Exhibit 4.2
▇▇▇▇▇ ▇ COMMUNICATIONS, INC.
$833,815,000
10-1/2% Senior Discount Notes Due 2008
REGISTRATION AGREEMENT
New York, New York
November 24, 1998
To: ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ INC.
▇▇▇▇▇▇▇, SACHS & CO.
CHASE SECURITIES INC.
▇.▇. ▇▇▇▇▇▇ & CO.
In care of:
▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc.
Seven ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Level 3 Communications, Inc., a Delaware corporation (the "Company"),
proposes to issue and sell to certain purchasers (the "Purchasers"), upon the
terms set forth in a purchase agreement dated the date hereof (the "Purchase
Agreement"), $833,815,000 aggregate principal amount at maturity of its 10-1/2%
Senior Discount Notes Due 2008 (the "Securities") (the "Initial Placement"). As
an inducement to the Purchasers to enter into the Purchase Agreement and in
satisfaction of a condition to your obligations thereunder, the Company agrees
with you, (i) for your benefit and the benefit of the other Purchasers and (ii)
for the benefit of the holders from time to time of the Securities (including
you and the other Purchasers) (each of the foregoing a "Holder" and together the
"Holders"), as follows:
1. Definitions. Capitalized terms used herein without definition shall
have their respective meanings set forth in the Purchase Agreement. As used in
this Agreement, the following capitalized defined terms shall have the following
meanings:
"Affiliate" of any specified person means any other person which,
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directly or indirectly, is in control of, is controlled by, or is under common
control with, such specified person. For purposes of this definition, control
of a person means the power, direct or indirect, to direct or cause the
direction of the management and policies of such person whether
by contract or otherwise; and the terms "controlling" and "controlled" have
meanings correlative to the foregoing.
"Exchange Offer Registration Period" means the 180-day period
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following the consummation of the Registered Exchange Offer, exclusive of any
period during which any stop order shall be in effect suspending the
effectiveness of the Exchange Offer Registration Statement.
"Exchange Offer Registration Statement" means a registration statement
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of the Company on an appropriate form under the Securities Act with respect to
the Registered Exchange Offer, all amendments and supplements to such
registration statement, including post-effective amendments, in each case
including the Prospectus contained therein, all exhibits thereto and all
material incorporated by reference therein.
"Exchanging Dealer" means any Holder (which may include the
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Purchasers) which is a broker-dealer electing to exchange Securities acquired
for its own account as a result of market-making activities or other trading
activities for New Securities.
"Holder" has the meaning set forth in the preamble hereto.
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"Indenture" means the Indenture relating to the Securities and the New
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Securities to be dated as of December 2, 1998, between the Company and IBJ
▇▇▇▇▇▇▇▇ Bank & Trust Company, as trustee, as the same may be amended from time
to time in accordance with the terms thereof.
"Initial Placement" has the meaning set forth in the preamble hereto.
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"Majority Holders" means the Holders of a majority of the aggregate
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principal amount of securities registered under a Registration Statement.
"Managing Underwriters" means the investment banker or investment
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bankers and manager or managers that shall administer an offering of securities
under a Shelf Registration Statement.
"New Securities" means debt securities of the Company identical in all
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material respects to the Securities (except that the interest rate step-up
provisions and the transfer restrictions will be modified or eliminated, as
appropriate), to be issued under the Indenture.
"Prospectus" means the prospectus included in any Registration
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Statement (including, without limitation, a prospectus that discloses
information previously omitted from a prospectus filed as part of an effective
registration statement in reliance upon Rule 430A under the Securities Act), as
amended or supplemented by any prospectus supplement, with respect to the
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terms of the offering of any portion of the Securities or the New Securities,
covered by such Registration Statement, and all amendments and supplements to
the Prospectus, including post-effective amendments.
"Registered Exchange Offer" means the proposed offer to the Holders to
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issue and deliver to such Holders, in exchange for the Securities, a like
principal amount of the New Securities.
"Registration Securities" has the meaning set forth in Section 3(a)
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hereof.
"Registration Statement" means any Exchange Offer Registration
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Statement or Shelf Registration Statement that covers any of the Securities or
the New Securities pursuant to the provisions of this Agreement, all amendments
and supplements to such registration statement, including, without limitation,
post-effective amendments, in each case including the Prospectus contained
therein, all exhibits thereto and all material incorporated by reference
therein.
"Securities" has the meaning set forth in the preamble hereto.
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"Shelf Registration" means a registration effected pursuant to Section
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3 hereof.
"Shelf Registration Period" has the meaning set forth in Section 3(b)
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hereof.
"Shelf Registration Statement" means a "shelf" registration statement
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of the Company pursuant to the provisions of Section 3 hereof which covers some
of or all the Securities or New Securities, as applicable, on an appropriate
form under Rule 415 under the Securities Act, or any similar rule that may be
adopted by the Commission, all amendments and supplements to such registration
statement, including post-effective amendments, in each case including the
Prospectus contained therein, all exhibits thereto and all material incorporated
by reference therein.
"Trustee" means the trustee with respect to the Securities and the New
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Securities under the Indenture.
"underwriter" means any underwriter of securities in connection with
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an offering thereof under a Shelf Registration Statement.
2. Registered Exchange Offer; Resales of New Securities by Exchanging
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Dealers; Private Exchange.
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(a) The Company shall prepare and, not later than 90 days after the date
of the original issuance of the Securities, shall file with the Commission the
Exchange Offer Registration
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Statement with respect to the Registered Exchange Offer. The Company shall use
its best efforts to cause the Exchange Offer Registration Statement to become
effective under the Securities Act within 150 days after the date of the
original issuance of the Securities.
