1
EXHIBIT 4.2
REGISTRATION RIGHTS AGREEMENT
Dated as of June 13, 1997
among
TRANSTEXAS GAS CORPORATION
and
THE RECIPIENTS TO WHOM NOTES ARE ORIGINALLY ISSUED
--------------------
13 3/4% Series C Senior Subordinated Notes due 2002
2
SECTION 1. Definitions . . . . . . . . . . . . . . . . . . . . . . . -1-
SECTION 2. Registered Exchange Offer . . . . . . . . . . . . . . . . -5-
SECTION 3. Shelf Registration . . . . . . . . . . . . . . . . . . . . -7-
SECTION 4. Additional Interest for Illiquidity . . . . . . . . . . . -8-
SECTION 5. Hold-Back Agreements . . . . . . . . . . . . . . . . . . . -9-
SECTION 6. Registration Procedures . . . . . . . . . . . . . . . . . -9-
SECTION 7. Registration Expenses . . . . . . . . . . . . . . . . . -16-
SECTION 8. Indemnification . . . . . . . . . . . . . . . . . . . . -17-
SECTION 9. Rules 144 and 144A . . . . . . . . . . . . . . . . . . . -20-
SECTION 10. Underwritten Registrations . . . . . . . . . . . . . . -20-
SECTION 11. Miscellaneous . . . . . . . . . . . . . . . . . . . . . -21-
3
This REGISTRATION RIGHTS AGREEMENT dated as of June 13, 1997, among
TransTexas Gas Corporation (the "Company") and the persons to whom the Notes
(as defined below) are originally issued (the "Recipients"), is made pursuant
to the Exchange Offer and Consent Solicitation dated May 17, 1997, as
supplemented (the "Exchange Offer and Consent Solicitation"), pursuant to which
the Company offered to exchange its 13 3/4% Series C Senior Subordinated Notes
due 2001 in an aggregate original principal amount of $115,836,000 (the
"Notes") for all of its outstanding 13 1/4% Series A Senior Subordinated Notes
due 2003 (the "Existing Notes"). In order to induce the Recipients to exchange
Existing Notes for Notes, the Company agreed to provide the registration rights
set forth in this Registration Rights Agreement.
The parties hereby agree as follows:
SECTION 1. Definitions. Capitalized terms used herein without
definition shall have their respective meanings set forth in the Exchange Offer
and Consent Solicitation or, if not set forth therein, set forth in the
Indenture. Notwithstanding the preceding sentence, as used in this Agreement,
the following terms shall have the following meanings:
"Advice" shall have the meaning set forth in the last paragraph of
Section 6.
"Affiliate" of any specified person shall mean any other person which,
directly or indirectly, is in control of, is controlled by or is under common
control with such specified person. For purposes of this definition, control of
a person means the power, direct or indirect, to direct or cause the direction
of the management and policies of such person, whether by contract or
otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing. For purposes of Section 2, an "Affiliate" of the
Company shall mean and include, in addition, any Person deemed an affiliate
thereof under the Securities Act or the Exchange Act in connection with the
Registered Exchange Offer.
"Closing Date" shall mean June 13, 1997.
"Consummated" shall mean, when used with reference to a Registered
Exchange Offer, the point at which a Registered Exchange Offer has been made in
accordance with this Agreement and, to the extent accepted, Exchange Notes have
been issued in exchange for Registrable Notes.
"Consummation Date" shall mean the date which is 30 days (or, if
longer, the period during which the Company is required under applicable
federal and state securities laws to keep the Registered Exchange Offer open)
after the Effectiveness Date.
"Cure Date" shall have the meaning set forth in Section 4(a).
"Effectiveness Date" shall mean the date which is 120 days after the
Closing Date.
-1-
4
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the SEC promulgated thereunder.
"Exchange Notes" shall mean the notes received in the Registered
Exchange Offer for the Notes received pursuant to the Exchange Offer and
Consent Solicitation.
"Exchange Period" shall have the meaning set forth in Section 2(a).
"Filing Date" shall mean the date which is 45 days after the Closing
Date.
A "Holder" of notes shall mean the registered holder or any beneficial
owner of such notes.
"Illiquidity Event" with respect to any Registrable Notes shall mean
any of the following events:
(i) as of the Effectiveness Date (which shall be deemed
the date such Illiquidity Event occurs), the Exchange Notes offered in
exchange for such Registrable Notes are not the subject of a
Registration Statement for a Registered Exchange Offer which has
become effective (and which, if applicable pursuant to Section 2(a),
covers resales of such Exchange Notes) and as of such date such
Registrable Notes are not the subject of an Initial Shelf Registration
which has become effective;
(ii) as of the Consummation Date (which shall be deemed
the date such Illiquidity Event occurs), a Registered Exchange Offer
for such Registrable Notes has not been Consummated (excluding the
consummation of any resales covered by the Registration Statement for
such Registered Exchange Offer) and as of such date such Registrable
Notes are not the subject of an Initial Shelf Registration which has
become effective;
(iii) the Exchange Notes offered in exchange for such
Registrable Notes are the subject of a Registration Statement for a
Registered Exchange Offer which was effective (and which, if
applicable pursuant to Section 2(a), covers resales of such Exchange
Notes) but which ceased to be effective for any reason as of any date
(which shall be deemed the date such Illiquidity Event occurs) prior
to the end of the Exchange Period; or
(iv) such Registrable Notes are the subject of an Initial
Shelf Registration or Subsequent Shelf Registration which was
effective but which has ceased to be effective for any reason (other
than because all such Registrable Notes have been sold) as of any date
(which shall be deemed the date such Illiquidity Event occurs) prior
to the end of the Effectiveness Period, unless there is an effective
Subsequent Shelf Registration in respect of such Registrable Notes.
-2-
5
An Illiquidity Event with respect to any Registrable Notes shall be
deemed to cease to exist on the date subsequent to the occurrence of such
Illiquidity Event on which:
(w) either a Registration Statement for a Registered
Exchange Offer for such Registrable Notes (which, if applicable
pursuant to Section 2(a), covers resales of the Exchange Notes
exchanged for such Registrable Notes) or an Initial Shelf Registration
covering such Registrable Notes shall become effective, in the case of
an Illiquidity Event described in clause (i) above;
(x) a Registered Exchange Offer for such Registrable
Notes shall have been Consummated (excluding the consummation of any
resales covered by the Registration Statement for such Registered
Exchange Offer) or an initial Shelf Registration covering such
Registrable Notes shall become effective, in the case of an
Illiquidity Event described in clause (ii) above;
(y) either a Registration Statement for a Registered
Exchange Offer for such Registrable Notes or an Initial Shelf
Registration covering such Registrable Notes shall become effective,
in the case of an Illiquidity Event described in clause (iii) above;
or
(z) a Subsequent Shelf Registration covering such
Registrable Notes shall become effective, in the case of an
Illiquidity Event described in clause (iv) above.
The term "including" means including, without limitation, whether or
not expressly so limited.
"Indemnified Holder" shall have the meaning set forth in Section 8(a).
The term "indemnified party" and "indemnifying party" shall have the
respective meanings set forth in Section 8(c).
"Indenture" shall mean the Indenture dated as of June 13, 1997, between
the Company and Bank One, Columbus, NA, as trustee, pursuant to which the Notes
are being issued, as amended or supplemented from time to time in accordance
with the terms thereof.
"Initial Shelf Registration" shall have the meaning set forth in
Section 3(a).
"Inspectors" shall have the meaning set forth in Section 6(p).
"Losses" shall have the meaning set forth in Section 8(a).
-3-
6
"Managing Underwriters" shall mean the investment banker or investment
bankers and manager or managers that shall administer an underwritten offering.
"NASD" shall mean the National Association of Securities Dealers, Inc.
