Exhibit 4.2
REGISTRATION RIGHTS AGREEMENT
Dated as of December 21, 2004
by and among
RCN CORPORATION
as the Company,
and
The Stockholders listed on the Signature Pages hereto
TABLE OF CONTENTS
1. Definitions.......................................................1
2. Shelf Registration................................................5
3. Registration Procedures...........................................7
4. Black-Out and Suspension.........................................13
5. Indemnification..................................................15
6. Underwritten Registrations.......................................19
7. Rule 144.........................................................19
8. Miscellaneous....................................................19
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REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "Agreement") is
dated as of December 21, 2004, and entered into by and among RCN Corporation,
a Delaware corporation (the "Company"), and the stockholders listed on the
signature pages hereto. Each Holder of Registrable Securities shall be
entitled to the benefits of this Agreement regardless of whether they are
initially named on the signature pages hereof; provided that in order to be
entitled to enforce its rights hereunder, such Holder shall become a party
hereto by delivering to the Company a counterpart signature page to this
Agreement.
WHEREAS, the Company proposes to issue and deliver shares of
Common Stock (as defined below) to certain entities pursuant to the Company's
Plan of Reorganization under Chapter 11 of the Bankruptcy Code (the "Plan"),
confirmed by order of the United States Bankruptcy Court for the Southern
District of New York, entered on December 8, 2004; and
WHEREAS, in connection with and pursuant to the Plan, the
Company has agreed to grant the registration rights described in this
Agreement to the holders of shares of Common Stock issued pursuant to the
Plan. All capitalized terms used and not otherwise defined herein shall have
the meanings assigned them in the Plan.
NOW THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto,
intending to be legally bound hereby, agree as follows:
1. Definitions. As used in this Agreement, the following terms shall have the
following meanings:
"Agreement" shall have the meaning set forth in the first
introductory paragraph hereto.
"Amendment Effectiveness Deadline Date" shall have the
meaning set forth in Section 2(d)(i) hereto.
"Bankruptcy Code" shall mean the Bankruptcy Reform Act of
1978, as codified in title 11 of the United States Code, 11 U.S.C. ▇▇.▇▇.
101-1330, as now in effect or hereafter amended.
"Business Day" shall mean any day that is not a Saturday,
Sunday or a day on which banking institutions in New York City are authorized
or required by law to be closed.
"Closing Date" shall mean December 21, 2004.
"Common Stock" shall mean any share of common stock, par
value $0.01 per share, of the Company, outstanding after giving effect to the
Plan.
"Company" shall have the meaning set forth in the first
introductory paragraph hereto and includes the Company's successors and
assigns.
"Controlling Person" shall have the meaning set forth in
Section 6 hereof.
"Designated Counsel" shall mean one firm of counsel chosen
by the Holders of a majority of Registrable Securities to be included in a
Registration Statement for a Shelf Registration and identified to the Company
in writing prior to the filing of such Registration Statement.
"Effectiveness Date" shall mean the date that is the 90th
day after the date the Initial Shelf Registration is filed with the SEC.
"Effectiveness Period" shall have the meaning set forth in
Section 2(a) hereof.
"End of Suspension Notice" shall have the meaning set forth
in Section 4(b) hereof.
"Exchange Act" shall mean the Securities Exchange Act of
1934, as amended, and the rules and regulations of the SEC promulgated
thereunder.
"Filing Date" shall mean the date that is the 60th day after
the later of (1) the date the Company files its Annual Report on Form 10-K for
the year ended December 31, 2004, or (2) the Plan Effective Date.
"Holder" shall mean (x) any signatory to this Agreement for
so long as such signatory is a beneficial owner (as such term is defined
pursuant to Section 13d-3 under the Exchange Act) of Registrable Securities
who (i) beneficially owns 5% or more of the outstanding Common Stock of the
Company, (ii) is an "affiliate" of the Company (as the term "affiliate" is
defined pursuant to the Securities Act), or (iii) is deemed, or might
reasonably be considered to be, an "affiliate," an "underwriter" or a "control
person" under Section 1145(b)(1) of the Bankruptcy Code, or (y) any other
beneficial owner (as such term is defined pursuant to Section 13d-3 under the
Exchange Act) of Registrable Securities acquired pursuant to the Plan which
provides the Company with notice that it meets the conditions specified in
clauses (x)(i),(ii), or (iii), or any person who purchased Registrable
Securities from any Holder other than pursuant to a Registration Statement or
Rule 144.
"Indemnified Holder" shall have the meaning set forth in
Section 6 hereof.
"Indemnified Person" shall have the meaning set forth in
Section 6 hereof.
"Indemnifying Person" shall have the meaning set forth in
Section 6 hereof.
"Initial Shelf Registration" shall have the meaning set
forth in Section 2(a) hereof.
"Inspectors" shall have the meaning set forth in Section
3(l) hereof.
"NASD" shall have the meaning set forth in Section 3(o)
hereof.
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"Note Purchase Agreement" shall mean the Note Purchase
Agreement dated as of December 21, 2004, by and among the Company, certain
subsidiaries of the Company that are required to be guarantors under the
Indenture (as defined in the Note Purchase Agreement), and the Purchasers,
which provides for the sale by the Company to the Purchasers of $[o] aggregate
principal amount of the Company's 7 3/8% Convertible Second-Lien Notes Due
2012 (the "Notes"), which are convertible into Common Stock of the Company.
"Notes Registration Rights Agreement" shall mean the
Registration Rights Agreement (this "Agreement") dated as of December 21,
2004, and entered into by and among RCN Corporation, a Delaware corporation
(the "Company"), and the Purchasers.
"Note Securities" shall mean all Registrable Securities as
defined in the Note Registration Rights Agreement.
"Notice and Questionnaire" shall mean a written notice
delivered to the Company containing substantially the information called for
by the Form of Selling Securityholder Notice and Questionnaire attached hereto
as Appendix A.
"Person" shall mean an individual, partnership, corporation,
limited liability company, unincorporated association, trust or joint venture,
or a governmental agency or political subdivision thereof.
"Plan Effective Date" shall mean the Effective Date as
defined in the Plan.
"Prospectus" shall mean the prospectus included in any
Registration Statement (including, without limitation, any prospectus subject
to completion and a prospectus that includes any 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, and all other amendments and
supplements to the Prospectus, including post-effective amendments, and all
material incorporated by reference or deemed to be incorporated by reference
in such Prospectus.
"Purchaser" shall mean those institutional investors whose
names and addresses are listed on Schedule I of the Notes Registration Rights
Agreement (collectively the "Purchasers").
"QIU" shall have the meaning set forth in Section 3(o)
hereof.
"Records" shall have the meaning set forth in Section 3(l)
hereof.
"Registrable Securities" means any share of Common Stock
beneficially owned by a Holder until the earliest date on which (i) such share
of Common Stock has been disposed of pursuant to a Registration Statement that
has been declared effective under the Securities Act during the period of time
that such Registration Statement is effective under the Securities Act and
(ii) such share of Common Stock, together with all other shares of Common
Stock beneficially owned by such Holder, may be sold or transferred without
registration under the
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Securities Act pursuant to Rule 144(k) and are freely tradeable without
restriction under the Securities Act following such sale or transfer.
"Registration Statement" shall mean any registration
statement of the Company filed with the SEC pursuant to the provisions of this
Agreement, including the Prospectus, amendments and supplements to such
registration statement, including post-effective amendments, all exhibits and
all documents incorporated by reference or deemed to be incorporated by
reference in such registration statement.
"Rule 144" shall mean Rule 144 promulgated under the
Securities Act, as such rule may be amended from time to time, or any similar
rule (other than Rule 144A) or regulation hereafter adopted by the SEC
providing for offers and sales of securities made in compliance therewith
resulting in offers and sales by subsequent holders that are not affiliates of
an issuer of such securities being free of the registration and prospectus
delivery requirements of the Securities Act.
"Rule 144A" shall mean Rule 144A promulgated under the
Securities Act, as such rule may be amended from time to time, or any similar
rule (other than Rule 144) or regulation 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
rule or regulation 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.
