EXECUTION COPY
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REGISTRATION RIGHTS AGREEMENT
DATED AS OF DECEMBER 15, 2005
BY AND AMONG
▇▇▇▇▇▇ AMERICAN CORP.
THE GUARANTORS LISTED ON SCHEDULE I HERETO
AND
BEAR, ▇▇▇▇▇▇▇ & CO. INC.
▇.▇. ▇▇▇▇▇▇ SECURITIES INC.
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This Registration Rights Agreement (this "AGREEMENT") is made and entered
into as of December 15, 2005, by and among ▇▇▇▇▇▇ American Corp., a Delaware
corporation (the "COMPANY"), the guarantors listed on Schedule I hereto (the
"GUARANTORS") and Bear, ▇▇▇▇▇▇▇ & Co. Inc. and ▇.▇. ▇▇▇▇▇▇ Securities Inc. (each
an "INITIAL PURCHASER" and, together, the "INITIAL PURCHASERS"), who have agreed
to purchase the Company's 11 3/4% Senior Notes due 2013 (the "INITIAL NOTES")
pursuant to the Purchase Agreement (as defined below).
This Agreement is made pursuant to the Purchase Agreement, dated December
8, 2005 between CA Investment Corp., a Delaware corporation, and the Initial
Purchasers, as amended by the first amendment thereto, dated the date hereof, by
and among the Company, the Guarantors and the Initial Purchasers (as so amended,
the "PURCHASE AGREEMENT"). In order to induce the Initial Purchasers to purchase
the Initial Notes, the Company and the Guarantors have agreed to provide the
registration rights set forth in this Agreement. The execution and delivery of
this Agreement is a condition to the obligations of the Initial Purchasers set
forth in Section 8 of the Purchase Agreement.
Capitalized terms used herein and not otherwise defined shall have the
meaning assigned to them in the Indenture, dated as of December 15, 2005 (the
"INDENTURE"), among the Company, the Guarantors and The Bank of New York, as
trustee, as amended, relating to the Initial Notes and the Exchange Notes (as
defined below).
The parties hereby agree as follows:
SECTION 1. DEFINITIONS
As used in this Agreement, the following capitalized terms shall have the
following meanings:
ACT: The Securities Act of 1933, as amended, or any successor statute, and
the rules and regulations promulgated by the Commission (as defined below)
thereunder.
AFFILIATE: As defined in Rule 144.
BROKER-DEALER: Any broker or dealer registered under the Exchange Act.
BUSINESS DAY: Any day other than a Saturday, a Sunday or a day on which
banking institutions in the City of New York are authorized or obligated by law,
regulation or executive order to remain closed. If the time to perform any
action hereunder falls on a day that is not a Business Day, such time will be
extended to the next Business Day.
CLOSING DATE: The date hereof.
COMMISSION: The Securities and Exchange Commission.
CONSUMMATE: An Exchange Offer shall be deemed "Consummated" for purposes of
this Agreement upon the occurrence of (a) the filing and effectiveness under the
Act of the Exchange Offer Registration Statement relating to the Exchange Notes
to be issued in the Exchange Offer, (b) the maintenance of such Exchange Offer
Registration Statement continuously effective and
the keeping of the Exchange Offer open for a period not less than the minimum
period required pursuant to Section 3(b) hereof and (c) the delivery by the
Company to the Registrar (as defined in the Indenture) under the Indenture of
Exchange Notes in the same aggregate principal amount as the aggregate principal
amount of Initial Notes that were tendered by Holders thereof pursuant to the
Exchange Offer.
CONSUMMATION DEADLINE: As defined in Section 3(b) hereof.
EXCHANGE ACT: The Securities Exchange Act of 1934, as amended, or any
successor statute, and the rules and regulations promulgated by the Commission
thereunder.
EXCHANGE NOTES: The Company's 11 3/4% Senior Notes due 2013 and the related
guarantees to be issued pursuant to the Indenture (i) in the Exchange Offer or
(ii) as contemplated by Section 4 hereof.
EXCHANGE OFFER: The exchange and issuance by the Company of a principal
amount of Exchange Notes (which shall be registered pursuant to the Exchange
Offer Registration Statement) equal to the outstanding principal amount of
Initial Notes that are tendered by such Holders in connection with such exchange
and issuance.
EXCHANGE OFFER EFFECTIVENESS DEADLINE: As defined in Section 3(a) hereof.
EXCHANGE OFFER REGISTRATION STATEMENT: The Registration Statement relating
to the Exchange Offer, including the related Prospectus.
FILING DEADLINE: As defined in Section 3(a) hereof.
HOLDERS: As defined in Section 2 hereof.
INDEMNIFIED HOLDER: As defined in Section 8(a) hereof.
INDEMNIFIED PARTY: As defined in Section 8(c) hereof.
INDEMNIFIED PERSON: As defined in Section 8(c) hereof.
LIQUIDATED DAMAGES: As defined in Section 5 hereof.
PERSON: An individual, partnership, limited liability company, corporation,
trust, unincorporated organization, or government, agency or political
subdivision thereof.
PROSPECTUS: The prospectus included in a Registration Statement at the time
such Registration Statement is declared effective, as amended or supplemented by
any prospectus supplement and by all other amendments thereto, including
post-effective amendments, and all material incorporated by reference into such
Prospectus.
RECOMMENCEMENT DATE: As defined in Section 6(d) hereof.
REGISTRATION DEFAULT: As defined in Section 5 hereof.
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REGISTRATION STATEMENT: Any registration statement of the Company and the
Guarantors 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, that is filed pursuant to the
provisions of this Agreement, in each case, including the Prospectus included
therein and all amendments and supplements thereto (including post-effective
amendments) and all exhibits and material incorporated by reference therein.
RULE 144: Rule 144 promulgated under the Act.
SHELF FILING DEADLINE: As defined in Section 4(a) hereof.
SHELF REGISTRATION STATEMENT: As defined in Section 4 hereof.
SHELF REGISTRATION STATEMENT EFFECTIVENESS DEADLINE: As defined in Section
4(a) hereof.
SUSPENSION NOTICE: As defined in Section 6(d) hereof.
TIA: The Trust Indenture Act of 1939 (15 U.S.C. Section 77aaa-77bbbb), as
amended.