"NASDAQ" shall mean the National Association of Securities Dealers
Automated Quotation System.
"Notes" shall mean the 13 3/4% Series C or Series D Senior
Subordinated Notes due 2001 of the Company received pursuant to the Exchange
Offer and Consent Solicitation or received pursuant to the Registered Exchange
Offer, respectively.
"Person" shall mean an individual, trustee, corporation, partnership,
joint stock company, trust, unincorporated association, union, business
association, firm or other entity.
"Proceeding" shall have the meaning set forth in Section 8(c).
"Prospectus" shall mean the prospectus included in any Registration
Statement (including, without limitation, a prospectus that discloses
information previously omitted from a prospectus filed as part of an effective
registration statement in reliance upon Rule 430A promulgated under the
Securities Act), as amended or supplemented by any prospectus supplement, with
respect to the terms of the offering of any portion of the Registrable Notes
covered by such Registration Statement, and all other amendments and
supplements to the Prospectus, including post-effective amendments, and all
material incorporated by reference in such Prospectus.
"Recipients" shall mean those persons listed as holders of the Notes
on the signature pages hereof.
"Registered Exchange Offer" shall have the meaning set forth in
Section 2(a).
"Registrable Notes" shall mean the Notes upon original issuance
thereof, and at all times subsequent thereto, until, in the case of any such
Note, (i) a Registration Statement covering such Note, or the Exchange Note to
be exchanged for such Note, has been declared effective and such Note has been
disposed of or exchanged (or, in any case where such Registration Statement
covers the resale of such Note, such Note has been exchanged and the Exchange
Note received therefor has been resold), as case may be, in accordance with
such effective Registration Statement, (ii) it is sold in compliance with Rule
144, (iii) it shall have been otherwise transferred and a new certificate for
any such Note not bearing a legend restricting further transfer shall have been
delivered by the Company or (iv) it ceases to be outstanding.
"Registration Statement" shall mean any registration statement of the
Company that covers any of the Registrable Notes or the Exchange Notes, as the
case may be, pursuant to the provisions of this Agreement, including the
Prospectus, amendments and supplements to
-4-
7
such Registration Statement, including post-effective amendments, all exhibits,
and all material incorporated by reference in such Registration Statement. For
purposes of the foregoing, unless the context requires otherwise, a
Registration Statement for a Registered Exchange Offer shall not be deemed to
cover Exchange Notes issued in exchange for Registrable Notes held by a
Restricted Person unless such Registration Statement covers the resale of such
Exchange Notes by such Restricted Person.
"Restricted Person" shall mean any Affiliate of the Company or any
broker dealer or any Affiliate thereof, in each case which is an original
Holder of Notes.
"Rule 144" and "Rule 144A" shall mean, respectively, Rule 144 and Rule
144A promulgated under the Securities Act, as such rules may be amended from
time to time, or any similar rules or regulations hereafter adopted by the SEC.
"Rule 415" shall mean Rule 415 promulgated under the Securities Act,
as such rule may be amended from time to time, or any similar rules or
regulations hereafter adopted by the SEC.
"SEC" shall mean the Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933, as amended,
and the rules and regulations of the SEC promulgated thereunder.
"Shelf Notice" shall have the meaning set forth in Section 2(b).
"Shelf Registration" shall have the meaning set forth in Section 3(b).
"Special Counsel" shall mean Ropes & ▇▇▇▇, special counsel to the
Recipients, or any other special counsel to the Holders of Registrable Notes or
Exchange Notes.
"Subsequent Shelf Registration" shall have the meaning set forth in
Section 3(b).
"TIA" shall mean the Trust Indenture Act of 1939, as amended, and the
rules and regulations of the SEC promulgated thereunder.
The term "underwritten registration or underwritten offering" shall
mean a registration in which securities are sold to an underwriter for
reoffering to the public.
SECTION 2. Registered Exchange Offer.
(a) The Company shall use its best efforts to file with the SEC on
or prior to the Filing Date a Registration Statement for an offer to exchange
(a "Registered Exchange Offer") any and all of the Registrable Notes (subject
to Section 2(c)) for a like aggregate principal amount of Notes which are in
all material respects identical to the Registrable Notes (the
-5-
8
"Exchange Notes") and which are entitled to the benefits of a trust indenture
which is in all material respects identical to the Indenture and which has been
qualified under the TIA) except that they have been registered pursuant to an
effective Registration Statement under the Securities Act. The Registered
Exchange Offer shall be registered under the Securities Act on the appropriate
form of Registration Statement and duly registered or qualified under
applicable blue sky or state securities law and shall comply with all
applicable tender offer rules and regulations under the Exchange Act and with
all other applicable laws. Subject to section 2(c), such Registration Statement
shall also cover any resales of Exchange Notes by any Restricted Person.
The Company shall use its best efforts (i) to cause the Registration
Statement covering the Registered Exchange Offer to become effective under the
Securities Act on or prior to the Effectiveness Date, (ii) to keep the
Registered Exchange Offer open for a period of not less than the period
required under applicable federal and state securities laws (provided; that in
no event shall such period be less than 30 days), (iii) to maintain such
Registration Statement continuously effective for a period (the "Exchange
Period") of not less than the longer of (A) the period until the consummation
of the Registered Exchange Offer and (B) the period of up to 180 days, subject
to extension pursuant to the last paragraph of Section 6, ending when any
resales of Exchange Notes covered by such Registration Statement have been
made, (iv) to consummate the Registered Exchange Offer prior to the
Consummation Date and (v) to deliver to the Registrar under the Indenture for
cancellation an amount of Notes having the same aggregate principal amount as
the aggregate principal amount of Notes exchanged by Holders thereof for
Exchange Notes pursuant to the Registered Exchange Offer.
Each of the Recipients (other than any Restricted Person), by its
acceptance of the Notes and the benefits of this Agreement, represents, and
each Holder of the Registrable Notes to be exchanged in the Registered Exchange
Offer (other than any Restricted Person) shall be required to represent, that
any Exchange Notes to be received by it shall be acquired in the ordinary
course of its business and that at the time of the consummation of the
Registered Exchange Offer it shall have no arrangement with any person to
participate in the distribution (within the meaning of the Securities Act) of
the Exchange Notes. Upon consummation of a Registered Exchange Offer in
accordance with this Section 2 and compliance with the other provisions of this
Section 2, the Company shall, subject to Sections 2(b) and 2(c), have no
further obligation to register Registrable Notes pursuant to Section 3 of this
Agreement; provided, that the other provisions of this Agreement shall continue
to apply as set forth in such provisions.
(b) In the event that the Company reasonably determines in good
faith and after conferring with counsel that (i) the Exchange Notes would not,
upon receipt in the Registered Exchange Offer by any Holder of Registrable
Notes (other than any Restricted Person), be tradeable by each Holder thereof
without restriction under the Securities Act and the Exchange Act and without
material restriction under applicable blue sky or state securities laws, (ii)
the SEC is unlikely to permit the Registration Statement covering the
Registered Exchange Offer to become effective prior to the Effectiveness Date
(except in the circumstances set forth in
-6-
9
clause (c)(i)(B) of this Section 2) or (iii) the Registered Exchange Offer may
not be made in compliance with applicable laws, then the Company shall promptly
deliver notice thereof (the "Shelf Notice") to the Holders of Registrable Notes
and the Trustee and shall thereafter file an Initial Shelf Registration
pursuant to, and otherwise comply with, the provisions of Section 3. Following
the delivery of a Shelf Notice in accordance with this Section 2(b) and
compliance with Section 3, the Company shall not have any further obligation
under this Section 2.