(b) Upon the effectiveness of the Exchange Offer Registration Statement,
the Company shall promptly commence the Registered Exchange Offer, it being the
objective of such Registered Exchange Offer to enable each Holder electing to
exchange Securities for New Securities (assuming that such Securities do not
constitute a portion of an unsold allotment acquired by such Holder directly
from the Company and such Holder is not an affiliate of the Company within the
meaning of the Securities Act, acquires the New Securities in the ordinary
course of such Holder's business and has no arrangements with any person to
participate in the distribution of the New Securities) to trade such New
Securities from and after their receipt without any limitations or restrictions
under the Securities Act and without material restrictions under the securities
laws of a substantial proportion of the several states of the United States.
(c) In connection with the Registered Exchange Offer, the Company shall:
(i) mail to each Holder a copy of the Prospectus forming part of the
Exchange Offer Registration Statement, together with an appropriate letter
of transmittal and related documents;
(ii) keep the Registered Exchange Offer open for not less than 30 days
after the date notice thereof is mailed to the Holders (or longer if
required by applicable law);
(iii) utilize the services of a depositary for the Registered Exchange
Offer with an address in the Borough of Manhattan, The City of New York;
and
(iv) comply in all material respects with all applicable laws.
(d) As soon as practicable after the close of the Registered Exchange
Offer, the Company shall:
(i) accept for exchange all Securities tendered and not validly
withdrawn pursuant to the Registered Exchange Offer;
(ii) deliver to the Trustee for cancellation all Securities so
accepted for exchange; and
(iii) cause the Trustee promptly to authenticate and deliver to each
Holder of Securities, New Securities equal
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in principal amount to the Securities of such Holder so accepted for
exchange.
(e) The Purchasers and the Company acknowledge that, pursuant to current
interpretations by the Commission's staff of Section 5 of the Securities Act,
and in the absence of an applicable exemption therefrom, each Exchanging Dealer
is required to deliver a Prospectus in connection with a sale of any New
Securities received by such Exchanging Dealer pursuant to the Registered
Exchange Offer in exchange for Securities acquired for its own account as a
result of market-making activities or other trading activities. Accordingly,
the Company shall:
(i) include the information set forth in Annex A hereto on the cover
of the Exchange Offer Registration Statement, in Annex B hereto in the
forepart of the Exchange Offer Registration Statement in a section setting
forth details of the Exchange Offer, in Annex C hereto in the underwriting
or plan of distribution section of the Prospectus forming a part of the
Exchange Offer Registration Statement, and in Annex D hereto in the Letter
of Transmittal delivered pursuant to the Registered Exchange Offer (it
being understood that a Holder's participation in the Exchange Offer is
conditioned on the Holder, by executing and returning the Letter of
Transmittal, representing in writing to the Company as set forth in Rider B
of Annex D hereto); and
(ii) use its best efforts to keep the Exchange Offer Registration
Statement continuously effective under the Securities Act during the
Exchange Offer Registration Period for delivery by Exchanging Dealers in
connection with sales of New Securities received pursuant to the Registered
Exchange Offer, as contemplated by Section 4(h) below.
(f) In the event that any Purchaser determines that it is not eligible to
participate in the Registered Exchange Offer with respect to the exchange of
Securities constituting any portion of an unsold allotment, at the request of
such Purchaser, the Company shall issue and deliver to such Purchaser or the
party purchasing New Securities registered under a Shelf Registration Statement
as contemplated by Section 3 hereof from such Purchaser, in exchange for such
Securities, a like principal amount of New Securities. The Company shall seek
to cause the CUSIP Service Bureau to issue the same CUSIP number for such New
Securities as for New Securities issued pursuant to the Registered Exchange
Offer.
3. Shelf Registration. If, (i) because of any change in law or applicable
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interpretations thereof by the Commission's staff, the Company determines upon
advice of its outside counsel that it is not permitted to effect the Registered
Exchange Offer as contemplated by Section 2 hereof, or (ii) for any other reason
the Exchange Offer Registration Statement is not declared
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effective within 150 days after the Closing Date or the Registered Exchange
Offer is not consummated within 180 days after the Closing Date, or (iii) any
Purchaser so requests with respect to Securities (or any New Securities received
pursuant to Section 2(f)) not eligible to be exchanged for New Securities in a
Registered Exchange Offer or, in the case of any Purchaser that participates in
any Registered Exchange Offer, such Purchaser does not receive freely tradable
New Securities, or (iv) any Holder (other than a Purchaser) is not eligible to
participate in the Registered Exchange Offer or (v) in the case of any such
Holder that participates in the Registered Exchange Offer, such Holder does not
receive freely tradable New Securities in exchange for tendered securities,
other than by reason of such Holder being an affiliate of the Company within the
meaning of the Securities Act (it being understood that, for purposes of this
Section 3, (x) the requirement that a Purchaser deliver a Prospectus containing
the information required by Items 507 and/or 508 of Regulation S-K under the
Securities Act in connection with sales of New Securities acquired in exchange
for such Securities shall result in such New Securities being not "freely
tradeable" but (y) the requirement that an Exchanging Dealer deliver a
Prospectus in connection with sales of New Securities acquired in the Registered
Exchange Offer in exchange for Securities acquired as a result of market-making
activities or other trading activities shall not result in such New Securities
being not "freely tradeable"), the following provisions shall apply:
(a) The Company shall as promptly as practicable (but in no event
more than the later of (i) 90 days after the Closing Date or (ii) 45 days after
so required or requested pursuant to this Section 3), file with the Commission
and thereafter shall use its best efforts to cause to be declared effective
under the Securities Act a Shelf Registration Statement relating to the offer
and sale of the Securities or the New Securities, as applicable, by the Holders
from time to time in accordance with the methods of distribution elected by such
Holders and set forth in such Shelf Registration Statement (such Securities or
New Securities, as applicable, to be sold by such Holders under such Shelf
Registration Statement being referred to herein as "Registration Securities");
provided, however, that, with respect to New Securities received by a Purchaser
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in exchange for Securities constituting any portion of an unsold allotment, the
Company may, if permitted by current interpretations by the Commission's staff,
file a post-effective amendment to the Exchange Offer Registration Statement
containing the information required by Regulation S-K Items 507 and/or 508, as
applicable, in satisfaction of its obligations under this paragraph (a) with
respect thereto, and any such Exchange Offer Registration Statement, as so
amended, shall be referred to herein as, and governed by the provisions herein
applicable to, a Shelf Registration Statement.