"Selling Holder" shall mean, on any date, any Holder that
has delivered a Notice and Questionnaire to the Company on or prior to such
date.
"Shelf Registration" shall have the meaning set forth in
Section 2(b) hereof.
"Shelf Registration Statement" shall have the meaning set
forth in Section 2(b) hereof.
"Subsequent Shelf Registration" shall have the meaning set
forth in Section 2(b) hereof.
"Suspension Event" shall have the meaning set forth in
Section 4(b) hereof.
"Suspension Notice" shall have the meaning set forth in
Section 4(b) hereof.
"Underwritten Registration" or "Underwritten Offering" shall
mean a registration in which securities of the Company are sold to an
underwriter for reoffering to the public.
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2. Shelf Registration.
(a) Shelf Registration. The Company shall file with the SEC
a "shelf" Registration Statement for an offering to be made on a continuous
basis pursuant to Rule 415 covering all of the Registrable Securities (the
"Initial Shelf Registration") on or prior to the Filing Date. The Company
shall use its commercially reasonable efforts to cause the Shelf Registration
Statement to be declared effective by the SEC not later than the 90th day
after the date of the initial filing.
The Initial Shelf Registration shall be on Form ▇-▇, ▇▇▇▇
▇-▇ or another appropriate form permitting registration of such Registrable
Securities for resale by Holders in the manner or manners designated by them
(including, without limitation, one or more Underwritten Offerings; provided
that the lead or managing underwriter in any Underwritten Offerings shall be
reasonably acceptable to the Company). The Company may permit securities other
than the Registrable Securities to be included in the Initial Shelf
Registration or any Subsequent Shelf Registration. In the event that (i) in
any offering pursuant to a Shelf Registration that is an Underwritten
Offering, both (1) Registrable Securities owned by a Holder and (2) Notes or
the common stock underlying the Notes request to have any such securities sold
in such an offering, and (ii) the lead or managing underwriter for such
Underwritten Offering notifies the Company that (x) the number of shares of
Common Stock exceeds the amount which may be sold without materially adversely
affecting such offering, (y) the number of shares of Common Stock requested to
be included would exceed any limitation on the number of shares to be included
as determined by the lead or managing underwriter in any Underwritten
Offerings or (z) the lead or managing underwriter advises that the number of
shares or types of securities proposed to be included in the offering would be
likely to have an adverse effect on such offering, then the holders of the
Notes and the Holders of the Registrable Securities shall be entitled to
participate in such offering as follows: (aa) first, up to the maximum amount
of Notes, and common shares underlying the Notes as applicable, proposed to be
included in such Underwritten Offering shall be included, (bb) second, up to
the maximum amount of shares owned by Holders of Registrable Securities shall
be included (reduced, if at all, pro rata based on the number of Registable
Securities beneficially owned by such Holders) and (cc) third, up to the full
amount of any other securities to be offered in such Underwritten Offering.
The Company shall use its commercially reasonable 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 such Initial
Shelf Registration continuously effective under the Securities Act until the
date that is three (3) years after the Effectiveness Date, provided such
period shall automatically be extended to the extent required to permit
brokers and dealers to comply with Rule 174 under the Securities Act, as
provided in Section 4 hereof or as otherwise provided herein (such period, as
it may be extended or shortened pursuant to this Agreement, the "Effectiveness
Period"), or such shorter period ending when no Registrable Securities
continue to be outstanding.
(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 (other than because of
the sale of all of the securities registered thereunder),
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the Company shall use its commercially reasonable efforts to obtain the prompt
withdrawal of any order suspending the effectiveness thereof, and in any event
shall within forty-five (45) days of such cessation of effectiveness amend the
Initial Shelf Registration in a manner 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 the Registrable
Securities (a "Subsequent Shelf Registration"). If a Subsequent Shelf
Registration is filed, the Company shall use its commercially reasonable
efforts to cause the Subsequent Shelf Registration to be declared effective
under the Securities Act as soon as practicable after such filing and to keep
such Registration Statement continuously effective for a period equal to the
number of days in the Effectiveness Period less the aggregate number of days
during which the Initial Shelf Registration or any Subsequent Shelf
Registration was previously continuously effective. As used herein, the term
"Shelf Registration" means the Initial Shelf Registration and any Subsequent
Shelf Registration and the term "Shelf Registration Statement" means any
Registration Statement filed in connection with a Shelf Registration.
(c) Supplements and Amendments. The Company shall promptly
supplement and amend the Shelf Registration if required by the rules,
regulations or instructions applicable to the registration form used for such
Shelf Registration, if required by the Securities Act, or, in the reasonable
discretion of the Company, if reasonably requested by the Holders of the
majority of Registrable Securities covered by such Registration Statement or
by any underwriter of such Registrable Securities; provided, however, that the
Company shall not be required to supplement or amend the Shelf Registration
Statement during the occurrence of any of the events described in Section
4(a)(i) or (ii).
(d) Notice and Questionnaire. Each Holder agrees that if
such Holder wishes to sell Registrable Securities pursuant to a Shelf
Registration Statement and related Prospectus, it will do so only in
accordance with this Section 2(d) and Section 3 hereof. Each Holder wishing to
sell Registrable Securities pursuant to a Shelf Registration Statement and
related Prospectus agrees to deliver a Notice and Questionnaire to the Company
at least five (5) Business Days prior to any intended distribution of
Registrable Securities under the Shelf Registration Statement. From and after
the date the Initial Shelf Registration Statement is declared effective, the
Company shall, as promptly as practicable after the date a Notice and
Questionnaire is delivered, and in any event upon five (5) Business Days after
such date:
(i) if required by applicable law, file with the
SEC a post-effective amendment to the Shelf Registration
Statement or prepare and, if required by applicable law,
file a supplement to the related Prospectus or a supplement
or amendment to any document incorporated therein by
reference or file any other required document so that the
Holder delivering such Notice and Questionnaire is named as
a selling securityholder in the Shelf Registration Statement
and the related Prospectus in such a manner as to permit
such Holder to deliver such Prospectus to purchasers of the
Registrable Securities in accordance with applicable law
and, if the Company shall file a post-effective amendment to
the Shelf Registration Statement, use its commercially
reasonable efforts to cause such post-effective amendment to
be declared effective under the Securities Act as promptly
as is practicable, but in any event by the date (the
"Amendment
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Effectiveness Deadline Date") that is forty-five (45) days
after the date such post-effective amendment is required by
this clause to be filed; provided, however, that such period
shall be tolled for so long as information provided by or
requested to be provided by any such Holder is reasonably
likely to prevent the effectiveness of any such
post-effective amendment or supplement;
(ii) provide such Holder copies of any documents
filed pursuant to Section 2(d)(i); and
(iii) notify such Holder as promptly as practicable
after the effectiveness under the Securities Act of any
post-effective amendment filed pursuant to Section 2(d)(i).
Notwithstanding anything contained herein to the contrary,
the Company shall be under no obligation to name any Holder
that has not delivered a complete Notice and Questionnaire
in accordance with this Section 2(d) and such other
information to the Company as required by Section 4(p)
hereof.
3. Registration Procedures.
In connection with the filing of any Registration Statement
pursuant to Section 2 hereof, the Company shall effect such registrations to
permit the sale of the securities covered thereby in accordance with the
intended method or methods of disposition thereof specified by the Holder of
Registrable Securities, and pursuant thereto and in connection with any
Registration Statement filed by the Company hereunder the Company shall:
(a) Prepare and file with the SEC, on or prior to the Filing
Date, a Registration Statement or Registration Statements as prescribed by
Section 2 hereof, and use its commercially reasonable efforts to cause each
such Registration Statement to become effective and remain effective as
provided herein; provided, however, that before filing any Registration
Statement or Prospectus or any amendments or supplements thereto, the Company
shall furnish to and afford the Holders of the Registrable Securities covered
by such Registration Statement and the managing underwriter or underwriters,
if any, a reasonable opportunity to review copies of all such documents
proposed to be filed (in each case, where possible, at least three (3)
Business Days prior to such filing, or such later date as is reasonable under
the circumstances). The Company shall not file any Registration Statement or
Prospectus or any amendments or supplements thereto if the Holders of a
majority of Registrable Securities covered by such Registration Statement or
the managing underwriter or underwriters, if any, shall reasonably object in
writing within such period.