(c) In the event that the Company reasonably determines in good faith
and after conferring with counsel that (i)(A) the Exchange Notes would not,
upon consummation of any resale thereof by a Restricted Person to any Person
other than another Restricted Person, be tradeable by each Holder thereof
without restriction under the Securities Act and the Exchange Act and without
material restriction under applicable blue sky or state securities laws, or (B)
the SEC is unlikely to permit the Registration Statement covering the
Registered Exchange Offer to become effective prior to the Effectiveness Date
solely because such Registration Statement covers resales of the Exchange Notes
by Restricted Persons, then the Company shall promptly deliver a Shelf Notice
to the Restricted Persons who are Holders of Registrable Notes and the Trustee
and the Company shall thereafter file an Initial Shelf Registration pursuant
to, and otherwise comply with, the provisions of Section 3; provided; that such
Initial Shelf Registration need only cover resales of Registrable Notes by
Restricted Persons if a Shelf Notice is not then otherwise required to be
delivered pursuant to Section 2(b). Following the delivery of a Shelf Notice in
accordance with this Section 2(c) and compliance with Section 3, the Company
shall not have any further obligation under this Section 2 with respect to the
filing of an offer to exchange the Registrable Notes held by Restricted Persons
(including, without limitation, any obligation to provide that a Registration
Statement filed pursuant to Section 2(a) cover resales of Exchange Notes by
Restricted Persons).
SECTION 3. Shelf Registration. If a Shelf Notice is delivered in
accordance with Section 2(b) or (c) then the Company shall comply with the
following provisions of this Section 3:
(a) Initial Shelf Registration. The Company shall use its best
efforts to prepare and file with the SEC, on or prior to the Filing Date, a
Registration Statement for an offering to be made on a continuous basis
pursuant to Rule 415 covering all of the Registrable Notes (or, if a Shelf
Notice is delivered solely pursuant to Section 2(c), all of the Registrable
Notes held by any Restricted Persons) (the "Initial Shelf Registration"). The
Initial Shelf Registration shall be on Form S-1 or another appropriate form
permitting registration of such Registrable Notes for resale by the Holders
thereof in the manner or manners designated by them (including, without
limitation, one or more underwritten offerings). No securities (other than
Registrable Notes) shall be included in the Initial Shelf Registration or any
Subsequent Shelf Registration without the consent of the Holders of a majority
in aggregate principal amount of the Notes covered thereby. The Company shall
use its best efforts to cause the Initial Shelf Registration to be declared
effective under the Securities Act on or prior to the Effectiveness Date and to
keep the Initial Shelf Registration continuously effective under the Securities
Act for a period of two years (subject to extension pursuant to the last
paragraph of Section 6) (the
-7-
10
"Effectiveness Period") after the Effectiveness Date, or such shorter period
ending when (i) all Registrable Notes covered by the Initial Shelf Registration
have been sold or (ii) a Subsequent Shelf Registration covering all of such
Registrable Notes remaining unsold has been declared effective under the
Securities Act.
(b) Subsequent Shelf Registrations. If the Initial Shelf
Registration or any Subsequent Shelf Registration ceases to be effective for
any reason at any time during the Effectiveness Period after the Effectiveness
Date (other than because of the sale of all of the Registrable Notes covered
thereby), the Company shall use its best efforts to obtain the prompt
withdrawal of any order suspending the effectiveness thereof, and in any event
shall within 60 days of such cessation of effectiveness amend such Initial
Shelf Registration or Subsequent Shelf Registration in a manner reasonably
expected to obtain the withdrawal of the order suspending the effectiveness
thereof, or file an additional "shelf" Registration Statement pursuant to Rule
415 covering all of such Registrable Notes remaining unsold (a "Subsequent
Shelf Registration"). If a Subsequent Shelf Registration is filed, the Company
shall use its best efforts to cause the Subsequent Shelf Registration to be
declared effective as soon as practicable after such filing and to keep such
Registration Statement continuously effective for a period after the date of
such effectiveness equal in length to the length of the Effectiveness Period,
less the aggregate number of days during which the Initial Shelf Registration
or any Subsequent Shelf Registration was previously effective. As used herein,
the term "Shelf Registration" means the Initial Shelf Registration and any
Subsequent Shelf Registration.
(c) Supplements and Amendments. The Company shall supplement and
amend the Shelf Registration if (i) required by the rules, regulations or
instructions applicable to the registration form used for such Shelf
Registration, (ii) otherwise required by the Securities Act or (iii) reasonably
requested by the Holders of a majority in aggregate principal amount of the
Notes covered by such Registration Statement or by any underwriter of such
Notes.
d) Selection of Underwriters. If at any time or from time to time
any of the Holders of the Registrable Notes included in any Shelf Registration
desire to sell Registrable Notes in an underwritten offering, the Managing
Underwriters shall be selected by the Holders of a majority in aggregate
principal amount of the Notes included in such offering; provided that such
Managing Underwriters shall be reasonably satisfactory to the Company.
SECTION 4. Additional Interest for Illiquidity.
(a) The Company acknowledges and agrees that the Recipients (and
any subsequent Holders of the Notes) have acquired the Notes in reliance on the
Company's covenant to cause a Registration Statement for the Registered
Exchange Offer or an Initial Shelf Registration to become effective on or prior
to the Effectiveness Date and to maintain the effectiveness thereof as
described herein, and that the failure of the Company to fulfill such covenant
will have an adverse effect on the Holders of the Notes. Therefore, the Company
agrees that in the event an Illiquidity Event with respect to any Registrable
Notes shall occur and be continuing, interest (in addition to the interest set
forth in paragraph 1 of the Notes) shall accrue with
-8-
11
respect to Notes which are then included in such Registrable Notes, until such
time as such Illiquidity Event shall cease to exist (and provided no other
Illiquidity Event with respect to such Registrable Notes shall then be
continuing), at the rate of one percent (1.00%) per annum, which additional
interest shall be payable by the Company to the Holders of such Notes at the
times, in the manner and subject to the same terms and conditions as set forth
in the Indenture, as nearly as may be, as though the interest rate provided in
paragraph 1 of the Notes had been increased by one percent (1.00%) per annum.
Any such additional interest accrued on such Notes but unpaid on the date on
which such interest ceases to accrue (the "Cure Date") shall be due and payable
on the next Interest Payment Date (as such term is defined in the Indenture)
after such Cure Date to the Holders of record of such Notes at the close of
business on the business day preceding such Due Date.
(b) The Company shall notify the Trustee of the occurrence of any
Illiquidity Event promptly (and in any case within three business days
thereof).
SECTION 5. Hold-Back Agreements.
(a) Restrictions on Sale by Holders of Registrable Notes. Each
Holder of Registrable Notes whose Registrable Notes are covered by a
Registration Statement, by its acceptance of the Notes and the benefits of this
Agreement, agrees not to effect any public sale or distribution of Registrable
Notes, including pursuant to Rule 144, during the period beginning 10 days
prior to, and ending 90 days after, the closing date of any underwritten
offering made pursuant to a Registration Statement filed pursuant to Section 3
in which such Holder is participating, to the extent timely requested in
writing by the Managing Underwriters of such offering (except as part of such
offering).
The foregoing provisions shall not apply to any Holder of Registrable
Notes if such Holder is prevented by applicable statute or regulation from
entering into any such agreement; provided, however, that any such Holder shall
undertake, in its request to participate in any underwritten offering made
pursuant to a Registration Statement filed pursuant to Section 3, not to effect
any public sale or distribution of Registrable Notes (except as part of such
underwritten offering) during the period commencing on the closing date of such
underwritten offering and ending 90 days thereafter, unless it has provided 45
days prior written notice of such sale or distribution to the Company and the
Managing Underwriters.
