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EXHIBIT 4.3
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REGISTRATION RIGHTS AGREEMENT
Dated as of February 8, 2000
GLOBIX CORPORATION
and
▇▇▇▇▇▇ BROTHERS INC.
CHASE SECURITIES INC.
CREDIT SUISSE FIRST BOSTON CORPORATION
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇ INCORPORATED
▇▇▇▇▇▇▇ ▇▇▇▇▇ BARNEY INC.
ING BARINGS LLC
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TABLE OF CONTENTS
Page
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1. Definitions...............................................................1
2. Securities Subject to This Agreement......................................3
3. Registered Exchange Offer.................................................3
4. Shelf Registration........................................................5
5. Liquidated Damages........................................................7
6. Registration Procedures...................................................8
7. Participation of Broker-Dealers in Exchange Offer........................18
8. Registration Expenses....................................................19
9. Indemnification and Contribution.........................................20
10. Rule 144A................................................................24
11. Participation in Underwritten Registrations..............................24
12. Selection of Underwriters................................................24
13. Miscellaneous............................................................25
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This Registration Rights Agreement (this "Agreement") is made
and entered into as of February 8, 2000 between Globix Corporation, a Delaware
corporation (the "Company"), and ▇▇▇▇▇▇ Brothers Inc., Chase Securities Inc.,
Credit Suisse First Boston Corporation, ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated, ▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc. and ING Barings LLC, (each, an Initial
Purchaser, and collectively, the "Initial Purchasers").
This Agreement is entered into in connection with the Purchase
Agreement, dated January 28, 2000, among the Company and the Initial Purchasers
(the "Purchase Agreement"), which provides for the sale by the Company to the
Initial Purchasers of $600,000,000 aggregate principal amount of the Company's
12.50% Senior Notes due 2010 (the "Notes"). Capitalized terms used but not
specifically defined herein have the respective meanings ascribed thereto in the
Purchase Agreement. As an inducement to the Initial Purchasers to enter into the
Purchase Agreement and in satisfaction of a condition to the Initial Purchasers'
obligations thereunder, the Company agrees with the Initial Purchasers, and its
direct and indirect transferees, for the benefit of the holders of the Notes
(including the Initial Purchasers) (collectively, the "Holders"), as follows:
1. Definitions. As used in this Agreement, the following
capitalized terms shall have the following meanings:
Broker-Dealer: Any broker or dealer registered under the
Exchange Act.
Closing Date: The date on which the Notes were sold to the
Initial Purchasers.
Commission: The Securities and Exchange Commission.
Damages Payment Date: With respect to the Notes, each Interest
Payment Date until the earlier of (i) the date on which Liquidated
Damages no longer are payable or (ii) maturity of the Notes.
Effectiveness Target Date: As defined in Section 5(a) hereof.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Exchange Notes: The Notes to be issued pursuant to the
Indenture in the Exchange Offer.
Exchange Offer: The registration by the Company under the
Securities Act of the Exchange Notes pursuant to a Registration
Statement pursuant to which the Company offers the Holders of all
outstanding Transfer Restricted Securities the opportunity to exchange
all such outstanding Transfer Restricted
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Securities held by such Holders for Exchange Notes in an aggregate
principal amount equal to the aggregate principal amount of the
Transfer Restricted Securities tendered in such exchange offer by such
Holders.
Exchange Offer Registration Statement: The Registration
Statement relating to the Exchange Offer, including the Prospectus
which forms a part thereof.
Exempt Resale: The transactions in which the Initial
Purchasers propose to sell the Notes to certain "qualified
institutional buyers," as such term is defined in Rule 144A under the
Securities Act, and to certain non-U.S. persons in offshore
transactions meeting the requirements of Rule 903 of Regulation S under
the Securities Act.
Holders: As defined in the second paragraph of this Agreement.
Indenture: The Indenture, dated as of the date hereof, between
the Company and HSBC Bank USA, as trustee (the "Trustee"), pursuant to
which the Notes are to be issued, as such Indenture is amended or
supplemented from time to time in accordance with the terms thereof.
Interest Payment Date: As defined in the Indenture.
Liquidated Damages: As defined in Section 5(a) hereof.
NASD: National Association of Securities Dealers, Inc.
Person: Any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated
organization, limited liability company, government or any agency or
political subdivision thereof or any other entity.
Prospectus: The prospectus included in a Registration
Statement, including any preliminary prospectus, and any such
prospectus as amended or supplemented by any prospectus supplement and
by all other amendments and supplements thereto, including
post-effective amendments, and all exhibits thereto and all material
incorporated by reference into such Prospectus.
Registration Default: As defined in Section 5(a) hereof.
Registration Statement: Any registration statement of the
Company relating to (a) an offering of Exchange Notes pursuant to an
Exchange Offer or (b) the registration for resale of Transfer
Restricted Securities pursuant to the Shelf Registration Statement,
which is filed pursuant to the provisions of this Agreement, in either
case, including the Prospectus included therein, all amendments and
supplements thereto (including post-effective amendments)
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and all exhibits and material incorporated by reference therein.
Related Transaction Documents: The Purchase Agreement and the
Indenture, together with all exhibits and schedules thereto.
Securities Act: The Securities Act of 1933, as amended.
Shelf Filing Deadline: As defined in Section 4(a)(x) hereof.
Shelf Registration Statement: As defined in Section 4 (a)(x)
hereof.
TIA: The Trust Indenture Act of 1939, as amended.
Transfer Restricted Securities: Each Note, until the earliest
to occur of (a) the date on which such Note has been exchanged by a
person other than a Broker-Dealer for Exchange Notes in the Exchange
Offer, (b) following the exchange by a Broker-Dealer in the Exchange
Offer of such Note for one or more Exchange Notes, the date on which
such Exchange Notes are sold to a purchaser who receives from such
Broker-Dealer on or prior to the date of such sale a copy of the
prospectus contained in the Exchange Offer Registration Statement, (c)
the date on which such Note has been effectively registered under the
Securities Act and disposed of in accordance with the Shelf
Registration Statement or (d) the date on which such Note is eligible
to be distributed to the public pursuant to Rule 144 (k) (or any
similar provision then in force) under the Securities Act.
Underwritten Registration or Underwritten Offering: A
registration in which securities of the Company are sold to an
underwriter for reoffering to the public.
2. Securities Subject to This Agreement.
(a) Transfer Restricted Securities. The securities entitled to
the benefits of this Agreement are the Transfer Restricted Securities.
(b) Holders of Transfer Restricted Securities. A Person is
deemed to be a holder of Transfer Restricted Securities whenever such Person
owns Transfer Restricted Securities.
3. Registered Exchange Offer.
(a) Exchange Offer Registration Statement. Unless the Exchange
Offer shall not be permissible under applicable law or Commission policy (after
the procedures set forth in Section 6(a) below have been complied with), the
Company shall (i) cause to be filed with the Commission as promptly as
practicable, but in no event later than 60 days after the Closing Date, a
Registration Statement under the Securities Act relating to the Exchange Notes
and the Exchange Offer, (ii) use its reasonable best efforts to cause such
Registration Statement to become effective
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within 150 days after the Closing Date, (iii) in connection with the foregoing,
(A) file all pre-effective amendments to such Registration Statement as may be
necessary in order to cause such Registration Statement to become effective, (B)
if applicable, file a post-effective amendment to such Registration Statement
pursuant to Rule 430A under the Securities Act and (C) cause all necessary
filings in connection with the registration and qualification of the Exchange
Notes to be made under the "blue sky" laws of such jurisdictions as are
necessary to permit consummation of the Exchange Offer, (iv) use its reasonable
best efforts to cause the Exchange Offer to be consummated on the earliest
practicable date after the Exchange Offer Registration Statement has become
effective, but in no event later than 180 days after the Closing Date and (v)
deliver the Exchange Notes in the same aggregate principal amount as the
aggregate principal amount of Transfer Restricted Securities that were validly
tendered by Holders thereof pursuant to the Exchange Offer. The Exchange Offer
shall be on the appropriate form permitting registration of the Exchange Notes
to be offered in exchange for the Transfer Restricted Securities and to permit
resales of Exchange Notes held by Broker-Dealers as contemplated by Section 3(c)
below. The time periods referred to in clauses (ii) and (iv) of this Section
3(a) shall not include any period during which the Company is pursuing a
Commission ruling pursuant to Section 6(a)(i) below.