(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 Effectiveness
Period; cause the related Prospectus to be supplemented by any Prospectus
supplement required by applicable law, and as so supplemented to be filed
pursuant to Rule 424 (or any similar provisions then in force) promulgated
under the Securities Act; and comply with the provisions of the Securities Act
and the Exchange Act
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applicable to it with respect to the disposition of all Registrable Securities
covered by such Registration Statement as so amended or in such Prospectus as
so supplemented.
(c) Notify the Selling Holders, Designated Counsel, if any,
and the managing underwriter or underwriters, if any, promptly (but in any
event within two (2) Business Days), (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 under the Securities Act (including in such notice a written
statement that any Holder may, upon request, obtain, at the sole expense of
the Company, conformed copies of such Registration Statement or post-effective
amendment including financial statements and schedules, documents incorporated
or deemed to be incorporated by reference and exhibits), (ii) 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 the initiation of any proceedings for that purpose, (iii) of the
happening of any event, the existence of any condition or any information
becoming known that makes any statement made in such Registration Statement or
related Prospectus or any document incorporated or deemed to be incorporated
therein by reference untrue in any material respect or that requires the
making of any changes in or amendments or supplements to such Registration
Statement, Prospectus or documents so that, in the case of the Registration
Statement, it will not contain any untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary to make
the statements therein not misleading, and that in the case of the Prospectus,
it will not contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading and (iv) of the Company's determination that a
post-effective amendment to a Registration Statement would be appropriate.
(d) Use its commercially reasonable 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 and, if any
such order is issued, to use its commercially reasonable efforts to obtain the
withdrawal of any such order at the earliest possible moment, and provide
prompt notice to the Selling Holders, Designated Counsel, if any, and the
managing underwriter or underwriters, if any, of the withdrawal of any such
order.
(e) If requested by the managing underwriter or
underwriters, if any, or the Holders of a majority of Registrable Securities
being sold in connection with an underwritten offering and reasonably
acceptable to the Company (i) promptly incorporate in a prospectus supplement
or post-effective amendment such information as the managing underwriter or
underwriters, if any, or such Holders reasonably determine, in consultation
with the Company, is necessary to be included therein, (ii) make all required
filings of such prospectus supplement or such post-effective amendment as soon
as reasonably practicable after the Company has received notification of the
matters to be incorporated in such prospectus supplement or post-effective
amendment and (iii) supplement or make amendments to such Registration
Statement.
(f) Furnish to each Selling Holder, Designated Counsel, if
any, and the managing underwriter or underwriters, if any, at the sole expense
of the Company, conformed copies of the Registration Statement or Registration
Statements and each post-effective
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amendment thereto, including financial statements and schedules, and, if
requested, all documents incorporated or deemed to be incorporated therein by
reference and all exhibits.
(g) Deliver to each Selling Holder, Designated Counsel, if
any, and the managing underwriter or underwriters, if any, at the sole expense
of the Company, as many copies of the Prospectus (including each form of
preliminary prospectus) and each amendment or supplement thereto and any
documents incorporated by reference therein as such Persons may reasonably
request; and the Company hereby consents to the use of such Prospectus and
each amendment or supplement thereto by each of the Selling Holders of
Registrable Securities, the managing underwriter or underwriters, if any, and
dealers, if any, in connection with the offering and sale of the Registrable
Securities covered by such Prospectus and any amendment or supplement thereto.
(h) The Company agrees to cause the Company's counsel to
perform blue sky investigations and file registrations and qualifications
required to be filed in connection with the registration or qualification (or
exemption from such registration or qualification) of such Registrable
Securities or offer and sale under the securities or blue sky laws of such
jurisdictions within the United States as any Selling Holder or the managing
underwriter or underwriters, if any, reasonably request, 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 reasonably necessary or advisable under blue sky
laws to enable the disposition in such jurisdictions of the Registrable
Securities covered by the applicable Registration Statement; provided,
however, that the Company shall not be required to (i) qualify generally to do
business in any jurisdiction where it is not then so qualified, or (ii)
subject itself to taxation in any such jurisdiction where it is not then so
subject.
(i) Cooperate with the Selling Holders, the managing
underwriter or underwriters, if any, and their respective counsel to
facilitate the timely preparation and delivery of certificates representing
shares of Registrable Securities to be sold, which certificates shall not bear
any restrictive legends; and enable such shares of Registrable Securities to
be in such denominations and registered in such names as the managing
underwriter or underwriters, if any, or Holders may reasonably request.
(j) Upon the occurrence of any event contemplated by Section
3(c)(ii), 3(c)(iii) or 3(c)(iv) hereof, as promptly as practicable prepare and
(subject to Section 3(a) hereof) file with the SEC, at the sole expense of the
Company, a supplement or post-effective amendment to the Registration
Statement or a supplement to the related Prospectus or any document
incorporated or deemed to be incorporated therein by reference, or file any
other required document so that, as thereafter delivered to the purchasers of
the Registrable Securities being sold thereunder, any such Prospectus will not
contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading.
(k) In connection with any underwritten offering of
Registrable Securities pursuant to a Shelf Registration, enter into an
underwriting agreement, reasonably satisfactory in form and substance to the
Company, as is customary in underwritten offerings of securities
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similar to the Registrable Securities and take all such other actions as are
reasonably requested by the managing underwriter or underwriters in order to
expedite or facilitate the registration or the disposition of such Registrable
Securities and, in such connection, (i) make such representations and
warranties to, and covenants with, the managing underwriter or underwriters
with respect to the business of the Company and its subsidiaries (including
any acquired business, properties or entity, if applicable) and the
Registration Statement, Prospectus and documents, if any, incorporated or
deemed to be incorporated by reference therein, in each case, as are
customarily made by issuers to underwriters in underwritten offerings of
securities similar to the Registrable Securities and confirm the same in
writing if and when requested; (ii) obtain the written opinion of counsel to
the Company and written updates thereof in form, scope and substance
reasonably satisfactory to the managing underwriter or underwriters, addressed
to the managing underwriter or underwriters covering the matters customarily
covered in opinions requested in underwritten offerings of securities similar
to the Registrable Securities and such other matters as may be reasonably
requested by the managing underwriter or underwriters; (iii) obtain "cold
comfort" letters and updates thereof in form, scope and substance reasonably
satisfactory to the managing underwriter or underwriters from the independent
certified public accountants of the Company (and, if necessary, any other
independent certified public accountants of any subsidiary of the Company or
of any business acquired by the Company for which financial statements and
financial data are, or are required to be, included or incorporated by
reference in the Registration Statement), addressed to each of the
underwriters, such letters to be in customary form and covering matters of the
type customarily covered in "cold comfort" letters in connection with
underwritten offerings of securities similar to the Registrable Securities and
such other matters as reasonably requested by the managing underwriter or
underwriters; and (iv) if an underwriting agreement is entered into, cause the
same to contain indemnification provisions and procedures no less favorable to
the sellers and underwriters, if any, than those set forth in Section 6 hereof
(or such other provisions and procedures acceptable to Holders of a majority
in aggregate principal amount of Registrable Securities covered by such
Registration Statement and the managing underwriter or underwriters or agents,
if any). The above shall be done as and to the extent required by such
underwriting agreement.