(b) Restrictions on Sale by the Company. The Company agrees (i)
that it shall not effect any public or private sale or distribution of its debt
securities, including a sale pursuant to Regulation D under the Securities Act,
during the period beginning 10 days prior to, and ending 90 days after, the
closing date of any underwritten offering made pursuant to a Registration
Statement filed pursuant to Section 3, to the extent timely requested in
writing by the Managing Underwriters (except as part of such underwritten
registration or pursuant to registrations on Form S-4 or S-8 or any successor
form to such Form) and (ii) to cause each holder of privately placed debt
securities of the Company issued at any time on or after the date of this
Agreement (other than the Holders of Registrable Notes) to agree on or before
the
-9-
12
date such securities are issued (unless prevented by applicable statute or
regulation) not to effect any public sale or distribution of any such
securities during such period, including a sale pursuant to Rule 144 (except as
part of such registration, if permitted).
SECTION 6. Registration Procedures. In connection with the
registration of any Registrable Notes or Exchange Notes pursuant to Section 2
or 3 hereof, the Company shall use its best efforts to effect such registration
to permit the sale of such Registrable Notes or Exchange Notes in accordance
with the intended method or methods of disposition thereof, and pursuant
thereto the Company shall, as expeditiously as possible:
(a) Prepare and file with the SEC, as soon as practicable after
the date hereof but in any event prior to the Filing Date, a Registration
Statement or Registration Statements as prescribed by Section 2 or 3, and use
its best efforts to cause each such Registration Statement to become effective
and remain effective for the applicable period as provided herein; provided,
however, that (i) the Company shall afford any Restricted Person which is a
Holder of Registrable Notes or Exchange Notes and its Special Counsel an
opportunity to review copies of all such documents proposed to be filed and
(ii) if such filing is pursuant to Section 3, before filing any Registration
Statement or Prospectus or any amendments or supplements thereto (including
documents that would be incorporated therein by reference after the initial
filing of the Registration Statement), the Company shall afford the Holders of
the Registrable Notes covered by such Registration Statement, their Special
Counsel and the Managing Underwriters, if any, an opportunity to review copies
of all such documents proposed to be filed. The Company shall not file any
Registration Statement or related Prospectus, and any amendments or supplements
thereto (including such documents incorporated by reference), if any such
Restricted Person (in the event resales of such Restricted Person's Exchange
Notes are covered by such Registration Statement), the Holders of a majority in
aggregate principal amount of the Notes covered by such Registration Statement,
their Special Counsel, or the Managing Underwriters, if any, shall reasonably
object, in writing, on a timely basis and such objection shall not be resolved
on a basis reasonably satisfactory to all such parties.
(b) Prepare and file with the SEC such amendments and
post-effective amendments to each Shelf Registration as may be necessary to
keep such Registration Statement continuously effective for the applicable
period as provided herein; cause the related Prospectus to be supplemented by
any required Prospectus supplement, and as so supplemented to be filed pursuant
to Rule 424 (or any similar provisions then in force) under the Securities Act,
the Exchange Act and the rules and regulations of the SEC promulgated
thereunder with respect to the disposition of all securities covered by such
Registration Statement as so amended or in such Prospectus as so supplemented
in accordance with the intended methods of disposition by the sellers of
Registrable Notes covered thereby set forth therein.
(c) If a Shelf Registration is filed pursuant to Section 3, notify
the selling Holders of Registrable Notes, their Special Counsel and the
Managing Underwriters, if any, promptly (but no later than five Business Days)
after the Company becomes aware thereof, and confirm
-10-
13
such notice in writing, (i) when a Prospectus or any Prospectus supplement or
post-effective amendment has been filed, and, with respect to a Registration
Statement or any post-effective amendment, when the same has become effective,
(ii) of any request by the SEC for amendments or supplements to the
Registration Statement or the Prospectus or for additional information, (iii)
of the issuance by the SEC of any stop order suspending the effectiveness of a
Registration Statement or of any order preventing or suspending the use of any
preliminary prospectus or Prospectus or the initiation of any proceedings for
that purpose, (iv) if at any time the representations and warranties of the
Company contained in any agreement (including any underwriting agreement)
contemplated by Section 6(o) below cease to be true and correct, (v) of the
receipt by the Company of any notification with respect to the suspension of
the qualification or exemption from qualification of a Registration Statement
or any of the Registrable Notes for offer or sale in any jurisdiction, or the
initiation or threatening of any proceeding for such purpose, (vi) of the
existence of any fact known to the Company which results in such Registration
Statement or related Prospectus or any document incorporated therein by
reference containing any untrue statement of a material fact or omitting to
state any material fact required to be stated therein or necessary to make the
statements therein not misleading and (vii) if the Company reasonably
determines that the filing of a post-effective amendment to such Registration
Statement would be appropriate.
(d) If a Shelf Registration is filed pursuant to Section 3, use
its best efforts to prevent the issuance of any order suspending the
effectiveness of a Registration Statement or of any order preventing or
suspending the use of a Prospectus or suspending the qualification (or
exemption from qualification) of any of the Registrable Notes for sale in any
jurisdiction and, if any such order is issued, to obtain the withdrawal of any
such order at the earliest possible moment.
(e) If a Shelf Registration is filed pursuant to Section 3 and if
requested by the Managing Underwriters or a Holder of Registrable Notes being
sold in connection with an underwritten offering, (i) promptly incorporate in a
Prospectus supplement or post-effective amendment such information as the
Managing Underwriters and the Holders of a majority in aggregate principal
amount of the Registrable Notes being sold reasonably agree should be included
therein relating to the sale of the Registrable Notes, including, without
limitation, information with respect to the aggregate principal amount of
Registrable Notes being sold to the underwriters of such offering, the purchase
price being paid therefor by such underwriters and any other terms of the
underwritten (or best efforts underwritten) offering of the Registrable Notes
to be sold in such offering and (ii) make all required filings of such
Prospectus supplement or post-effective amendment as soon as notified of the
matters to be incorporated in such Prospectus supplement or post-effective
amendment.
(f) If a Shelf Registration is filed pursuant to Section 3,
furnish to each selling Holder of Registrable Notes who so requests and to
Special Counsel and each Managing Underwriter, if any, without charge, one
conformed copy of the Registration Statement or Statements and each
post-effective amendment thereto, including financial statements and schedules,
all documents incorporated therein by reference and all exhibits (including
those incorporated by reference).
-11-
14
(g) If a Shelf Registration is filed pursuant to Section 3,
deliver to each selling Holder of Registrable Notes, Special Counsel and the
underwriters, if any, without charge, as many copies of the Prospectus or
Prospectuses (including each preliminary prospectus) and each amendment or
supplement thereto as such persons may reasonably request; and, subject to the
last paragraph of this Section 6, the Company hereby consents to the use of
such Prospectus and each amendment or supplement thereto by each of the selling
Holders of Registrable Notes and the underwriters, if any, in connection with
the offering and sale of the Registrable Notes covered by such Prospectus and
any amendment or supplement thereto.
(h) Prior to any public offering of Registrable Notes, register or
qualify, and cooperate with the selling Holders of Registrable Notes, the
underwriters, if any, and their respective counsel in connection with the
registration or qualification (or exemption from such registration or
qualification) of, such Registrable Notes for offer and sale under the
securities or blue sky laws of such jurisdictions within the United States as
any selling Holder or the Managing Underwriters reasonably request in writing
provided; that where Registrable Notes are offered other than through an
underwritten offering, the Company agrees to cause its counsel to perform blue
sky investigations and file registrations and qualifications required to be
filed pursuant to this Section 6(h)); keep each such registration or
qualification (or exemption therefrom) effective during the period such
Registration Statement is required to be kept effective; and do any and all
other acts or things necessary or advisable to enable the disposition in such
jurisdictions of the Registrable Notes covered by the applicable Registration
Statement.