(b) Consummation of the Exchange Offer. The Company shall use
its reasonable best efforts to cause the Exchange Offer Registration Statement
to be effective continuously and shall keep the Exchange Offer open for a period
of not less than the minimum period required under applicable federal and state
securities laws to consummate the Exchange Offer; provided, however, that in no
event shall such period be less than 20 business days. The Company shall cause
the Exchange Offer to comply in all material respects with all applicable
federal and state securities laws. No securities other than the Exchange Notes
shall be included in the Exchange Offer Registration Statement. The Exchange
Offer shall not be subject to any conditions, other than that the Exchange Offer
does not violate applicable law or any applicable interpretation of the
Commission. The Company shall inform the Initial Purchasers of the names and
addresses of the Holders to whom the Exchange Offer is made, and the Initial
Purchasers shall have the right, subject to applicable law and at its own
expense, to contact such Holders and otherwise facilitate the tender of Transfer
Restricted Securities in the Exchange Offer.
(c) "Plan of Distribution" Section of the Prospectus. The
Company shall indicate in a "Plan of Distribution" section contained in the
Prospectus contained in the Exchange Offer Registration Statement that any
Broker-Dealer who holds Notes that are Transfer Restricted Securities and that
were acquired for its own account as a result of market-making activities or
other trading activities (other than Transfer Restricted Securities acquired
directly from the Company), may exchange such Notes pursuant to the Exchange
Offer; provided, however, such Broker-Dealer may be deemed to be an
"underwriter" within the meaning of the Securities Act and must, therefore,
deliver a prospectus meeting the requirements of the Securities Act in
connection with any resales of the Exchange Notes received by such Broker-
Dealer in
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the Exchange Offer, which prospectus delivery requirement may be satisfied by
the delivery by such Broker-Dealer of the Prospectus contained in the Exchange
Offer Registration Statement. Such "Plan of Distribution" section shall also
contain all other information with respect to such resales by Broker-Dealers
that the Commission may require in order to permit such resales pursuant
thereto, but such "Plan of Distribution" shall not name any such Broker- Dealer
or disclose the amount of Exchange Notes held by any such Broker-Dealer except
to the extent required by the Commission.
The Company shall use its reasonable best efforts to keep the
Exchange Offer Registration Statement continuously effective, supplemented and
amended as required by the provisions of Section 6(c) below to the extent
necessary (i) to ensure that it is available for resales of Exchange Notes
acquired by Broker-Dealers for their own accounts as a result of market-making
activities or other trading activities, and (ii) to ensure that it conforms with
the requirements of this Agreement, the Securities Act and the policies, rules
and regulations of the Commission as announced from time to time, in each case,
for a period ending on the earlier of (a) 180 days from the date on which the
Exchange Offer Registration Statement is declared effective or (b) such shorter
period as will terminate when all Transfer Restricted Securities covered by such
Registration Statement have been sold pursuant thereto.
The Company shall provide sufficient copies of the latest
version of such Prospectus to Broker-Dealers promptly upon their reasonable
request at any time during the period referred to in the previous paragraph in
order to facilitate such resales.
4. Shelf Registration.
(a) Shelf Registration. If (i) the Company is not permitted to
file the Exchange Offer Registration Statement or to consummate the Exchange
Offer because the Exchange Offer is not permitted by applicable law or
Commission policy (after the procedures set forth in Section 6(a) below have
been compiled with), (ii) any Holder of Transfer Restricted Securities that is a
"qualified institutional buyer" (as defined in Rule 144A under the Securities
Act) shall notify the Company at least 30 business days prior to the
consummation of the Exchange Offer (A) that such Holder is prohibited by
applicable law or Commission policy from participating in the Exchange Offer, or
(B) that such Holder may not resell the Exchange Notes acquired by it in the
Exchange Offer to the public without delivering a prospectus and that the
Prospectus contained in the Exchange Offer Registration Statement is not
appropriate or available for such resales by such Holder, or (C) that such
Holder is a Broker-Dealer and holds Notes acquired directly from the Company or
one of its affiliates, (iii) the Exchange Offer is not for any other reason
consummated by August 8, 2000 or (iv) the Exchange Offer has been completed and
in the written opinion of counsel for the Initial Purchasers a Registration
Statement must be filed and a Prospectus must be delivered by the Initial
Purchasers in connection with any offering or sale of Transfer Restricted
Securities, then the Company shall in lieu of, or in the event of (ii), (iii)
and (iv) above, in addition to, effecting the registration of the Exchange Notes
pursuant to the Exchange Offer
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Registration Statement, use its reasonable best efforts to:
(x) cause to be filed a shelf registration statement pursuant
to Rule 415 under the Securities Act which may be an amendment to the
Exchange Offer Registration Statement (in either event, the "Shelf
Registration Statement"), within 60 days of the earliest to occur of
(1) the date on which the Company determines that it is not required to
file the Exchange Offer Registration Statement, (2) the date on which
the Company receives notice from a Holder of Transfer Restricted
Securities as contemplated by clause (ii) above, (3) August 8, 2000 or
(4) the receipt by the Company of the opinion of counsel contemplated
by clause (iv) above (the 60th day following the earliest to occur of
(1) through (4) being hereinafter referred to as the "Shelf Filing
Deadline"), which Shelf Registration Statement shall provide for
resales of all Transfer Restricted Securities for which the Holders of
such Transfer Restricted Securities shall have provided the information
required pursuant to Section 4(b) hereof; and
(y) cause such Shelf Registration Statement to be declared
effective by the Commission on or before the 120th day after the Shelf
Filing Deadline.
The Company shall use its reasonable best efforts to keep such Shelf
Registration Statement continuously effective, supplemented and amended as
required by the provisions of Sections 6(b) and (c) hereof to the extent
necessary (i) to ensure that it is available for resales of Notes by the Holders
of Transfer Restricted Securities entitled to the benefit of this Section 4(a),
and (ii) to ensure that such Shelf Registration Statement conforms and continues
to conform with the requirements of this Agreement, the Securities Act and the
policies, rules and regulations of the Commission, as announced from time to
time, in each case, for a period ending on the earlier of (a) the second
anniversary of the Closing Date and (b) the date on which all Transfer
Restricted Securities covered by such Shelf Registration Statement shall have
been sold pursuant thereto.
(b) Provision by Holders of Certain Information in Connection
with the Shelf Registration Statement. No Holder of Transfer Restricted
Securities may include any of its Transfer Restricted Securities in any Shelf
Registration Statement pursuant to this Agreement unless and until such Holder
furnishes to the Company in writing, within 10 business days after receipt of a
request therefor, such information as the Company may reasonably request for use
in connection with any Shelf Registration Statement or Prospectus or preliminary
prospectus included therein. No Holder of Transfer Restricted Securities shall
be entitled to Liquidated Damages pursuant to Section 5 hereof unless and until
such Holder shall have provided all such reasonably requested information within
the time period prescribed in this Section 4(b). For as long as the Company is
required to keep any Shelf Registration Statement effective, each Holder as to
which any such Shelf Registration Statement is being effected agrees to notify
the Company promptly if any of the information previously furnished is
misleading or inaccurate in any material respect and to furnish promptly to the
Company all information required to be disclosed in order to make the
information previously furnished to the Company by such
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Holder not materially misleading or inaccurate.
(c) Declaring Effective the Exchange Offer Registration
Statement. An Exchange Offer Registration Statement pursuant to Section 3(a)
hereof or a Shelf Registration Statement pursuant to Section 4(a) hereof will
not be deemed to have become effective unless it has been declared effective by
the Commission; provided, however, that if, after it has been declared
effective, the offering of Transfer Restricted Securities pursuant to a Shelf
Registration Statement is interfered with by any stop order, injunction or other
order or requirement of the Commission or any other governmental agency or
court, such Registration Statement will be deemed not to have become effective
during the period of such interference until the offering of Transfer Restricted
Securities pursuant to such Registration Statement may legally resume.