(l) Make available at reasonable times for inspection by one
or more representatives of the Selling Holders, designated in writing by
Holders of a majority of Registrable Securities to be included in such
Registration Statement of such Registrable Securities being sold, any managing
underwriter or underwriters participating in any such disposition of
Registrable Securities, if any, and any attorney, accountant or other agent
retained by any such Selling Holder or underwriter (collectively, the
"Inspectors"), at the offices where normally kept, during reasonable business
hours at such time or times as shall be mutually convenient for the Company
and the Inspectors as a group, all financial and other records, pertinent
corporate documents and instruments of the Company and its subsidiaries
(collectively, the "Records") as shall be reasonably necessary to enable them
to exercise any applicable due diligence responsibilities, and cause the
officers, directors and employees of the Company and its subsidiaries to
supply all information reasonably requested by any such Inspector in
connection with such Registration Statement. Records that the Company
determines, in good faith, to be confidential and any Records that it notifies
the Inspectors are confidential shall not be disclosed by any Inspector unless
(i) the disclosure of such Records is necessary to avoid or correct a
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material misstatement or material omission in such Registration Statement,
(ii) the release of such Records is ordered pursuant to a subpoena or other
order from a court of competent jurisdiction, (iii) disclosure of such
information is, in the opinion of counsel for any Inspector, necessary or
advisable in connection with any action, claim, suit or proceeding, directly
involving or potentially involving such Inspector and arising out of, based
upon, relating to, or involving this Agreement or any transactions
contemplated hereby or arising hereunder or (iv) the information in such
Records has been made generally available to the public other than through the
acts of such Inspector; provided, however, that prior notice shall be provided
as soon as practicable to the Company of the potential disclosure of any
information by such Inspector pursuant to clauses (ii) or (iii) of this
sentence to permit the Company to obtain a protective order (or waive the
provisions of this paragraph (l)). Each Inspector shall take such actions as
are reasonably necessary to protect the confidentiality of such information
(if practicable) to the extent such actions are otherwise not inconsistent
with, an impairment of or in derogation of the rights and interests of the
Holder or any Inspector, unless and until such information in such Records has
been made generally available to the public other than as a result of a breach
of this Agreement.
(m) Provide (i) the Holders of the Registrable Securities to
be included in such Registration Statement and Designated Counsel, if any,
(ii) the underwriters (which term, for purposes of this Registration Rights
Agreement, shall include a Person deemed to be an underwriter within the
meaning of Section 2(11) of the Securities Act), if any, thereof, (iii) the
sales or placement agent, if any, thereof, and (iv) one counsel for such
underwriters or agents, reasonable opportunity to participate in the
preparation of such Registration Statement, each prospectus included therein
or filed with the SEC, and each amendment or supplement thereto.
(n) Comply with all applicable rules and regulations of the
SEC and make generally available to its security holders earning statements
satisfying the provisions of Section 11(a) of the Securities Act and Rule 158
thereunder (or any similar rule promulgated under the Securities Act) no later
than forty-five (45) days after the end of any twelve (12)-month period (or
ninety (90) days after the end of any twelve (12)-month period if such period
is a fiscal year) (i) commencing at the end of any fiscal quarter in which
Registrable Securities are sold to underwriters in a firm commitment or
commercially reasonable 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 Effectiveness Date of a Registration
Statement, which statements shall cover said twelve (12)-month periods.
(o) Cooperate with each Selling Holder of Registrable
Securities covered by any Registration Statement and the managing underwriter
or underwriters, if any, participating in the disposition of such Registrable
Securities and their respective counsel in connection with any filings
required to be made with the NASD, Inc. (the "NASD"), including, if the
Conduct Rules of the NASD or any successor thereto as amended from time to
time so require, engaging a "qualified independent underwriter" ("QIU") as
contemplated therein and making Records available to such QIU as though it
were a participating underwriter for the purposes of Section 4(l) and
otherwise applying the provisions of this Agreement to such QIU (including
indemnification) as though it were a participating underwriter.
(p) Use its commercially reasonable efforts to take all
other steps necessary or advisable to effect the registration of the
Registrable Securities covered by a Registration Statement contemplated
hereby.
(q) Prior to the effective date of the first Registration
Statement relating to the Registrable Securities, provide CUSIP numbers for
the Registrable Securities.
Each Holder agrees, by acquisition of the Registrable
Securities, that no Holder shall be entitled to sell any of such Registrable
Securities pursuant to a Registration Statement or to receive a Prospectus
relating thereto, unless such Holder has furnished the Company with a Notice
and Questionnaire as required pursuant to Section 2(d) hereof (including the
information required to be included in such Notice and Questionnaire) and the
information set forth in the next sentence. Each Selling Holder agrees
promptly to furnish to the Company all information required to be disclosed in
order to make the information previously furnished to the Company by such
Selling Holder not misleading and any other information regarding such Selling
Holder and the distribution of such Registrable Securities as the Company may
from time to time reasonably request. Any sale of any Registrable Securities
by any Holder shall constitute a representation and warranty by such Holder
that the information provided by and relating to such Holder and its plan of
distribution is as set forth in the Prospectus delivered by such Holder in
connection with such disposition, that such Prospectus does not as of the time
of such sale contain any untrue statement of a material fact provided by such
Holder and that such Prospectus does not as of the time of such sale omit to
state any material fact provided by such Holder necessary to make the
statements in such Prospectus, in the light of the circumstances under which
they were made, not misleading.
The Company may require each Selling Holder of Registrable
Securities as to which any registration is being effected to furnish to the
Company such additional information regarding such Holder and the distribution
of such Registrable Securities as the Company may, from time to time,
reasonably request to the extent necessary or advisable to comply with the
Securities Act. The Company may exclude from such registration the Registrable
Securities of any Selling Holder if such Holder fails to furnish such
additional information within twenty (20) Business Days after receiving such
request. Each Selling Holder as to which any Shelf Registration is being
effected agrees to furnish promptly to the Company all information required to
be disclosed so that the information previously furnished to the Company by
such Holder is not materially misleading and does not omit to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances under which
they were made.
Each Holder of Registrable Securities agrees by acquisition
of such Registrable Securities that upon the happening of any event of the
kind described in Section 3(c)(ii), 3(c)(iii) or 3(c)(iv) hereof, such Holder
will forthwith discontinue disposition of such Registrable Securities covered
by such Registration Statement or Prospectus until such Holder's receipt of
the copies of the supplemented or amended Prospectus contemplated by Section
3(j) hereof, or until it is advised in writing by the Company that the use of
the applicable Prospectus may be resumed, and has received copies of any
amendments or supplements thereto.
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4. Black-Out and Suspension.
(a) Black-Out Period. Subject to the provisions of this
Section 4 and a good faith determination by a majority of the members of the
Board of Directors of the Company that it is in the best interests of the
Company to suspend the use of the Registration Statement, following the
effectiveness of a Registration Statement (and the filings with any
international, federal or state securities commissions), the Company, by
written notice to the Holders, may direct the Holders to suspend sales of the
Registrable Securities pursuant to a Registration Statement for such times as
the Company reasonably may determine is necessary and advisable (but in no
event for more than an aggregate of sixty (60) days in any rolling twelve
(12)-month period commencing on the Closing Date, or thirty (30) days in any
rolling ninety (90)-day period, and no more than two (2) separate times in any
rolling twelve (12)-month period) if any of the following events shall occur:
(i) a primary Underwritten Offering by the Company where the Company is
advised by the representative of the managing underwriters for such
Underwritten Offering that the sale of Registrable Securities pursuant to the
Registration Statement would have a material adverse effect on the Company's
Underwritten Offering; (ii) a majority of the members of the Board of
Directors of the Company in good faith determine that (A) the offer or sale of
any Registrable Securities would materially impede, delay or interfere with
any material proposed acquisition, merger, tender offer, business combination,
corporate reorganization, consolidation or other similar material transaction
involving the Company, (B) after the advice of counsel, sale of Registrable
Securities pursuant to the Registration Statement would require disclosure of
non-public material information not otherwise required to be disclosed under
applicable law, and (C) disclosure could have a material adverse effect on the
Company or the Company's ability to consummate such transaction in each case
under circumstances that would make it impracticable or inadvisable to cause
the Registration Statement (or such filings) to become effective or to
promptly amend or supplement the Registration Statement on a post-effective
basis, as applicable; or (iii) a majority of the members of the Board of
Directors of the Company shall have determined in good faith, after the advice
of counsel, that it is required by law, rule or regulation to supplement the
Registration Statement or file a post-effective amendment to the Registration
Statement in order to incorporate information into the Registration Statement
for the purpose of (A) including in the Registration Statement any Prospectus
required under Section 10(a)(3) of the Securities Act, (B) reflecting in the
Prospectus included in the Registration Statement any facts or events arising
after the effective date of the Registration Statement (or of the most-recent
post-effective amendment) that, individually or in the aggregate, represents a
fundamental change in the information set forth therein, or (C) including in
the Prospectus included in the Registration Statement any material information
with respect to the plan of distribution not disclosed in the Registration
Statement or any material change to such information. Upon the occurrence of
any such suspension, the Company shall use its commercially reasonable efforts
to cause the Registration Statement to become effective or to promptly amend
or supplement the Registration Statement on a post-effective basis or to take
such action as is necessary to permit resumed use of the Registration
Statement as soon as possible. Notwithstanding the foregoing, (x) the Company
may not suspend the use of the Registration Statement pursuant to clauses (i)
or (ii) of this Section 4(a) unless it simultaneously suspends the
registration statements relating to any other securities of the Company which
the Company has filed and maintains for resale of such securities other than
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Registrations on Form S-8("Other Registrations") and (y) the suspension of the
Registration Statement shall not commence earlier than, or end later than, the
suspension of any Other Registration.