(i) If a Shelf Registration is filed pursuant to Section 3,
cooperate with the selling Holders of Registrable Notes and the Managing
Underwriters, if any, to facilitate the timely preparation and delivery of
certificates representing Registrable Notes to be sold, which certificates
shall not bear any restrictive legends and shall be in a form eligible for
deposit with The Depository Trust Company; and enable such Notes to be in such
denominations and registered in such names as the Managing Underwriters, if
any, or Holders may reasonably request at least two business days prior to any
sale of Registrable Notes in a firm commitment underwritten public offering, or
at least 10 business days prior to any other such sale.
(j) Cause the Registrable Notes covered by the Registration
Statement or the Exchange Notes, as the case may be, to be registered with or
approved by such other governmental agencies or authorities within the United
States as may be necessary to enable the seller or sellers thereof or the
underwriters, if any, to consummate the disposition of such Registrable Notes
or to enable the Holders thereof to consummate the Registered Exchange Offer.
-12-
15
(k) If a Shelf Registration is filed pursuant to Section 3, upon
the occurrence of any event contemplated by Section 6(c), prepare a supplement
or post-effective amendment to the Registration Statement or a supplement to
the related Prospectus or any documents incorporated therein by reference or
file any other required document so that, as thereafter delivered to the
purchasers of the Registrable Notes, such Prospectus will not contain an untrue
statement of a material fact or omit to state a material fact necessary to make
the statements therein not misleading.
(l) Use its best efforts to cause the Registrable Notes covered by
the Registration Statement or the Exchange Notes, as the case may be, to be
rated with the appropriate rating agencies, if so requested by the Holders of a
majority in aggregate principal amount of Notes covered by such Registration
Statement or the Exchange Notes, as the case may be, or the Managing
Underwriters, if any.
(m) Prior to the effective date of the first Registration
Statement relating to the Notes which are Registrable Notes or the Exchange
Notes, as the case may be, (i) provide the Trustee with printed certificates
for such Notes in a form eligible for deposit with The Depository Trust Company
and (ii) provide a CUSIP number for such Notes.
(n) Use its best efforts to cause all Registrable Notes covered by
such Registration Statement or the Exchange Notes, as the case may be, to be
(i) listed on each securities exchange, if any, on which similar securities
issued by the Company are then listed or (ii) authorized to be quoted on NASDAQ
or the National Market System of NASDAQ if similar securities of the Company
are so authorized, in each case, if requested by the Holders of a majority in
aggregate principal amount of the Notes covered by such Registration Statement
or the Exchange Notes, as the case may be, or the Managing Underwriters, if
any.
(o) If a Shelf Registration is filed pursuant to Section 3, enter
into such agreements (including underwriting agreements) and take all other
appropriate actions in order to expedite or facilitate the registration or the
disposition of such Registrable Notes and, in connection therewith, whether or
not an underwriting agreement is entered into and whether or not the
registration involves an underwritten offering, (i) make such representations
and warranties to the Holders of such Registrable Notes and the underwriters,
if any, in form, substance and scope as are customarily made by issuers to
underwriters in primary underwritten offerings and covering matters including,
but not limited to, those set forth in the Exchange Offer and Consent
Solicitation; (ii) obtain opinions of counsel to the Company and updates
thereof (which opinions (in form, scope and substance) shall be reasonably
satisfactory to the managing underwriters, if any, and the Holders of a
majority in aggregate principal amount of the Notes being sold) addressed to
each selling Holder and the underwriters, if any, covering such matters as are
customarily covered in opinions requested in underwritten offerings and such
other matters as may be reasonably requested by such Holders and underwriters;
(iii) obtain "cold comfort" letters and updates thereof from the independent
certified public
-13-
16
accountants of the Company (and, if necessary, any other independent certified
public accountants of any subsidiary of the Company or any business acquired by
the Company for which financial statements and financial data are, or are
required to be, included in the Registration Statement), addressed to each
selling Holder of Registrable Notes and the underwriters, if any, in customary
form and covering matters of the type customarily covered in "cold comfort"
letters in connection with primary underwritten offerings; (iv) if an
underwriting agreement is entered into, cause the same to contain
indemnification provisions and procedures no less favorable than those set
forth in Section 8 (or such other provisions and procedures acceptable to
Holders of a majority in aggregate principal amount of the Notes covered by
such Registration Statement and the Managing Underwriters, if any) with respect
to all parties to be indemnified pursuant to Section 8; and (v) deliver such
documents and certificates as may be requested by the Holders of a majority in
aggregate principal amount of the Notes being sold and the Managing
Underwriters, if any, to evidence compliance with Section 6(k) and with any
customary conditions contained in the underwriting agreement or other agreement
entered into by the Company. The foregoing actions set forth in this Section
6(o) shall be performed at (A) the effectiveness of such Registration Statement
and each post-effective amendment thereto, (B) each closing under any
underwriting or similar agreement as and to the extent required thereunder and
(C) from time to time as may be reasonably requested by any selling Holder in
connection with the disposition of Registrable Notes pursuant to such
Registration Statement, provided, in the case of actions taken pursuant to
clause (C), such actions are taken at the requesting Holder's sole expense.
(p) If a Shelf Registration is filed pursuant to Section 3, make
available for inspection by a representative of the Holders of a majority in
aggregate principal amount of the Notes being sold, any underwriter
participating in any such disposition of Registrable Notes, if any, and any
attorney or accountant retained by such representative of the Holders or
underwriter (collectively, the "Inspectors"), during reasonable business hours,
all financial and other records, pertinent corporate documents and properties
of the Company and its subsidiaries, and cause the officers, directors and
employees of the Company and its subsidiaries to supply all information in each
case reasonably requested by any such Inspector in connection with such
Registration Statement; provided, however, that any information that is
designated in writing by the Company, in good faith, as confidential at the
time of delivery of such information, shall be kept confidential by such
Inspector (other than as to Holders of Registrable Notes) and by any Holders of
Registrable Notes receiving such information, unless (i) disclosure of such
information is required by court or administrative order, (ii) disclosure of
such information is necessary to avoid or correct a misstatement or omission of
a material fact in the Registration Statement, Prospectus or any supplement or
post-effective amendment thereto or disclosure is otherwise required by law,
(iii) such information becomes generally available to the public other than as
a result of a disclosure by such Inspector in violation of this Section 6(p) or
(iv) such party rightfully receives the information from any third party
without an accompanying obligation of confidentiality, the information is
already in such party's possession without an accompanying obligation of
confidentiality or the information is approved for release by the Company in
writing.
-14-
17
(q) Provide a Trustee for the Registrable Notes or the Exchange
Notes, as the case may be, and use its best efforts to cause the Indenture or
the trust indenture provided for in Section 2(a), as the case may be, to be
qualified under the TIA not later than the Effective Date; and in connection
therewith, cooperate with the Trustee under any such indenture and the Holders
of the Registrable Notes, to effect such changes to such indenture as may be
required for such indenture to be so qualified in accordance with the terms of
the TIA and execute, and use its best efforts to cause the Trustee to execute,
all documents as may be required to effect such changes, and all other forms
and documents required to be filed with the SEC to enable such indenture to be
so qualified in a timely manner.
(r) Otherwise use its best efforts to comply with all applicable
rules and regulations of the SEC and make generally available to its security
holders earnings statements satisfying the provisions of Section 11(a) of the
Securities Act (in accordance with Rule 158 thereunder or otherwise) no later
than 45 days after the end of any 12-month period (or 90 days after the end of
any 12-month period if such period is a fiscal year) (i) commencing at the
beginning of the first fiscal quarter of the Company following that in which
Registrable Notes are sold to underwriters in a firm commitment or best efforts
underwritten offering and (ii) if not sold to underwriters in such an offering,
commencing on the first day of the first fiscal quarter of the Company after
the effective date of a Registration Statement, which statements shall cover
said 12-month periods.