TRANSFER RESTRICTED SECURITIES: Each Initial Note until the earliest to
occur of (a) the date on which such Initial Note has been exchanged by a Person
other than a Broker-Dealer for an Exchange Note in the Exchange Offer, (b)
following the exchange by a Broker-Dealer in the Exchange Offer of an Initial
Note for an Exchange Note, the date on which such Exchange Note is 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 Initial Note has been effectively
registered under the Act and disposed of in accordance with the Shelf
Registration Statement or (d) the date on which such Initial Note is distributed
to the public pursuant to Rule 144.
SECTION 2. HOLDERS
A Person is deemed to be a holder of Transfer Restricted Securities (each,
a "HOLDER") whenever such Person owns Transfer Restricted Securities.
SECTION 3. REGISTERED EXCHANGE OFFER
(a) Unless the Exchange Offer shall not be permitted by applicable law or
Commission policy (after the procedures set forth in Section 6(a)(i) below have
been complied with), the Company and the Guarantors shall (i) cause the Exchange
Offer Registration Statement to be filed with the Commission as soon as
practicable after the Closing Date, but in no event later than 150 days after
the Closing Date (such 150th day being the "FILING DEADLINE"), (ii) use all of
their respective commercially reasonable efforts to cause such Exchange Offer
Registration Statement to become effective at the earliest practicable time, but
in no event later than 240 days after the Closing Date (such 240th day being the
"EXCHANGE OFFER EFFECTIVENESS DEADLINE"), (iii) in connection with the
foregoing, use their respective commercially reasonable efforts to (A) file all
pre-effective amendments to such Exchange Offer Registration Statement as may be
necessary in order to cause it to become effective, (B) file, if
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applicable, a post-effective amendment to such Exchange Offer Registration
Statement pursuant to Rule 430A under the Act and (C) cause all necessary
filings, if any, 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; provided, however, that
neither the Company nor the Guarantors shall be required to take any action that
would subject them to general service of process or taxation in any jurisdiction
where they are not already so subject, and (iv) as promptly as practicable after
the effectiveness of such Exchange Offer Registration Statement, commence and
Consummate the Exchange Offer. The 150 and 240 day periods referred to in clause
(i) and (ii) of this Section 3(a) shall not include any period in which the
Company is pursuing a Commission decision in accordance with the provisions of
Section 6(a)(i) hereof. The Exchange Offer shall be on the appropriate form
permitting (i) registration of the Exchange Notes to be offered in exchange for
the Transfer Restricted Securities and (ii) resales of Exchange Notes by
Broker-Dealers that tendered into the Exchange Offer Initial Notes that such
Broker-Dealer acquired for its own account as a result of market-making
activities or other trading activities (other than Initial Notes acquired
directly from the Company or any of its Affiliates) as contemplated by Section
3(c) below.
(b) Unless the Exchange Offer shall not be permitted by applicable law or
Commission policy (after the procedures set forth in Section 6(a)(i) below have
been complied with), the Company and the Guarantors shall use all of their
respective commercially reasonable 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 and the Guarantors 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 Company and the Guarantors shall use all of their
respective commercially reasonable 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 45
Business Days thereafter, or longer, if required by the federal securities laws
(such 45th (or longer) Business Day being the "CONSUMMATION DEADLINE").
(c) The Company and the Guarantors shall include a "Plan of Distribution"
section in the Prospectus contained in the Exchange Offer Registration Statement
and indicate therein that any Broker-Dealer who holds Initial Notes that are
Transfer Restricted Securities that were acquired for the account of such
Broker-Dealer as a result of market-making activities or other trading
activities (other than Transfer Restricted Securities acquired directly from the
Company or any Affiliate of the Company), may exchange such Transfer Restricted
Securities pursuant to the Exchange Offer. Such "Plan of Distribution" section
shall also contain all other information with respect to such sales by such
Broker-Dealers that the Commission may require in order to permit such sales
pursuant thereto, but such "Plan of Distribution" shall not name any such
Broker-Dealer or disclose the amount of Initial Notes held by any such
Broker-Dealer, except to the extent required by the Commission as a result of a
change in policy, rules or regulations after the date of this Agreement. See the
Shearman & Sterling no-action letter (available July 2, 1993).
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Because such Broker-Dealer may be deemed to be an "underwriter" within the
meaning of the Act and must, therefore, deliver a prospectus meeting the
requirements of the Act in connection with its initial sale of any Exchange
Notes received by such Broker-Dealer in the Exchange Offer, the Company and
Guarantors shall permit the use of the Prospectus contained in the Exchange
Offer Registration Statement by such Broker-Dealer to satisfy such prospectus
delivery requirement. To the extent necessary to ensure that the Prospectus
contained in the Exchange Offer Registration Statement is available for sales of
Exchange Notes by Broker-Dealers, the Company and the Guarantors agree to use
all of their respective commercially reasonable efforts to keep the Exchange
Offer Registration Statement continuously effective, supplemented and amended as
required by and subject to the provisions of Sections 6(a) and (c) hereof and in
conformity with the requirements of this Agreement, the Act and the policies,
rules and regulations of the Commission as announced from time to time, for a
period of one year from the Consummation Deadline or such shorter period ending
on the date when all Transfer Restricted Securities covered by such Registration
Statement have been sold pursuant thereto. The Company and the Guarantors shall
provide sufficient copies of the latest version of such Prospectus to such
Broker-Dealers, promptly upon reasonable request at any time during such period.
SECTION 4. SHELF REGISTRATION
(a) Shelf Registration. If (i) the Company and the Guarantors are not (A)
required to file the Exchange Offer Registration Statement or (B) permitted to
Consummate the Exchange Offer because the Exchange Offer is not permitted by
applicable law or Commission policy (after the Company and the Guarantors have
complied with the procedures set forth in Section 6(a)(i) below) or (ii) any
Holder of Transfer Restricted Securities notifies the Company prior to 20
Business Days following Consummation of the Exchange Offer that (A) such Holder
was prohibited by law or Commission policy from participating in the Exchange
Offer, (B) such Holder may not resell the Exchange Notes acquired by it in the
Exchange Offer to the public without delivering a prospectus and the Prospectus
contained in the Exchange Offer Registration Statement is not appropriate or
available for such resales by such Holder or (C) such Holder is a Broker-Dealer
and holds Initial Notes acquired directly from the Company or any of its
Affiliates, then the Company and the Guarantors shall:
(x) use all of their respective commercially reasonable efforts on or prior
to 45 days after the earlier of (i) the date as of which the Company determines
that the Exchange Offer Registration Statement will not be or cannot be, as the
case may be, filed as a result of clause (a)(i) above and (ii) the date on which
the Company receives the notice specified in clause (a)(ii) above (such earlier
date, the "SHELF FILING DEADLINE"); provided that such Shelf Filing Deadline
shall not be earlier than 150 days after the date of this Agreement, to file a
shelf registration statement pursuant to Rule 415 under the Act (which may be an
amendment to the Exchange Offer Registration Statement (the "SHELF REGISTRATION
STATEMENT")), relating to all Transfer Restricted Securities of Holders that
have provided the information required pursuant to Section 4(b) hereof; and
(y) use all of their respective commercially reasonable efforts to cause
such Shelf Registration Statement to become effective on or prior to 240 days
after the Shelf Filing Deadline (such 240th day, the "SHELF REGISTRATION
STATEMENT EFFECTIVENESS DEADLINE").