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(b) The Company shall use its best efforts to keep the Shelf
Registration Statement continuously effective in order to permit the Prospectus
forming part thereof to be usable by Holders for a period of two years from the
date the Shelf Registration Statement is declared effective by the Commission or
such shorter period that will terminate when all the Securities or New
Securities, as applicable, covered by the Shelf Registration Statement have been
sold pursuant to the Shelf Registration Statement (in any such case, such period
being called the "Shelf Registration Period"). The Company shall be deemed not
to have used its best efforts to keep the Shelf Registration Statement effective
during the Shelf Registration Period if it voluntarily takes any action that
would result in Holders of securities covered thereby not being able to offer
and sell such securities during that period, unless (i) such action is required
by applicable law or (ii) such action is taken by the Company in good faith and
for valid business reasons (not including avoidance of the Company's obligation
hereunder), including the acquisition or divestiture of assets, so long as the
Company promptly thereafter complies with the requirements of Section 4(k)
hereof, if applicable.
4. Registration Procedures. In connection with any Shelf Registration
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Statement and, to the extent applicable, any Exchange Offer Registration
Statement, the following provisions shall apply:
(a) (i) The Company shall furnish to you, prior to the filing
thereof with the Commission, a copy of any Exchange Offer Registration
Statement, each amendment thereof and each amendment or supplement, if any,
to the Prospectus included therein and shall use its best efforts to
reflect in each such document, when so filed with the Commission, such
comments as you reasonably may propose.
(ii) The Company shall furnish to you, prior to the filing thereof
with the Commission, a copy of any Shelf Registration Statement, each
amendment thereof and each amendment or supplement, if any, to the
Prospectus included therein and shall use its best efforts to reflect in
each such document, when so filed with the Commission, such comments as any
Holder whose securities are to be included in such Shelf Registration
Statement reasonably may propose.
(b) The Company shall ensure that (i) any Registration Statement and
any amendment thereto and any Prospectus forming part thereof and any
amendment or supplement thereto complies in all material respects with the
Securities Act and the rules and regulations thereunder, (ii) any
Registration Statement and any amendment thereto does not, when it becomes
effective, contain an untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary to make the
statements therein not misleading and (iii) any Prospectus forming part
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of any Registration Statement, and any amendment or supplement to such
Prospectus, does not include an untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading.
(c) (1) The Company shall advise you and, in the case of a Shelf
Registration Statement, the Holders of securities covered thereby, and, if
requested by you or any such Holder, confirm such advice in writing:
(i) when a Registration Statement and any amendment thereto has
been filed with the Commission and when the Registration Statement or
any post-effective amendment thereto has become effective; and
(ii) of any request by the Commission for amendments or
supplements to the Registration Statement or the Prospectus included
therein or for additional information.
(2) The Company shall advise you and, in the case of a Shelf
Registration Statement, the Holders of securities covered thereby, and, in the
case of an Exchange Offer Registration Statement, any Exchanging Dealer which
has provided in writing to the Company a telephone or facsimile number and
address for notices, and, if requested by you or any such Holder or Exchanging
Dealer, confirm such advice in writing:
(i) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or the
initiation of any proceedings for that purpose;
(ii) of the receipt by the Company of any notification with
respect to the suspension of the qualification of the securities
included therein for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose; and
(iii) of the happening of any event that requires the making of any
changes in the Registration Statement or the Prospectus so that, as of
such date, the statements therein are not misleading and do not omit
to state a material fact required to be stated therein or necessary to
make the statements therein (in the case of the Prospectus, in the
light of the circumstances under which they were made) not misleading
(which advice shall be accompanied by an instruction to suspend the
use of the Prospectus until the requisite changes have been made).
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Each such Holder or Exchanging Dealer agrees by its acquisition of such
securities to be sold by such Holder or Exchanging Dealer, that, upon being
so advised by the Company of any event described in clause (iii) of this
paragraph (c)(2), such Holder or Exchanging Dealer will forthwith
discontinue disposition of such securities under such Registration
Statement or Prospectus, until such Holder's or Exchanging Dealer's receipt
of the copies of the supplemented or amended Prospectus contemplated by
paragraph 4(k) hereof, or until it is advised in writing by the Company
that the use of the applicable Prospectus may be resumed.
(d) The Company shall use its best efforts to obtain the withdrawal
of any order suspending the effectiveness of any Registration Statement at
the earliest possible time.
(e) The Company shall furnish to each Holder of securities included
within the coverage of any Shelf Registration Statement, without charge, at
least one copy of such Shelf Registration Statement and any post-effective
amendment thereto, including financial statements and schedules, and, if
the Holder so requests in writing, any documents incorporated by reference
therein and all exhibits thereto (including those incorporated by reference
therein).
(f) The Company shall, during the Shelf Registration Period, deliver
to each Holder of securities included within the coverage of any Shelf
Registration Statement, without charge, as many copies of the Prospectus
(including each preliminary Prospectus) included in such Shelf Registration
Statement and any amendment or supplement thereto as such Holder may
reasonably request; and the Company consents to the use of the Prospectus
or any amendment or supplement thereto by each of the selling Holders of
securities in connection with the offering and sale of the securities
covered by the Prospectus or any amendment or supplement thereto.