(s) Cooperate with and assist each selling Holder of Registrable
Notes and each underwriter participating in the disposition of such Registrable
Notes and their respective counsel in connection with any filings required to
be made with the NASD and in the performance of any due diligence investigation
by any underwriter, including any "qualified independent underwriter" that is
required to be retained in connection with the rules and regulations of the
NASD.
For purposes of the covenants set forth in this Section 6, references
to a Shelf Registration, including a Shelf Registration filed pursuant to
Section 3, shall be deemed to include any Registration Statement, filed
pursuant to Section 2, which covers resales of Exchange Notes held by
Restricted Persons as provided in Section 2, and, in connection with such
resales, such Restricted Persons shall be entitled to exercise all rights,
receive all notices and copies of documents, and otherwise receive all benefits
afforded to sellers or Holders of Registrable Notes under this Section 6 in
connection with a Shelf Registration. Without limiting the generality of the
foregoing, the Company agrees to fulfill its obligations set forth in Sections
6(a), (b), (c), (d), (e), (f), (g), (i), (k), (o) and (p) with respect to any
such Registration Statement filed pursuant to Section 2 insofar as it covers
such resales.
The Company may require each Holder of Registrable Notes as to which
any registration is being effected to furnish to the Company (i) such
information regarding the distribution of such Registrable Notes as the Company
may, from time to time, reasonably request in writing and which is required by
the Securities Act to be included in the Registration Statement and (ii) such
other information as the Company may from time to time, reasonably
-15-
18
request in writing, which is required by the Securities Act to be included in
the Registration Statement and which is in the sole possession of such Holder.
Each Holder of Registrable Notes agrees by acquisition of such
Registrable Notes that, upon receipt of any notice from the Company of the
happening of any event of the kind described in Section 6(c)(ii), 6(c)(iii),
6(c)(v) or 6(c)(vi), such Holder shall forthwith discontinue disposition of
such Registrable Notes covered by such Registration Statement or Prospectus
until such Holder's receipt of the copies of the supplemented or amended
Prospectus contemplated by Section 6(k), or until it is advised in writing (the
"Advice") by the Company that the use of the applicable Prospectus may be
reused, and has received copies of any amendments or supplements thereto. In
the event the Company shall give any such notice, the length of the
Effectiveness Period or the 180-day period referred to in Section 2(a)(iii)(B),
as applicable, shall be extended by the number of days during such period from
and including the date of the giving of such notice to and including the date
when each seller of Registrable Notes covered by such Registration Statement
shall have received (x) the copies of the supplemented or amended Prospectus
contemplated by Section 6(k) or (y) the Advice.
SECTION 7. Registration Expenses.
(a) All fees and expenses incident to the performance of or
compliance with this Agreement by the Company shall be borne by the Company,
whether or not the Registered Exchange Offer or a Shelf Registration is filed
or becomes effective, including, without limitation, (i) all registration and
filing fees (including, without limitation, (A) fees and expenses with respect
to filings required to be made with the NASD in connection with the
Registration Statement, including, if applicable, the fees and expenses of any
"qualified independent underwriter" or other independent appraiser (and its
counsel) that is required to be retained in accordance with the rules and
regulations of the NASD and legal fees and expenses in connection with any such
filings and (B) fees and expenses of compliance with state securities or blue
sky laws (including, without limitation, fees and disbursements of counsel in
connection with blue sky qualifications of the Registrable Notes or Exchange
Notes and determination of the eligibility of the Registrable Notes or Exchange
Notes for investment under the laws of such jurisdictions (x) where the Holders
of Registrable Notes are located, in the case of the Exchange Notes, or (y) as
provided in Section 6(h), in the case of Registrable Notes)), (ii) printing
expenses (including, without limitation, expenses of printing certificates for
Registrable Notes or Exchange Notes in a form eligible for deposit with The
Depository Trust Company and of printing prospectuses if the printing of
prospectuses is requested by the Managing Underwriters, if any, or by the
Holders of a majority in aggregate principal amount of the Notes covered by any
Registration Statement or by any Restricted Person which is a Holder of
Registrable Notes or Exchange Notes), (iii) messenger, telephone and delivery
expenses, (iv) fees and disbursements of counsel for the Company and of Special
Counsel for the sellers of Registrable Notes (subject to the provisions of
Section 7(b)), (v) fees and disbursements of all independent certified public
accountants referred to in Section 6(o) (iii)
-16-
19
(including, without limitation, expenses of any special audit and "cold
comfort" letters required by or incident to such performance), (vi) fees and
disbursement of underwriters (excluding discounts, commissions or fees of
underwriters, selling brokers, dealer managers or similar securities industry
professionals relating to the distribution of the Registrable Notes or legal
expenses of any Person other than the Company and the selling Holders), (vii)
rating agency fees, (viii) Securities Act liability insurance, if the Company
desires such insurance, (ix) fees and expenses of all other Persons, including
special experts, retained by the Company, (x) internal expenses of the Company
(including, without limitation, all salaries and expenses of officers and
employees of the Company performing legal or accounting duties), (xi) the
expense of any annual audit of the Company's financial statements by the
Company's independent auditors and (xii) the fees and expenses incurred in
connection with the listing of the Registrable Notes or Exchange Notes on any
securities exchange or quotation system.
(b) In connection with any Registration Statement hereunder, the
Company shall reimburse the Holders of the Registrable Notes being registered
in such registration for the reasonable fees and disbursements of not more than
one counsel chosen by the Holders of the majority in aggregate principal amount
of Notes being registered.
SECTION 8. Indemnification
(a) Indemnification by the Company. The Company shall, without
limitation as to time, indemnify and hold harmless each Holder of Registrable
Notes, the officers, directors, agents, advisers, counsel and employees of each
of them and each Person who controls such Holder within the meaning of Section
15 of the Securities Act or Section 20 of the Exchange Act (each such Person
being sometimes hereinafter referred to as an "Indemnified Holder") from and
against any and all losses, claims, damages, liabilities, costs and expenses
(including, without limitation, reasonable costs of investigation)
(collectively, "Losses"), as incurred, arising out of, resulting from or based
upon any untrue or alleged untrue statement of a material fact contained in any
Registration Statement or Prospectus or in any amendment or supplement thereto
or in any preliminary prospectus, or arising out of, resulting from or based
upon any omission or alleged omission of a material fact required to be stated
therein or necessary to make the statements therein not misleading, except to
the extent that the same arise out of, results from or are based upon
information furnished in writing to the Company by such Indemnified Holder or
the related Holder of a Registrable Note expressly for use therein; provided,
however, that the Company shall not be liable to any Indemnified Holder to the
extent that any such Losses arise out of, result from or are based upon an
untrue statement or alleged untrue statement or omission or alleged omission
made in any preliminary prospectus if (i) such Indemnified Holder or the
related Holder of a Registrable Note failed to send or deliver a copy of the
Prospectus, including any amendments or supplements thereto, with or prior to
the delivery of written confirmation of the sale by such Indemnified Holder or
the related Holder of a Registrable Note to the person asserting the claim from
which such Losses arise in any case where such delivery is required by the
Securities Act, (ii) the
-17-
20
Prospectus, including any amendments or supplements thereto, would have
corrected such untrue statement or alleged untrue statement or such omission or
alleged omission and (iii) the Company has complied with its obligations under
Sections 6(c), 6(g) and 6(k) prior to such delivery of confirmation; provided
further, that the Company shall not be liable in any such case to the extent
that any such Losses arise out of, result from or are based upon an untrue
statement or alleged untrue statement or omission or alleged omission in the
Prospectus, if (A) such untrue statement or alleged untrue statement, omission
or alleged omission is corrected in an amendment or supplement to the
Prospectus, (B) such Indemnified Holder or the related Holder of a Registrable
Note thereafter fails to deliver such Prospectus as so amended or supplemented,
prior to or concurrently with the sale of a Registrable Note to the Person
asserting the claim from which such Losses arise in any case where such
delivery is required by the Securities Act, and (C) the Company has complied
with its obligations under Sections 6(c), 6(g) and 6(k) prior to such sale. The
Company shall also indemnify underwriters (including any Holder of Registrable
Notes in respect of resales of Exchange Notes covered by the Registration
Statement for the Registered Exchange Offer), selling brokers, dealer managers
and similar securities industry professionals participating in the
distribution, their officers, directors, agents and employees and each Person
who controls such Person within the meaning of Section 15 of the Securities Act
or Section 20 of the Exchange Act, to the same extent as provided above with
respect to the indemnification of the Holders of Registrable Notes.