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If, after the Company and the Guarantors have filed an Exchange Offer
Registration Statement that satisfies the requirements of Section 3(a) above,
the Company and the Guarantors are required to file and make effective a Shelf
Registration Statement solely because the Exchange Offer is not permitted as a
result of the circumstances described under applicable federal law or Commission
policy (i.e., clause (a)(i)(B) above), then the filing of the Exchange Offer
Registration Statement shall be deemed to satisfy the requirements of clause (x)
above; provided that, in such event, the Company and the Guarantors shall remain
obligated to meet the Shelf Registration Statement Effectiveness Deadline.
To the extent necessary to ensure that the Shelf Registration Statement is
available for sales of Transfer Restricted Securities by the Holders thereof
entitled to the benefit of this Section 4(a) and the other securities required
to be registered therein pursuant to Section 6(b)(ii) hereof, the Company and
the Guarantors shall use all of their respective commercially reasonable efforts
to keep any Shelf Registration Statement required by this Section 4(a)
continuously effective, supplemented and amended as required by and subject to
the provisions of Sections 6(b) and (c) hereof and in conformity in all material
respects with the requirements of this Agreement, the Act and the policies,
rules and regulations of the Commission as announced from time to time, for a
period of at least two years (as extended pursuant to Section 6(d) hereof)
following the Closing Date, or such shorter period as will terminate when all
Transfer Restricted Securities covered by such Shelf Registration Statement 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 (i) such Holder furnishes
to the Company in writing, within 20 days after receipt of a request therefor,
the information specified in Item 507 or Item 508 of Regulation S-K, as
applicable, of the Act for use in connection with any Shelf Registration
Statement or Prospectus or preliminary prospectus included therein, and (ii) in
the case of an underwritten offering, such Holder completes and executes all
questionnaires, powers of attorney, underwriting agreements, lock-up letters and
other documents reasonably requested by the Company in connection with the terms
of such underwritten offering. Furthermore, 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 Holder's comments to the disclosure relating to such
Holder in the Shelf Registration Statement. 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 information. Each
selling Holder agrees to promptly furnish additional information required to be
disclosed in order to make the information previously furnished to the Company
by such Holder not materially misleading.
SECTION 5. LIQUIDATED DAMAGES
Subject to the Company's rights set forth in Section 6(b)(iii) and 6(d)
hereof, if (i) any Registration Statement required by this Agreement is not
filed with the Commission on or prior to the applicable Filing Deadline or Shelf
Filing Deadline, as applicable, (ii) any of such Registration Statements is not
declared effective by the Commission on or prior to the Exchange Offer
Effectiveness Deadline or the Shelf Registration Statement Effectiveness
Deadline, as
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applicable, (iii) the Exchange Offer has not been Consummated on or prior to the
Consummation Deadline or (iv) any Registration Statement required by this
Agreement is filed and declared effective but thereafter ceases to be usable for
its intended purpose, without being succeeded within 10 Business Days by a
post-effective amendment to such Registration Statement that cures such failure
and that is itself declared effective within such 10 Business Day period (each
such event referred to in clauses (i) through (iv), a "REGISTRATION DEFAULT"),
then the Company and the Guarantors hereby jointly and severally agree to pay to
each Holder of Transfer Restricted Securities liquidated damages ("LIQUIDATED
DAMAGES") in an amount equal to a per annum rate of 0.25% on the principal
amount of Transfer Restricted Securities held by such Holder for the period of
time that the Registration Default continues for the first 90-day period
immediately following the occurrence of such Registration Default. The amount of
the Liquidated Damages shall increase by an additional per annum rate of 0.25%
with respect to each subsequent 90-day period until no Registration Default is
in effect, up to a maximum amount of Liquidated Damages for all Registration
Defaults of 1.00% per annum on the principal amount of Transfer Restricted
Securities; provided that the Company and the Guarantors shall in no event be
required to pay Liquidated Damages for more than one Registration Default at any
given time. Notwithstanding anything to the contrary set forth herein, (1) upon
filing of the Exchange Offer Registration Statement (and/or, if applicable, the
Shelf Registration Statement), in the case of (i) above, (2) upon the
effectiveness of the Exchange Offer Registration Statement (and/or, if
applicable, the Shelf Registration Statement), in the case of (ii) above, (3)
upon Consummation of the Exchange Offer, in the case of (iii) above, or (4) upon
the filing of a post-effective amendment to the Registration Statement or an
additional Registration Statement that causes the Exchange Offer Registration
Statement (and/or, if applicable, the Shelf Registration Statement) to again be
declared effective or made usable in the case of (iv) above, the Liquidated
Damages payable with respect to the Transfer Restricted Securities as a result
of such clause (i), (ii), (iii) or (iv), as applicable, shall cease on the date
of such cure and the interest rate on such Transfer Restricted Securities will
revert to the interest rate on such Transfer Restricted Securities prior to the
applicable Registration Default.
All accrued Liquidated Damages shall be paid to the Holders entitled
thereto, in the manner provided for the payment of interest in the Indenture, on
the next scheduled Interest Payment Date (as defined in the Indenture), as more
fully set forth in the Indenture and the Notes. Notwithstanding the fact that
any securities for which Liquidated Damages are due cease to be Transfer
Restricted Securities, all obligations of the Company and the Guarantors to pay
Liquidated Damages with respect to securities shall survive until such time as
such obligations with respect to such securities shall have been satisfied in
full.
The amount of Liquidated Damages payable shall not increase because more
than one Registration Default has occurred and is continuing, and a Holder of
Initial Notes or Exchange Notes who is not entitled to the benefits of a Shelf
Registration Statement shall not be entitled to Liquidated Damages with respect
to a Registration Default that pertains to such Shelf Registration Statement.