(b) In the case of an event specified in Section 4(a) that
causes the Company to suspend the use of a Registration Statement (a
"Suspension Event"), the Company shall give written notice (a "Suspension
Notice") to the Holders to suspend sales of the Registrable Securities and
such notice shall state generally the basis for the notice and certify, by an
officer of the Company, that such suspension shall continue only for so long
as the Suspension Event or its effect is continuing and the Company is taking
all reasonable steps to terminate suspension of the use of the Registration
Statement as promptly as possible. The Holders shall not effect any sales of
the Registrable Securities pursuant to such Registration Statement (or such
filings) at any time after receiving a Suspension Notice from the Company and
prior to receipt of an End of Suspension Notice (as defined below). If so
directed by the Company, each Holder will deliver to the Company (at the
expense of the Company) all copies other than permanent file copies then in
such Holder's possession of the Prospectus covering the Registrable Securities
at the time of receipt of the Suspension Notice. The Holders may recommence
effecting sales of the Registrable Securities pursuant to the Registration
Statement (or such filings) following further notice to such effect (an "End
of Suspension Notice") from the Company, which End of Suspension Notice shall
be given by the Company to the Holders in the manner described above promptly
following the conclusion of any Suspension Event and its effect.
(c) Notwithstanding any provision herein to the contrary, if
the Company shall give a Suspension Notice pursuant to this Section 4 with
respect to any Registration Statement, the Company agrees that it shall extend
the period of time during which such Registration Statement shall be
maintained effective pursuant to this Agreement by the number of days during
the period from the date of the giving of a Suspension Notice to and including
the date when Holders shall have received an End of Suspension Notice and
copies of the supplemented or amended Prospectus necessary to resume sales,
with respect to each Suspension Event; provided such period of time shall not
be extended beyond the date that Underlying Shares are not Registrable
Securities.
5. 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,
including, without limitation, (i) all registration and filing fees
(including, without limitation, (A) fees with respect to filings required to
be made with the NASD in connection with an underwritten offering and (B) fees
and expenses of compliance with state securities or blue sky laws, including,
without limitation, reasonable fees and disbursements of counsel in connection
with blue sky qualifications of the Registrable Securities and determination
of the eligibility of the Registrable Securities for investment under the laws
of such jurisdictions as provided in Section 3(h) hereof), (ii) printing
expenses, including, without limitation, expenses of printing certificates for
Registrable Securities and of printing prospectuses if the printing of
prospectuses is requested by the managing underwriter or underwriters, if any,
or by the Holders of the majority of Registrable Securities included in any
Registration Statement, (iii) messenger, telephone and delivery
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expenses, (iv) fees and disbursements of counsel for the Company, (v) fees and
disbursements of all independent certified public accountants referred to in
Section 3(k)(iii) hereof (including, without limitation, the expenses of any
special audit and "cold comfort" letters required by or incident to such
performance), (vi) Securities Act liability insurance, if the Company desires
such insurance, (vii) fees and expenses of all other Persons retained by the
Company, (viii) internal expenses of the Company (including, without
limitation, all salaries and expenses of officers and employees of the Company
performing legal or accounting duties), (ix) the expense of any annual audit,
(x) the fees and expenses incurred in connection with the listing of the
securities to be registered on any securities exchange, if applicable, and
(xi) the expenses relating to printing, word processing and distributing all
Registration Statements, underwriting agreements, securities sales agreements
and any other documents necessary in order to comply with this Agreement.
Notwithstanding anything in this Agreement to the contrary, each Holder shall
pay all underwriting discounts and brokerage commissions with respect to any
Registrable Securities sold by it and, except as set forth in Section 5(b)
below, the Company shall not be responsible for the fees and expenses of any
counsel for the Holders.
(b) The Company shall reimburse the Holders of the
Registrable Securities being registered in a Shelf Registration for the
reasonable fees and disbursements, not to exceed $75,000, of Designated
Counsel.
6. Indemnification.
The Company agrees to indemnify and hold harmless (i) each
Holder, (ii) each Person, if any, who controls (within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act) any Holder
(any of the Persons referred to in this clause (ii) being hereinafter referred
to as a "Controlling Person"), (iii) the respective officers, directors,
partners, members, employees, representatives and agents of any Holder
(including any predecessor holder) or any controlling person (any person
referred to in clause (i), (ii) or (iii) may hereinafter be referred to as an
"Indemnified Holder") against any losses, claims, damages, liabilities or
expenses to which such Indemnified Holder may become subject under the
Securities Act or otherwise, (A) insofar as such losses, claims, damages,
liabilities or expenses (or actions or proceedings in respect thereof) arise
out of or are based upon any untrue statement or alleged untrue statement of
any material fact contained in any Registration Statement or Prospectus, or
any amendment or supplement thereto or any related preliminary prospectus, (B)
insofar as such losses, claims, damages, liabilities or expenses (or actions
or proceedings in respect thereof) arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, in the
light of the circumstances in which they were made, (C) to the extent of the
aggregate amount paid in settlement of any litigation, or any investigation or
proceeding by any court or governmental agency or body, commenced or
threatened, or of any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission, or (D) insofar as
such losses, claims, damages, liabilities or expenses arise out investigating,
preparing or defending against any litigation, or any investigation or
proceeding by any court or governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission; provided, however,
that the Company will not be liable under this paragraph, to the
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extent that (i) any such loss, claim, damage, liability or expense arises out
of or is based upon an untrue statement or alleged untrue statement, or
omission or alleged omission made in any such Registration Statement or
Prospectus, or any amendment or supplement thereto or any related preliminary
prospectus in reliance upon and in conformity with written information
relating to any Holder furnished to the Company or any underwriter by or on
behalf of such Holder specifically for use in therein or (ii) any untrue
statement contained in or omission from a preliminary Prospectus if a copy of
the Prospectus (as then amended or supplemented, if the Company shall have
furnished to or on behalf of the Holder participating in the distribution
relating to the relevant Registration Statement any amendments or supplements
thereto) was not sent or given by or on behalf of such Holder to the Person
asserting any such liabilities who purchased Underlying Shares, if such
Prospectus (or Prospectus as amended or supplemented) is required by law to be
sent or given at or prior to the written confirmation of the sale of such
Underlying Shares to such Person and the untrue statement contained in or
omission from such preliminary Prospectus was corrected in the Prospectus (or
the Prospectus as amended or supplemented if the Company shall have furnished
any amendments or supplements thereto). The indemnity provided for herein
shall remain in full force and effect regardless of any investigation made by
or on behalf of any such Holder. The Company shall notify such Indemnified
Holder promptly of the institution, threat or assertion of any claim,
proceeding (including any governmental investigation) or litigation in
connection with the matters addressed by this Agreement which involves the
Company or such Indemnified Holder.
