance with the internal laws of the State
of New York
21
without regard to the conflicts of laws provisions thereof. The
Company hereby irrevocably submits to the jurisdiction of any court of the
State of New York located in the County of New York or the United States
District Court for the Southern District of the State of New York, any
appellate courts from any thereof (any such court, a "New York Court") or any
court of the United Kingdom located in London, or any appellate courts from any
thereof (any such court, a "UK Court"), but shall not be required to submit to
the jurisdiction of a court other than a New York Court or UK Court, for the
purpose of any suit, action or other proceeding arising out of or relating to
this Agreement or under any applicable securities laws and arising out of the
foregoing, which is brought by or against the Company, and the Company hereby
irrevocably agrees that all claims in respect of any such suit, action or
proceeding will be heard and determined in any such court. Each party hereto
(other than the Company) hereby irrevocably submits to the jurisdiction of any
New York Court, but shall not be required to submit to the jurisdiction of a
court other than a New York Court, for the purpose of any suit, action or other
proceeding arising out of or relating to this Agreement or under any applicable
securities laws and arising out of the foregoing, which is brought by or
against such party, and such party hereby irrevocably agrees that all claims in
respect of any such suit, action or proceeding will be heard and determined in
any such court. The Company hereby agrees not to commence any action, suit or
proceeding relating to this Agreement other than in a New York Court except to
the extent mandated by applicable law. The Company hereby waives any objection
that it may now or hereafter have to the venue of any such suit, action or
proceeding in any New York Court or any UK Court or that such suit, action or
proceeding was brought in an inconvenient court and agree not to plead or claim
the same. Each party hereto (other than the Company) hereby waives any
objection that it may now or hereafter have to the venue of any such suit,
action or proceeding in any New York Court or that such suit, action or
proceeding was brought in an inconvenient court and agree not to plead or claim
the same. EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO
TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER
THIS AGREEMENT OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE
DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT THIS AGREEMENT, OR
THE TRANSACTIONS RELATED HERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER
ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY
HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF
ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO
THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH
ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES HERETO TO THE
WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
The submission to the jurisdiction referred to in the preceding
paragraph shall not limit the right of any Holder to take proceedings against
any other party hereto in courts of any other competent jurisdiction nor shall
the taking of proceedings against such other party in any one or more
jurisdictions preclude the taking of proceedings against such other party in
any other jurisdiction (whether concurrently or not) if and to the extent
permitted by applicable law.
The Company agrees that the process by which any suit, action or
proceeding is begun in connection with this Agreement may be served on it at
its principal place of business in the United Kingdom for the time being. If
the Company ceases to have a principal place of
22
business in the United Kingdom, it shall immediately appoint a further person
in the United Kingdom to accept service of process on its behalf in such
jurisdiction. Nothing contained herein shall affect the right of the parties
hereto to serve process in any other manner permitted by law. In addition, the
Company acknowledges and agrees that (a) it has, by separate letter,
irrevocably appointed CT Corporation System, as its authorized agent upon which
process may be served in any suit or proceeding against the Company arising out
of or relating to this Agreement or under any securities laws of the United
States or any state thereof and arising out of the foregoing, (b) it has, prior
to the date hereof, paid such agent an amount in cash sufficient to procure
such agent's services for eleven years from the date hereof and (c) service of
process upon such agent, and written notice of said service to the Company by
the person serving the same to the address provided above, shall be deemed in
every respect effective service of process upon the Company in any such suit or
proceeding. The Company agrees to take any and all action as may be necessary
to maintain such designation and appointment of such agent in full force and
effect for a period of at least eleven years from the date of this Agreement.
Section 6.10. Specific Performance. The parties hereto acknowledge
that there would be no adequate remedy at law if any party fails to perform in
any material respect any of its obligations hereunder, and accordingly agree
that each party, in addition to any other remedy to which it may be entitled at
law or in equity, shall be entitled to compel specific performance of the
obligations of any other party under this Agreement in accordance with the
terms and conditions of this Agreement.
Section 6.11. Additional Documents. Each party agrees to execute any
and all further documents and writings within its powers and to perform such
other actions which may be or become necessary or expedient to effectuate and
carry out this Agreement.
Section 6.12. No Third-Party Beneficiaries. Except as set forth in
Section 5.1 hereof, none of the provisions of this Agreement shall be for the
benefit of, or enforceable by, any third-party beneficiary.
Section 6.13. Entire Agreement. This Agreement is intended by the
parties as a final expression of their agreement and intended to be a complete
and exclusive statement of the agreement and understanding of the parties
hereto in respect of the subject matter contained herein. This Agreement
supersedes all prior agreements and understandings between the Company, on the
one hand, and the other parties to this Agreement, on the other, with respect
to such subject matter.
Section 6.14. Termination of Obligations With Respect to Registrable
Notes. The right to require the Company to register Registrable Notes pursuant
to Sections 2.1 and 2.2 hereof shall terminate and cease to be of any further
force or effect upon the earlier to occur of (a) the Majority Conversion Date
and (b) the eleventh anniversary of the date of this Agreement (it being
understood and agreed that such termination shall have no effect on the
Company's other obligations under this Agreement (including, without
limitation, its obligation to register Registrable Shares)).
23
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the date first written above.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INCORPORATED VIATEL HOLDING (BERMUDA) LIMITED
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
--------------------------- -----------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Mananging Director Title: Authorized Signatory
AHAB PARTNERS, ▇.▇. ▇▇▇▇▇ PARTNERS, INC.
By: Pequod, LLC, its General Partner By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Mananging Partner
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
---------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Mananging Memeber,
Pequod LLC
General Partner,
Ahab Partners, ▇.▇.
▇▇▇▇▇▇▇▇▇ INSTITUTIONAL PARTNERS, L.P.
By: _________________, its ________
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: General Partner
ORE HILL HUB FUND LTD.
By: Ore Hill Partners LLC, its Investment Manamger
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
Title: Managing Partner
[Signature Page #1 to Registration Rights Agreement]
▇▇▇▇ ▇▇▇▇▇ WAYLAND DISTRESSED OPPORTUNITIES
FUND I-A, LLC
/s/ ▇▇▇▇ ▇▇▇▇▇
------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇ By: CSFC Wayland Advisors, Inc., its Mananger
---------------------------- --------
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Authorized Signatory
SAPPHIRE SPECIAL OPPORTUNITIES
FUND, LLC
By: CSFC Wayland Advisors, Inc., its Mananger
---------------------------- --------
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Authorized Signatory
[Signature Page #2 to Registration Rights Agreement]