SECTION 6. REGISTRATION PROCEDURES
(a) Exchange Offer Registration Statement. In connection with the Exchange
Offer, the Company and the Guarantors shall (x) comply with all applicable
provisions of Section 6(c)
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below, (y) use all of their respective commercially reasonable efforts to effect
such exchange and to permit the resale of Exchange Notes by Broker-Dealers that
tendered in the Exchange Offer Initial Notes that such Broker-Dealer acquired
for its own account as a result of its market-making activities or other trading
activities (other than Initial Notes acquired directly from the Company or any
of its Affiliates) being sold in accordance with the intended method or methods
of distribution thereof set forth in the Registration Statement, and (z) comply
with all of the following provisions:
(i) If, following the date hereof there has been announced a change in
Commission policy with respect to exchange offers such as the Exchange
Offer, that in the reasonable opinion of counsel to the Company raises a
substantial question as to whether the Exchange Offer is permitted by
applicable law, the Company and the Guarantors hereby agree to seek a
no-action letter or other favorable decision from the Commission allowing
the Company and the Guarantors to Consummate an Exchange Offer for such
Transfer Restricted Securities. The Company and the Guarantors hereby agree
to pursue the issuance of such a decision to the Commission staff level;
provided that the Company and the Guarantors shall not be required to take
any commercially unreasonable action to effect a change in Commission
policy. In connection with the foregoing, the Company and the Guarantors
hereby agree, however, to take all such other commercially reasonable
actions as may be requested by the Commission or otherwise required in
connection with the issuance of such decision, including without limitation
(A) participating in telephonic conferences with the Commission, (B)
delivering 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)
diligently pursuing a resolution of such submission (which need not be
favorable) by the Commission staff.
(ii) As a condition to its participation in the Exchange Offer, each
Holder of Transfer Restricted Securities (including, without limitation,
any Holder who is a Broker-Dealer) shall furnish, upon the request of the
Company, prior to the Consummation of the Exchange Offer, a written
representation to the Company and the Guarantors (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,
(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.
As a condition to its participation in the Exchange Offer each Holder using
the Exchange Offer to participate in a distribution of the Exchange Notes
shall acknowledge and agree that, if the resales are of Exchange Notes
obtained by such Holder in exchange for Initial Notes acquired directly
from the Company or an Affiliate thereof, it (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, if
applicable, any no-action letter obtained pursuant to clause (i) above),
and (2) must comply with the registration and prospectus delivery
requirements of the Act in connection with a secondary resale transaction
and that such a
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secondary resale transaction must 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.
(iii) Prior to effectiveness of the Exchange Offer Registration
Statement, the Company and the Guarantors shall provide a supplemental
letter to the Commission (A) stating that the Company and the Guarantors
are 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) as
interpreted in the Commission's letter to Shearman & Sterling dated July 2,
1993, and, if applicable, any no-action letter obtained pursuant to clause
(i) above, (B) including a representation that neither the Company has nor
the Guarantors have 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 and the Guarantors'
information and belief, each Holder 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 and (C)
any other undertaking or representation required by the Commission as set
forth in any no-action letter obtained pursuant to clause (i) above, if
applicable.
(b) Shelf Registration Statement. In connection with the Shelf Registration
Statement, the Company and the Guarantors shall:
(i) comply with all the provisions of Section 6(c) below and use all
of their respective commercially reasonable 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 (as indicated in the information furnished to the Company pursuant
to Section 4(b) hereof), and pursuant thereto the Company and the
Guarantors will prepare and file with the Commission a Registration
Statement relating to the registration on any appropriate form under the
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 within the time periods and otherwise in accordance
with the provisions hereof, and
(ii) issue, upon the request of any Holder or purchaser of Initial
Notes covered by any Shelf Registration Statement contemplated by this
Agreement; provided that such Holder provides all documentation reasonably
requested by the Company in connection with such issuance, Exchange Notes
having an aggregate principal amount equal to the aggregate principal
amount of Initial Notes sold pursuant to the Shelf Registration Statement
and surrendered to the Company for cancellation; the Company shall register
Exchange Notes on the Shelf Registration Statement for this purpose and
issue the Exchange Notes to the purchaser(s) of securities subject to the
Shelf Registration Statement in the names as such purchaser(s) shall
designate.
(iii) If the Board of Directors of the Company determines in good
faith that it is in the best interests of the Company not to disclose the
existence of or facts
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surrounding any proposed or pending material corporate transaction or other
material development involving the Company or the Guarantors, the Company
may allow the Shelf Registration Statement to fail to be effective or the
Prospectus contained therein to be unusable as a result of such
nondisclosure for up to seventy-five (75) days in any year during the
two-year period of effectiveness required by Section 4 hereof and no
Liquidated Damages shall become payable by the Company or the Guarantors as
a result of any such Shelf Registration Statement failing to be effective
or any such Prospectus being unusuable pursuant to this Section 6(b)(iii).
(c) General Provisions. In connection with any Registration Statement and
any related Prospectus required by this Agreement, the Company and the
Guarantors shall:
(i) use their respective commercially reasonable efforts to keep such
Registration Statement continuously effective and provide all requisite
financial statements for the period specified in Section 3 or 4 hereof, as
applicable. Upon the occurrence of any event that would cause any such
Registration Statement or the Prospectus contained therein (A) to contain
an untrue statement of 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 or (B) not to be effective and usable for resale of Transfer
Restricted Securities during the period required by this Agreement, the
Company and the Guarantors shall file as promptly as practicable an
appropriate amendment to such Registration Statement curing such defect,
and, if Commission review is required, use all of their respective
commercially reasonable efforts to cause such amendment to be declared
effective as soon as practicable;
(ii) prepare and file with the Commission such amendments and
post-effective amendments to the applicable Registration Statement as may
be necessary to keep such Registration Statement effective for the
applicable period set forth in Section 3 or 4 hereof, as the case may be;
cause the Prospectus to be supplemented by any required Prospectus
supplement, and as so supplemented to be filed pursuant to Rule 424 under
the Act, and to comply fully with the applicable provisions of Rules 424,
430A and 462, as applicable, under the Act in a timely manner; and comply
with the provisions of the 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) advise the Holders as promptly as practicable and, if requested
by such Holders, 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 applicable Registration Statement or any post-effective
amendment thereto, when the same has become effective, (B) of any request
by the Commission 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 Act or
of the suspension by any state securities commission of the qualification
of the Transfer
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Restricted Securities for offering or sale in any jurisdiction, or the
initiation of any proceeding for any of the preceding purposes, and (D) 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 in order to make
the statements therein not misleading, or that requires the making of any
additions to or changes in the Prospectus in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading (provided, however, that no advice by the Company shall be
required pursuant to this clause (D) in the event that the Company either
promptly files a Prospectus supplement to update the Prospectus or a Form
8-K or other appropriate Exchange Act report that is incorporated by
reference into such Registration Statement, which, in either case, contains
the requisite information with respect to such event or facts that results
in such Registration Statement no longer containing any untrue statement of
material fact or omitting to state a material fact necessary to make the
statements contained therein not misleading). 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 and the Guarantors shall use all of their
respective commercially reasonable efforts to obtain the withdrawal or
lifting of such order at the earliest practicable time;
(iv) subject to Section 6(c)(i), if any fact or event contemplated by
Section 6(c)(iii)(D) above shall exist or have occurred, prepare 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, the Prospectus, as of its
date, will not contain an untrue statement of a material fact or omit to
state any material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
(v) in the case of a Shelf Registration Statement, furnish to each
Holder named in any such Registration Statement in connection with such
exchange or sale, 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 and
comment of such Holders in connection with such sale, if any, for a period
of at least 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 such Holders shall reasonably object in
writing within five Business Days after the receipt thereof. A Holder 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 an untrue statement of a material fact or omits to
state any material fact required to be stated therein or necessary to make
the statements therein not
11
misleading or fails to comply with the applicable requirements of the Act.
