REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this Agreement ), dated as
of September 26, 1997, is entered into between Edison Brothers Stores,
Inc., a Delaware corporation (the Company ), and each of the other persons
or entities signatory hereto (each of such other persons, a Stockholder ).
W I T N E S S E T H :
WHEREAS, the Debtors' Amended Joint Plan of Reorganization under
Chapter 11 of the Bankruptcy Code (the Plan ) was confirmed on September
9, 1997 by order of the United States Bankruptcy Court for the District of
Delaware in Case No. 95-1354 (PJW);
WHEREAS, pursuant to the Plan, each Stockholder will receive at
least 10% of the aggregate shares of Common Stock (as hereinafter defined),
and/or at least 10% in aggregate principal amount of the New Notes,
issuable under the Plan (such shares of Common Stock issued to the
Stockholders, collectively the Shares );
WHEREAS, the Shares and the New Notes will be issued to the
Stockholders pursuant to the Plan without registration under the Securities
Act (as hereinafter defined), in reliance on an applicable exemption from
such registration, and the Company and the Stockholders desire to provide
for the registration of the resale by the Stockholders of Registrable
Securities (as hereinafter defined) from time to time, upon the terms and
subject to conditions hereinafter set forth; and
WHEREAS, it is intended by the Company and the Stockholders that
this Agreement shall become effective immediately as of the Effective Date.
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants herein contained, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged and affirmed,
the parties hereto, intending to be legally bound, hereby agree as follows:
1. DEFINITIONS.
All capitalized terms used but not defined in this Agreement have
the respective meanings assigned to such terms in the Plan. As used in
this Agreement, the following capitalized terms (in their singular and
plural forms, as applicable) have the following meanings:
Agreement has the meaning assigned to such term in the
introductory paragraph to this Agreement.
Commission means the United States Securities and Exchange
Commission and any successor United States federal agency or governmental
authority having similar powers.
Common Stock means the common stock, par value $0.01 per share,
of the Company, issued as of the Effective Date pursuant to the Plan.
Company has the meaning assigned to such term in the
introductory paragraph to this Agreement.
Demand Common Stock Registration has the meaning assigned to
such term in Section 2(b).
Demand New Notes Registration has the meaning assigned to such
term in Section 2(b).
Demand Registration has the meaning assigned to such term in
Section 2(b).
Demand Request has the meaning assigned to such term in Section
2(b).
Effective Period has the meaning assigned to such term in
Section 2(a)(ii).
Exchange Act means the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission thereunder.
Material Adverse Effect has the meaning assigned to such term
in Section 2(b)(iv).
Material Disclosure Event means, as of any date of
determination, any pending or imminent event relating to the Company,
which, in the good faith, reasonable opinion of the Board of Directors of
the Company (i) requires disclosure of material, non-public information
relating to such event in any registration statement so that such
registration statement would not be materially misleading, (ii) is
otherwise not required to be publicly disclosed at that time (e.g., on Form
8-K or Form 10-Q) under applicable federal or state securities laws, and
(iii) if publicly disclosed at the time of such event, would have a
material adverse effect on the business, financial condition or prospects
of the Company.
Permitted Assignee means any person or entity that (i) wholly
owns, is wholly owned by or is under common whole ownership with any
Stockholder and (ii) acquires, in a single transaction from any
Stockholder, at least ten percent of the Company's then-outstanding shares
of Common Stock, such percentage to be calculated as of immediately after
such acquisition.
Piggyback Registration has the meaning assigned to such term in
Section 2(c)(i).
The terms register, registered and registration means a
registration effected by preparing and filing with the Commission a
registration statement on an appropriate form in compliance with the
Securities Act, and the declaration or order of the Commission of the
effectiveness of such registration statement under the Securities Act.
Registrable Securities means the Shares (and any other
securities issued by the Company in respect thereof), the shares of Common
Stock issuable upon exercise of the Warrants issued pursuant to the Plan
and the New Notes; provided, however, that as to any Registrable
Securities, such securities shall cease to constitute Registrable
Securities for purposes of this Agreement if and when (i) a registration
statement with respect to the sale of such securities shall have been
declared effective by the Commission and such securities shall have been
sold pursuant thereto in accordance with the intended plan and method of
distribution therefor set forth in the final prospectus forming part of
such registration statement or (ii) such securities shall have been sold in
satisfaction of all applicable resale provisions of Rule 144 under the
Securities Act or (iii) such securities have been transferred to any person
or entity other than a Permitted Transferee or (iv) such securities may be
freely sold publicly without registration under the Securities Act or
compliance with Rule 144 under the Securities Act.
Registration Expenses means all reasonable expenses incurred by
the Company in complying with Section 2 hereof, including, without
limitation, all registration and filing fees (including fees and expenses
associated with filings required to be made with the National Association
of Securities Dealers, Inc. and any national securities exchange or U.S.
automated inter-dealer quotation system of a registered national securities
association on which the class of Registrable Securities is listed or
otherwise admitted to unlisted trading privileges), printing expenses, if
any (including expenses of printing certificates for the Registrable
Securities being registered in a form eligible for deposit with The
Depository Trust Company and of printing registration statements and
prospectuses), fees and disbursements of counsel for the Company, fees and
expenses of compliance with state securities or blue sky laws (including
reasonable fees and expenses of one firm of counsel for all underwriters
collectively, if any, in connection with blue sky qualifications of the
Registrable Securities being registered and the determination of eligi
bility for investment under the laws of such jurisdictions designated by
the underwriters, if any), accountants' fees and expenses (including the
expenses of any special audits or comfort letters incident to or required
by any such registration), transfer taxes, fees of transfer agents and
registrars, and reasonable fees and disbursements of underwriters
customarily paid by issuers or sellers of securities, but excluding
underwriting discounts and commissions and broker-dealer concessions,
commissions and allowances and marketing expenses.