(g) The Company shall furnish to each Exchanging Dealer which so
requests, without charge, at least one copy of the Exchange Offer
Registration Statement and any post-effective amendment thereto, including
financial statements and schedules and, if the Exchanging Dealer so
requests in writing, any documents incorporated by reference therein and
all exhibits thereto (including those incorporated by reference therein).
(h) The Company shall, during the Exchange Offer Registration Period,
promptly deliver to each Exchanging Dealer, without charge, as many copies
of the Prospectus included in such Exchange Offer Registration Statement
and any amendment or supplement thereto as such Exchanging Dealer may
reasonably request for delivery by such
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Exchanging Dealer in connection with a sale of New Securities received by
it pursuant to the Registered Exchange Offer; and the Company consents to
the use of the Prospectus or any amendment or supplement thereto by any
such Exchanging Dealer, as aforesaid.
(i) Prior to the Registered Exchange Offer or any other offering of
securities pursuant to any Registration Statement, the Company shall
register or qualify or cooperate with the Holders of securities included
therein and their respective counsel in connection with the registration or
qualification of such securities for offer and sale under the securities or
blue sky laws of such jurisdictions as any such Holder reasonably requests
in writing and do any and all other acts or things necessary or advisable
to enable the offer and sale in such jurisdictions of the securities
covered by such Registration Statement; provided, however, that the Company
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will not be required to qualify generally to do business in any
jurisdiction where it is not then so qualified or to take any action which
would subject it to general service of process or to taxation in any such
jurisdiction where it is not then so subject.
(j) The Company shall cooperate with the Holders of Securities to
facilitate the timely preparation and delivery of certificates representing
Securities to be sold pursuant to any Registration Statement free of any
restrictive legends and in such denominations and registered in such names
as Holders may request prior to sales of securities pursuant to such
Registration Statement.
(k) Upon the occurrence of any event contemplated by paragraph
(c)(2)(iii) above, the Company shall promptly prepare a post-effective
amendment to any Registration Statement or an amendment or supplement to
the related Prospectus or file any other required document so that, as
thereafter delivered to purchasers of the securities included therein, the
Prospectus will not include 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.
(l) Not later than the effective date of any such Registration
Statement hereunder, the Company shall provide a CUSIP number for the
Securities or New Securities, as the case may be, registered under such
Registration Statement, and provide the Trustee with printed certificates
for such Securities or New Securities, in a form, if requested by the
applicable Holder or Holder's Counsel, eligible for deposit with The
Depository Trust Company or any successor thereto under the Indenture.
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(m) The Company shall use its best efforts to comply with all
applicable rules and regulations of the Commission to the extent and so
long as they are applicable to the Registered Exchange Offer or the Shelf
Registration and will make generally available to its security holders a
consolidated earnings statement (which need not be audited) covering a
twelve-month period commencing after the effective date of the Registration
Statement and ending not later than 15 months thereafter, as soon as
practicable after the end of such period, which consolidated earnings
statement shall satisfy the provisions of Section 11(a) of the Securities
Act.
(n) The Company shall cause the Indenture to be qualified under the
Trust Indenture Act of 1939, as amended, on or prior to the effective date
of any Shelf Registration Statement or Exchange Offer Registration
Statement.
(o) The Company may require each Holder of securities to be sold
pursuant to any Shelf Registration Statement to furnish to the Company in
writing such information regarding the Holder and the distribution of such
securities as the Company may from time to time reasonably require for
inclusion in such Registration Statement. The Company may exclude from any
such Registration Statement the securities of any such Holder who fails to
furnish such information within a reasonable time after receiving such
request. Each Holder as to which any Shelf Registration is being effected
agrees to furnish promptly to the Company all information required to be
disclosed in order to make the information previously furnished to the
Company by such Holder not materially misleading.
(p) The Company shall, if requested, promptly incorporate in a
Prospectus supplement or post-effective amendment to a Shelf Registration
Statement, such information as the Managing Underwriters, if any, and
Majority Holders reasonably agree should be included therein and shall make
all required filings of such Prospectus supplement or post-effective
amendment as soon as notified of the matters to be incorporated in such
Prospectus supplement or post-effective amendment.
(q) (i) In the case of any Shelf Registration Statement, the Company
shall enter into such agreements (including underwriting agreements) and
take all other appropriate actions in order to expedite or facilitate the
registration or the disposition of the Securities, and in connection
therewith, if an underwriting agreement is entered into, cause the same to
contain indemnification provisions and procedures no less favorable than
those set forth in Section 6 hereof (or such other provisions and
procedures acceptable to the Majority Holders and the Managing
Underwriters, if any), with respect to all parties to
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be indemnified pursuant to Section 6 hereof from Holders of Securities to the
Company.
(ii) Without limiting in any way paragraph (q)(i), no Holder may
participate in any underwritten registration hereunder unless such Holder
(x) agrees to sell such Holder's securities to be covered by such
registration on the basis provided in any underwriting arrangements
approved by the Majority Holders and the Managing Underwriters and (y)
completes and executes in a timely manner all customary questionnaires,
powers of attorney, underwriting agreements and other documents reasonably
required by the Company or the Managing Underwriters in connection with
such underwriting arrangements.