Notwithstanding the foregoing, the Company shall not be required to take
any actions under this Section 6(c)(v) that are not, in the reasonable
opinion of counsel for the Company, in compliance with applicable law;
(vi) 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 in connection with such exchange or
sale, if any, provide copies of such document to the Holders named in any
such Registration Statement, make the Company's and the Guarantors'
representatives available for discussion of such document and other
customary due diligence matters, subject to negotiation, execution and
delivery of customary confidentiality agreements, and include such
information in such document prior to the filing thereof as such Holders
may reasonably request;
(vii) make available, at reasonable times, for inspection by the
Holders named in any applicable Registration Statement and legal counsel or
accountant retained by such Holders, all financial and other records,
pertinent corporate documents of the Company and the Guarantors reasonably
requested by any such Persons and cause the Company's and the Guarantors'
officers, directors and employees to supply all information reasonably
requested by any such Holder, counsel or accountant, subject to
negotiation, execution and delivery of customary confidentiality
agreements, in connection with such Registration Statement or any
post-effective amendment thereto subsequent to the filing thereof and prior
to its effectiveness;
(viii) in the case of a Shelf Registration Statement, if requested by
any Holders named in any such Registration Statement in connection with
such exchange or sale, promptly include in any Registration Statement or
Prospectus, pursuant to a supplement, document incorporated by reference or
post-effective amendment if necessary, such information as such Holders 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, 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 included in
such Prospectus supplement or post-effective amendment;
(ix) in the case of a Shelf Registration Statement, use its
commercially reasonable efforts to cause the Transfer Restricted Securities
covered by the Registration Statement to be rated with the appropriate
rating agencies, if so requested by the Holders of a majority in aggregate
principal amount of Transfer Restricted Securities covered thereby;
(x) in the case of a Shelf Registration Statement, upon request,
furnish to each Holder named in any such Registration Statement in
connection with such exchange or sale, without charge, at least one copy of
the Registration Statement, as first filed with the
12
Commission, and of each amendment thereto, (without all documents
incorporated by reference therein and exhibits thereto, unless requested);
(xi) in the case of a Shelf Registration Statement, upon request,
deliver to each Holder named in any such Registration Statement without
charge, as many copies of the Prospectus (including each preliminary
prospectus) and any amendment or supplement thereto as such Persons
reasonably may request; provided that if no Registration Statement is
effective or no Prospectus is usable in accordance with the provisions of
Section 6(b) hereof, the Company shall deliver to each Holder named in any
such Registration Statement a notice to that effect; the Company and the
Guarantors hereby consent to the use (in accordance with law) of the
Prospectus and any amendment or supplement thereto by each selling Holder
in connection with the offering and the sale of the Transfer Restricted
Securities covered by the Prospectus or any amendment or supplement
thereto;
(xii) in the case of a Shelf Registration Statement, upon the
reasonable request of any Holder named in any such Registration Statement,
enter into such agreements (including underwriting agreements containing
customary terms) and make such customary representations and warranties and
take all such other customary actions in connection therewith in order to
expedite or facilitate the disposition of the Transfer Restricted
Securities pursuant to such Registration Statement as may be reasonably
requested by any such Holder in connection with any sale or resale pursuant
to such Registration Statement. In such connection, the Company and the
Guarantors shall:
(A) to the extent reasonably requested by any Holder named in any
such Registration Statement, furnish (or in the case of paragraphs (2)
and (3), use all of their respective commercially reasonable efforts
to cause to be furnished) to each Holder, upon the effectiveness of
the Shelf Registration Statement:
(1) a certificate in customary form, dated such date, signed
on behalf of the Company and each Guarantor by (x) the President
or any Vice President and (y) a principal financial or accounting
officer of the Company, in customary form, and such Guarantor,
confirming, as of the date thereof, the matters set forth in
Sections 8(a), (c), (d) and (e) of the Purchase Agreement and
such other matters as such Holders may reasonably request;
(2) an opinion in customary form, dated the date of
effectiveness of the Shelf Registration Statement, of counsel for
the Company and the Guarantors, covering such matters as set
forth in Sections 8(g) and (h) of the Purchase Agreement and such
other matters as such Holder may reasonably request; and
(3) a customary comfort letter, dated the date of
effectiveness of the Shelf Registration Statement, from the
Company's independent accountants, in the customary form and
covering matters of the type customarily covered in comfort
letters to underwriters in connection with
13
primary underwritten offerings, and covering or affirming the
matters set forth in the comfort letters delivered pursuant to
Section 8(i) of the Purchase Agreement; and
(B) deliver such other documents and certificates as may be
reasonably requested by the Holders named in any such Registration
Statement and as are customarily delivered in similar offerings to
evidence compliance with the matters covered in clause (A) above and
with any customary conditions contained in any agreement entered into
by the Company and the Guarantors pursuant to this clause (B);
(xiii) prior to any public offering of Transfer Restricted Securities,
use all of their respective commercially reasonable efforts to cooperate
with the Holders named in the applicable Registration Statement and their
counsel in connection with the registration and qualification of the
Transfer Restricted Securities under the state securities or blue sky laws
of such jurisdictions as such Holders may reasonable request and use all of
their respective commercially reasonable efforts to do any and all other
acts or things necessary or advisable to enable the disposition in such
jurisdictions of the Transfer Restricted Securities covered by the
applicable Registration Statement; provided, however, that neither the
Company nor the Guarantors shall be required to register or qualify as a
foreign corporation 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 in
any jurisdiction where it is not now so subject;