Required Filing Date has the meaning assigned to such term in
Section 2(b).
Securities Act means the Securities Act of 1933, as amended,
and the rules and regulations of the Commission thereunder.
Shares has the meaning assigned to such term in the recitals to
this Agreement.
Shelf Registration Statement has the meaning assigned to such
term in Section 2(a)(i).
Stockholder has the meaning assigned to such term in the
introductory paragraph to this Agreement.
2. REGISTRATION UNDER THE SECURITIES ACT, ETC.
(a) Shelf Registration.
(i) General. The Company shall use reasonable commercial
efforts to prepare and file with the Commission, and to cause to become
effective under the Securities Act, not later than the 91st day after the
Effective Date, a registration statement on Form S-3 or other applicable
form relating to the resale, from time to time, of the Registrable
Securities by the Stockholders in accordance with the plan and method of
distribution set forth in the prospectus forming part of such registration
statement (a Shelf Registration Statement ). The Company shall provide
each Stockholder with a reasonable opportunity to review and comment on
such Shelf Registration Statement prior to the filing thereof with the
Commission, and shall not unreasonably decline to make such changes thereto
required by the Securities Act as any Stockholder may reasonably request in
writing.
(ii) Effective Period. The Company agrees to use reasonable
commercial efforts to keep the Shelf Registration Statement continuously
effective until the 24-month anniversary of the date on which the Shelf
Registration Statement shall have first been declared effective by the
Commission (subject to Suspension Periods (as hereinafter defined) and
extensions coincident with the length of such Suspension Periods), or the
date on which all Registrable Securities covered by the Shelf Registration
Statement have been sold thereunder in accordance with the plan and method
of distribution intended by the Stockholders and as disclosed in the
prospectus forming part of the Shelf Registration Statement (the Effective
Period ).
(iii) Suspension Period. For purposes hereof, Suspension
Period shall mean a period of time commencing on the date on which the
Company provides notice that the Shelf Registration Statement is no longer
effective, that the prospectus included in the Shelf Registration Statement
no longer complies with the requirements therefor prescribed by Section
10(a) of the Securities Act, or there is a Material Disclosure Event and
the Company has elected to require the suspension of the sale by the
Stockholders of Registrable Securities pursuant to the Shelf Registration
Statement, and shall end on the date when the Stockholders either receive
copies of the supplemented or amended prospectus contemplated by Section
2(d)(vi) plus an additional five Business Days or otherwise are advised in
writing by the Company that use of the prospectus may be resumed. Each of
the Stockholders agrees that it will not sell any Registrable Securities
pursuant to the Shelf Registration Statement during any Suspension Period.
The Company agrees to cause each Suspension Period to end as soon as
reasonably practicable. The Company further agrees that no other holder of
the Company's stock will be permitted to sell shares of the Company's stock
pursuant to a registration statement during a Suspension Period. If one or
more Suspension Periods occur, the Effective Period shall be extended by
such number of days equal to the aggregate number of days included in all
Suspension Periods.
(b) Demand Registration.
(i) Request for Registration. Commencing on the 91st day
after the Effective Date and ending on the second anniversary of the
Effective Date, any one or more of the Stockholders may request
(collectively, the Requesting Stockholders, which term shall include
parties deemed Requesting Stockholders pursuant to Section 2(b)(vi)
hereof) in writing (a Demand Request ), that the Company effect (1) the
registration under the Securities Act of that number of Shares (including
Shares issuable upon exercise of Warrants) requested and owned by the
Requesting Stockholders (a Demand Common Stock Registration ) or (2) the
registration under the Securities Act of that principal amount of New Notes
requested and owned by the Requesting Stockholders (a Demand New Notes
Registration and, together with the Demand Common Stock Registrations, the
Demand Registrations ). Notwithstanding anything to the contrary set forth
in this Agreement, the Company shall in no event be required to effect, in
the aggregate with respect to all of the Stockholders, more than two Demand
Common Stock Registrations or more than one Demand New Notes Registration;
provided that, if any Registrable Securities requested to be registered
pursuant to a Demand Request under this Section 2(b)(i) are excluded from a
registration pursuant to Section 2(b)(iv) below, the Requesting
Stockholders shall have the right, with respect to each such exclusion, to
one additional Demand Registration under this Section 2(b)(i) with respect
to such excluded Registrable Securities. Subject to Section 2(b)(v), the
Company shall file with the Commission, within 60 days after receiving a
Demand Request (the Required Filing Date ), a registration statement on an
appropriate form under the Securities Act providing for the sale or
distribution of those Registrable Securities subject to the Demand
Registration, and shall thereafter use reasonable commercial efforts to
cause the same to be declared effective by the Commission as promptly as
practicable after such filing. Notwithstanding anything to the contrary
set forth in this Agreement, (1) no Stockholder may make a Demand Request
or participate in a Demand Registration unless, at the time thereof, (a)
such Stockholder owns at least 10% of the then-outstanding shares of Common
Stock with respect to a Demand Common Stock Registration or at least 10% in
aggregate principal amount of the then-outstanding New Notes with respect
to a Demand New Notes Registration or (b) certifies in writing to the
Company that such Stockholder may be deemed to be an affiliate of the
Company under the Securities Act; (2) the Company shall not be required to
effect any Demand Registration pursuant to any registration statement other
than the Shelf Registration Statement at any time when the Shelf
Registration Statement is effective and may be used for such Demand
Registration; and (3) the Company shall not be required to effect any
Demand Registration of an offering and sale that can otherwise be effected
in compliance with Rule 144 under the Securities Act.