(r) In the case of any Shelf Registration Statement, the Company
shall (i) make reasonably available for inspection by the Holders of
securities to be registered thereunder, any underwriter participating in
any disposition pursuant to such Registration Statement, and any attorney,
accountant or other agent retained by the Holders or any such underwriter
all relevant financial and other records, pertinent corporate documents and
properties of the Company and its subsidiaries reasonably requested by such
person; (ii) cause the Company's officers, directors and employees to
supply all relevant information reasonably requested by the Holders or any
such underwriter, attorney, accountant or agent in connection with any such
Registration Statement as is customary for due diligence examinations in
connection with primary underwritten offerings; provided, however, that any
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information that is nonpublic at the time of delivery of such information
shall be kept confidential by the Holders or any such underwriter,
attorney, accountant or agent, unless such disclosure is made in connection
with a court proceeding or required by law, or such information becomes
available to the public generally or through a third party without an
accompanying obligation of confidentiality; (iii) make such representations
and warranties to the Holders of securities registered thereunder and the
underwriters, if any, in form, substance and scope as are customarily made
by issuers to underwriters in primary underwritten offerings; (iv) obtain
opinions of counsel to the Company (which counsel and opinions (in form,
scope and substance) shall be reasonably satisfactory to the Managing
Underwriters, if any) addressed to each selling Holder and the
underwriters, if any, covering such matters as are customarily covered in
opinions requested in underwritten offerings and such other matters as may
be reasonably requested by such Holders and underwriters; (v) obtain "cold
comfort" letters (or, in the case of any person that does not satisfy the
conditions for receipt of a "cold comfort" letter specified in Statement on
Auditing Standards No. 72, an "agreed-upon procedures" letter under
Statement on Auditing Standards No. 35) and updates thereof from the
independent certified public
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accountants of the Company (and, if necessary, any other independent
certified public accountants of any subsidiary of the Company or of any
business acquired by the Company for which financial statements and
financial data are, or are required to be, included or incorporated by
reference in the Registration Statement), addressed to each selling Holder
of securities registered thereunder and the underwriters, if any, in
customary form and covering matters of the type customarily covered in
"cold comfort" letters in connection with primary underwritten offerings;
and (vi) deliver such documents and certificates as may be reasonably
requested by the Majority Holders and the Managing Underwriters, if any,
including those to evidence compliance with Section 4(k) and with any
customary conditions contained in the underwriting agreement or other
agreement entered into by the Company. The foregoing actions set forth in
clauses (iii), (iv), (v) and (vi) of this Section 4(r) shall be performed
(A) on the effective date of such Registration Statement and each post-
effective amendment thereto and (B) at each closing under any underwriting
or similar agreement as and to the extent required thereunder.
(s) In the case of any Exchange Offer Registration Statement, the
Company shall (i) make reasonably available for inspection by each
Purchaser, and any attorney, accountant or other agent retained by such
Purchaser, all relevant financial and other records, pertinent corporate
documents and properties of the Company and its subsidiaries reasonably
requested by such person; (ii) cause the Company's officers, directors and
employees to supply all relevant information reasonably requested by such
Purchaser or any such attorney, accountant or agent in connection with any
such Registration Statement as is customary for due diligence examinations
in connection with primary underwritten offerings; provided, however, that
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any information that is nonpublic at the time of delivery of such
information shall be kept confidential by such Purchaser or any such
attorney, accountant or agent, unless such disclosure is made in connection
with a court proceeding or required by law, or such information becomes
available to the public generally or through a third party without an
accompanying obligation of confidentiality; (iii) make such representations
and warranties to such Purchaser, in form, substance and scope as are
customarily made by issuers to underwriters in primary underwritten
offerings; (iv) obtain opinions of counsel to the Company (which counsel
and opinions (in form, scope and substance) shall be reasonably
satisfactory to such Purchaser and its counsel), addressed to such
Purchaser, covering such matters as are customarily covered in opinions
requested in underwritten offerings and such other matters as may be
reasonably requested by such Purchaser or its counsel; (v) obtain "cold
comfort" letters and updates thereof from the independent certified public
accountants of the Company (and, if
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necessary, any other independent certified public accountants of any
subsidiary of the Company or of any business acquired by the Company for
which financial statements and financial data are, or are required to be,
included or incorporated by reference in the Registration Statement),
addressed to such Purchaser, in customary form and covering matters of the
type customarily covered in "cold comfort" letters in connection with
primary underwritten offerings, or if requested by such Purchaser or its
counsel in lieu of a "cold comfort" letter, an agreed-upon procedures
letter under Statement on Auditing Standards No. 35, covering matters
requested by such Purchaser or its counsel; and (vi) deliver such documents
and certificates as may be reasonably requested by such Purchaser or its
counsel, including those to evidence compliance with Section 4(k) and with
conditions customarily contained in underwriting agreements. The foregoing
actions set forth in clauses (iii), (iv), (v) and (vi) of this Section 4(s)
shall be performed (A) at the close of the Registered Exchange Offer and
(B) on the effective date of any post-effective amendment to the Exchange
Offer Registration Statement.
5. Registration Expenses. The Company shall bear all expenses incurred in
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connection with the performance of its obligations under Sections 2, 3 and 4
hereof and, in the event of any Shelf Registration Statement, will reimburse the
Holders for the reasonable fees and disbursements of one firm or counsel (in
addition to one local counsel in each relevant jurisdiction) designated by the
Majority Holders to act as counsel for the Holders in connection therewith
("Holders' Counsel"). Notwithstanding the foregoing, the Holders of the
securities being registered shall pay all agency or brokerage fees and
commissions and underwriting discounts and commissions attributable to the sale
of such securities and the fees and disbursements of any counsel or other
advisors or experts retained by such holders (severally or jointly), other than
the counsel and experts specifically referred to above in this Section 5,
transfer taxes on resale of any of the securities by such Holders and any
advertising expenses incurred by or on behalf of such Holders in connection with
any offers they may make.