(xiv) in connection with any sale of Transfer Restricted Securities
that will result in such securities no longer being Transfer Restricted
Securities, cooperate with the Holders to facilitate the timely preparation
and delivery of certificates representing Transfer Restricted Securities to
be sold and not bearing any restrictive legends; and to enable such
Transfer Restricted Securities to be registered in such denominations and
such names as the selling Holders may request at least three Business Days
prior to such sale of Transfer Restricted Securities;
(xv) use all of their respective commercially reasonable efforts to
cause the disposition of 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 to consummate the disposition of such Transfer
Restricted Securities other than as set forth in Section 6(c)(xiii) hereof;
(xvi) provide a CUSIP number for all Transfer Restricted Securities
not later than the effective date of a Registration Statement covering such
Transfer Restricted Securities and provide the Trustee under the Indenture
with any necessary printed certificates for the Transfer Restricted
Securities which are in a form eligible for deposit with the Depository
Trust Company;
(xvii) otherwise use all of their respective commercially reasonable
efforts to comply with all applicable rules and regulations of the
Commission, and make generally available to its security holders with
regard to any applicable Registration Statement, as
14
soon as practicable, a consolidated earnings statement meeting the
requirements of Rule 158 under the Act (which need not be audited) covering
a twelve-month period beginning after the effective date of the
Registration Statement (as such term is defined in paragraph (c) of Rule
158 under the Act);
(xviii) 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 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 all of their respective commercially reasonable efforts
to cause the Trustee to execute, all documents that may be required to
effect such changes and all other forms and documents required to be filed
with the Commission to enable such Indenture to be so qualified in a timely
manner; and
(xix) provide as promptly as practicable to each Holder, upon request,
each document filed with the Commission pursuant to the requirements of
Section 13 or Section 15(d) of the Exchange Act.
(d) Restrictions on Holders. Each Holder agrees by acquisition of a
Transfer Restricted Security that, upon receipt of the notice referred to in
Section 6(c)(iii)(C), or any notice from the Company of the existence of any
fact of the kind described in Section 6(c)(iii)(D) hereof (in each case, a
"SUSPENSION NOTICE"), such Holder will forthwith discontinue disposition of
Transfer Restricted Securities pursuant to the applicable Registration Statement
until (x) such Holder has received copies of the supplemented or amended
Prospectus contemplated by Section 6(c)(iv) hereof, or (y) such Holder is
advised in writing 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 (in each case, the "RECOMMENCEMENT
DATE"). Each Holder receiving a Suspension Notice hereby agrees that it will
either (i) destroy any Prospectuses, other than permanent file copies, then in
such Holder's possession which have been replaced by the Company with more
recently dated Prospectuses or (ii) 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 the Suspension 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 hereof, as
applicable, shall be extended by a number of days equal to the number of days in
the period from and including the date of delivery of the Suspension Notice to
the Recommencement Date.
SECTION 7. REGISTRATION EXPENSES
(a) All expenses incident to the Company's and the Guarantors' performance
of or compliance with this Agreement (other than any underwriting discounts and
commissions) 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; (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), messenger and delivery
services and telephone;
15
(iv) all fees and disbursements of counsel for the Company and the Guarantors
and all reasonable fees and disbursements of one firm of counsel for the Holders
of Transfer Restricted Securities; (v) all application and filing fees in
connection with listing the Exchange Notes on a national securities exchange or
automated quotation system pursuant to the requirements thereof; and (vi) all
fees and disbursements of independent certified public accountants of the
Company and the Guarantors (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 and the Guarantors' 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 or the Guarantors.
(b) In connection with any Registration Statement required by this
Agreement (including, without limitation, the Exchange Offer Registration
Statement and the Shelf Registration Statement) regardless of whether a
Registration Statement becomes effective, the Company and the Guarantors will
reimburse the Initial Purchasers and the Holders of Transfer Restricted
Securities who are tendering Initial Notes in the Exchange Offer and/or selling
or reselling Initial Notes or Exchange Notes 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
▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, unless another firm shall be chosen by the Holders of a
majority in principal amount of the Transfer Restricted Securities for whose
benefit such Registration Statement is being prepared; provided that the Company
and the Guarantors' reimbursement obligation with respect to such fees and
disbursements shall not exceed $25,000.
SECTION 8. INDEMNIFICATION
(a) The Company and the Guarantors agree, jointly and severally, to
indemnify and hold harmless each Holder, its directors, officers and each
Person, if any, who controls such Holder (within the meaning of Section 15 of
the Act or Section 20 of the Exchange Act) (collectively, an "INDEMNIFIED
HOLDER"), from and against any and all losses, claims, damages, liabilities,
judgments, and expenses (including without limitation, any reasonable legal fees
or other expenses reasonably incurred in connection with investigating,
preparing or defending any matter, including any action that could give rise to
any such losses, claims, damages, liabilities or judgments) to which they or any
of them may become subject under the Act, the Exchange Act or otherwise, insofar
as such losses, claims, damages, liabilities, judgments and expenses are caused
by any untrue statement or alleged untrue statement of a material fact contained
in any Registration Statement, preliminary prospectus or Prospectus (or any
amendment or supplement thereto) provided by the Company to any Holder or any
prospective purchaser of Exchange Notes or registered Initial Notes, or caused
by any omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading,
except insofar as such losses, claims, damages, liabilities or judgments are
caused by an untrue statement or omission or alleged untrue statement or
omission that is based upon information relating to any of the Holders furnished
in writing to the Company by any of the Holders.