(ii) Effective Registration and Expenses. A registration
will not count as a Demand Registration until it has become effective
(unless the Requesting Stockholders withdraw from such registration all
their Registrable Securities and the Company has performed its obligations
hereunder in all material respects, in which case such demand will count as
a Demand Registration unless the Requesting Stockholders pay all
Registration Expenses in connection with such withdrawn registration);
provided that, if, after it has become effective, an offering of
Registrable Securities pursuant to such registration is terminated by any
stop order, injunction, or other order of the Commission or other
governmental agency or court, such registration will be deemed not to have
been effected and will not count as a Demand Registration.
(iii) Selection of Underwriters. Any offering of
Registrable Securities pursuant to a Demand Registration shall be in the
form of a firm commitment underwritten offering or such other lawful form
as the Requesting Stockholders may reasonably specify; provided however,
that no such offering may be in the form of a best efforts or similar
type offering. With respect to any offering of Registrable Securities
pursuant to a Demand Registration in the form of a firm commitment
underwritten offering, the holders of a majority of the Registrable
Securities to be included in such offering (measured by number of shares
with respect to the Shares and principal amount with respect to the New
Notes) and the Company shall jointly select the investment banking firm or
firms to manage the underwritten offering.
(iv) Priority on Demand Registrations. No securities to be
sold for the account of any person or entity (including the Company) other
than a Requesting Stockholder shall be included in a Demand Registration
unless the managing underwriter or underwriters shall advise the Company or
the Requesting Stockholders in writing that the inclusion of such
securities will not materially and adversely affect the price or success of
the offering (a Material Adverse Effect ). Furthermore, in the event that
the managing underwriter or underwriters shall advise the Company or the
Requesting Stockholders that even after exclusion of all securities of the
other persons or entities pursuant to the immediately preceding sentence,
the amount of Registrable Securities proposed to be included in such Demand
Registration by Requesting Stockholders is sufficiently large to cause a
Material Adverse Effect, the Registrable Securities of the Requesting
Stockholders to be included in such Demand Registration shall equal that
number of Shares or principal amount of New Notes, as the case may be,
which the Company is so advised can be sold in such offering without a
Material Adverse Effect and such Shares or New Notes shall be allocated pro
rata among the Requesting Stockholders on the basis of the number of Shares
or principal amount of New Notes, as the case may be, requested to be
included by each such Requesting Stockholder.
(v) Deferral of Filing. If a Material Disclosure Event
exists as of the time the filing of a registration statement is otherwise
required by Section 2(b), the Company may defer such filing (but not the
preparation) of such registration statement until a date not later than 120
days after the Required Filing Date. A deferral of the filing of a
registration statement pursuant to this Section 2(b)(v) shall be lifted,
and the requested registration statement shall be filed forthwith, if the
Material Disclosure Event ceases. In order to defer the filing of a
registration statement pursuant to this Section 2(b)(v), the Company shall
promptly (but in any event within 10 days), upon determining to seek such
deferral, deliver to each Requesting Stockholder a certificate signed by an
executive officer of the Company stating that the Company is deferring such
filing pursuant to this Section 2(b)(v) and a general statement of the
reason for such deferral and an approximation of the anticipated delay.
Within 20 days after receiving such certificate, the holders of a majority
of the Registrable Securities (measured by number of shares with respect to
the Shares and principal amount with respect to the New Notes) beneficially
owned by the Requesting Stockholders and for which registration was
previously requested may withdraw such Demand Request by giving notice to
the Company; if withdrawn, the Demand Request shall be deemed not to have
been made for all purposes of this Agreement.
(vi) Rights of Nonrequesting Stockholders. Upon receipt of
any Demand Request, the Company shall promptly, but in any event within 10
days, give notice of such proposed Demand Registration to all other
Stockholders, who shall have the right, exercisable by written notice to
the Company within 20 days of their receipt of the Company's notice, to
elect to include in such Demand Registration, all or any portion of their
Registrable Securities (such notice from any Stockholder shall state the
number of shares of Common Stock or the principal amount of New Notes
requested to be registered). All Stockholders requesting to have any of
their Registrable Securities included in a Demand Registration in
accordance with the preceding sentence shall be deemed to be Requesting
Stockholders for purposes of Section 2. The failure of any Stockholder to
elect to include any of such Stockholder's Registrable Securities in such
Demand Registration pursuant to this Section 2(b)(vi) shall not result in
such Demand Registration failing to count as one Demand Registration for
all purposes of this Agreement.
(c) Piggyback Registration.