The Company agrees to reimburse each Indemnified Holder upon
demand for any legal or other expenses reasonably incurred by such Indemnified
Holder in connection with investigating or defending any such loss, claim,
damage or liability, action or proceeding or in responding to a subpoena or
governmental inquiry related to the offering of the Registrable Securities,
whether or not such Indemnified Holder is a party to any action or proceeding.
In the event that it is finally judicially determined that an Indemnified
Holder was not entitled to receive payments for legal and other expenses
pursuant to this paragraph, such Indemnified Holder will promptly return all
sums that had been advanced pursuant hereto.
Each Holder agrees, severally and not jointly, to indemnify
and hold harmless the Company, its directors and officers and each Person who
controls the Company (within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act) to the same extent as the
indemnity provided in the first paragraph of this Section 6 from the Company
to each Holder, but only with reference to such losses, claims, damages,
liabilities or expenses which are caused by any untrue statement or omission
or alleged untrue statement or omission made in reliance upon and in
conformity with information relating to a Holder furnished to the Company or
any underwriter in writing by such Holder expressly for use in any
Registration Statement or Prospectus, or any amendment or supplement thereto
or any related preliminary prospectus. The liability of any Holder under this
paragraph shall in no event exceed the net proceeds received by such Holder
from sales of Registrable Securities giving rise to such obligation.
In case any suit, action, proceeding (including any
governmental or regulatory investigation), claim or demand shall be brought or
asserted against any Person in respect of which indemnity may be sought
pursuant to either of the first and third paragraphs of this Section
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6, such Person (the "Indemnified Person") shall promptly notify the Person or
Persons against whom such indemnity may be sought (each an "Indemnifying
Person") in writing. No indemnification provided for in the first or third
paragraphs of this Section 6 shall be available to any Person who shall have
failed to give notice as provided in this paragraph if the party to whom
notice was not given was unaware of the proceeding to which such notice would
have related and was materially prejudiced by the failure to give such notice,
but the failure to give such notice shall not relieve the Indemnifying Person
or Persons from any liability which it or they may have to the Indemnified
Person for contribution or otherwise than on account of the provisions of the
first and third paragraphs of this Section 6. In case any such proceeding
shall be brought against any Indemnified Person and it shall notify the
Indemnifying Person of the commencement thereof, the Indemnifying Person shall
be entitled to participate therein and, to the extent that it shall wish,
jointly with any other Indemnifying Person similarly notified, to assume the
defense thereof, with counsel reasonably satisfactory to such Indemnified
Person and shall pay as incurred (or within 30 days of presentation) the fees
and disbursements of such counsel related to such proceeding. In any such
proceeding, any Indemnified Person shall have the right to retain its own
counsel at its own expense. Notwithstanding the foregoing, the Indemnifying
Person shall pay as incurred (or within 30 days of presentation) the fees and
expenses of the counsel retained by the Indemnified Person in the event (i)
the Indemnifying Person and the Indemnified Person shall have mutually agreed
to the retention of such counsel, (ii) the named parties to any such
proceeding (including any impleaded parties) include both the Indemnifying
Person and the Indemnified Person and representation of both parties by the
same counsel would be inappropriate due to actual or potential differing
interests between them or (iii) the Indemnifying Person shall have failed to
assume the defense and employ counsel reasonably acceptable to the Indemnified
Person within a reasonable period of time after notice of commencement of the
action. It is understood that the Indemnifying Person shall not, in connection
with any proceeding or related proceedings in the same jurisdiction, be liable
for the reasonable fees and expenses of more than one separate firm for all
such Indemnified Persons. Such firm shall be designated in writing by a
majority of Holders of Registrable Securities in the case of parties
indemnified pursuant to the first paragraph of this Section 6 and by the
Company in the case of parties indemnified pursuant to the third paragraph of
this Section 6. The Indemnifying Person shall not be liable for any settlement
of any proceeding effected without its written consent but if settled with
such consent or if there be a final judgment for the plaintiff, the
Indemnifying Person agrees to indemnify the Indemnified Person from and
against any loss or liability by reason of such settlement or judgment. In
addition, the Indemnifying Person will not, without the prior written consent
of the Indemnified Person, settle or compromise or consent to the entry of any
judgment in any pending or threatened claim, action or proceeding of which
indemnification may be sought hereunder (whether or not any Indemnified Person
is an actual or potential party to such claim, action or proceeding) unless
such settlement, compromise or consent includes an unconditional release of
each Indemnified Person from all liability arising out of such claim, action
or proceeding.
To the extent the indemnification provided for in this
Section 6 is unavailable to or insufficient to hold harmless an Indemnified
Person under the first or third paragraph of this Section 6 in respect of any
losses, claims, damages, liabilities or expenses (or actions or proceedings in
respect thereof) referred to therein, except by reason of the exceptions set
forth in
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the first or third paragraphs of this Section 6 or the failure of the
Indemnified Person to give notice as required in the fourth paragraph of this
Section 6, then each Indemnifying Person shall contribute to the amount paid
or payable by such Indemnified Person as a result of such losses, claims,
damages, liabilities or expenses (or actions or proceedings in respect
thereof) in such proportion as is appropriate to reflect the relative fault of
the Indemnifying Person on the one hand and the Indemnified Person on the
other in connection with the statements or omissions which resulted in such
losses, claims, damages, liabilities or expenses (or actions or proceedings 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 the
omission or alleged omission to state a material fact relates to information
supplied by the Company on the one hand or such Indemnified Holder on the
other and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
The Company and the Holders agree that it would not be just
and equitable if contributions pursuant to the immediately preceding paragraph
of this Section 6 were determined by pro rata allocation or by any other
method of allocation which does not take account of the equitable
considerations referred to in the immediately preceding paragraph. The amount
paid or payable by an Indemnified Person as a result of the losses, claims,
damages, liabilities or expenses (or actions or proceedings in respect
thereof) referred to in the immediately preceding paragraph shall be deemed to
include any legal or other expenses reasonably incurred by such Indemnified
Person in connection with investigating or defending any such action or claim
or enforcing any rights hereunder. Notwithstanding the provisions of this
paragraph and the immediately preceding paragraph of this Section 6, (i) in no
event shall any Holder be required to contribute any amount in excess of the
amount by which the net proceeds received by such Holder from the offering or
sale of the Registrable Securities pursuant to a Shelf Registration Statement
exceeds the amount of damages which such Holder would have otherwise been
required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission and (ii) 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.
Except as otherwise provided in this Section 6, any losses,
claims, damages, liabilities or expenses for which an Indemnified Person is
entitled to indemnification or contribution under this Section 6 shall be paid
by the Indemnifying Person to the Indemnified Person as such losses, claims,
damages, liabilities or expenses are incurred (or within thirty (30) days of
presentation).
The remedies provided for in this Section 6 are not
exclusive and shall not limit any rights or remedies that may otherwise be
available to any indemnified party at law or in equity.
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The indemnity and contribution agreements contained in this
Section 6 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 Holder or any Person controlling any Holder or by or on behalf
of the Company, its officers or directors or any other Person controlling any
of the Company and (iii) acceptance of and payment for any of the Registrable
Securities.
7. Underwritten Registrations.
If any of the Registrable Securities covered by any Shelf
Registration are to be sold in an underwritten offering, the investment banker
or investment bankers and manager or managers that will manage the offering
will be selected by, and the underwriting arrangements with respect thereto
will be approved by, the Holders of a majority of the Registrable Securities
to be included in such offering in consultation with the Company; provided,
that no managing investment banker or underwriter shall be chosen to which the
Company shall reasonably object.
No Holder of Registrable Securities may participate in any
underwritten registration hereunder unless such Holder (a) agrees to sell such
Holder's Registrable Securities on the basis provided in any underwriting
arrangements approved by the Persons entitled 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.