(d) Failure of the Company to Comply with its Obligations.
Without limiting the remedies available to the Initial Purchasers and the
Holders, the Company acknowledges that any failure by the Company to comply with
its obligations under Section 3(a) and Section 4(a) hereof may result in
material irreparable injury to the Initial Purchasers or the Holders for which
there is no adequate remedy at law, that it will not be possible to measure
damages for such injuries precisely and that, in the event of any such failure,
the Initial Purchasers or any Holder may obtain such relief as may be required
to specifically enforce the Company's obligations under Section 3(a) and Section
4(a) hereof.
5. Liquidated Damages.
(a) Accrual and Amount of Liquidated Damages. If (i) the
Exchange Offer Registration Statement or Shelf Registration Statement is not
filed with the Commission on or prior to the date specified for such filing in
this Agreement, (ii) any of such Registration Statements has not been declared
effective by the Commission on or prior to the date specified for such
effectiveness as set forth in Section 3(a)(ii) and 4(a)(y) of this Agreement
(the "Effectiveness Target Date"), (iii) the Exchange Offer has not been
consummated within 180 days after the Closing Date with respect to the Exchange
Offer Registration Statement or (iv) any Registration Statement required by this
Agreement is filed and declared effective but shall thereafter cease to be
effective or fail to be usable for its intended purpose without being succeeded
within five business days by a post-effective amendment to such Registration
Statement that cures such failure and that is itself declared effective within
such five business day period (each such event referred to in clauses (i)
through (iv), a "Registration Default"), then additional cash interest
("Liquidated Damages") shall accrue to each Holder of the Notes commencing upon
the occurrence of such Registration Default in an amount equal to .50% per annum
of the principal amount of Notes held by such Holder. The amount of Liquidated
Damages will increase by an additional .50% per annum of the principal amount of
Notes with respect to each subsequent 90-day period (or portion thereof) until
all Registration Defaults have been cured, up to a maximum rate of Liquidated
Damages of 1.50% per annum of the principal amount of Notes. All accrued
Liquidated Damages shall be paid to Holders by the Company in the same manner as
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interest is paid pursuant to the Indenture. Immediately upon the cure of all
Registration Defaults relating to any particular Transfer Restricted Securities,
the accrual of Liquidated Damages with respect to such Transfer Restricted
Securities will cease.
All obligations of the Company set forth in the preceding
paragraph that have accrued and are outstanding with respect to any Transfer
Restricted Security at the time such security ceases to be a Transfer Restricted
Security shall survive until such time as all such obligations with respect to
such Transfer Restricted Security shall have been satisfied in full.
(b) Notification of the Trustee. The Company shall notify the
Trustee within one business day after each and every date on which an event
occurs in respect of which Liquidated Damages are required to be paid (an "Event
Date"). Liquidated Damages shall be paid by depositing Liquidated Damages with
the Trustee, in trust, for the benefit of the Holders of the Notes, on or before
the applicable Interest Payment Date (whether or not any payment other than
Liquidated Damages is payable on such Notes), in immediately available funds in
sums sufficient to pay the Liquidated Damages then due to such Holders. Each
obligation to pay Liquidated Damages shall be deemed to accrue from the
applicable date of the occurrence of the Registration Default.
6. Registration Procedures.
(a) Exchange Offer Registration Statement. In connection with
the Exchange Offer, the Company shall comply with all of the provisions of
Section 6(c) below and shall use its reasonable best efforts to effect such
exchange to permit the sale of Transfer Restricted Securities being sold in
accordance with the intended method or methods of distribution thereof. In
addition, the Company (with respect to (i) and (iii) of this Section 6(a)) and
each Holder of Transfer Restricted Securities (with respect to (ii) of this
Section 6(a)) shall comply with the following provisions:
(i) If in the reasonable opinion of counsel to the Company
there is a question as to whether the Exchange Offer is permitted by
applicable law, the Company hereby agrees to seek a no-action letter or
other favorable decision from the Commission allowing the Company to
consummate an Exchange Offer for such Notes. The Company hereby agrees
to pursue the issuance of such a decision to the Commission staff level
but shall not be required to take commercially unreasonable action to
effect a change of Commission policy. The Company hereby agrees,
however, to (A) participate in telephonic conferences with the staff of
the Commission, (B) deliver to the Commission staff an analysis
prepared by counsel to the Company setting forth the legal bases, if
any, upon which such counsel has concluded that such an Exchange Offer
should be permitted and (C) use reasonable best efforts pursue a
resolution (which need not be favorable) by the Commission staff of
such submission.
(ii) As a condition to its participation in the Exchange Offer
pursuant to
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the terms of this Agreement, each Holder of Transfer Restricted
Securities shall (x) furnish, upon the request of the Company, prior to
the consummation thereof, a written representation to the Company
(which may be contained in the letter of transmittal contemplated by
the Exchange Offer Registration Statement) to the effect that (A) it is
not an "affiliate" of the Company as defined in Rule 405 of the
Securities Act, (B) it is not engaged in, and does not intend to engage
in, and has no arrangement or understanding with any person to
participate in, a distribution of the Exchange Notes to be issued in
the Exchange Offer and (C) it is acquiring the Exchange Notes in its
ordinary course of business and (y) otherwise cooperate in the
Company's preparations for the Exchange Offer. Each Holder hereby
acknowledges and agrees that any Broker-Dealer and any such Holder
using the Exchange Offer to participate in a distribution of the
securities to be acquired in the Exchange Offer (1) could not under
Commission policy as in effect on the date of this Agreement rely on
the position of the Commission enunciated in ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and Co.,
Inc. (available June 5, 1991) and Exxon Capital Holdings Corporation
(available May 13, 1988), as interpreted in the Commission's letter to
Shearman & Sterling dated July 2, 1993, and similar no-action letters
(including ▇▇▇▇▇ & ▇▇▇▇ LLP (available February 7, 1997), and any
no-action letter obtained pursuant to clause (i) above), and (2) must
comply with the registration and prospectus delivery requirements of
the Securities Act in connection with a secondary resale transaction
and that such a secondary resale transaction should be covered by an
effective registration statement containing the selling security holder
information required by Item 507 or 508, as applicable, of Regulation
S-K if the resales are of Exchange Notes obtained by such Holder in
exchange for Notes acquired by such Holder directly from the Company.
(iii) Prior to the effectiveness of the Exchange Offer
Registration Statement, to the extent required by the Commission, the
Company shall provide a supplemental letter to the Commission (A)
stating that the Company is registering the Exchange Offer in reliance
on the position of the Commission enunciated in Exxon Capital Holdings
Corporation (available May 13, 1988), ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and Co., Inc.
(available June 5, 1991), ▇▇▇▇▇ & Wood LLP (available February 7, 1997)
and, if applicable, any no-action letter obtained pursuant to clause
(i) above and (B) including a representation that the Company has not
entered into any arrangement or understanding with any Person to
distribute the Exchange Notes to be received in the Exchange Offer and
that to the best of the Company's information and belief, each Holder
(other than an Initial Purchaser) participating in the Exchange Offer
is acquiring the Exchange Notes in its ordinary course of business and
has no arrangement or understanding with any Person to participate in
the distribution of the Exchange Notes received in the Exchange Offer.
(b) Shelf Registration Statement. In connection with the Shelf
Registration Statement, the Company shall comply with all the provisions of
Section
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6(c) below and shall use its reasonable best efforts to effect such registration
to permit the sale of the Transfer Restricted Securities being sold in
accordance with the intended method or methods of distribution thereof, and
pursuant thereto the Company shall as expeditiously as possible prepare and file
with the Commission a Registration Statement relating to the registration on any
appropriate form under the Securities Act, which form shall be available for the
sale of the Transfer Restricted Securities in accordance with the intended
method or methods of distribution thereof.