16
(b) Each Holder of Transfer Restricted Securities agrees, severally and not
jointly, to indemnify and hold harmless the Company and the Guarantors, and
their respective directors and officers, and each person, if any, who controls
(within the meaning of Section 15 of the Act or Section 20 of the Exchange Act)
the Company, or the Guarantors to the same extent as the foregoing indemnity
from the Company and the Guarantors set forth in section (a) above to each of
the Indemnified Holders, but only with reference to information relating to such
Indemnified Holder furnished in writing to the Company by such Indemnified
Holder expressly for use in any Registration Statement. In no event shall any
Indemnified Holder, its directors, officers or any Person who controls such
Holder be liable or responsible for any amount in excess of the amount by which
the total amount received by such Indemnified Holder with respect to its sale of
Transfer Restricted Securities pursuant to a Registration Statement exceeds (i)
the amount paid by such Indemnified Holder for such Transfer Restricted
Securities and (ii) the amount of any damages that such Indemnified Holder, its
directors, officers or any Person who controls such Holder has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission.
(c) In case any action shall be commenced involving any person in respect
of which indemnity may be sought pursuant to Section 8(a) or 8(b) (the
"INDEMNIFIED PARTY"), the indemnified party shall promptly notify the person
against whom such indemnity may be sought (the "INDEMNIFYING PERSON") in writing
and the indemnifying party shall assume the defense of such action, including
the employment of counsel reasonably satisfactory to the indemnified party and
the payment of all fees and expenses of such counsel, as incurred (except that
in the case of any action in respect of which indemnity may be sought pursuant
to both Sections 8(a) and 8(b), an Indemnified Holder shall not be required to
assume the defense of such action pursuant to this Section 8(c), but may employ
separate counsel and participate in the defense thereof, but the fees and
expenses of such counsel, except as provided below, shall be at the expense of
the Indemnified Holder). Any indemnified party shall have the right to employ
separate counsel in any such action and participate in the defense thereof, but
the fees and expenses of such counsel shall be at the expense of the indemnified
party unless (i) the employment of such counsel shall have been specifically
authorized in writing by the indemnifying party, (ii) the indemnifying party
shall have failed to assume the defense of such action or employ counsel
reasonably satisfactory to the indemnified party within a reasonable time after
notice of commencement of the action or (iii) the named parties to any such
action (including any impleaded parties) include both the indemnified party and
the indemnifying party, and the indemnified party shall have been advised by
such counsel that there may be one or more legal defenses available to it which
are different from or additional to those available to the indemnifying party
(in which case the indemnifying party shall not have the right to assume the
defense of such action on behalf of the indemnified party). In any such case,
the indemnifying party shall not, in connection with any one action or separate
but substantially similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances, be liable for the fees and
expenses of more than one separate firm of attorneys (in addition to any local
counsel) for all indemnified parties and all such fees and expenses shall be
reimbursed as they are incurred. Such firm shall be designated in writing by a
majority of the Indemnified Holders, in the case of the parties indemnified
pursuant to Section 8(a), and by the Company and Guarantors, in the case of
parties indemnified pursuant to Section 8(b). The indemnifying party shall
indemnify and hold harmless the indemnified party from and against any and all
losses, claims, damages, liabilities and judgments by reason of any settlement
of any action (i) effected
17
with its written consent or (ii) effected without its written consent if the
settlement is entered into more than twenty Business Days after the indemnifying
party shall have received a request from the indemnified party for reimbursement
for the fees and expenses of counsel (in any case where such fees and expenses
are at the expense of the indemnifying party) and, prior to the date of such
settlement, the indemnifying party shall have failed to comply with such
reimbursement request. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement or compromise of, or
consent to the entry of judgment with respect to, any pending or threatened
action in respect of which the indemnified party is or could have been a party
and indemnity or contribution may be or could have been sought hereunder by the
indemnified party, unless such settlement, compromise or judgment (i) includes
an unconditional release of the indemnified party from all liability on claims
that are or could have been the subject matter of such action and (ii) does not
include a statement as to or an admission of fault, culpability or a failure to
act, by or on behalf of the indemnified party.
(d) To the extent that the indemnification provided for in this Section 8
is unavailable to an indemnified party in respect of any losses, claims,
damages, liabilities or judgments referred to therein, then each indemnifying
party, in lieu of indemnifying such indemnified party, shall contribute to the
amount paid or payable by such indemnified party as a result of such losses,
claims, damages, liabilities or judgments (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company and the
Guarantors, on the one hand, and the Indemnified Holders, on the other hand,
from their sale of Transfer Restricted Securities or (ii) if the allocation
provided by clause 8(d)(i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause 8(d)(i) above but also the relative fault of the Company and the
Guarantors, on the one hand, and of the Indemnified Holders, on the other hand,
in connection with the statements or omissions which resulted in such losses,
claims, damages, liabilities or judgments, as well as any other relevant
equitable considerations. The relative fault of the Company and the Guarantors,
on the one hand, and of the Indemnified Holders, on the other hand, shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company or the
Guarantors, on the one hand, or by the Indemnified Holder, on the other hand,
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The amount paid or
payable by a party as a result of the losses, claims, damages, liabilities and
judgments referred to above shall be deemed to include any legal or other fees
or expenses reasonably incurred by such party in connection with investigating
or defending any claim or action.
The Company, the Guarantors and each Holder agree that it would not be just
and equitable if contribution pursuant to this Section 8(d) were determined by
pro rata allocation (even if the Holders were treated as one entity for such
purpose) 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 party as a result of the losses,
claims, damages, liabilities or judgments referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any matter, including any
action that could have given rise to such losses, claims, damages, liabilities
or judgments. Notwithstanding the provisions of this
18
Section 8, no Holder, or its related Indemnified Holders, its directors, its
officers or any Person, if any, who controls such Holder shall be required to
contribute, in the aggregate, any amount in excess of the amount by which the
total received by such Holder with respect to the sale of Transfer Restricted
Securities pursuant to a Registration Statement exceeds (i) the amount paid by
such Holder for such Transfer Restricted Securities and (ii) the amount of any
damages which such Holder has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. The Holders' obligations to contribute
pursuant to this Section 8(d) are several in proportion to the respective
principal amount of Transfer Restricted Securities held by each Holder hereunder
and not joint.
SECTION 9. RULE 144A AND RULE 144
The Company and the Guarantors agrees with each Holder, for so long as any
Transfer Restricted Securities remain outstanding and during any period in which
the Company or the Guarantors (i) is not subject to Section 13 or 15(d) of the
Exchange Act, to make available, upon request of any Holder, to such Holder or
beneficial owner of Transfer Restricted Securities in connection with any sale
thereof and any prospective purchaser of such Transfer Restricted Securities
designated by such Holder or beneficial owner, the information required by Rule
144A(d)(4) under the Act in order to permit resales of such Transfer Restricted
Securities pursuant to Rule 144A under the Act, and (ii) is subject to Section
13 or 15(d) of the Exchange Act, to make all filings required thereby in a
timely manner in order to permit resales of such Transfer Restricted Securities
pursuant to Rule 144.