(b) Indemnification by Holder of Registrable Notes. Each Holder of
Registrable Notes, by its acceptance of the Notes and the benefits of this
Agreement, agrees severally to indemnify and hold harmless the Company, its
officers, directors, agents, counsel and employees and each Person who controls
the Company within the meaning of Section 15 of the Securities Act or Section
20 of the Exchange Act from and against all Losses arising out of, resulting
from or based upon any untrue or alleged untrue statement of a material fact
contained in any Registration Statement or Prospectus or in any amendment or
supplement thereto or in any preliminary prospectus, or arising out of,
resulting from or based upon any omission or alleged omission of a material
fact required to be stated therein or necessary to make the statements therein
not misleading, to the extent, but only to the extent, that such untrue or
alleged untrue statement is contained in, or such omission or alleged omission
is required to be contained in, any information relating to such Holder
furnished in writing by such Holder to the Company expressly for use in such
Registration Statement or Prospectus, or in any amendment or supplement thereto
or in any preliminary prospectus and that such information was used by the
Company in preparation of such Registration Statement or Prospectus or such
amendment or supplement thereto or such preliminary prospectus. In no event
shall the liability of any selling Holder of Registrable Notes hereunder be
greater in amount than the dollar amount of the proceeds (net of payment of all
expenses) received by such Holder upon the sale of the Registrable Notes giving
rise to such indemnification obligation. The Company shall be entitled to
receive indemnities from underwriters, selling brokers, dealer managers and
similar securities industry professionals participating in the distribution, to
the same extent as provided above with respect to information furnished in
writing by such Persons specifically for inclusion in any Prospectus or
Registration Statement or any amendment or supplement thereto or any
preliminary prospectus.
-18-
21
(c) Conduct of Indemnification Proceedings. If any action or
proceeding (including any governmental investigation or inquiry) (a
"Proceeding") shall be brought or asserted against any Person who is entitled
to indemnity hereunder ("indemnified party"), such indemnified party shall give
prompt notice to the party or parties from which such indemnity is sought (each
an "indemnifying party") of the commencement of such Proceeding if a claim in
respect thereof is to be made hereunder; provided, however, that the failure so
to notify an indemnifying party shall not relieve such indemnifying party from
any obligation or liability except to the extent that such indemnifying party
has been materially prejudiced by such failure. The indemnifying party or
parties shall have the right, exercisable by giving written notice to an
indemnified party promptly after the receipt of written notice from such
indemnified party of such Proceeding, to assume, at such indemnifying party's
or parties' expense, the defense of any such Proceeding, with counsel
reasonably satisfactory to such indemnified party; provided, however, that an
indemnified party or parties (if more than one such indemnified party is named
in any Proceeding) shall have the right to employ separate counsel in any such
Proceeding and to participate in the defense thereof, but the fees and expenses
of such counsel shall be at the expense of such indemnified party or parties
unless: (1) the indemnifying party or parties agree to pay such fees and
expenses; or (2) the indemnifying party or parties fail promptly to assume the
defense of such Proceeding or fail to employ counsel reasonably satisfactory to
such indemnified party or parties; or (3) the indemnified party or parties
shall have been advised in writing by counsel, in its reasonable judgment, that
there is reasonably likely to be a conflict between the positions of the
indemnifying party or parties and such indemnified party or parties in
conducting the defense of such Proceeding or that there are reasonably likely
to be one or more legal defenses available to such indemnified party or parties
that are different from or additional to those available to the indemnifying
party or parties (in which case, if such indemnified party or parties notify
the indemnifying party or parties in writing that it or they elect to employ
separate counsel at the expense of the indemnifying party or parties, the
indemnifying party or parties shall not have the right to assume the defense
thereof and such counsel shall be at the expense of the indemnifying party or
parties, it being understood, however, that, unless there exists a conflict
among indemnified parties, the indemnifying party or parties shall not, in
connection with any one such Proceeding or separate but substantially similar
or related Proceedings in the same jurisdiction, arising out of the same
general allegations or circumstances, be liable for the fees and expense of
more than one separate firm of attorneys (together with appropriate local
counsel) at any time for such indemnified party or parties and any other
indemnified party or parties, which firm shall be designated in writing by such
indemnified parties). No indemnifying party shall be liable for any settlement
of any Proceeding made without its written consent (but such consent shall not
be unreasonably withheld); provided that, if such Proceeding is settled with
its written consent or if there shall be a final judgment for the claimant or
plaintiff in such Proceeding, such indemnifying party shall indemnify and hold
harmless the indemnified party or parties from and against any Losses by reason
of such settlement or judgment for which the indemnified party or parties would
be
-19-
22
entitled to indemnification hereunder. No indemnifying party shall, without the
consent of an indemnified party, consent to entry of any judgment or enter into
any settlement that does not include as an unconditional term thereof the
giving by the claimant or plaintiff to such indemnified party of a release, in
form and substance satisfactory to such indemnified party, from all liability
in respect of such Proceeding for which such indemnified party would be
entitled to indemnification hereunder.
(d) Contribution. If the indemnification provided for in the
foregoing provisions of this Section 8 is unavailable to an indemnified party
(for any reason other than by reason of the exceptions set forth in those
provisions) or is insufficient to hold such indemnified party harmless for any
Losses in respect of which the foregoing provisions of this Section 8 would
otherwise apply by their terms, then each applicable indemnifying party, in
lieu of indemnifying such indemnified party, shall have a joint and several
obligation to contribute to the amount paid or payable by such indemnified
party as a result of such Losses, in such proportion as is appropriate to
reflect the relative fault of such indemnifying party, on the one hand, and
such indemnified party, on the other hand, in connection with the statements or
omissions that resulted in such Losses as well as any other relevant equitable
considerations. The relative fault of such indemnifying party, on the one
hand, and such indemnified party, on the other hand, shall be determined by
reference to, among other things, whether any untrue or alleged untrue
statement of a material fact or omission or alleged omission to state a
material fact has been taken, or relates to information supplied by or on
behalf of such indemnifying party, on the one hand, or by or on behalf of such
indemnified party, on the other hand, and such parties' relative intent,
knowledge, access to information and opportunity to correct or prevent any such
statement or omission. The amount paid or payable by a party as a result of any
Losses shall be deemed to include any legal or other fees and expenses incurred
by such party in connection with any Proceeding, to the extent such party would
have been indemnified for such fees and expense if the indemnification provided
for in Section 8(a) or 8(b) was available to such party.
The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 8(d) 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. Notwithstanding the provisions of this Section 8(d), no Indemnified
Holder shall be required to contribute any amount which, when added to the
amounts contributed by any related Indemnified Holders, is in excess of the
amount by which the total price at which the Registrable Notes sold by such
Indemnified Holder (or related selling Holder of Registrable Notes) and
distributed to the public were offered to the public exceeds the amount of any
damages that such Indemnified Holder and related Indemnified Holders have
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission and for which they have not been
reimbursed by the Company. 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.