(c) General Provisions. In connection with any Registration
Statement and any Prospectus required by this Agreement to permit the sale or
resale of Transfer Restricted Securities (including, without limitation, any
Registration Statement and the related Prospectus required to permit resales of
Notes by Broker-Dealers), the Company shall:
(i) use its reasonable best efforts to (x) keep such
Registration Statement continuously effective and (y) provide all
requisite financial statements for the period specified in Section 3 or
4(a) of this Agreement, as applicable; upon the occurrence of any event
that would cause any such Registration Statement or the Prospectus
contained therein (A) to contain a material misstatement or omission or
(B) not to be effective and usable for resale of Transfer Restricted
Securities during the period required by this Agreement, the Company
shall file promptly an appropriate amendment to such Registration
Statement, in the case of clause (A), correcting any such misstatement
or omission, and, in the case of either clause (A) or (B), use its
reasonable best efforts to cause such amendment to be declared
effective and such Registration Statement and the related Prospectus to
become usable for their intended purpose(s) as soon as practicable
thereafter;
(ii) prepare and file with the Commission such amendments and
post-effective amendments to the Registration Statement as may be
necessary to keep the Registration Statement effective for the
applicable period set forth in Section 3 or 4(a) hereof, as applicable,
or such shorter period as will terminate when all Transfer Restricted
Securities covered by such Registration Statement have been sold; cause
the 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 to comply fully with the applicable provisions of
Rules 424 and 430A under the Securities Act in a timely manner; and
comply with the provisions of the Securities Act with respect to the
disposition of all securities covered by such Registration Statement
during the applicable period in accordance with the intended method or
methods of distribution by the sellers thereof set forth in such
Registration Statement or supplement to the Prospectus;
(iii) in the case of a Shelf Registration Statement and for so
long as the Company is required to keep such Shelf Registration
Statement effective, advise the underwriter(s), if any, and selling
Holders promptly and, if requested by any
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underwriter(s) or selling Holders to confirm such advice in writing,
(A) when the Prospectus or any Prospectus supplement or post-effective
amendment has been filed, and, with respect to any Registration
Statement or any post-effective amendment thereto, when the same has
become effective, (B) of any request by the Commission or any state
securities authority for amendments to the Registration Statement or
amendments or supplements to the Prospectus or for additional
information relating thereto, (C) of the issuance by the Commission of
any stop order suspending the effectiveness of the Registration
Statement under the Securities Act or of the suspension by any state
securities commission of the qualification of the Transfer Restricted
Securities for offering or sale in any jurisdiction, or the initiation
of any proceeding for any of the preceding purposes, (D) if, between
the effective date of a Registration Statement and the closing of any
sale of Transfer Restricted Securities covered thereby, the
representations and warranties of the Company contained in any
underwriting agreement, securities sales agreement or other similar
agreement, if any, relating to the offering cease to be true and
correct in all material respects, (E) of the existence of any fact or
the happening of any event that makes any statement of a material fact
made in the Registration Statement, the Prospectus, any amendment or
supplement thereto, or any document incorporated by reference therein
untrue, or that requires the making of any additions to or changes in
the Registration Statement or the Prospectus in order to make the
statements therein not misleading and (F) of any determination by the
Company that a post-effective amendment to a Registration Statement
would be appropriate. If at any time the Commission shall issue any
stop order suspending the effectiveness of the Registration Statement,
or any state securities commission or other regulatory authority shall
issue an order suspending the qualification or exemption from
qualification of the Transfer Restricted Securities under state
securities or Blue Sky laws, the Company shall use its reasonable best
efforts to obtain the withdrawal or lifting of such order at the
earliest possible time and shall provide prompt notice to each of the
selling or exchanging Holders of the withdrawal of any such order;
(iv) in the case of a Shelf Registration Statement, furnish to
each of the selling or exchanging Holders and each of the
underwriter(s), if any, before filing with the Commission, copies of
any Registration Statement or any Prospectus included therein or any
amendments or supplements to any such Registration Statement or
Prospectus (including all documents incorporated by reference after the
initial filing of such Registration Statement), which documents will be
subject to the review of such Holders and underwriter(s), if any, for a
period of five business days, and the Company will not file any such
Registration Statement or Prospectus or any amendment or supplement to
any such Registration Statement or Prospectus (including all such
documents incorporated by reference) to which selling Holders of a
majority in aggregate principal amount of Transfer Restricted
Securities covered by such Registration Statement or the
underwriter(s), if any, shall reasonably object within five business
days after the
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receipt thereof. A selling Holder or underwriter, if any, shall be
deemed to have reasonably objected to such filing if such Registration
Statement, amendment, Prospectus or supplement, as applicable, as
proposed to be filed, contains a material misstatement or omission;
(v) in the case of a Shelf Registration Statement, promptly
prior to the filing of any document that is to be incorporated by
reference into a Registration Statement or Prospectus, provide copies
of such document to the selling Holders and to the underwriter(s), if
any, make the Company's representatives available for discussion of
such document and other customary due diligence matters, and include
such information in such document prior to the filing thereof as such
selling Holders or underwriter(s), if any, reasonably may request,
provided that such Holders agree to use any information received
pursuant to this clause in accordance with all applicable federal
securities laws;
(vi) in the case of a Shelf Registration Statement, subject to
execution of a confidentiality agreement reasonably acceptable to the
Company, make available at reasonable times for inspection by a
representative of the selling Holders, any underwriter participating in
any disposition pursuant to such Registration Statement, and any
attorney or accountant retained by such selling Holders or any of the
underwriter(s), all financial and other records, pertinent corporate
documents and properties of the Company and cause the Company's
officers, directors, managers and employees to supply all information
reasonably requested by any such Holder, underwriter, attorney or
accountant in connection with such Registration Statement subsequent to
the filing thereof and prior to its effectiveness;
(vii) in the case of a Shelf Registration Statement, if
requested by any selling Holders or the underwriter(s), if any,
promptly incorporate in any Registration Statement or Prospectus,
pursuant to a supplement or post-effective amendment if necessary, such
information as such selling Holders and underwriter(s), if any, may
reasonably request to have included therein, including, without
limitation, information relating to the "Plan of Distribution" of the
Transfer Restricted Securities, information with respect to the
principal amount of Transfer Restricted Securities being sold to such
underwriter(s), the purchase price being paid therefor and any other
terms of the offering of the Transfer Restricted Securities to be sold
in such offering; and make all required filings of such Prospectus
supplement or post-effective amendment as soon as practicable after the
Company is notified of the matters to be incorporated in such
Prospectus supplement or post-effective amendment;
(viii) in the case of a Shelf Registration Statement, upon
request, furnish to each selling Holder and each of the underwriter(s),
if any, without charge, at least one conformed copy of the Registration
Statement, as first filed with the Commission, and of each amendment
thereto, including all documents incorporated by reference therein and
all exhibits (including exhibits incorporated
15
therein by reference);
(ix) in the case of a Shelf Registration Statement, deliver to
each selling Holder and each of the underwriter(s), if any, without
charge, as many conformed copies of the Prospectus (including each
preliminary prospectus) and any amendment or supplement thereto as such
Persons reasonably may request; the Company hereby consents to the use
of the Prospectus and any amendment or supplement thereto by each of
the selling Holders and each of the underwriter(s), if any, in
connection with the offering and the sale of the Transfer Restricted
Securities covered by the Prospectus or any amendment or supplement
thereto;
(x) in the case of a Shelf Registration Statement, enter into
such agreements (including an underwriting agreement in a form
customary for similar transactions), and make such representations and
warranties, and take all such other actions in connection therewith in
order to expedite or facilitate the disposition of the Transfer
Restricted Securities pursuant to any Registration Statement
contemplated by this Agreement, all to such extent as may be reasonably
requested by any Holder of Transfer Restricted Securities or
underwriter in connection with any sale or resale pursuant to any
Registration Statement contemplated by this Agreement; and in
connection with an Underwritten Registration, the Company shall:
(A) upon request, furnish to each selling Holder and
each underwriter, if any, in such substance and scope as they
may request and as are customarily made by issuers to
underwriters in primary underwritten offerings, upon the date
of the effectiveness of the Shelf Registration Statement:
(1) a certificate, dated the date of the
effectiveness of the Shelf Registration Statement,
signed by (y) the Chairman of the Board, its Chief
Executive Officer, its President or a Vice President
and (z) the Chief Financial Officer of the Company,
confirming, as of the date thereof, such customary
matters as such parties may reasonably request;
(2) an opinion, dated the date of the
effectiveness of the Shelf Registration Statement, of
counsel for the Company, covering such customary
matters as such parties may reasonably request, and
in any event including a statement to the effect that
such counsel has participated in conferences with
officers and other representatives of the Company,
representatives of the independent public accountants
for the Company, the Initial Purchasers'
representatives and the Initial Purchasers' counsel
in connection with the preparation of such
Registration Statement and the related Prospectus and
have considered the matters required
16
to be stated therein and the statements contained
therein, although such counsel has not independently
verified the accuracy, completeness or fairness of
such statements; and that such counsel advises that,
on the basis of the foregoing, no facts came to such
counsel's attention that caused such counsel to
believe that the applicable Registration Statement,
at the time such Registration Statement or any
post-effective amendment thereto became effective,
contained an untrue statement of a material fact or
omitted to state a material fact required to be
stated therein or necessary to make the statements
therein not misleading, or that the Prospectus
included in such Registration Statement as of its
date, contained an untrue statement of a material
fact or omitted to state a material fact necessary in
order to make the statements therein, in light of the
circumstances under which they were made, not
misleading. Without limiting the foregoing, such
counsel may state further that such counsel assumes
no responsibility for, and has not independently
verified, the accuracy, completeness or fairness of
the financial statements, notes and schedules and
other financial data included in any Registration
Statement contemplated by this Agreement or the
related Prospectus; and
(3) a customary comfort letter, dated the
date of the effectiveness of the Shelf Registration
Statement from the Company's independent accountants
and from the independent accountants of other Persons
whose financial statements are included in the Shelf
Registration Statement, in the customary form and
covering matters of the type customarily covered in
comfort letters by underwriters in connection with
primary underwritten offerings.