SECTION 10. MISCELLANEOUS
(a) Remedies. The Company and the Guarantors acknowledge and agree that any
failure by the Company and/or the Guarantors to comply with their respective
obligations under Sections 3 and 4 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 and the Guarantors' obligations under Sections 3 and 4 hereof. The
Company and the Guarantors further agree to waive the defense in any action for
specific performance that a remedy at law would be adequate.
(b) No Inconsistent Agreements. Neither the Company nor the Guarantors
will, 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.
Neither the Company has nor the Guarantors have previously entered into, nor is
currently party to, any agreement granting any registration rights with respect
to its securities to any Person that would require such securities to be
included in any Registration Statement filed hereunder. 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 and the Guarantors'
securities under any agreement in effect on the date hereof.
19
(c) Amendments and Waivers. The provisions of this Agreement may not be
amended, modified or supplemented, and waivers or consents to or departures from
the provisions hereof may not be given unless (i) in the case of Section 5
hereof and this Section 10(c)(i), the Company has obtained the written consent
of Holders of all outstanding Transfer Restricted Securities and (ii) in the
case of all other provisions hereof, the Company has obtained the written
consent of Holders of a majority of the outstanding principal amount of Transfer
Restricted Securities (excluding Transfer Restricted Securities held by the
Company or its Affiliates). Notwithstanding the foregoing, a waiver or consent
to departure from the provisions hereof that relates exclusively to the rights
of Holders whose Transfer Restricted Securities are being tendered pursuant to
the Exchange Offer, and that does not affect directly or indirectly the rights
of other Holders whose Transfer Restricted 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 subject to
such Exchange Offer.
(d) Additional Guarantors. The Company shall cause any of its Restricted
Subsidiaries (as defined in the Indenture) that becomes, prior to the
consummation of the Exchange Offer, a Guarantor in accordance with the terms and
provisions of the Indenture to become a party to this Agreement as a Guarantor.
Notwithstanding the generality of the foregoing statement, any entity that
becomes a Guarantor upon the consummation of the Acquisition (as defined in the
Purchase Agreement) shall become a party to this Agreement as a Guarantor. It is
understood and agreed that if, prior to the Exchange Offer, a Guarantor that has
executed this Agreement is no longer a Guarantor under the Indenture pursuant to
and in accordance with the provisions of the Indenture, such Guarantor shall no
longer be a Guarantor for purposes of this Agreement.
(e) Third Party Beneficiary. The Holders shall be third party beneficiaries
to the agreements made hereunder between the Company and the Guarantors, on the
one hand, and the Initial Purchasers, on the other hand, and shall have the
right to enforce such agreements directly to the extent they may deem such
enforcement necessary or advisable to protect its rights or the rights of
Holders hereunder.
By acquiring Transfer Restricted Securities, a Holder will be deemed to
have agreed to indemnify and hold harmless the Company, the Guarantors, and
their respective directors and officers, and each person, if any, who controls
(within the meaning of Section 15 of the Act or Section 20 of the Exchange Act)
to the same extent as the indemnity from the Company and the Guarantors set
forth in Section 8(a) hereof, but only with reference to information relating to
such Holder and provided in writing by such Holder for inclusion in any Shelf
Registration Statement. In no event shall any such Holder be liable or
responsible for any amount in excess of the amount by which such Holder with
respect to its sale of Transfer Restricted Securities pursuant to a Shelf
Registration Statement exceeds (i) the amount paid by such Holder for such
Transfer Restricted Securities and (ii) the amount of any damages that such
Holder, its directors, officers or any Person who controls such Holder has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission.
(f) 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), facsimile or air courier
guaranteeing overnight delivery:
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(i) if to a Holder, at the address set forth on the records of the
Registrar under the Indenture, with a copy to the Registrar under the
Indenture; and
(ii) if to the Company or the Guarantors:
▇▇▇▇▇▇ American Corp.
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Chief Financial Officer
With a copy to:
▇▇▇▇, Weiss, Rifkind, ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇, LLP
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇. Wee
And a copy to:
M&F Worldwide Corp.
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: General Counsel
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
acknowledged, if telecopied; and on the next Business Day, if timely delivered
to an air courier guaranteeing overnight delivery.
Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the Trustee at the
address specified in the Indenture.
(g) Successors and Assigns. This Agreement shall inure to the benefit of
and be binding upon the successors and assigns of each of the parties, including
without limitation and without the need for an express assignment, subsequent
Holders of Transfer Restricted Securities; provided that nothing herein shall be
deemed to permit any assignment, transfer or other disposition of Transfer
Restricted Securities in violation of the terms hereof or of the Purchase
Agreement or the Indenture. 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, including
the restrictions on resale set forth in this Agreement and, if applicable, the
Purchase Agreement, and such Person shall be entitled to receive the benefits
hereof.
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(h) 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.
(i) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(j) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE
CONFLICT OF LAW RULES THEREOF. TIME IS OF THE ESSENCE IN THIS AGREEMENT.
(k) 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 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.
(l) Entire Agreement. This Agreement is intended by the parties as a final
expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the subject matter contained herein. There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein
with respect to the registration rights granted with respect to the Transfer
Restricted Securities. This Agreement supersedes all prior agreements and
understandings between the parties with respect to such subject matter.
(Signature Pages Follow)
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.
▇▇▇▇▇▇ AMERICAN CORP.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇.
-------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇.
Title: Senior Vice President and
Chief Financial Officer
B(2) DIRECT, INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇.
-------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇.
Title: Senior Vice President and
Chief Financial Officer
CHECKS IN THE MAIL, INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇.
-------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇.
Title: Senior Vice President and
Chief Financial Officer
▇▇▇▇▇▇ AMERICAN CHECKS, INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇.
-------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇.
Title: Senior Vice President and
Chief Financial Officer
CORE SKILLS INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇.
-------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇.
Title: Senior Vice President and
Chief Financial Officer
BEAR, ▇▇▇▇▇▇▇ & CO. INC.
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-----------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Senior Managing Director
▇.▇. ▇▇▇▇▇▇ SECURITIES INC.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
SCHEDULE I
GUARANTORS
B2 DIRECT, INC.
CHECKS IN THE MAIL, INC.
▇▇▇▇▇▇ AMERICAN CHECKS, INC.
CORE SKILLS INC.