(i) Right to Piggyback. Commencing on the 91st day after
the Effective Date and ending on the second anniversary of the Effective
Date, each time during such period that the Company proposes to register
any of its Common Stock under the Securities Act for sale pursuant to an
underwritten public offering for cash (whether for the account of the
Company or the account of any securityholder of the Company other than
under Section 2(b)) and the form of registration statement to be used
permits the registration of Registrable Securities (without limitation,
Forms S-4 and S-8 and successor forms thereto shall be deemed not to permit
such registration), the Company shall give prompt written notice to each
Stockholder (which notice shall be given not less than 30 days prior to the
effective date of the Company's registration statement), which notice shall
offer each Stockholder the opportunity to include any or all of such
Registrable Securities of such Stockholder in such registration statement,
subject to the limitations contained in Section 2(c)(ii) (a Piggyback
Registration ). Each Stockholder that desires to have its Registrable
Securities included in such registration statement shall so advise the
Company in writing (stating the number of shares of Common Stock or the
principal amount of New Notes desired to be registered) within 20 days
after the date of receipt of such notice from the Company. Any Stockholder
shall have the right to withdraw such Stockholder's request for inclusion
of such Stockholder's Registrable Securities in any registration statement
pursuant to this Section 2(c) by giving written notice to the Company of
such withdrawal not later than five days prior to the effective date of the
Company's registration statement. Subject to Section 2(c)(ii) below, the
Company shall include in such registration statement all such Registrable
Securities so requested to be included therein; provided, however, that the
Company may at any time withdraw or cease proceeding with any such
registration if it shall at the same time withdraw or cease proceeding with
the registration of all the Common Stock originally proposed to be
registered. Notwithstanding anything to the contrary set forth in this
Agreement, no Stockholder may participate in a registration under this
Section 2(c) unless, at the time thereof, (1) such Stockholder owns at
least 10% of the then-outstanding shares of Common Stock with respect to a
registration involving the Common Stock or at least 10% in aggregate
principal amount of the then-outstanding New Notes with respect to a
registration revolving the New Notes or (2) certifies in writing to the
Company that such Stockholder may be deemed to be an affiliate of the
Company under the Securities Act.
(ii) Priority on Registrations. If the Registrable
Securities requested to be included in the registration statement by any
Stockholder differ from the type of securities proposed to be registered by
the Company and the managing underwriter advises the Company that due to
such differences the inclusion of such Registrable Securities would cause a
Material Adverse Effect, then (1) the number of such Stockholder's or
Stockholders' Registrable Securities to be included in the Registration
Statement shall be reduced to an amount which, in the judgment of the
managing underwriter, would eliminate such Material Adverse Effect or (2)
if no such reduction would, in the judgment of the managing underwriter,
eliminate such Material Adverse Effect, then the Company shall have the
right to exclude all such Registrable Securities from such registration
statement provided no other securities of such type are included and
offered for the account of any other person or entity in such registration
statement. Any partial reduction in the number of Registrable Securities
to be included in the registration statement pursuant to clause (1) of the
immediately preceding sentence shall be effected pro rata based on the
ratio which such Stockholder's requested securities bears to the total
number of Shares or principal amount of New Notes, as the case may be,
requested to be included in such registration statement by all persons or
entities (including Requesting Stockholders) who have requested (pursuant
to contractual registration rights) that their securities be included in
such registration statement. If the Registrable Securities requested to be
included in the registration statement are of the same type as the
securities being registered by the Company and the managing underwriter
advises the Company that the inclusion of such Registrable Securities would
cause a Material Adverse Effect, the Company will be obligated to include
in such registration statement, as to each Stockholder, only a portion of
the Registerable Securities such Stockholder has requested be registered
equal to the ratio which such Stockholder's requested securities bears to
the total number of Shares or principal amount of New Notes, as the case
may be, requested to be included in such registration statement by all
persons or entities (including Requesting Stockholders) who have requested
(pursuant to contractual registration rights) that their securities be
included in such registration statement. If as a result of the provisions
of this Section 2(c)(ii) any Stockholder shall not be entitled to include
all Registrable Securities in a registration that such Stockholder has
requested to be so included, such Stockholder may withdraw such
Stockholder's request to include Registrable Securities in such
registration statement.