(B) set forth in full or incorporate by reference in
the underwriting agreement, if any, the indemnification
provisions and procedures of Section 9 hereof with respect to
all parties to be indemnified pursuant to said Section; and
(C) deliver such other documents and certificates as
may be reasonably requested by such parties to evidence
compliance with clause (A) above and with any customary
conditions contained in the underwriting agreement or other
agreement entered into by the Company pursuant to this clause
(x), if any.
If at any time the representations and warranties of the Company contemplated in
clause (A)(1) above cease to be true and correct, the Company shall so advise
the Initial Purchasers and the underwriter(s), if any, and each selling Holder
promptly and, if requested by such Persons, shall confirm such advice in writing
delivered to such Persons;
17
(xi) in the case of a Shelf Registration Statement, prior to
any public offering of Transfer Restricted Securities, cooperate with
the selling Holders, the underwriter(s), if any, and their respective
counsel in connection with the registration and qualification of the
Transfer Restricted Securities under the securities or Blue Sky laws of
such jurisdictions as the selling Holders or underwriter(s), if any,
may reasonably request and do any and all other acts or things as may
be reasonably necessary or advisable to enable the disposition in such
jurisdictions of the Transfer Restricted Securities covered by the
Shelf Registration Statement; provided, however, that the Company shall
not be required to register or qualify as a foreign corporation or as a
dealer in securities in any jurisdiction where it is not now so
qualified or to take any action that would subject it to the service of
process in suits or to taxation, other than as to matters and
transactions relating to the Registration Statement, in any
jurisdiction where it is not now so subject;
(xii) in the case of an Exchange Offer Registration Statement,
shall issue, upon the request of any Holder of Notes covered by the
Exchange Offer Registration Statement, Exchange Notes in the same
amount as the Notes surrendered to the Company by such Holder in
exchange therefor or being sold by such Holder; such Exchange Notes to
be registered in the name of such Holder or in the name of the
purchaser(s) of such Exchange Notes, as the case may be; in return, the
Notes held by such Holder shall be surrendered to the Company for
cancellation;
(xiii) in the case of a Shelf Registration Statement,
cooperate with the selling Holders and the underwriter(s), if any, to
facilitate the timely preparation and delivery of certificates
representing Transfer Restricted Securities to be sold and not bearing
any restrictive legends; and enable such Transfer Restricted Securities
to be in such denominations (consistent with the provisions of the
Indenture) and registered in such names as the selling Holders or the
underwriter(s), if any, may reasonably request at least two business
days prior to any sale of Transfer Restricted Securities made by such
underwriter(s);
(xiv) use its reasonable best efforts to cause the Transfer
Restricted Securities covered by the Registration Statement to be
registered with or approved by such other governmental agencies or
authorities as may be necessary to enable the seller or sellers thereof
or the underwriter(s), if any, to consummate the disposition of such
Transfer Restricted Securities, subject to the proviso contained in
clause (xi) above;
(xv) if any fact or event contemplated by clause (c)(iii)(E)
of this Section 6 shall exist or have occurred, prepare and file with
the Commission a supplement or post-effective amendment to the
Registration Statement or related Prospectus or any document
incorporated therein by reference or file any other required document
so that, as thereafter delivered to the purchasers of Transfer
Restricted Securities, such Prospectus will not contain an untrue
statement of a
18
material fact or omit to state any material fact necessary to make the
statements therein, in light of the circumstances under which they were
made, not misleading;
(xvi) provide CUSIP numbers for all Transfer Restricted
Securities not later than the effective date of the Registration
Statement and provide certificates for the Transfer Restricted
Securities;
(xvii) cooperate and assist in 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 accordance with the rules and
regulations of the NASD, and use its reasonable best efforts to cause
such Registration Statement to become effective and approved by such
governmental agencies or authorities as may be necessary to enable the
Holders selling Transfer Restricted Securities to consummate the
disposition of such Transfer Restricted Securities; provided, however,
that the Company shall not be required to register or qualify as a
foreign corporation or as a dealer in securities in any jurisdiction
where it is not now so qualified or to take any action that would
subject it to the service of process in suits or to taxation, other
than as to matters and transactions relating to the Registration
Statement, in any jurisdiction where it is not now so subject;
(xviii) otherwise use its reasonable best efforts to comply
with all applicable rules and regulations of the Commission, and make
generally available to the Holders, as soon as practicable, a
consolidated earnings statement meeting the requirements of Rule 158
(which need not be audited) for the twelve-month period (A) commencing
at the end of any fiscal quarter in which Transfer Restricted
Securities are sold to underwriters in a firm or reasonable best
efforts Underwritten Offering or (B) if not sold to underwriters in
such an offering, beginning with the first month of the Company's first
fiscal quarter commencing after the effective date of the Registration
Statement;
(xix) cause the Indenture to be qualified under the TIA not
later than the effective date of the first Registration Statement
required by this Agreement, and, in connection therewith, cooperate
with the Trustee and the Holders of Notes 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 execute and use its
reasonable best 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 Commission to enable such
Indenture to be so qualified in a timely manner; and
(xx) provide promptly to each Holder upon reasonable request
each document filed with the Commission pursuant to the requirements of
Section 13 and Section 15 of the Exchange Act.
19
Each Holder agrees by acquisition of a Transfer Restricted
Security that, upon receipt of any notice from the Company of the existence of
any fact of the kind described in Section 6(c)(iii)(E) hereof, such Holder will
forthwith discontinue disposition of Transfer Restricted Securities pursuant to
the applicable Registration Statement until such Holder's receipt of the copies
of the supplemented or amended Prospectus contemplated by Section 6(c)(xv)
hereof, or until such Holder is advised in writing (the "Advice") by the Company
that the use of the Prospectus may be resumed, and has received copies of any
additional or supplemental filings that are incorporated by reference in the
Prospectus. If so directed by the Company, each Holder will deliver to the
Company (at the Company's expense) all copies, other than permanent file copies
then in such Holder's possession, of the Prospectus covering such Transfer
Restricted Securities that was current at the time of receipt of such notice. In
the event the Company shall give any such notice, the time period regarding the
effectiveness of such Registration Statement set forth in Section 3 or 4(a)
hereof, as applicable, shall be extended by the number of days during the period
from and including the date of the giving of such notice pursuant to Section
6(c)(iii)(E) hereof to and including the date when each selling Holder covered
by such Registration Statement shall have received the copies of the
supplemented or amended Prospectus contemplated by Section 6(c)(xv) hereof or
shall have received the Advice.