6. Indemnification and Contribution. (a) In connection with any Registration
---------------------------------
Statement, the Company agrees to indemnify and hold harmless each Holder of
securities covered thereby (including each Purchaser and, with respect to any
Prospectus delivery as contemplated in Section 4(h) hereof, each Exchanging
Dealer), the directors, officers, employees and agents of each such Holder and
each other person, if any, who controls any such Holder within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act against any
and all losses, claims, damages or liabilities, joint or several, to which they
or any of them may become subject under the Securities Act, the Exchange Act or
other Federal or state statutory law or
14
regulation, at common law or otherwise, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of a material fact contained in
the Registration Statement as originally filed or in any amendment thereof, or
in any preliminary Prospectus or Prospectus, or in any amendment thereof or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, and agrees to reimburse
each such indemnified party, as incurred, for any legal or other expenses
reasonably incurred by them in connection with investigating or defending any
such loss, claim, damage, liability or action; provided, however, that the
-----------------
Company will not be liable in any case to the extent that any such loss, claim,
damage or liability arises out of or is based upon any such untrue statement or
alleged untrue statement or omission or alleged omission made therein in
reliance upon and in conformity with written information furnished to the
Company by or on behalf of any such Holder specifically for inclusion therein;
provided further, however, that the indemnity agreement contained in this
---------------- -------
Section 6(a) shall not inure to the benefit of any indemnified party to the
extent that it is determined by a final, non-appealable judgment that (i) a
preliminary Prospectus contained an untrue statement of a material fact or
omitted to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, (ii) the sale to the
person asserting any such losses, claims, damages or liabilities was an initial
resale of securities by any Holder, (iii) any such loss, claim, damage or
liability of such indemnified party results from the fact that there was not
sent or given to such person, at or prior to the written confirmation of the
sale of such securities to such person, a copy of any revised preliminary
Prospectus, the related Prospectus or the related Prospectus as amended or
supplemented in any case where such delivery is required by the Securities Act,
and the Company had previously furnished copies thereof to such Holder and (iv)
the revised preliminary Prospectus, the related Prospectus or the related
Prospectus as amended or supplemented corrected such untrue statement or
omission. This indemnity agreement will be in addition to any liability which
the Company may otherwise have.
The Company also agrees to indemnify or contribute to Losses (as
defined below) of, as provided in Section 6(d), any underwriters of Securities
registered under a Shelf Registration Statement, their officers, directors,
employees and agents and each person who controls such underwriters on
substantially the same basis as that of the indemnification of the Purchasers
and the selling Holders provided in this Section 6(a) and shall, if requested by
any Holder, enter into an underwriting agreement reflecting such agreement, as
provided in Section 4(q) hereof.
15
(b) Each Holder of securities covered by a Registration Statement
(including each Purchaser and, with respect to any Prospectus delivery as
contemplated in Section 4(h) hereof, each Exchanging Dealer) severally and not
jointly agrees to indemnify and hold harmless the Company, each of its directors
and officers 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 to
the same extent as the foregoing indemnity from the Company to each such Holder,
but only with reference to written information relating to such Holder furnished
to the Company by or on behalf of such Holder specifically for inclusion in the
documents referred to in the foregoing indemnity. This indemnity agreement will
be in addition to any liability which any such Holder may otherwise have.
(c) Promptly after receipt by an indemnified party under this Section
6 of notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under this
Section 6, notify the indemnifying party in writing of the commencement thereof;
but the failure so to notify the indemnifying party (i) will not relieve it from
liability under paragraph (a) or (b) above unless and to the extent it did not
otherwise learn of such action and such failure results in the forfeiture by the
indemnifying party of substantial rights and defenses and (ii) will not, in any
event, relieve the indemnifying party from any obligations to any indemnified
party other than the indemnification obligation provided in paragraph (a) or (b)
above. The indemnifying party shall be entitled to appoint counsel of the
indemnifying party's choice at the indemnifying party's expense to represent the
indemnified party in any action for which indemnification is sought (in which
case the indemnifying party shall not thereafter be responsible for the fees and
expenses of any separate counsel retained by the indemnified party or parties
except as set forth below); provided, however, that such counsel shall be
-------- -------
reasonably satisfactory to the indemnified party. Notwithstanding the
indemnifying party's election to appoint counsel to represent the indemnified
party in an action, the indemnified party shall have the right to employ
separate counsel (including local counsel), and the indemnifying party shall
bear the reasonable fees, costs and expenses of such separate counsel (and local
counsel) if (i) the use of counsel chosen by the indemnifying party to represent
the indemnified party would present such counsel with a conflict of interest,
(ii) the actual or potential defendants in, or targets of, any such action
include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be legal
defenses available to it and/or other indemnified parties which are different
from or additional to those available to the indemnifying party, (iii) the
indemnifying party shall not have employed counsel reasonably satisfactory to
the indemnified party to represent the indemnified party within a reasonable
time after notice of the
16
institution of such action or (iv) the indemnifying party shall authorize the
indemnified party to employ separate counsel at the expense of the indemnifying
party. An indemnifying party will not, without the prior written consent of the
indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified parties are actual or potential
parties to such claim or action) unless such settlement, compromise or consent
includes an unconditional release of each indemnified party from all liability
arising out of such claim, action, suit or proceeding. It is understood,
however, that the Company shall, in connection with any one such 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
reasonable fees and expenses of only one separate firm of attorneys (in addition
to any local counsel) at any time for all such Holders and controlling persons.
An indemnifying party shall not be liable under this Section 6 to any
indemnified party regarding any settlement or compromise or consent to the entry
of any judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified parties are actual or potential
parties to such claim or action) unless such settlement, compromise or consent
is consented to by such indemnifying party, which consent shall not be
unreasonably withheld.