8. Rule 144
The Company covenants that it will file the reports required
to be filed by it under the Indenture, the Securities Act and the Exchange Act
and the rules and regulations adopted by the SEC thereunder in a timely
manner, other than the filing by the Company of its annual report on Form 10-K
for the year ended December 31, 2004 by April 30, 2005, in accordance with the
requirements of the Securities Act and the Exchange Act and, for so long as
any Registrable Securities remain outstanding, if at any time the Company is
not required to file such reports, it will (a) make publicly available such
information as is necessary to permit sales pursuant to Rule 144 and (b) take
such further action, if any, that is reasonable in the circumstances, in each
case, to the extent required from time to time to enable such Holder to sell
its Registrable Securities without registration under the Securities Act
within the limitation of the exemptions provided by (i) Rule 144 or (ii) any
similar rules or regulations hereafter adopted by the SEC. Upon the request of
any Holder of Registrable Securities, the Company will deliver to such Holder
a written statement as to whether it has complied with such requirements.
9. Miscellaneous.
(a) No Inconsistent Agreements. Other than the Note Purchase
Agreement and Notes Registration Rights Agreement, to the extent that either
thereof may be inconsistent with the rights granted to the Holders of
Registrable Securities in this Agreement or otherwise in conflict with the
provisions hereof, the Company has not, as of the date hereof, and the Company
shall not, after the date of this Agreement, enter into any agreement, with
respect to any of its
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securities, that is inconsistent with the rights granted to the Holders of
Registrable Securities in this Agreement or otherwise conflicts with the
provisions hereof.
(b) Adjustments Affecting Registrable Securities. The
Company shall not, directly or indirectly, take any action with respect to the
Registrable Securities as a class that would materially and adversely affect
the ability of the Holders of Registrable Securities to include such
Registrable Securities in a registration undertaken pursuant to this
Agreement.
(c) Amendments and Waivers. The provisions of this Agreement
may not be amended, modified or supplemented, and waivers or consents to
departures from the provisions hereof may not be given, otherwise than with
the prior written consent of the Company and the Holders of not less than a
majority of Registrable Securities then outstanding; provided, however, that
Section 6 and this Section 9(c) may not be amended, modified or supplemented
without the prior written consent of the Company and each Holder (including,
in the case of an amendment, modification or supplement of Section 6, any
Person who was a Holder of Registrable Securities disposed of pursuant to any
Registration Statement). Notwithstanding the foregoing, a waiver or consent to
depart from the provisions hereof with respect to a matter that relates
exclusively to the rights of Holders of Registrable Securities whose
securities are being sold pursuant to a Registration Statement and that does
not directly or indirectly affect, impair, limit or compromise the rights of
other Holders of Registrable Securities may be given by Holders of at least a
majority of the Registrable Securities being sold by such Holders pursuant to
such Registration Statement.
(d) Notices. All notices and other communications provided
for or permitted hereunder shall be made in writing by hand delivery,
registered first-class mail, next-day air courier or facsimile:
(1) if to a Holder, at the most current address of
such Holder set forth on the stock ledger of the Company unless any Holder
shall have provided notice information in a Notice and Questionnaire or any
amendment thereto, in which case such information shall control.
(2) if to the Company:
RCN Corporation
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
with copies to (which shall not constitute
notice):
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Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
All such notices and communications shall be deemed to have
been duly given, when delivered by hand, if personally delivered, five (5)
Business Days after being deposited in the mail, postage prepaid, if mailed;
one Business Day after being timely delivered to a next-day air courier; and
when the addressor receives facsimile confirmation, if sent by facsimile
during normal business hours, and otherwise on the next Business Day during
normal business hours.
(e) Successors and Assigns. This Agreement shall inure to
the benefit of and be binding upon the successors and assigns of each of the
parties hereto, including, without limitation, the Holders and, without the
need for an express assignment, subsequent Holders. If any transferee of any
Holder shall acquire the Registrable Securities, in any manner, whether by
operation of law or otherwise, such Registrable Securities shall be held
subject to all of the terms of this Agreement, and by taking and holding such
Registrable Securities, such Person shall be conclusively deemed to have
agreed to be bound by and to perform all of the terms and provisions of this
Agreement and such Person shall be entitled to receive the benefits hereof.
(f) 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.
(g) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(h) Governing Law; Jurisdiction; Waiver of Jury Trial. All
questions concerning the construction, validity, enforcement and
interpretation of this Agreement shall be governed by the internal laws of the
State of New York, without giving effect to any choice of law or conflict of
law provision or rule (whether of the State of New York or any other
jurisdictions) that would cause the application of the laws of any
jurisdictions other than the State of New York. Each party hereby irrevocably
waives personal service of process and consents to process being served in any
such suit, action or proceeding by mailing a copy thereof to such party at the
address for such notices to it under this Agreement and agrees that such
service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any
right to serve process in any manner permitted by law. If any provision of
this Agreement shall be invalid or unenforceable in any jurisdiction, such
invalidity or unenforceability shall not affect the validity or enforceability
of the remainder of this Agreement in that jurisdiction or the validity or
enforceability of any provision of this Agreement in any other jurisdiction.
EACH OF THE PARTIES HERETO WAIVES ANY RIGHT TO REQUEST A TRIAL BY JURY IN ANY
LITIGATION WITH RESPECT TO THIS AGREEMENT AND REPRESENTS THAT COUNSEL HAS BEEN
CONSULTED SPECIFICALLY AS TO THIS WAIVER.
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(i) Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction to
be invalid, illegal, void or unenforceable, the remainder of the terms,
provisions, covenants and restrictions set forth herein shall remain in full
force and effect and shall in no way be affected, impaired or invalidated, and
the parties hereto shall use their best efforts to find and employ an
alternative means to achieve the same or substantially the same result as that
contemplated by such term, provision, covenant or restriction. It is hereby
stipulated and declared to be the intention of the parties that they would
have executed the remaining terms, provisions, covenants and restrictions
without including any of such that may be hereafter declared invalid, illegal,
void or unenforceable.
(j) Securities Held by the Company or Its Affiliates.
Whenever the consent or approval of Holders of a majority is required
hereunder, Registrable 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 majority.
(k) Third-Party Beneficiaries. Holders of Registrable
Securities are intended third-party beneficiaries of this Agreement and the
Company and each Holder shall have the right to enforce this Agreement
directly to the extent it deems such enforcement necessary or advisable to
protect its rights or the rights of Holders hereunder.
(l) Entire Agreement. This Agreement, together with the Plan
of Reorganization, Note Purchase Agreement and Notes Registration Rights
Agreement, is intended by the parties as a final and exclusive statement of
the agreement and understanding of the parties hereto in respect of the
subject matter contained herein and therein and any and all prior oral or
written agreements, representations, or warranties, contracts, understandings,
correspondence, conversations and memoranda between the Holders on the one
hand and the Company on the other, or between or among any agents,
representatives, parents, subsidiaries, affiliates, predecessors in interest
or successors in interest with respect to the subject matter hereof and
thereof are merged herein and replaced hereby.
[Signature page follows]
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IN WITNESS WHEREOF, the parties have executed this Registration
Rights Agreement as of the date first written above.
RCN CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Senior Vice President,
General Counsel and
Corporate Secretary
Raptor Global Portfolio Ltd.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Managing Director, Tudor
Investment Corporation,
Investment Adviser
Tudor BVI Global Portfolio Ltd.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Managing Director, Tudor
Investment Corporation,
Investment Adviser
The Altar Rock Fund, L.P.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Managing Director, Tudor
Investment Corporation,
Investment Adviser
Tudor Proprietary Trading, L.L.C.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Managing Director, Tudor
Investment Corporation,
Investment Adviser
Appendix A
Notice and Questionnaire
------------------------
FORM OF SELLING SECURITYHOLDER NOTICE AND QUESTIONNAIRE
The undersigned beneficial holder of common stock, par value
$0.01 per share (the "Common Stock"), of RCN Corporation, a Delaware
corporation (the "Company"), understands that the Company has filed or intends
to file with the Securities and Exchange Commission a registration statement
(the "Shelf Registration Statement") for the registration and resale of the
Registrable Securities in accordance with the terms of the Registration Rights
Agreement, dated as of December 21, 2004 (the "Registration Rights
Agreement"), by and among the Company and the purchasers named therein. A copy
of the Registration Rights Agreement is available from the Company upon
request at the address set forth below.