20
7. Participation of Broker-Dealers in Exchange Offer.
(a) Participating Broker-Dealer May Be Deemed an
"Underwriter". The Commission has taken the position that any Broker-Dealer that
receives Exchange Notes for its own account in the Exchange Offer in exchange
for Notes that were acquired by such Broker- Dealer as a result of market-making
or other trading activities (a "Participating Broker-Dealer") may be deemed to
be an "underwriter" within the meaning of the Securities Act and must deliver a
prospectus meeting the requirements of the Securities Act in connection with any
resale of such Exchange Notes.
The Company understands that it is the Commission's position
that if the Prospectus contained in the Exchange Offer Registration Statement
includes a "Plan of Distribution" containing a statement to the above effect and
the means by which Participating Broker-Dealers may resell the Exchange Notes,
without naming the Participating Broker-Dealers or specifying the amount of
Exchange Notes owned by them, such Prospectus may be delivered by Participating
Broker-Dealers to satisfy their prospectus delivery obligation under the
Securities Act in connection with resales of Exchange Notes for their own
accounts, so long as the Prospectus otherwise meets the requirements of the
Securities Act.
(b) Provisions Regarding Shelf Registration Statement to Apply
to Exchange Offer Registration. In light of the above, notwithstanding the other
provisions of this Agreement, the Company agrees that the provisions of this
Agreement as they relate to a Shelf Registration Statement shall also apply to
an Exchange Offer Registration to the extent, and with such reasonable
modifications thereto, as may be reasonably requested by the Initial Purchasers
or by one or more Participating Broker-Dealers, in each case as provided in
clause (ii) below, in order to expedite or facilitate the disposition of any
Exchange Notes by Participating Broker-Dealers consistent with the positions of
the Commission recited in Section 7(a) above; provided, however, that:
(i) the Company shall not be required to amend or supplement
the Prospectus contained in the Exchange Offer Registration Statement,
as would otherwise be contemplated by Section 6(c)(xv), for a period
exceeding 180 days after the last date of acceptance for exchange (as
such period may be extended pursuant to the last paragraph of Section 6
of this Agreement) and Participating Broker-Dealers shall not be
authorized by the Company to deliver and shall not deliver such
Prospectus after such period in connection with the resales
contemplated by this Section 7; and
(ii) the application of the Shelf Registration Statement
procedures set forth in Section 4 of this Agreement to an Exchange
Offer Registration, to the extent not required by the positions of the
Commission or the Securities Act and the rules and regulations
thereunder, will be in conformity with the reasonable request to the
Company by the Initial Purchasers or with the reasonable request in
writing to the Company by one or more broker-dealers who certify to the
Initial
21
Purchasers and the Company in writing that they anticipate that they
will be Participating Broker-Dealers;
provided further that, in connection with such application of the Shelf
Registration Statement procedures set forth in Section 4 to an Exchange Offer
Registration, the Company shall be obligated (x) to deal only with one entity
representing the Participating Broker-Dealers, which shall be ▇▇▇▇▇▇ Brothers
Inc. unless it elects not to act as such representative, in which case such
entity shall be selected by a majority of the Participating Broker-Dealers, (y)
to pay the fees and expenses of only one counsel representing the Participating
Broker-Dealers, which shall be counsel selected by the ▇▇▇▇▇▇ Brothers Inc. and
reasonably acceptable to the Company (unless such counsel elects not to so act),
and (z) to cause to be delivered only one, if any, "cold comfort" letter with
respect to the Prospectus in the form existing on the last date of acceptance
for exchange and with respect to each subsequent amendment or supplement, if
any, effected during the period specified in clause (i) above.
(c) Liability of the Initial Purchasers. The Initial
Purchasers shall have no liability to the Company or any Holder with respect to
any request that the Initial Purchasers may make pursuant to Section 7(b) above.
8. Registration Expenses.
(a) All expenses incident to the Company's performance of or
compliance with this Agreement will be borne by the Company, regardless of
whether a Registration Statement becomes effective, including without
limitation: (i) all registration and filing fees and expenses (including filings
made by any Initial Purchaser or Holder with the NASD (and, if applicable, the
reasonable fees and expenses of any "qualified independent underwriter") and its
counsel that may be required by the rules and regulations of the NASD); (ii) all
fees and expenses of compliance with federal securities and state Blue Sky or
securities laws; (iii) all expenses of printing (including printing certificates
for the Exchange Notes to be issued in the Exchange Offer and printing of
Prospectuses), and associated messenger and delivery services and
telecommunications usage; (iv) all fees and disbursements of counsel for the
Company and, subject to Section 8(b) below, the Holders of Transfer Restricted
Securities; (v) all application and filing fees in connection with listing Notes
on a national securities exchange or automated quotation system; and (vi) all
fees and disbursements of independent certified public accountants of the
Company and other Persons whose financial statements are included in a
Registration Statement (including the expenses of any special audit and comfort
letters required by or incident to such performance).
The Company will, in any event, bear its internal expenses
(including, without limitation, all salaries and expenses of its officers and
employees performing legal or accounting duties), the expenses of any annual
audit and the fees and expenses of any Person, including special experts,
retained by the Company.
(b) In connection with any Registration Statement required by
this
22
Agreement (including, without limitation, the Exchange Offer Registration
Statement and the Shelf Registration Statement), the Company will reimburse the
Initial Purchasers and the Holders of Transfer Restricted Securities being
tendered in the Exchange Offer and/or resold pursuant to the "Plan of
Distribution" contained in the Exchange Offer Registration Statement or
registered pursuant to the Shelf Registration Statement, as applicable, for the
reasonable fees and disbursements of not more than one counsel, who shall be
counsel selected by ▇▇▇▇▇▇ Brothers Inc. and reasonably acceptable to the
Company (unless such counsel elects not to so act). The Company shall not be
required to pay any underwriting discount, commission or similar fee related to
the sale of any securities.