(d) In the event that the indemnity provided in paragraph (a) or (b)
of this Section 6 is unavailable to or insufficient to hold harmless an
indemnified party for any reason, then each applicable indemnifying party, in
lieu of indemnifying such indemnified party, shall have a joint and several
obligation to contribute to the aggregate losses, claims, damages and
liabilities (including legal or other expenses reasonably incurred in connection
with investigating or defending same) (collectively "Losses") to which such
indemnified party may be subject in such proportion as is appropriate to reflect
the relative benefits received by such indemnifying party, on the one hand, and
such indemnified party, on the other hand, from the Initial Placement and the
Registration Statement which resulted in such Losses; provided, however, that in
-------- -------
no case shall any Purchaser or any subsequent Holder of any Security or New
Security be responsible, in the aggregate, for any amount in excess of the
purchase discount or commission applicable to such Security, or in the case of a
New Security, applicable to the Security which was exchangeable into such New
Security, as set forth on the cover page of the Final Memorandum, nor shall any
underwriter be responsible for any amount in excess of the underwriting discount
or commission applicable to the securities purchased by such underwriter under
the Registration Statement which resulted in such Losses. If the allocation
provided by the immediately preceding sentence is unavailable for any reason,
the
17
indemnifying party and the indemnified party shall contribute in such proportion
as is appropriate to reflect not only such relative benefits but also the
relative fault of such indemnifying party, on the one hand, and such indemnified
party, on the other hand, in connection with the statements or omissions which
resulted in such Losses as well as any other relevant equitable considerations.
Benefits received by the Company shall be deemed to be equal to the sum of (x)
the total net proceeds from the Initial Placement (before deducting expenses) as
set forth on the cover page of the Final Memorandum and (y) the total amount of
additional interest which the Company was not required to pay as a result of
registering the securities covered by the Registration Statement which resulted
in such Losses. Benefits received by the Purchasers shall be deemed to be equal
to the total purchase discounts and commissions as set forth on the cover page
of the Final Memorandum, and benefits received by any other Holders shall be
deemed to be equal to the value of receiving Securities or New Securities, as
applicable, registered under the Securities Act. Benefits received by any
underwriter shall be deemed to be equal to the total underwriting discounts and
commissions, as set forth on the cover page of the Prospectus forming a part of
the Registration Statement which resulted in such Losses. Relative fault shall
be determined by reference to whether any alleged untrue statement or omission
relates to information provided by the indemnifying party, on the one hand, or
by the indemnified party, on the other hand. The parties agree that it would not
be just and equitable if contribution were determined by pro rata allocation or
any other method of allocation which does not take account of the equitable
considerations referred to above. Notwithstanding the provisions of this
paragraph (d), no person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 6, each person who controls a
Holder within the meaning of either the Securities Act or the Exchange Act and
each director, officer, employee and agent of such Holder shall have the same
rights to contribution as such Holder, and each person who controls the Company
within the meaning of either the Securities Act or the Exchange Act, each
officer of the Company who shall have signed the Registration Statement and each
director of the Company shall have the same rights to contribution as the
Company, subject in each case to the applicable terms and conditions of this
paragraph (d).
(e) The provisions of this Section 6 will remain in full force and
effect, regardless of any investigation made by or on behalf of any Purchaser,
any other Holder, the Company or any underwriter or any of the officers,
directors or controlling persons referred to in this Section 6, and will survive
the sale by a Holder of securities covered by a Registration Statement.
18
7. Miscellaneous.
-------------
(a) No Inconsistent Agreements. The Company has not, as of the date
---------------------------
hereof, entered into, nor shall it, on or after the date hereof, enter into, any
agreement with respect to its securities that limits the rights granted to the
Holders herein or otherwise conflicts with the provisions hereof.
(b) Amendments and Waivers. The provisions of this Agreement,
-----------------------
including the provisions of this sentence, may not be amended, qualified,
modified or supplemented, and waivers or consents to departures from the
provisions hereof may not be given, unless the Company has obtained the written
consent of the Holders of at least a majority of the then outstanding aggregate
principal amount of Securities (or, after the consummation of any Exchange Offer
in accordance with Section 2 hereof, of New Securities); provided that, with
--------
respect to any matter that directly or indirectly affects the rights of any
Purchaser hereunder, the Company shall obtain the written consent of each such
Purchaser against which such amendment, qualification, supplement, waiver or
consent is to be effective. Notwithstanding the foregoing (except the foregoing
proviso), a waiver or consent to departure from the provisions hereof with
respect to a matter that relates exclusively to the rights of Holders whose
securities are being sold pursuant to a Registration Statement and that does not
directly or indirectly affect the rights of other Holders may be given by the
Majority Holders, determined on the basis of securities being sold rather than
registered under such Registration Statement.
(c) Notices. All notices and other communications provided for or
--------
permitted hereunder shall be made in writing by hand-delivery, first-class mail,
facsimile, or air courier guaranteeing overnight delivery:
(1) if to a Holder, at the most current address given by such
Holder to the Company in accordance with the provisions of this
Section 7(c), which address initially is, with respect to each Holder,
the address of such Holder maintained by the registrar under the
Indenture, with a copy in like manner to ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc. by
facsimile (212-783-2823) and confirmed by mail to it at Seven ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: General Counsel;
(2) if to you, initially at the address set forth in the Purchase
Agreement; and
(3) if to the Company, initially at its address set forth in the
Purchase Agreement.
All such notices and communications shall be deemed to have been duly
given when received.
19
The Purchasers or the Company by notice to the other may designate
additional or different addresses for subsequent notices or communications.
(d) 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 the need for an express assignment or any consent by
the Company or subsequent Holders of Securities and/or New Securities. The
Company hereby agrees to extend the benefits of this Agreement to any Holder of
Securities and/or New Securities and any such Holder may specifically enforce
the provisions of this Agreement as if an original party hereto.
(e) 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.
(f) Headings. The headings in this Agreement are for convenience of
---------
reference only and shall not limit or otherwise affect the meaning hereof.
(g) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
--------------
IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD TO
THE CONFLICT OF LAW PROVISIONS THEREOF).
(h) Severability. In the event that any one of more of the
-------------
provisions contained herein, or the application thereof in any circumstances, is
held invalid, illegal or unenforceable in any respect for any reason, the
validity, legality and enforceability of any such provision in every other
respect and of the remaining provisions hereof shall not be in any way impaired
or affected thereby, it being intended that all the rights and privileges of the
parties shall be enforceable to the fullest extent permitted by law.