(d) Registration Procedures. The Company shall:
(i) provide the Stockholders with a reasonable
opportunity to review and comment on any registration statement to be filed
pursuant to Section 2 of this Agreement prior to the filing thereof with
the Commission, and shall not unreasonably decline to make such changes
thereto required by the Securities Act as any Stockholder may reasonably
request in writing;
(ii) cause any such registration statement and the
related prospectus and any amendment or supplement thereto, as of the
effective date of such registration statement, amendment or supplement,
(A) to comply in all material respects with the applicable requirements of
the Securities Act and the rules and regulations of the Commission
promulgated thereunder and (B) not to contain any untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading;
(iii) use reasonable commercial efforts to prepare
and file with the Commission such amendments and supplements to such
registration statement and the prospectus used in connection with such
registration statement, and take such other actions, as may be necessary to
keep such registration statement effective and to comply with the
provisions of the Securities Act with respect to the disposition of all
Registrable Securities covered by such registration statement until, with
respect to the Shelf Registration Statement, the earlier of (a) such time
as all such Registrable Securities have been disposed of in accordance with
the intended plan and method of disposition by the Stockholders or (b) the
24-month anniversary of the date on which such Shelf Registration Statement
was first declared effective (subject to Suspension Periods and extensions
coincident with the length of such suspensions), with respect to any
registration statement filed under Section 2(b) of this Agreement, such
time as all such Registrable Securities have been disposed of in accordance
with the intended plan and method of disposition by the Stockholders but in
no event more than 180 days after the second anniversary of the Effective
Date, and with respect to any registration statement filed under Section
2(c) of this Agreement, such time as the Company determines to withdraw or
cease proceeding with any such registration pursuant to the terms hereof,
and will furnish to the Stockholders a copy of any amendment or supplement
to such registration statement or prospectus prior to filing the same with
the Commission and shall not file any such amendment or supplement to which
the Stockholders shall reasonably have objected in writing on the grounds
that such amendment or supplement does not comply in all material respects
with the requirements of the Securities Act or otherwise inaccurately
describes information pertaining to the Stockholders or to the intended
plan and method of disposition of Registrable Securities by the
Stockholders;
(iv) furnish to the Stockholders such number of
conformed copies of such registration statement and of each such amendment
and supplement thereto (in each case including all exhibits thereto), such
number of copies of the prospectus included in such registration statement
(including each preliminary prospectus), and such number of the documents,
if any, incorporated by reference in such registration statement or
prospectus, as the Stockholders reasonably may request;
(v) use reasonable commercial efforts to register
or qualify the Registrable Securities covered by such registration
statement under such securities or blue sky laws of the states of the
United States as the Stockholders reasonably shall request, to keep such
registration or qualification in effect for so long as such registration
statement remains in effect, and to do any and all other acts and things
which may be necessary or advisable to enable the Stockholders to
consummate the disposition in such jurisdictions of the Registrable
Securities covered by such registration statement, except that the Company
shall not for any such purpose be required to qualify generally to do
business as a foreign corporation in any jurisdiction in which it is not
and would not, but for the requirements of this Section 2(d)(v), be
obligated to be so qualified, or to subject itself to taxation in any such
jurisdiction, or to consent to general service of process in any such
jurisdiction;
(vi) immediately notify the Stockholders, at any
time when a prospectus or prospectus supplement relating thereto is
required to be delivered under the Securities Act, upon discovery that, or
upon the occurrence of any event as a result of which, the prospectus
included in such registration statement, as then in effect, includes 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,
in light of the circumstances under which they were made, not misleading,
which untrue statement or omission requires amendment of the registration
statement or supplementing of the prospectus, and, at the request of the
Stockholders, prepare and furnish to the Stockholders a reasonable number
of copies of a supplement to such prospectus as may be necessary so that,
as thereafter delivered to the purchasers of such Registrable Securities,
such prospectus shall not include 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; provided, however, that with respect to
Registrable Securities registered pursuant to such registration statement,
each Stockholder agrees that it will not sell any Registrable Securities
pursuant to such registration statement during the time after the
furnishing of the Company's notice that the Company is preparing and filing
with the Commission a supplement to or an amendment of such prospectus or
registration statement and, with respect to a Shelf Registration Statement,
such period shall be a Suspension Period for purposes of determining the
Effective Period hereunder;
(vii) use reasonable commercial efforts to comply
with all applicable rules and regulations of the Commission, and make
available to holders of its securities, as soon as reasonably practicable,
an earnings statement covering the period of at least 12 months, but not
more than 18 months, beginning with the first month of the first fiscal
quarter after the effective date of such registration statement, which
earnings statement shall satisfy the provisions of Section 11(a) of the
Securities Act;
(viii) provide and cause to be maintained a transfer
agent and registrar for the Registrable Securities covered by such
registration statement from and after a date not later than the effective
date of such registration statement; it being hereby agreed that the
Stockholders shall furnish to the Company such information regarding the
Stockholders and the plan and method of distribution of Registrable
Securities intended by the Stockholders as the Company may from time to
time reasonably request in writing and as shall be required by law or by
the Commission in connection therewith;
(ix) notify the Stockholders and the managing
underwriters, if any, promptly, and (if requested by any such person)
confirm such notice in writing, (A) when a prospectus, prospectus
supplement or post-effective amendment related to such registration
statement has been filed, and, with respect to such registration statement
or any post-effective amendment thereto, when the same has become
effective, (B) of any request by the Commission or any other federal or
state governmental authority for amendments or supplements to such
registration statement or related prospectus, (C) of the issuance by the
Commission or any other federal or state governmental authority of any stop
order suspending the effectiveness of such registration statement or the
initiation of any proceedings for that purpose, and (D) of the receipt by
the Company of any notification with respect to the suspension of the
qualification or exemption from qualification of any of the Registrable
Securities for sale in any jurisdiction or the initiation or threatening of
any proceeding for such purpose;
(x) use reasonable commercial efforts to obtain
the withdrawal of any order suspending the effectiveness of such
registration statement, or the lifting of any suspension of the
qualification (or exemption from qualification) of any of the Registrable
Securities for sale in any jurisdiction, at the earliest possible moment;
(xi) cooperate with the Stockholders and the
managing underwriters, if any, to facilitate the timely preparation and
delivery of certificates representing Registrable Securities to be sold,
which certificates will not bear any restrictive legends; and enable such
Registrable Securities to be in such authorized denominations and
registered in such names as the managing underwriters, if any, shall
reasonably request at least two Business Days prior to any sale of
Registrable Securities to the underwriters; and
(xii) with respect to a firm commitment
underwritten offering, enter into an underwriting agreement in such form,
scope and substance as is customary in such underwritten offerings.