9. Indemnification and Contribution.
(a) The Company to Indemnify Holders. In connection with a
Shelf Registration Statement or in connection with any delivery of a Prospectus
contained in an Exchange Offer Registration Statement by any Participating
Broker-Dealer or Initial Purchaser, as applicable, who seeks to sell Exchange
Notes, the Company shall indemnify and hold harmless each Holder of Transfer
Restricted Securities included within any such Shelf Registration Statement and
each Participating Broker-Dealer or Initial Purchaser selling Exchange Notes
(each, a "Participant"), such Participant's officers, employees and directors
and each person, if any, who controls any Participant within the meaning of
Section 15 of the Securities Act from and against any loss, claim, damage or
liability, joint or several, or any action in respect thereof (including, but
not limited to, any loss, claim, damage, liability or action relating to
purchases and sales of Notes), to which such Participant, officer, employee,
director or controlling person may become subject, under the Securities Act or
otherwise, insofar as such loss, claim, damage, liability or action arises out
of, or is based upon, (i) any untrue statement or alleged untrue statement of a
material fact contained in (A) any preliminary Prospectus, Registration
Statement or Prospectus or in any amendment or supplement thereto or (B) any
blue sky application or other document prepared or executed by the Company (or
based upon any written information furnished by the Company) specifically for
the purpose of qualifying any or all of the Exchange Notes under the securities
laws of any state or other jurisdiction (any such application, document or
information being hereinafter called a "Blue Sky Application"), or (ii) the
omission or alleged omission to state in any (x) preliminary Prospectus or
Prospectus or in any amendment or supplement thereto, any material fact required
to be stated therein or necessary to make the statements therein not misleading,
in light of the circumstances in which they were made, and (y) Registration
Statement or in any amendment or supplement thereto, or in any Blue Sky
Application any material fact required to be stated therein or necessary to make
the statements therein not misleading, and shall reimburse each Participant and
each such officer, employee, director or controlling person promptly upon demand
for any legal or other expenses reasonably incurred by that Participant,
officer, employee, director or controlling person in connection with
investigating or defending or preparing to defend against any such loss, claim,
damage, liability or action as such expenses are incurred; provided, however,
that the Company shall not
23
be liable in any such case to the extent that any such loss, claim, damage,
liability or action arises out of, or is based upon, any untrue statement or
alleged untrue statement or omission or alleged omission made in any preliminary
Prospectus, Prospectus or Registration Statement, in any amendment or supplement
thereto, or in any Blue Sky Application, in reliance upon and in conformity with
written information concerning such Participant furnished to the Company by or
on behalf of any Participant specifically for inclusion therein; provided
further that as to any preliminary Prospectus, this indemnity agreement shall
not inure to the benefit of any Participant or any officer, employee, director
or controlling person of that Participant on account of any loss, claim, damage,
liability or action arising from the sale of the Exchange Notes or any Notes
sold pursuant to a Shelf Registration Statement to any person by such
Participant if (i) that Participant failed to send or give a copy of the
Prospectus, as the same may be amended or supplemented, to that person within
the time required by the Securities Act and (ii) the untrue statement or alleged
untrue statement of a material fact or omission or alleged omission to state a
material fact in such preliminary Prospectus was corrected in the Prospectus or
a supplement or amendment thereto, as the case may be, unless in each case, such
failure resulted from noncompliance by the Company with Section 6(c). The
foregoing indemnity agreement is in addition to any liability which the Company
may otherwise have to any Participant or to any officer, employee, director or
controlling person of that Participant. In connection with any Underwritten
Offering permitted by Section 6(c) hereof, the Company will also indemnify the
underwriters, if any, selling brokers, dealers and similar securities industry
professionals participating in the distribution, their officers, employees and
directors and each Person who controls such Persons (within the meaning of the
Securities Act and the Exchange Act) to the same extent as provided above with
respect to the indemnification of the Holders, if requested in connection with
any Registration Statement.
(b) Participants to Indemnify the Company and its Directors,
Officers and Controlling Persons. Each Participant, severally and not jointly,
shall indemnify and hold harmless the Company, its directors, employees and
officers, and each person, if any, who controls the Company within the meaning
of Section 15 of the Securities Act, from and against any loss, claim, damage or
liability, joint or several, or any action in respect thereof, to which the
Company or any such director, employee, officer or controlling person may become
subject, under the Securities Act or otherwise, insofar as such loss, claim,
damage, liability or action arises out of, or is based upon, (i) any untrue
statement or alleged untrue statement of a material fact contained in (A) any
preliminary Prospectus, Registration Statement or Prospectus or in any amendment
or supplement thereto or (B) any Blue Sky Application or (ii) the omission or
alleged omission to state in any (x) preliminary Prospectus or Prospectus or in
any amendment or supplement thereto, any material fact required to be stated
therein or necessary to make the statements therein in light of the
circumstances in which they were made not misleading, and (y) Registration
Statement or in any amendment or supplement thereto, or in any Blue Sky
Application any material fact required to be stated therein or necessary to make
the statements therein not misleading but in the case of clauses (i) and (ii)
only to the extent that the untrue statement or alleged untrue statement or
24
omission or alleged omission was made in reliance upon and in conformity with
the written information concerning such Participant furnished to the Company by
or on behalf of that Participant specifically for inclusion therein, and shall
reimburse the Company and any such director, employee, officer or controlling
person for any legal or other expenses reasonably incurred by the Company or any
such director, employee, officer or controlling person in connection with
investigating or defending or preparing to defend against any such loss, claim,
damage, liability or action as such expenses are incurred. The foregoing
indemnity agreement is in addition to any liability which any Participant may
otherwise have to the Company or any such director, employee, officer or
controlling person.
(c) Notification of Indemnifying Party; Counsel; Settlement.
Promptly after receipt by an indemnified party under this Section 9 of notice of
any claim or the commencement of any action, the indemnified party shall, if a
claim in respect thereof is to be made against the indemnifying party under this
Section 9, notify the indemnifying party in writing of the claim or the
commencement of that action; provided, however, that the failure to notify the
indemnifying party shall not relieve it from any liability which it may have
under this Section 9 except to the extent the indemnifying party has been
materially prejudiced by such failure and provided further that the failure to
notify the indemnifying party shall not affect any liability which it may have
to an indemnified party otherwise than under this Section 9. If any such claim
or action shall be brought against an indemnified party, and it shall notify the
indemnifying party thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it wishes, jointly with any other
similarly notified indemnifying party, to assume the defense thereof with
counsel reasonably satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under this Section 9 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation; provided, however, that
the indemnified party shall have the right to employ counsel to represent
jointly the indemnified party and its respective directors, employees, officers
and controlling persons who may be subject to liability arising out of any claim
in respect of which indemnity may be sought by the indemnified party against the
indemnifying party under this Section 9 if such indemnified party shall have
been advised in writing that the representation of such indemnified party and
those directors, employees, officers and controlling persons by the same counsel
would be inappropriate under applicable standards of professional conduct due to
actual or potential differing interests between them, and in that event the fees
and expenses of such separate counsel shall be paid by the indemnifying party.
It is understood that the indemnifying party shall not be liable for the fees
and expenses of more than one separate firm (in addition to local counsel in
each jurisdiction) for all indemnified parties in connection with any proceeding
or related proceedings. Each indemnified party, as a condition of the indemnity
agreements contained in Sections 9(a) and 9(b), shall use its reasonable best
efforts to cooperate with the indemnifying party in the defense of any such
action or claim. No indemnifying party shall (i) without the prior written
consent of
25
the indemnified parties (which consent shall not be unreasonably withheld),
settle or compromise or consent to the entry of any judgment with respect to any
pending or threatened claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or not the
indemnified parties are actual or potential parties to such claim or action)
unless such settlement, compromise or consent includes an unconditional release
of each indemnified party from all liability arising out of such claim, action,
suit or proceeding, or (ii) be liable for any settlement of any such action
effected without its written consent (which consent shall not be unreasonably
withheld), but if settled with its written consent or if there be a final
judgment of the plaintiff in any such action, the indemnifying party agrees to
indemnify and hold harmless any indemnified party from and against any loss or
liability by reason of such settlement or judgment in accordance with this
Section 9. Notwithstanding the foregoing, 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 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 such request prior to the date of such
settlement.
(d) Indemnification Unavailable. If the indemnification
provided for in this Section 9 shall for any reason be unavailable to or
insufficient to hold harmless an indemnified party under Section 9(a) or 9(b) in
respect of any loss, claim, damage or liability, or any action in respect
thereof, referred to therein, then each indemnifying party shall, in lieu of
indemnifying such indemnified party, contribute to the amount paid or payable by
such indemnified party as a result of such loss, claim, damage or liability, or
action in respect thereof, in such proportion as is appropriate to reflect the
relative fault of the Company, on the one hand, and the Participants, on the
other hand, with respect to the statements or omissions which resulted in such
loss, claim, damage or liability, or action in respect thereof, as well as any
other relevant equitable considerations. The relative fault shall be determined
by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or omission or alleged omission to state a material
fact relates to information supplied by the Company, on the one hand, or the
Participants, on the other hand, the intent of the parties and their relative
knowledge, access to information and opportunity to correct or prevent such
statement or omission. Each of the Company and the Participants agrees that it
would not be just and equitable if contributions pursuant to this Section 9(d)
were to be determined by pro rata allocation (even if either the Participants or
the Company, as the case may be, were treated as one entity for such purpose) or
by any other method of allocation which does not take into account the equitable
considerations referred to herein. The amount paid or payable by an indemnified
party as a result of the loss, claim, damage or liability, or action in respect
thereof, referred to above in this Section 9(d) 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 the provisions
26
of this Section 9(d), no Participant shall be required to indemnify or
contribute any amount in excess of the amount by which proceeds received by the
Participants from an offering of the Notes exceeds the amount of any damages
which such Participant has otherwise paid or become liable to pay by reason of
any 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. The remedies provided
for in this Section 9 are not exclusive and shall not limit any rights or
remedies which may otherwise be available to any indemnified party at law or in
equity. The Participants' obligations to contribute as provided in this Section
9(d) are several and not joint.