(i) Securities Held by the Company, etc. Whenever the consent or
------------------------------------
approval of Holders of a specified percentage of principal amount of Securities
or New Securities is required hereunder, Securities or New Securities, as
applicable, held by the Company or its Affiliates (other than subsequent Holders
of Securities or New Securities if such subsequent Holders are deemed to be
Affiliates solely by reason of their holdings of such Securities or New
Securities) shall not be counted in determining whether such consent or approval
was given by the Holders of such required percentage.
(j) Termination. This Agreement shall automatically terminate,
------------
without any further action on the part of the Company or the Purchasers, upon
the termination or cancelation of the Purchase Agreement prior to the Closing
Date.
20
Please confirm that the foregoing correctly sets forth the agreement
between the Company and you.
Very truly yours,
▇▇▇▇▇ ▇ COMMUNICATIONS, INC.
By:
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Senior Vice President and
General Counsel
The foregoing Agreement is
hereby confirmed and accepted
as of the date first above written
▇▇▇▇▇▇▇ ▇▇▇▇▇ BARNEY INC.
▇▇▇▇▇▇▇, ▇▇▇▇▇ & CO.
▇▇▇▇▇ SECURITIES INC.
▇.▇. ▇▇▇▇▇▇ & CO.
By: ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ INC.
By:
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇.
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇.
Title: Vice President
21
ANNEX A
Each broker-dealer that receives New Securities for its own account pursuant to
the Registered Exchange Offer must acknowledge that it will deliver a prospectus
in connection with any resale of such New Securities. The Letter of Transmittal
states that by so acknowledging and by delivering a prospectus, a broker-dealer
will not be deemed to admit that it is an "underwriter" within the meaning of
the Securities Act. This Prospectus, as it may be amended or supplemented from
time to time, may be used by a broker-dealer in connection with resales of New
Securities received in exchange for Securities where such New Securities were
acquired by such broker-dealer as a result of market-making activities or other
trading activities. The Company has agreed that, starting on the date hereof
(the "Expiration Date") and ending on the close of business on the day that is
180 days following the Expiration Date, it will make this Prospectus available
to any broker-dealer for use in connection with any such resale. See "Plan of
Distribution."
ANNEX B
Each broker-dealer that receives New Securities for its own account in exchange
for Securities, where such Securities were acquired by such broker-dealer as a
result of market-making activities or other trading activities, must acknowledge
that it will deliver a prospectus in connection with any resale of such New
Securities. See "Plan of Distribution."
1
ANNEX C
PLAN OF DISTRIBUTION
Each broker-dealer that receives New Securities for its own account
pursuant to the Registered Exchange Offer must acknowledge that it will deliver
a prospectus in connection with any resale of such New Securities. The
Prospectus, as it may be amended or supplemented from time to time, may be used
by a broker-dealer in connection with resales of New Securities received in
exchange for Securities where such Securities were acquired as a result of
market-making activities or other trading activities. The Company has agreed
that, starting on the Expiration Date and ending on the close of business on the
day that is 180 days following the Expiration Date, it will make this
Prospectus, as amended or supplemented, available to any broker-dealer for use
in connection with any such resale. In addition, until , 199 , all
dealers effecting transactions in the Exchange Securities may be required to
deliver a prospectus. */
-
The Company will not receive any proceeds from any sale of New Securities
by broker-dealers. New Securities received by broker-dealers for their own
account pursuant to the Exchange Offer may be sold from time to time in one or
more transactions in the over-the-counter market, in negotiated transactions,
through the writing of options on the New Securities or a combination of such
methods of resale, at market prices prevailing at the time of resale, at prices
related to such prevailing market prices or negotiated prices. Any such resale
may be made directly to purchasers or to or through brokers or dealers who may
receive compensation in the form of commissions or concessions from any such
broker-dealer and/or the purchasers of any such New Securities. Any broker-
dealer that resells New Securities that were received by it for its own account
pursuant to the Registered Exchange Offer and any broker or dealer that
participates in a distribution of such New Securities may be deemed to be an
"underwriter" within the meaning of the Securities Act and any profit of any
such resale of New Securities and any commissions or concessions received by any
such persons may be deemed to be underwriting compensation under the Securities
Act. The Letter of Transmittal states that by acknowledging that it will
deliver and by delivering a prospectus, a broker-dealer will not be deemed to
admit that it is an "underwriter" within the meaning of the Securities Act.
--------------------
*/ In addition, the legend required by Item 502(e) of Regulation S-K will
-
appear on the back cover page of the Exchange Offer Prospectus.
For a period of 180 days after the Expiration Date, the Company will
promptly send additional copies of this Prospectus and any amendment or
supplement to this Prospectus to any broker-dealer that requests such documents
in the Letter of Transmittal. The Company has agreed to pay all expenses
incident to the Exchange Offer (other than the expenses of counsel for the
holders of the Securities) other than commissions or concessions of any brokers
or dealers and will indemnify the holders of the Securities (including any
broker-dealers) against certain liabilities, including liabilities under the
Securities Act.
[If applicable, add information required by Regulation S-K Items 507 and/or
508.]
2
ANNEX D
Rider A
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[_] CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE 10 ADDITIONAL
COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR SUPPLEMENTS
THERETO.
Name:
-----------------------------------------------------------------
Address:
--------------------------------------------------------------
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Rider B
-------
If the undersigned is not a broker-dealer, the undersigned represents that it is
not engaged in, and does not intend to engage in, a distribution of New
Securities. If the undersigned is a broker-dealer that will receive New
Securities for its own account in exchange for Securities that were acquired as
a result of market-making activities or other trading activities, it
acknowledges that it will deliver a prospectus in connection with any resale of
such New Securities; however, by so acknowledging and by delivering a
prospectus, the undersigned will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act.