(e) Preparation; Reasonable Investigation. In connection with
the preparation and filing of each registration statement registering
Registrable Securities under the Securities Act as contemplated by this
Agreement, the Company shall give the Stockholders, their underwriters, if
any, and the Stockholders' counsel and accountants, the opportunity to
review the Company's preparation of such registration statement, each
prospectus included in such registration statement or filed with the
Commission and each amendment or supplement thereto, and the Company will
give such person or persons such reasonable access to the Company's books
and records and such opportunities to discuss the business of the Company
with its officers and the independent public accountants who have certified
its financial statements as shall be necessary for the Stockholders and
such other persons to conduct a reasonable investigation within the meaning
of Section 11 of the Securities Act. To minimize disruption and expense to
the Company during the course of the registration process, each Stockholder
shall use reasonable commercial efforts to coordinate its investigation and
due diligence efforts and, to the extent practicable, will act through a
single firm of counsel for all Stockholders and a single firm of
accountants for all Stockholders and, if requested by the Company, will
enter into a confidentiality agreement with the Company in a form
reasonably satisfactory to the Company.
(f) Indemnification. (i) Indemnification by the Company. The
Company shall indemnify and hold harmless (x) each Stockholder and its
affiliates, with respect to any registration statement filed pursuant to
this Agreement, (y) any underwriter or selling agent selected by the
Stockholders with respect to such Registrable Securities and (z) each
person who controls the Stockholder or affiliate, and any underwriter or
selling agent, within the meaning of Section 15 of the Securities Act and
Section 20 of the Exchange Act, against any losses, claims, damages,
liabilities or expenses (each a Loss and collectively Losses ), joint or
several, to which the Stockholder or any such persons may become subject
under the Securities Act or otherwise, to the extent that such Losses (or
related actions or proceedings) arise out of or are based upon (A) any
untrue statement or alleged untrue statement of any material fact contained
in an effective registration statement in which such Registrable Securities
were included for registration under the Securities Act, any preliminary
prospectus if used prior to the effective date of the registration
statement (unless such statement is corrected in the final prospectus and
the Company shall have furnished a sufficient number of copies thereof to
the Stockholder in a manner and at a time sufficient to permit delivery of
the same to prospective purchasers concurrently with or prior to the sale
of the related Registrable Securities), final prospectus (as supplemented,
if the Company shall have filed with the Commission any supplement thereto)
if used during the period in which the Company is required to keep the
registration statement to which such prospectus relates current and
otherwise in compliance with Section 10(a) of the Securities Act, or
(B) any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading;
provided, however, that the Company shall have no obligation to provide any
indemnification hereunder if any such Losses (or actions or proceedings in
respect thereof) arise out of or are based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in such
registration statement, preliminary prospectus or final prospectus, as the
case may be, in reliance upon and in conformity with written information
furnished to the Company by the Stockholder or on the Stockholder's behalf
for inclusion in such registration statement; and provided, further, that
the Company shall have no obligation to provide any indemnification
hereunder if any such Losses arise out of or are based upon an untrue
statement or alleged untrue statement or omission or alleged omission in
the final prospectus, if such untrue statement or alleged untrue statement
or omission or alleged omission shall have been corrected in a supplement
to the final prospectus and the Stockholder or any such other person shall
have failed to deliver such final prospectus as so supplemented prior to or
concurrently with the sale of the Registrable Securities covered by a
registration statement to the individual or entity asserting such Losses
after the Company shall have furnished the Stockholder or any such other
persons with a sufficient number of copies thereof in a manner and at a
time sufficient to permit such delivery of the same. The indemnity
provided in this Section 2(f)(i) shall remain in full force and effect
regardless of any investigation made by or on behalf of the Stockholder or
any such other persons and shall survive the transfer of the Registrable
Securities by the Stockholder or any such other persons.
(ii) Indemnification by the Stockholders. Each Stockholder
shall indemnify and hold harmless (in the same manner and to the same
extent as set forth in Section 2(f)(i) hereof) the Company, each director
of the Company, each officer of the Company who shall sign such
registration statement and each other person, if any, who controls the
Company within the meaning of Section 15 of the Securities Act or Section
20 of the Exchange Act, with respect to any untrue statement in or omission
from any registration statement filed by the Company pursuant to this
Agreement, any preliminary prospectus or any final prospectus included in
such registration statement, or any amendment or supplement to such
registration statement or prospectus, as the case may be, of a material
fact if such statement or omission was made in reliance upon and in
conformity with written information furnished to the Company or any of its
representatives by the Stockholder or such other persons, if any, who
control the Stockholder within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act, or on the Stockholder's behalf, for
inclusion in such registration statement, preliminary prospectus or final
prospectus, as the case may be.
(iii) Notice of Claims, etc. Promptly after
receipt by an indemnified party of notice of the commencement of any action
or proceeding (an Action ) involving a claim referred to in Sections
2(f)(i) and 2(f)(ii) hereof, such indemnified party shall, if
indemnification is sought against an indemnifying party, give written
notice to the indemnifying party of the commencement of such action;
provided, however, that the failure of any indemnified party to give said
notice shall not relieve the indemnifying party of its obligations under
Sections 2(f)(i) or 2(f)(ii) hereof, except to the extent that the
indemnifying party is actually and materially prejudiced by such failure.
In case an Action is brought against any indemnified party, and such
indemnified party notifies an indemnifying party of the commencement there
of, the indemnifying party shall be entitled to participate therein and, to
the extent it may elect by written notice delivered to the indemnified
party promptly after receiving the aforesaid notice, to assume the defense
thereof with counsel reasonably satisfactory to such indemnified party.