-20-
23
SECTION 9. Rules 144 and 144A. The Company covenants that it shall
file the reports required to be filed by it under the Securities Act and the
Exchange Act (or, if the Company is not required to file such reports, the
Company shall (i) upon the request of any Holder of Registrable Notes made
after 21 months from the Closing Date (or at such earlier date as is necessary
to enable Holders to sell Registrable Notes under Rule 144) make publicly
available such information as is necessary to enable Holders to sell
Registrable Notes pursuant to Rule 144 and (ii) deliver such information to a
prospective purchaser as is necessary to enable Holders to sell Registrable
Notes pursuant to Rule 144A), and the Company shall take such further action as
any Holder of Registrable Notes may reasonably request, all to the extent
required from time to time to enable such Holder to sell Registrable Notes
without registration under the Securities Act within the limitations of the
exemptions provided by Rule 144 and Rule 144A. Upon the request of any Holder
or Registrable Notes or the Trustee, the Company shall deliver to such Holder
or the Trustee, as the case may be, a written statement as to whether it has
complied with such requirements. Notwithstanding the foregoing, nothing in this
Section 9 shall be deemed to require the Company to register any of its
securities under any section of the Exchange Act.
SECTION 10. Underwritten Registrations. No Person may participate in
any underwritten registration hereunder unless such Person (a) agrees to sell
such Person's securities on the basis provided in any underwriting arrangements
approved by the Persons entitled hereunder to approve such arrangements and (b)
completes and executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents reasonably required under the terms
of such underwriting arrangements. Nothing in this Section 10 shall be
construed to create any additional rights regarding the registration of
Registrable Notes in any Person otherwise than as set forth herein.
SECTION 11. Miscellaneous.
(a) Remedies. In the event of a breach by the Company of any of
its obligations under this Agreement, each Holder of Registrable Notes, in
addition to being entitled to exercise all rights granted by law, including
recovery of damages, shall be entitled to specific performance of its rights
under this Agreement. The Company agrees that monetary damages would not be
adequate compensation for any loss incurred by reason of a breach by them of
any of the provisions of this Agreement and hereby further agree that, in the
event of any action for specific performance in respect of such breach, they
shall waive the defense that a remedy at law would be adequate.
(b) No Inconsistent Agreements. The Company has not, as of the
date hereof, nor shall it, on or after the date hereof, enter into, any
agreement with respect to its securities that is inconsistent with the rights
granted to the Holders of Registrable Notes herein or otherwise conflicts with
the provisions hereof.
-21-
24
(c) Adjustments Affecting Registrable Notes. The Company shall
not, directly or indirectly, take any action with respect to the Registrable
Notes as a class (i) which would adversely affect the ability of the Holders of
Registrable Notes in a registration undertaken pursuant to this Agreement or
(ii) that would adversely affect the marketability of such Registrable Notes in
any such registration.
(d) Amendments and Waivers. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, qualified 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
Holders of at least a majority of the then outstanding aggregate principal
amount of Notes, provided that, with respect to any matter that directly or
indirectly affects the rights of any Restricted Person hereunder, the Company
shall obtain the written consent of each such Restricted Person against which
such amendment, qualification, supplement, waiver or consent is to be
effective. Notwithstanding the foregoing (except for the foregoing proviso), a
waiver or consent to departure from the provisions hereof with respect to a
matter that relates exclusively to the rights of Holders of Registrable Notes
whose Notes are being sold pursuant to a Registration Statement and that does
not directly or indirectly affect the rights of other Holders of Registrable
Notes may be given by Holders of at least a majority in aggregate principal
amount of the Registrable Notes being sold by such Holders pursuant to such
Registration Statement; provided, however, that the provisions of this sentence
may not be amended, modified or supplemented except in accordance with the
provisions of the immediately preceding sentence.
(e) Notices. All notices and other communications (including,
without limitation, any notices or other communications to the Trustee)
provided for or permitted hereunder shall be made in writing and delivered by
hand delivery, registered first-class mail, next-day air courier or telecopier:
(i) if to a Holder of Registrable Notes, at the most
current address given by such Holder to the Company in accordance with
the provisions of this Section 11(e), which address initially is, with
respect to each Purchaser, the address set forth on its respective
signature page attached hereto, with a copy to Ropes & ▇▇▇▇, ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇.
▇▇▇▇, Esq.; and
(ii) if to the Company, initially to TransTexas Gas
Corporation, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇, Attention: ▇▇ ▇▇▇▇▇▇▇, Vice President and Chief Financial
Officer, with a copy to Gardere & ▇▇▇▇▇, L.L.P., 3000 Thanksgiving
Tower, ▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attention: C.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇, Esq.
All such notices and communications shall be deemed to have been duly
given: when delivered by hand, if personally delivered; five business days
after being deposited in the mail, postage prepaid, if mailed; one business day
after being timely delivered for a next-day delivery; and when receipt is
acknowledged by the addressee, if telecopied.
-22-
25
Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the Trustee at the
address specified in the Indenture.
(f) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each of the
parties, including without limitation and without the need for an express
assignment or any consent by the Company thereto, subsequent Holders of
Registrable Notes. The Company hereby agrees to extend the benefits of this
Agreement to any Holder of Notes and any such Holder may specifically enforce
the provisions of this Agreement as if an original party hereto.
(g) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(h) Headings. The headings in this Agreement are for convenience
of reference only and shall not limit or otherwise affect the meaning hereof.
(i) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO
CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAW. THE COMPANY HEREBY IRREVOCABLY SUBMITS TO THE
JURISDICTION OF THE SUPREME COURT OF NEW YORK, NEW YORK COUNTY OR THE UNITED
STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK IN RESPECT OF ANY
SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, AND
IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND
UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS. THE COMPANY
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO UNDER
APPLICABLE LAW, TRIAL BY JURY AND ANY OBJECTION THAT IT MAY NOW OR HEREAFTER
HAVE TO THE LAYING OF THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT
IN ANY SUCH COURT AND ANY CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING
BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. NOTHING
HEREIN SHALL AFFECT THE RIGHT OF ANY PURCHASER TO SERVE PROCESS IN ANY MANNER
PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST
THE COMPANY IN ANY OTHER JURISDICTION.
(j) Severability. In the event that 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
or affected thereby, it being intended that all of the rights and privileges of
the parties shall be enforceable to the fullest extent permitted by law.
-23-
26
(k) Entire Agreement. This Agreement, together with the Note
Purchase Agreement and Indenture, is intended by the parties as a final
expression of their agreement, and is intended to be a complete and exclusive
statement of the agreement and understanding of the parties thereto in respect
of the subject matter contained herein and therein. There are no restrictions,
promises, warranties or undertakings, other than these set forth or referred to
herein and therein. This Agreement, together with the Note Purchase Agreement
and the Indenture, supersedes all prior agreements and understandings between
the parties thereto with respect to such subject matter.
(l) Notes Held by the Company, etc. Whenever the consent or
approval of Holders of a specified percentage of principal amount of
Registrable Notes is required hereunder, Registrable Notes held by the Company,
its Affiliates (other than the Recipients or subsequent Holders of Registrable
Notes if such subsequent Holders are deemed to be such Affiliates solely by
reason of their holdings of such Registrable Notes) shall not be counted in
determining whether such approval was given by the Holders of such required
percentage.
(m) Attorneys' Fees. In any action or proceeding brought to
enforce any provision of this Agreement, or where any provision hereof is
validly asserted as a defense, the successful party shall be entitled to
recover reasonable attorneys' fees in addition to its costs and expenses and
any other available remedy.
-24-
27
IN WITNESS WHEREOF, the undersigned has executed this Agreement as of
the date first written above.
TRANSTEXAS GAS CORPORATION
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President and Chief
Financial Officer
-25-