(e) The indemnity and contribution provisions contained in
this Section 9 shall remain operative and in full force and effect regardless of
(i) any termination of this Agreement, (ii) any investigation made by or on
behalf of any Initial Purchaser, any Holder or any person controlling any
Initial Purchaser or any Holder, or by or on behalf of the Company, its officers
or directors or any person controlling the Company, (iii) acceptance of any of
the Exchange Notes and (iv) any sale of Transfer Restricted Securities pursuant
to a Shelf Registration Statement.
10. Rule 144A.
The Company hereby agrees with each Holder, for so long as any
Transfer Restricted Securities remain outstanding, to make available to any
Holder or beneficial owner of Transfer Restricted Securities in connection with
any sale thereof and any prospective purchaser of such Transfer Restricted
Securities from such Holder or beneficial owner, the information required by
Rule 144A(d)(4) under the Securities Act in order to permit resales of such
Transfer Restricted Securities pursuant to Rule 144A.
11. Participation in Underwritten Registrations.
No Holder may participate in any Underwritten Registration
hereunder unless such Holder (a) agrees to sell such Holder's Transfer
Restricted 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, lockup letters and other documents reasonably required
under the terms of such underwriting arrangements. In no event shall an
Underwritten Registration be commenced if a period of less than 180 days has
elapsed since the consummation of the most recent Underwritten Registration
hereunder, without the consent of the Company (which shall not be unreasonably
withheld).
12. Selection of Underwriters.
The Holders of Transfer Restricted Securities covered by the
Shelf
27
Registration Statement who desire to do so may sell such Transfer Restricted
Securities in an Underwritten Offering. In any such Underwritten Offering, the
investment banker or investment bankers and manager or managers that will
administer the offering will be selected by the Holders of a majority in
aggregate principal amount of the Transfer Restricted Securities included in
such offering; provided that such investment bankers and managers must be
reasonably satisfactory to the Company.
13. Miscellaneous.
(a) Remedies. The Company agrees that monetary damages
(including Liquidated Damages) would not be adequate compensation for any loss
incurred by reason of a breach by it of the provisions of this Agreement and
hereby agrees to waive the defense in any action for specific performance that a
remedy at law would be adequate.
(b) No Inconsistent Agreements. The Company will not on or
after the date of this Agreement enter into any agreement with respect to its
securities that is inconsistent with the rights granted to the Holders in this
Agreement or otherwise conflicts with the provisions hereof. 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 securities
under the provisions of any agreement in effect on the date hereof.
(c) Adjustments Affecting the Notes. The Company will not take
any action, or permit any change to occur, with respect to Notes that would
materially and adversely affect the ability of the Holders to consummate any
Exchange Offer unless such action or change is required by applicable law.
(d) 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 or 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 outstanding principal amount of Transfer
Restricted Securities; provided, however, that no amendment, modification,
supplement, waiver or consent to or departure from the provisions of Section 9
hereof shall be effective as against any Holder of Transfer Restricted
Securities unless consented to in writing by such Holder. Notwithstanding the
foregoing, a waiver or consent to departure from the provisions hereof that
relates exclusively to the rights of Holders whose securities are being tendered
pursuant to the Exchange Offer and that does not affect directly or indirectly
the rights of other Holders whose securities are not being tendered pursuant to
such Exchange Offer may be given by the Holders of a majority of the outstanding
principal amount of Transfer Restricted Securities being tendered or registered.
(e) Notices. All notices and other communications provided for
or permitted hereunder shall be made in writing by hand delivery, first-class
mail (registered or certified, return receipt requested), telecopier, or air
courier guaranteeing
28
overnight delivery:
(i) if to a Holder, at the address of such Holder maintained
by the Registrar under the Indenture; and
(ii) if to the Company:
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: President
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
▇▇▇▇▇▇▇ ▇▇▇▇▇
Bershad ▇▇▇▇▇ & Lerach LLP
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(iii) if to the Initial Purchasers:
c/▇ ▇▇▇▇▇▇ Brothers Inc.
Three World Financial Center
New York, New York 10285
Attention: Syndicate Department
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇.
With a copy to:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
All such notices and communications shall be deemed to have
been duly given: at the time delivered by hand, if personally delivered; five
business days after being deposited in the mail, postage prepaid, if mailed;
when receipt is acknowledged, if telecopied; and on the next business day, if
timely delivered to an air courier guaranteeing overnight delivery. All notice
information may be changed upon notice to the other parties hereto given in
accordance with the provisions of this Section 13(a).
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
29
specified in the Indenture.
(f) 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 limitation, and without the need for an
express assignment, subsequent Holders of Transfer Restricted Securities;
provided, however, that nothing herein shall be deemed to permit any assignment,
transfer or other disposition of Transfer Restricted Securities in violation of
the terms of the Purchase Agreement; provided further that this Agreement shall
not inure to the benefit of or be binding upon a successor, transferee or assign
of a Holder unless and to the extent such successor, transferee or assign
acquired Transfer Restricted Securities from such Holder. If any transferee of
any Holder shall acquire Transfer Restricted Securities, in any manner, whether
by operation of law or otherwise, such Transfer Restricted Securities shall be
held subject to all of the terms of this Agreement, and by taking and holding
such Transfer Restricted 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 and such Person shall be entitled to receive the benefits hereof.
The Initial Purchasers (in their capacity as Initial Purchasers) shall have no
liability or obligation to the Company with respect to any failure by a Holder
to comply with, or breach by any Holder of, any of the obligations of such
Holder under this Agreement.
(g) Purchases and Sales of Notes. The Company shall not, and
shall use its reasonable best efforts to cause its affiliates (as defined in
Rule 405 under the Securities Act) not to, purchase and then resell or otherwise
transfer any Notes.
(h) Third Party Beneficiary. The Holders shall be third party
beneficiaries to the agreements made hereunder between the Company, on the one
hand, and the Initial Purchasers, on the other hand, and such Initial Purchasers
shall have the right to enforce such agreements directly to the extent they deem
such enforcement necessary or advisable to protect their rights or the rights of
Holders hereunder.
(i) 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.
(j) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(k) GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND DUTIES OF
THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK.
(l) Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstance, is
held invalid, illegal
30
or unenforceable, the validity, legality and enforceability of any such
provision in every other respect and of the remaining provisions contained
herein shall not be affected or impaired thereby.
(m) Entire Agreement. This Agreement, together with each of
the Related Transaction Documents, 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. There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein
with respect to the registration rights granted by the Company with respect to
the Transfer Restricted Securities. This Agreement supersedes all prior
agreements and understandings between the parties with respect to such subject
matter.
(n) Required Consents. Whenever the consent or approval of
Holders of a specified percentage of Transfer Restricted Securities is required
hereunder, Transfer Restricted Securities held by the Company or its affiliates
(as such term is defined in Rule 405 under the Securities Act) shall not be
counted in determining whether such consent or approval was given by the Holders
of such required percentage.
31
IN WITNESS WHEREOF, the parties shave executed this Agreement
as of the date first written above.
GLOBIX CORPORATION
By:______________________________
Name:
Title:
Accepted, February 8, 2000
▇▇▇▇▇▇ BROTHERS INC.
CHASE SECURITIES INC.
CREDIT SUISSE FIRST BOSTON CORPORATION
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇ INCORPORATED
▇▇▇▇▇▇▇ ▇▇▇▇▇ BARNEY INC.
ING BARINGS LLC
Acting severally on behalf of themselves and the other Initial Purchasers named
in Schedule I to the Purchase Agreement.
By: ▇▇▇▇▇▇ BROTHERS INC.
By:_____________________________
Authorized Representative