Notwithstanding the foregoing, the indemnified party shall have the right
to employ its own counsel in any such case, but the fees and expenses of
such counsel shall be at the expense of such indemnified party, unless
(A) the employment of such counsel shall have been authorized in writing by
the indemnifying party, (B) the indemnifying party shall not have employed
counsel (reasonably satisfactory to the indemnified party) to take charge
of the defense of such Action, within a reasonable time after notice of the
commencement thereof, or (C) such indemnified party reasonably shall have
concluded that there may be defenses available to it which are different
from or additional to those available to the indemnifying party which, if
the indemnifying party and the indemnified party were to be represented by
the same counsel, could result in a conflict of interest for such counsel
or materially prejudice the prosecution of the defenses available to such
indemnified party. If any of the events specified in clauses (A), (B) or
(C) of the preceding sentence shall have occurred or otherwise shall be
applicable, then the fees and expenses of one counsel (or firm of counsel)
for the indemnified party shall be borne by the indemnifying party. If, in
any case, the indemnified party employs separate counsel, the indemnifying
party shall not have the right to direct the defense of such action on
behalf of the indemnified party. Anything in this Section 2(f)(iii) to the
contrary notwithstanding, an indemnifying party shall not be liable for the
settlement of any action effected without its prior written consent (which
consent in the case of an action exclusively seeking monetary relief shall
not unreasonably be withheld or delayed), but if settled with the prior
written consent of the indemnifying party, or if there be a final judgment
adverse to the indemnified party, the indemnifying party agrees to
indemnify the indemnified party from and against any loss or liability by
reason of such settlement or judgment. No indemnifying party shall,
without the prior consent of the indemnified party, consent to entry of any
judgment or enter into any settlement which does not include as a term
thereof the unconditional release of the indemnified party from all
liability in respect of such claim or litigation.
(iv) Contribution. If the indemnification
provided for in this Section 2 is unavailable or insufficient to hold
harmless an indemnified party in respect of any Losses, then each
indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a
result of such Losses in such proportion as appropriate to reflect the
relative fault of the Company, on the one hand, and the Stockholder, on the
other hand, and the parties' relative intent, knowledge, access to
information and opportunity to correct or mitigate the damage in respect of
or prevent any untrue statement or omission giving rise to such
indemnification obligation. The Company and the Stockholders agree that it
would not be just and equitable if contributions pursuant to this Section
2(f)(iv) were determined by pro rata allocation or by any other method of
allocation which did not take account of the equitable considerations
referred to above. 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 is not guilty of such
fraudulent misrepresentation.
(v) Indemnification Payments. Periodic payments
of amounts required to be paid pursuant to this Section 2 shall be made
during the course of the investigation or defense, as and when reasonably
itemized bills therefor are delivered to the indemnifying party in respect
of any particular Loss, damage or liability that is incurred.
(g) Registration Expenses. The Company shall bear all
Registration Expenses incurred in connection with the performance of its
obligations under Section 2 of this Agreement.
(h) Holdback Agreements.
(i) Restrictions on Public Sale by Stockholders. Each
Stockholder agrees not to effect any public sale or distribution of
Registrable Securities or similar securities of the Company, or any
securities convertible into or exchangeable or exercisable for such
securities, including a sale pursuant to Rule 144 under the Securities Act,
during the 14 days prior to, and during the period (not to exceed 90 days)
beginning on, the commencement of an underwritten public distribution of
Registrable Securities under any registration statement pursuant to this
Agreement (except as part of such underwritten public distribution), if and
to the extent requested by the Company or by the managing underwriter or
underwriters.
(ii) Restrictions on Public Sale by the Company. The
Company agrees not to effect any public sale or distribution of any
securities similar to those being registered hereunder, or any securities
convertible into or exchangeable or exercisable for such securities, except
in any case for any such sale or distribution of such securities in
connection with any merger or consolidation involving the Company or any
subsidiary thereof, the acquisition by the Company or any subsidiary
thereof of the capital stock or substantially all of the assets of any
other person or entity, any shelf registration, or any employee or director
benefit or similar plan or any dividend reinvestment plan), during the 14
days prior to, and during the period (not to exceed 90 days) beginning on,
the commencement of an underwritten public distribution of Registrable
Securities, if and to the extent requested by the managing underwriter or
underwriters.
(i) Certain Obligations of Stockholders. The Company may
require each Stockholder of Registrable Securities as to which any
registration is being effected to furnish to the Company all such
information regarding the distribution of such Registrable Securities as
the Company may from time to time reasonably request in writing and such
other information as may be legally required in connection with such
registration. Each Stockholder agrees that, upon receipt of any notice
from the Company of the happening of any Material Disclosure Event, such
Stockholder will forthwith discontinue the offering and disposition of
Registrable Securities pursuant to any registration statement covering such
Registrable Securities until such Stockholder's receipt of the copies of
any supplemented or amended prospectus and until it is advised in writing
by the Company that the use of the prospectus may be resumed, and, if so
directed by the Company, such Stockholder will deliver to the Company (at
the Company's expense) all copies, other than permanent file copies then in
such Stockholder's possession, of the prospectus covering such Registrable
Securities current at the time of receipt of such notice. In the event the
Company shall give any such notice, the Company shall extend the period
during which such registration statement shall be maintained effective by
the number of days during the period from and including the date of the
giving of such notice to and including the date when each Stockholder of
Registrable Securities covered by such registration statement shall have
received the copies of any supplemented or amended prospectus and such
notification from the Company permitting the resumption of the use of the
prospectus. No Stockholder may participate in any registration under this
Agreement (whether pursuant to the Shelf Registration Statement, a Demand
Registration or a Piggyback Registration) unless such Stockholder (1)
agrees to sell its Registrable Securities on the basis provided in any
underwriting arrangements approved by the Company; (2) completes and
executes all questionnaires, powers of attorney, indemnities, underwriting
agreements, and other documents reasonably required under the terms of such
underwriting arrangements; provided, however, that no Stockholder shall be
required to make any representations or warranties in connection with any
such registration other than representations and warranties as to (a) its
ownership of its Registrable Securities to be sold or transferred free and
clear of all liens, claims, and encumbrances, (b) its power and authority
to effect such transfer, and (c) such matters pertaining to compliance with
securities laws as may be reasonably requested; and (3) exercises, pursuant
to the terms of the warrant agreement governing the Warrants, Warrants to
purchase Common Stock to the extent such Common Stock is to be so
registered.