Each beneficial owner of Registrable Securities is entitled
to the benefits of the Registration Rights Agreement. In order to sell or
otherwise dispose of any Registrable Securities pursuant to the Shelf
Registration Statement, a beneficial owner of Registrable Securities generally
will be required to be named as a selling securityholder in the related
prospectus, deliver a prospectus to each purchaser of Registrable Securities
and be bound by those provisions of the Registration Rights Agreement
applicable to such beneficial owner (including certain indemnification
provisions, as described below). Beneficial owners are encouraged to complete
and deliver this Selling Securityholder Notice and Questionnaire prior to the
effectiveness of the Shelf Registration Statement so that such beneficial
owners may be named as selling securityholders in the related prospectus at
the time of effectiveness. Any beneficial owner of shares of Common Stock
wishing to include its Registrable Securities must deliver to the Company a
properly completed and signed Selling Securityholder Notice and Questionnaire.
Certain legal consequences arise from being named as a
selling securityholder in the Shelf Registration Statement and the related
prospectus. Accordingly, holders and beneficial owners of Registrable
Securities are advised to consult their own securities law counsel regarding
the consequences of being named or not being named as a selling securityholder
in the Shelf Registration Statement and the related prospectus.
Notice
The undersigned beneficial owner (the "Selling
Securityholder") of Registrable Securities hereby gives notice to the Company
of its intention to sell or otherwise dispose of Registrable Securities
beneficially owned by it and listed below in Item 3 (unless otherwise
specified under Item 3) pursuant to the Shelf Registration Statement. The
undersigned, by signing and returning this Selling Securityholder Notice and
Questionnaire, understands that it will be bound by the terms and conditions
of this Selling Securityholder Notice and Questionnaire and the Registration
Rights Agreement.
The undersigned hereby provides the following information to
the Company and represents and warrants that such information is accurate and
complete as of the date below:
Questionnaire
1. (a) Full Legal Name of Selling Securityholder:
______________________________________________________________
(b) Full Legal Name of Registered Holder (if not the same as (a)
above) through which Registrable Securities listed in (3)
below are held:
______________________________________________________________
(c) Full Legal Name of DTC Participant (if applicable and if not
the same as (b) above) through which Registrable Securities
listed in (3) below are held:
______________________________________________________________
2. Address for Notices to Selling Securityholder:
__________________________________________________________________
__________________________________________________________________
Telephone: __________________________________________________
Fax: ________________________________________________________
Contact Person: _____________________________________________
3. Beneficial Ownership of Registrable Securities:
(a) Type and Principal Amount of Registrable Securities
beneficially owned:
______________________________________________________________
______________________________________________________________
(b) CUSIP No(s). of Registrable Securities beneficially owned:
______________________________________________________________
______________________________________________________________
4. If other than a natural person, please indicate the form or
organization of the Selling Securityholder (e.g., corporation,
limited liability company, limited partnership, general partnership,
trust, estate, etc.):
__________________________________________________________________
5. If the Selling Securityholder is not a natural person, and is not a
publicly traded entity, please identify the individuals who
beneficially own the shares or interests of the Selling
Securityholder (including any intermediate entities through which
such beneficial ownership is held) and the amounts and percentages of
such ownership:
__________________________________________________________________
__________________________________________________________________
6. Please indicate whether the Selling Securityholder is a "broker" or a
"dealer" (as such terms are defined in Section 3 of the Securities
Exchange Act of 1934, as amended) or an affiliate of any broker or
dealer.
__________________________________________________________________
__________________________________________________________________
7. If the Selling Securityholder is an affiliate of any broker or
dealer, please indicate by checking the appropriate box whether the
answer to the following questions is "True" or "False."
(a) The Selling Securityholder purchased the Registrable
Securities in the ordinary course of business.
___ True ___ False
(b) At the time of the purchase of the Registrable Securities to
be resold, the Selling Securityholder had no agreements or
understandings, directly or indirectly, with any person to
distribute them.
___ True ___ False
8. Beneficial Ownership of the Company's securities owned by the Selling
Securityholder:
Except as set forth below in this Item (4), the undersigned is not
the beneficial or registered owner of any "Other Securities," defined
as securities of the Company other than the Registrable Securities
listed above in Item (3).
(a) Type and Amount of Other Securities beneficially owned by the
Selling Securityholder:
______________________________________________________________
______________________________________________________________
(b) CUSIP No(s). of such Other Securities beneficially owned:
______________________________________________________________
______________________________________________________________
9. Relationship with the Company:
Except as set forth below, neither the undersigned nor any of its
affiliates, officers, directors or principal equityholders (5% or
more) has held any position or office or has had any other material
relationship with the Company (or its predecessors or affiliates)
during the past three years.
State any exceptions here:
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
10. Plan of Distribution:
Except as set forth below, the undersigned (including its donees or
pledgees) intends to distribute the Registrable Securities listed
above in Item (3) pursuant to the Shelf Registration Statement only
as follows (if at all): Such Registrable Securities may be sold from
time to time directly by the undersigned or alternatively, through
underwriters, broker-dealers or agents (with the prior agreement of
the Company). If the Registrable Securities are sold through
underwriters or broker-dealers, the Selling Securityholder will be
responsible for underwriting discounts or commissions or agent's
commissions. Such Registrable Securities may be sold in one or more
transactions at fixed prices, at prevailing market prices at the time
of sale, at varying prices determined at the time of sale or at
negotiated prices. Such sales may be effected in transactions (which
may involve block transactions) (i) on any national securities
exchange or quotation service on which the Registrable Securities may
be listed or quoted at the time of sale, (ii) in the over-the-counter
market, (iii) in transactions otherwise than on such exchanges or
services or in the over-the-counter market or (iv) through the
writing of options. In connection with sales of the Registrable
Securities or otherwise, the undersigned may enter into hedging
transactions with broker-dealers, which may in turn engage in short
sales of the Registrable Securities and deliver Registrable
Securities to close out such short positions, or loan or pledge
Registrable Securities to broker-dealers that in turn may sell such
securities.
State any exceptions here:
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
The undersigned acknowledges that it understands its
obligation to comply with the provisions of the Securities Exchange Act of
1934, as amended, and the rules thereunder relating to stock manipulation,
particularly Regulation M thereunder (or any successor rules or
regulations), in connection with any offering of Registrable Securities
pursuant to the Shelf Registration Statement. The undersigned agrees that
neither it nor any person acting on its behalf will engage in any transaction
in violation of such provisions.
The Selling Securityholder hereby acknowledges its
obligations under the Registration Rights Agreement to indemnify and hold
harmless certain persons as set forth therein.
Pursuant to the Registration Rights Agreement, the Company
has agreed under certain circumstances to indemnify the Selling Securityholder
against certain liabilities.
In accordance with the undersigned's obligation under the
Registration Rights Agreement to provide such information as may be required
by law for inclusion in the Shelf Registration Statement, the undersigned
agrees to promptly notify the Company of any inaccuracies or changes in the
information provided herein that may occur subsequent to the date hereof at
any time while the Shelf Registration Statement remains effective. All notices
hereunder and pursuant to the Registration Rights Agreement shall be made in
writing at the address set forth below.
By signing below, the undersigned consents to the disclosure
of the information contained herein in its answers to items (1) through (10)
above and the inclusion of such information in the Shelf Registration
Statement and the related prospectus. The undersigned understands that such
information will be relied upon by the Company in connection with the
preparation or amendment of the Shelf Registration Statement and the related
prospectus.
IN WITNESS WHEREOF, the undersigned, by authority duly
given, has caused this Selling Securityholder Notice and Questionnaire to be
executed and delivered either in person or by its duly authorized agent.
Dated: Beneficial Owner
By:__________________________________
Name:
Title:
PLEASE RETURN THE COMPLETED AND EXECUTED SELLING SECURITYHOLDER NOTICE AND
QUESTIONNAIRE TO:
RCN Corporation
[General Counsel's Office]
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Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