3. RULE 144.
The Company shall comply with the requirements of Rule 144(c)
under the Securities Act, as such Rule may be amended from time to time (or
any similar rule or regulation hereafter adopted by the Commission),
regarding the availability of current public information to the extent
required to enable any Stockholder to sell Registrable Securities without
registration under the Securities Act pursuant to the resale provisions of
Rule 144 (or any similar rule or regulation). Upon the request of any
Stockholder, the Company will deliver to such Stockholder a written
statement as to whether it has complied with such requirements and, upon
such Stockholder's compliance with the applicable provisions of Rule 144,
will take such action as may be required (including, without limitation,
causing legal counsel to issue an appropriate opinion) to cause its
transfer agent to effectuate any transfer of Registrable Securities
properly requested by such Stockholder, in accordance with the terms and
conditions of Rule 144.
4. MISCELLANEOUS.
(a) Notice Generally. Any notice, demand, request, consent,
approval, declaration, delivery or other communication hereunder to be made
pursuant to the provisions of this Agreement shall specify the Section of
this Agreement pursuant to which it is given or being made and shall be
sufficiently given or made if in writing and signed by the party making the
same, and either delivered in person with receipt acknowledged or sent by
registered or certified mail, return receipt requested, postage prepaid, or
by telecopy and confirmed by telecopy answerback, addressed as follows:
(i) If to any Stockholder, at the address of such
Stockholder as set forth on the signature pages hereto; and
(ii) If to Company, at
Edison Brothers Stores, Inc.
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Attention: ▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Executive Vice President,
General Counsel and Secretary
Telecopy Number: (▇▇▇) ▇▇▇-▇▇▇▇
or at such other address as may be substituted by notice given as herein
provided. The giving of any notice required hereunder may be waived in
writing by the party entitled to receive such notice. Every notice,
demand, request, consent, approval, declaration, delivery or other
communication hereunder shall be deemed to have been duly given or served
on the date on which personally delivered, with receipt acknowledged,
telecopied and confirmed by telecopy answerback or three Business Days
after the same shall have been deposited in the United States mail (by
registered or certified mail, return receipt requested, postage prepaid),
whichever is earlier.
(b) Successors and Assigns. This Agreement (i) may not be
assigned by the Company or any Stockholder (except that this Agreement may
be assigned by any Stockholder to a Permitted Assignee in connection with
the transaction pursuant to which such Permitted Assignee becomes such,
whereupon such Permitted Assignee shall be deemed to be a Stockholder for
all purposes of this Agreement) and (ii) shall be binding on all successors
to the Company and the Stockholders.
(c) Amendments. This Agreement may be amended or modified only
by a written agreement signed by each party hereto.
(d) Severability. Wherever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Agreement shall be
prohibited by or invalid under applicable law, such provision shall be
ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of
this Agreement.
(e) Headings. The headings used in this Agreement are for the
convenience of reference only and shall not, for any purpose, be deemed a
part of this Agreement.
(f) Governing Law. This Agreement shall be governed by the laws
of the State of New York, without regard to the provisions thereof relating
to conflict of laws.
(g) Counterparts. This Agreement may be executed in any number
of counterparts and each of such counterparts shall for all purposes be
deemed to be an original, and all such counterparts shall together
constitute but one and the same instrument.
(h) Entire Agreement. This Agreement embodies the entire
agreement and understanding between the Company and the Stockholders in
respect of the subject matter contained herein. This Agreement supersedes
all prior agreements and understandings between the parties with respect to
the subject matter of this Agreement.
(i) Specific Performance. The parties hereto acknowledge and
agree that they would not have adequate remedies at law and would be
irreparably harmed if any of the provisions of this Agreement were not
performed by the parties hereto in accordance with the specific terms
hereof or were otherwise breached, and that, in such case, it would be
impossible to measure in money the damages to such parties. It is
accordingly agreed that the parties hereto shall be entitled to injunctive
relief or the enforcement of other equitable remedies, without bond or
other security, to compel performance and to prevent breaches of this
Agreement and specifically to enforce the terms and provisions hereof, in
addition to any other remedy to which they may be entitled, at law or in
equity.
IN WITNESS WHEREOF, the parties hereto have caused this
Registration Rights Agreement to be duly executed and delivered as of the
date first above written.
EDISON BROTHERS STORES, INC.
By:
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
Title: Executive Vice President and
Chief Financial Officer
SWISS BANK CORPORATION
By:
Name:
Title:
Address: Swiss Bank Corporation,
New York Branch
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Telecopy Number:
