EXHIBIT 4(b)
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REGISTRATION RIGHTS AGREEMENT
Dated as of December 12, 2003
between
The Cleveland Electric Illuminating Company,
as Issuer
and
Barclays Capital Inc. and
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
as Representatives of the Initial Purchasers
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REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (the "Agreement") is made
and entered into this 12th day of December, 2003, by and between The Cleveland
Electric Illuminating Company, an Ohio corporation (the "Issuer") and Barclays
Capital Inc. and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated, as representatives of the
Initial Purchasers (as defined below).
This Agreement is made pursuant to the Purchase Agreement,
dated December 9, 2003 (the "Purchase Agreement"), between the Issuer and the
Initial Purchasers, which provides for the sale by the Issuer to the Initial
Purchasers of $300,000,000 aggregate principal amount of the Issuer's 5.65%
Senior Notes due 2013 (the "Notes"). In order to induce the Initial Purchasers
to enter into the Purchase Agreement, the Issuer has agreed to provide to the
Initial Purchasers and their direct and indirect transferees the registration
rights set forth in this Agreement. The execution and delivery of this Agreement
is a condition to the closing under the Purchase Agreement.
In consideration of the foregoing, the parties hereto agree as
follows:
1. Definitions. As used in this Agreement, the following
capitalized defined terms shall have the following meanings:
"1933 Act" shall mean the Securities Act of 1933, as amended
from time to time.
"1934 Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time.
"Closing Date" shall mean the Closing Time as defined in the
Purchase Agreement.
"Depositary" shall mean The Depository Trust Company, or any
other depositary appointed by the Issuer, provided, however, that such
depositary must have an address in the Borough of Manhattan, in The
City of New York and, provided further, that if the Notes are not held
in book-entry form, references herein to the Depositary shall be deemed
to refer to the Holders.
"Exchange Notes" shall mean the Issuer's 5.65% Exchange Senior
Notes due 2013 containing terms identical to the Issuer's 5.65% Senior
Notes due 2013 in all material respects (except in each case for
references to certain interest rate provisions, restrictions on
transfers and restrictive legends), to be offered to Holders of Notes
in exchange for Registrable Notes pursuant to the Exchange Offer.
"Exchange Offer" shall mean the exchange offer by the Issuer
of Exchange Notes for Registrable Notes pursuant to Section 2.1 hereof.
"Exchange Offer Registration" shall mean a registration under
the 1933 Act effected pursuant to Section 2.1 hereof.
"Exchange Offer Registration Statement" shall mean an exchange
offer registration statement on Form S-4 (or, if applicable, on another
appropriate form), and all amendments and supplements to such
registration statement, including the Prospectus contained therein, all
exhibits thereto and all documents incorporated by reference therein.
"Exchange Period" shall have the meaning set forth in Section
2.1 hereof.
"Holder" shall mean any beneficial owner from time to time of
Registrable Notes (including any of the Initial Purchasers, for so long
as it owns any Registrable Notes).
"Indenture" shall mean the Senior Note Indenture relating to
the Notes, dated as of December 1, 2003 among the Issuer, and JPMorgan
Chase Bank, as trustee, as the same may be amended, supplemented,
waived or otherwise modified from time to time in accordance with the
terms thereof.
"Initial Purchasers" shall mean Barclays Capital Inc. and
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated, Scotia Capital (USA) Inc. and UBS
Securities LLC.
"Issuer" shall have the meaning set forth in the preamble and
shall also include the Issuer's successors.
"Majority Holders" shall mean the Holders of a majority of the
aggregate principal amount of Outstanding (as defined in the Indenture)
Registrable Notes of each series; provided that whenever the consent or
approval of Holders of a specified percentage of Registrable Notes is
required hereunder, Registrable Notes held by the Issuer or any
Affiliate (as defined in the Indenture) of the Issuer shall be
disregarded in determining whether such consent or approval was given
by the Holders of such required percentage amount.
"Notes" shall have the meaning set forth in the preamble to
this Agreement.
"Participating Broker-Dealer" shall mean Barclays Capital
Inc., ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated, Scotia Capital (USA) Inc., UBS
Securities LLC and any other broker-dealer which makes a market in the
Notes and exchanges Registrable Notes in the Exchange Offer for
Exchange Notes.
"Person" shall mean an individual, partnership (general or
limited), corporation, limited liability company, trust or
unincorporated organization, or a government or agency or political
subdivision thereof.
"Prospectus" shall mean the prospectus included in a
Registration Statement, including any preliminary prospectus, and any
such prospectus as amended or supplemented by any prospectus
supplement, including any such prospectus supplement with respect to
the terms of the offering of any portion of the Registrable Notes
covered by a Shelf Registration Statement, and by all other amendments
and supplements to a prospectus, including pre-effective and
post-effective amendments, and in each case including all material
incorporated by reference therein.
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"Purchase Agreement" shall have the meaning set forth in the
preamble.
"Registrable Notes" shall mean the Notes of any Holder;
provided, however, that such Notes shall cease to be Registrable Notes
when (i) a Registration Statement with respect to such Notes shall have
been declared effective under the 1933 Act and such Notes shall have
been disposed of pursuant to such Registration Statement, (ii) such
Notes have been sold to the public pursuant to Rule 144 (or any similar
provision then in force, but not Rule 144A) under the 1933 Act, (iii)
such Notes shall have ceased to be outstanding or (iv) the Exchange
Offer is consummated (except in the case of Notes purchased from the
Issuer and continued to be held by the Initial Purchasers).
"Registration Expenses" shall mean any and all expenses
incident to performance of or compliance by the Issuer with this
Agreement, regardless of whether a Registration becomes effective,
including without limitation: (i) all SEC, stock exchange or National
Association of Securities Dealers, Inc. (the "NASD") registration and
filing fees, including, if applicable, the reasonable fees and expenses
of any "qualified independent underwriter" (and its counsel) that is
required to be retained by any Holder of Registrable Notes in
accordance with the rules and regulations of the NASD, (ii) all
reasonable fees and expenses incurred in connection with compliance
with state securities or blue sky laws and compliance with the rules of
the NASD (including reasonable fees and disbursements of counsel for
any underwriters or Holders in connection with blue sky qualification
of any of the Exchange Notes or Registrable Notes and any filings with
the NASD), (iii) all expenses of any Persons in preparing or assisting
in preparing, word processing, printing and distributing any
Registration Statement, any Prospectus, any amendments or supplements
thereto, any underwriting agreements, securities sales agreements and
other documents relating to the performance of and compliance with this
Agreement, (iv) all fees and expenses incurred in connection with the
listing, if any, of any of the Registrable Notes on any securities
exchange or exchanges, (v) all rating agency fees, (vi) the fees and
disbursements of counsel for the Issuer and of the independent public
accountants of the Issuer, including the expenses of any special audits
or "cold comfort" letters required by or incident to such performance
and compliance, (vii) the fees and expenses of the Trustee, and any
escrow agent or custodian, (viii) the reasonable fees and expenses of
the Initial Purchasers in connection with the Exchange Offer, including
the reasonable fees and expenses of counsel to the Initial Purchasers
in connection therewith, and (ix) any reasonable fees and disbursements
of the underwriters customarily required to be paid by issuers or
sellers of securities and the reasonable fees and expenses of any
special experts retained by the Issuer in connection with any
Registration Statement, but excluding underwriting discounts and
commissions and transfer taxes, if any, relating to the sale or
disposition of Registrable Notes by a Holder, it being understood that
in no event shall the Issuer be liable for the fees and expenses of
more than one counsel (in addition to any local counsel) in connection
with registration pursuant to either Section 2.1 or 2.2.
"Registration Statement" shall mean any registration statement
of the Issuer which covers any of the Exchange Notes or Registrable
Notes pursuant to the provisions of this Agreement, and all amendments
and supplements to any such Registration Statement, including
pre-effective and post-effective amendments, in each case including
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the Prospectus contained therein, all exhibits thereto and all material
incorporated by reference therein.
"SEC" shall mean the United States Securities and Exchange
Commission or any successor agency or government body performing the
functions currently performed by the United States Securities and
Exchange Commission.
"Shelf Registration" shall mean a registration effected
pursuant to Section 2.2 hereof.
"Shelf Registration Statement" shall mean a "shelf"
registration statement of the Issuer pursuant to the provisions of
Section 2.2 of this Agreement which covers all of the Registrable
Notes, of each series, on an appropriate form under Rule 415 under the
1933 Act, or any similar rule that may be adopted by the SEC, and 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" shall mean the trustee with respect to the Notes
under the Indenture.
2. Registration Under the ▇▇▇▇ ▇▇▇.
2.1 Exchange Offer. The Issuer shall (A) prepare and, as soon
as practicable following the Closing Date, file with the SEC an Exchange Offer
Registration Statement with respect to a proposed Exchange Offer and the
issuance and delivery to the Holders, in exchange for the Registrable Notes of
each series, a like principal amount of Exchange Notes of such series, (B) use
its reasonable best efforts to cause the Exchange Offer Registration Statement
to be declared effective under the 1933 Act not later than 180 calendar days
following the Closing Date, (C) use its reasonable best efforts to keep the
Exchange Offer Registration Statement effective until the closing of the
Exchange Offer and (D) use its reasonable best efforts to cause the Exchange
Offer to be consummated within 210 calendar days following the Closing Date. The
Exchange Notes will be issued under the Indenture. Upon the effectiveness of the
Exchange Offer Registration Statement, the Issuer shall promptly commence the
Exchange Offer, it being the objective of such Exchange Offer to enable each
Holder eligible and electing to exchange Registrable Notes for Exchange Notes
(assuming that such Holder (a) is not an affiliate of the Issuer within the
meaning of Rule 405 under the 1933 Act, (b) is not a broker-dealer tendering
Registrable Notes acquired directly from the Issuer for its own account, (c)
acquired the Exchange Notes in the ordinary course of such Holder's business and
(d) has no arrangements or understandings with any person to participate in the
Exchange Offer for the purpose of distributing the Exchange Notes) to transfer
such Exchange Notes from and after their receipt without any limitations or
restrictions under the 1933 Act and without material restrictions under the
securities laws of a majority of the several states of the United States.
In connection with the Exchange Offer, the Issuer shall:
(a) mail to the Depositary a copy of the Prospectus forming
part of the Exchange Offer Registration Statement together with an
appropriate letter of transmittal and related documents;
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(b) use its reasonable best efforts to keep the Exchange
Offer open for acceptance for a period of not less than 20 business
days after the date notice thereof is mailed to the Depositary (or
longer if required by applicable law) (such period referred to herein
as the "Exchange Period");
(c) utilize the services of the Depositary for the
Exchange Offer;
(d) permit Holders to withdraw tendered Registrable Notes
at any time prior to 5:00 p.m. (Eastern Time) on the last business day
of the Exchange Period, by sending to the institution specified in the
notice, a telegram, telex, facsimile transmission or letter setting
forth the name of such Holder, the principal, the principal amount of
Registrable Notes delivered for exchange, and a statement that such
Holder is withdrawing his election to have such Notes exchanged;
(e) notify the Depositary that any Registrable Notes not
tendered will remain outstanding and continue to accrue interest, but
will not retain any rights under this Agreement (except in the case of
the Initial Purchasers and Participating Broker-Dealers as provided
herein); and
(f) otherwise comply in all respects with all applicable
laws relating to the Exchange Offer.
As soon as practicable after the close of the Exchange Offer,
the Issuer shall:
(i) accept for exchange all Registrable Notes
duly tendered and not validly withdrawn pursuant to the
Exchange Offer in accordance with the terms of the Exchange
Offer Registration Statement and the letter of transmittal
which shall be an exhibit thereto;
(ii) deliver to the Trustee for cancellation all
Registrable Notes so accepted for exchange; and
(iii) cause the Trustee promptly to authenticate
and deliver the respective Exchange Notes to each Holder of
Registrable Notes so accepted for exchange in a principal
amount equal to the principal amount of the Registrable Notes
of such Holder so accepted for exchange.
The Issuer shall use its reasonable best efforts to keep the
Exchange Offer Registration Statement effective and to amend and supplement the
Prospectus contained therein, in order to permit such Prospectus to be lawfully
delivered by all Participating Broker-Dealers subject to the prospectus delivery
requirements of the 1933 Act for such period of time as such Participating
Broker-Dealers must comply with such requirements in order to resell the
Exchange Notes; provided, however, that (i) such period shall be the lesser of
90 days after the consummation of the Exchange Offer and the date on which all
Participating Broker-Dealers have sold all Exchange Notes held by them (unless
such period is extended pursuant to Section 3(k) below) and (ii) the Issuer
shall make such Prospectus, and any amendment or supplement thereto, available
to any such Participating Broker-Dealer for use in connection with any resale of
any Exchange Notes for a period of the lesser of 90 days after the consummation
of
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the Exchange Offer and the date on which all Participating Broker-Dealers have
sold all Exchange Notes held by them (unless such period is extended pursuant to
Section 3(k) below).
Interest on the Exchange Notes of each series will accrue from
the most recent interest payment date to which interest has been paid on the
respective Registrable Notes surrendered in exchange therefor or, if no interest
has been paid on such Registrable Notes, from the Closing Date. The Exchange
Offer shall not be subject to any conditions, other than (i) that the Exchange
Offer, or the making of any exchange by a Holder, does not violate applicable
law or any applicable interpretation of the staff of the SEC, (ii) the due
tendering of Registrable Notes in accordance with the Exchange Offer, (iii) that
each Holder of Registrable Notes exchanged in the Exchange Offer shall have
represented (x) that all Exchange Notes to be received by it shall be acquired
in the ordinary course of its business (y) that it is not an affiliate of the
Issuer and (z) that at the time of the consummation of the Exchange Offer it
shall have no arrangement or understanding with any person to participate in the
distribution (within the meaning of the ▇▇▇▇ ▇▇▇) of the Exchange Notes and
shall have made such other representations as may be reasonably necessary under
applicable SEC rules, regulations or interpretations to render the use of Form
S-4 or other appropriate form under the 1933 Act available and (iv) that no
action or proceeding shall have been instituted or threatened in any court or by
or before any governmental agency with respect to the Exchange Offer which, in
the judgment of the Issuer, would reasonably be expected to impair the ability
of the Issuer to proceed with the Exchange Offer. The Issuer shall inform the
Initial Purchasers of the names and addresses of the Holders to whom the
Exchange Offer is made, and the Initial Purchasers shall have the right to
contact such Holders and otherwise facilitate the tender of Registrable Notes in
the Exchange Offer. Each Holder of Registrable Notes who wishes to exchange such
Registrable Notes for Exchange Notes in the Exchange Offer will be required to
make certain customary representations in connection therewith, including
representations that (i) it is not an affiliate of the Issuer, (ii) the Exchange
Notes to be received by it were acquired in the ordinary course of its business
and (iii) at the time of the Exchange Offer, it has no arrangement with any
person to participate in the distribution (within the meaning of the ▇▇▇▇ ▇▇▇)
of the Exchange Notes. Each Holder hereby acknowledges and agrees that any
Participating Broker-Dealer and any such Holder using the Exchange Offer to
participate in a distribution of the Exchange Notes: (1) could not under SEC
policy as in effect on the date of this Agreement rely on the position of the
SEC enunciated in ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and Co., Inc. (available June 5, 1991) and
Exxon Capital Holdings Corporation (available May 13, 1988), as interpreted in
the SEC's letter to Shearman & Sterling dated July 2, 1993, and similar
no-action letters (including any no-action letter obtained based on the
representation in clause (i) above), and (2) must comply with the registration
and prospectus delivery requirements of the 1933 Act in connection with the
secondary resale transaction and that such a secondary resale transaction should
be covered by an effective registration statement containing the selling
security holder information required by Items 507 and 508, as applicable, of
Regulation S-K, the SEC standard instructions for filing forms under the 1933
Act, if the resales are of Exchange Notes obtained by such Holder in exchange
for Notes acquired by such Holder directly from the Issuer or an affiliate of
the Issuer.
2.2 Shelf Registration. (i) If, because of any changes in law,
SEC rules or regulations or applicable interpretations thereof by the staff of
the SEC, the Issuer is not permitted to effect the Exchange Offer as
contemplated by Section 2.1 hereof, (ii) if for any other reason (A) the
Exchange Offer Registration Statement is not declared effective within 180
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calendar days following the Closing Date or (B) the Exchange Offer is not
consummated within 210 calendar days after the Closing Date (provided that the
Issuer is not then actively pursuing such effectiveness or consummation, as the
case may be), (iii) upon the written request of the Initial Purchasers with
respect to any Registrable Notes which it acquired directly from the Issuer (iv)
upon the written request of any Holder that either (A) is not permitted pursuant
to applicable law, SEC rules and regulations or applicable interpretations
thereof by the staff of the SEC to participate in the Exchange Offer or (B)
participates in the Exchange Offer and does not receive fully tradable Exchange
Notes pursuant to the Exchange Offer or (v) if the Issuer so elects, then in
case of each of clauses (i) through (v) the Issuer shall, at its cost:
(a) As promptly as practicable, file with the SEC, and
thereafter shall use its reasonable best efforts to cause to be
declared effective as promptly as practicable but no later than 180
calendar days after the Closing Date, a Shelf Registration Statement
relating to the offer and sale of the Registrable Notes by the Holders
from time to time in accordance with the methods of distribution
elected by the Majority Holders participating in the Shelf Registration
and set forth in such Shelf Registration Statement.
(b) Use its reasonable 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
ending on the earliest of (i) two years from the Closing Date, (ii) the
date on which the Registrable Notes become eligible for resale without
volume limitations pursuant to Rule 144 under the 1933 Act, or (iii)
for such shorter period that will terminate when all Registrable Notes
of each series covered by the Shelf Registration Statement have been
sold pursuant to the Shelf Registration Statement or cease to be
outstanding or otherwise to be Registrable Notes.
(c) Notwithstanding any other provisions hereof, use its
reasonable best efforts to ensure that (i) any Shelf Registration
Statement and any amendment thereto and any Prospectus forming part
thereof and any supplement thereto complies in all material respects
with the 1933 Act and the rules and regulations thereunder, (ii) any
Shelf 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 of any Shelf Registration Statement, and any
supplement to such Prospectus (as amended or supplemented from time to
time), does not include an untrue statement of a material fact or omit
to state a material fact necessary in order to make the statements, in
light of the circumstances under which they were made, not misleading.
The Issuer further agrees, if necessary, to supplement or
amend the Shelf Registration Statement, as required by Section 3(b) below, and
to furnish to the Depositary copies of any such supplement or amendment as
promptly as reasonably practicable after its being used or filed with the SEC.
No Holder of Registrable Notes shall be entitled to include
any of its Registrable Notes in any Shelf Registration Statement pursuant to
this Agreement unless and until such Holder agrees in writing to be bound by all
of the provisions of this Agreement applicable to such Holder and furnishes to
the Issuer in writing, within 15 days after receipt of a request
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therefor, such information as the Issuer may, after conferring with counsel with
regard to information relating to Holders that would be required by the SEC to
be included in such Shelf Registration Statement or Prospectus included therein,
reasonably request for inclusion in any Shelf Registration Statement or
Prospectus included therein. Each Holder as to which any Shelf Registration is
being effected agrees promptly to furnish to the Issuer all information with
respect to such Holder necessary to make the information previously furnished to
the Issuer by such Holder not materially misleading.
2.3 Expenses. The Issuer shall pay all Registration Expenses
in connection with the registration pursuant to Section 2.1 or 2.2. Each Holder
shall pay all underwriting discounts and commissions and transfer taxes, if any,
relating to the sale or disposition of such Holder's Registrable Notes pursuant
to the Shelf Registration Statement.
2.4 Effectiveness. (a) The Issuer will be deemed not to have
used its reasonable best efforts to cause the Exchange Offer Registration
Statement or the Shelf Registration Statement, as the case may be, to become, or
to remain, effective during the requisite period if the Issuer voluntarily takes
any action that would, or omits to take any action which omission would, result
in any such Registration Statement not being declared effective or in the
Holders of Registrable Notes covered thereby not being able to exchange or offer
and sell such Registrable Notes during that period as and to the extent
contemplated hereby, unless such action is required by applicable law.
(b) An Exchange Offer Registration Statement pursuant to
Section 2.1 hereof or a Shelf Registration Statement pursuant to
Section 2.2 hereof will not be deemed to have become effective unless
it has been declared effective by the SEC; provided, however, that if,
after it has been declared effective, the offering of Registrable Notes
pursuant to a Shelf Registration Statement is interfered with by any
stop order, injunction or other order or requirement of the SEC or any
other governmental agency or court, such Registration Statement will be
deemed not to have become effective during the period of such
interference until the offering of Registrable Notes pursuant to such
Registration Statement may legally resume.
2.5 Interest. The Notes will provide that if the Exchange
Offer is not consummated and the Shelf Registration Statement is not declared
effective on or prior to the date that is 210 days after the Closing Date, the
interest rate on the Notes will be increased by 0.25% per annum commencing on
the date that is 210 days after the Closing Date, until the Exchange Offer is
consummated or the Shelf Registration Statement is declared effective by the
SEC; provided, that in the case of a Shelf Registration Statement, if the Issuer
is unable to cause such Shelf Registration Statement to become effective because
Holders of Registrable Notes have not provided information with respect to
themselves as required by law to be included therein pursuant to the Issuer's
request as provided herein, such 0.25% increase in the interest rate shall be
payable only to Holders that have furnished such information required by law to
be included therein to the Issuer pursuant to its request hereunder from but
excluding the date such information is provided to the Issuer to but excluding
the date the Shelf Registration Statement is declared effective by the SEC.
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2.6 Specific Enforcement. Without limiting the remedies
available to the Initial Purchasers and the Holders, the Issuer acknowledges
that any failure by the Issuer to comply with its obligations under Sections 2.1
and 2.2 hereof may result in material irreparable injury to the Initial
Purchasers or the Holders for which there is no adequate remedy at law, that it
will not be possible to measure damages for such injuries precisely and that, in
the event of any such failure, the Initial Purchasers or any Holder may obtain
such relief as may be required to specifically enforce the Issuer's obligations
under Sections 2.1 and 2.2 hereof.
3. Registration Procedures. In connection with the obligations
of the Issuer with respect to Registration Statements pursuant to Sections 2.1
and 2.2 hereof, the Issuer shall:
(a) prepare and file with the SEC a Registration
Statement, within the relevant time period specified in Section 2, on
the appropriate form under the 1933 Act, which form (i) shall be
selected by the Issuer, (ii) shall in the case of a Shelf Registration,
be available for the sale of the Registrable Notes by the selling
Holders thereof, (iii) shall comply as to form in all material respects
with the requirements of the applicable form and include or incorporate
by reference all financial statements required by the SEC to be filed
therewith or incorporated by reference therein, and (iv) shall comply
in all respects with the requirements of Regulation S-T under the 1933
Act, and use its best efforts to cause such Registration Statement to
become effective and remain effective in accordance with Section 2
hereof;
(b) prepare and file with the SEC such amendments and
post-effective amendments to each Registration Statement as may be
necessary under applicable law to keep such Registration Statement
effective for the applicable period; and cause each Prospectus to be
supplemented by any required prospectus supplement, and as so
supplemented to be filed pursuant to Rule 424 under the 1933 Act and
comply with the provisions of the 1933 Act applicable to them with
respect to the disposition of all securities covered by each
Registration Statement during the applicable period in accordance with
the intended method or methods of distribution by the selling Holders
thereof;
(c) in the case of a Shelf Registration, (i) notify the
Depositary, at least five (5) business days prior to filing, that a
Shelf Registration Statement is being filed and advising the Depositary
that the distribution of Registrable Notes will be made in accordance
with the method selected by the Majority Holders participating in the
Shelf Registration; (ii) furnish to the Depositary and to each
underwriter of an underwritten offering of Registrable Notes, if any,
without charge, as many copies of each Prospectus, including each
preliminary Prospectus, and any amendment or supplement thereto and
such other documents as the Depositary or underwriter may reasonably
request, including financial statements and schedules and, if the
Depositary so requests, all exhibits in order to facilitate the public
sale or other disposition of the Registrable Notes; and (iii) hereby
consent to the use of the Prospectus or any amendment or supplement
thereto by each of the selling Holders of Registrable Notes in
connection with the offering and sale of the Registrable Notes covered
by the Prospectus or any amendment or supplement thereto;
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(d) use its best efforts to register or qualify the
Registrable Notes under all applicable state securities or "blue sky"
laws of such jurisdictions as any Holder of Registrable Notes covered
by a Registration Statement and each underwriter of an underwritten
offering of Registrable Notes shall reasonably request in writing by
the time the applicable Registration Statement is declared effective by
the SEC, and do any and all other acts and things which may be
reasonably necessary or advisable to enable each such Holder and
underwriter to consummate the disposition in each such jurisdiction of
such Registrable Notes owned by such Holder; provided, however, that
the Issuer shall not be required to (i) qualify as a foreign
corporation or as a dealer in securities in any jurisdiction where it
would not otherwise be required to qualify but for this Section 3(d),
or (ii) take any action which would subject it to general service of
process or taxation in any such jurisdiction where it is not then so
subject;
(e) notify promptly each Holder of Registrable Notes
under a Shelf Registration or any Participating Broker-Dealer who has
notified the Issuer that it is utilizing the Exchange Offer
Registration Statement as provided in paragraph (f) below, and, if
requested by such Holder or Participating Broker-Dealer, confirm such
advice in writing promptly (i) when a Registration Statement has become
effective and when any post-effective amendments and supplements
thereto become effective, (ii) of any request by the SEC or any state
securities authority for post-effective amendments and supplements to a
Registration Statement and Prospectus or for additional information
after the Registration Statement has become effective, (iii) of the
issuance by the SEC or any state securities authority of any stop order
suspending the effectiveness of a Registration Statement or the
initiation of any proceedings for that purpose, (iv) in the case of a
Shelf Registration, if, between the effective date of a Registration
Statement and the closing of any sale of Registrable Notes covered
thereby, the representations and warranties of the Issuer contained in
any underwriting agreement, securities sales agreement or other similar
agreement, if any, relating to the offering cease to be true and
correct in all material respects, (v) of the happening of any event or
the discovery of any facts during the period a Shelf Registration
Statement is effective which makes any statement made in such
Registration Statement or related Prospectus untrue in any material
respect or which requires the making of any changes in such
Registration Statement or Prospectus in order to make the statements
therein not misleading and (vi) of the receipt by the Issuer of any
notification with respect to the suspension of the qualification of the
Registrable Notes or the Exchange Notes, as the case may be, for sale
in any jurisdiction or the initiation or threatening of any proceeding
for such purpose;
(f) in the case of the Exchange Offer Registration
Statement (i) include in the Prospectus contained in the Exchange Offer
Registration Statement a section entitled "Plan of Distribution" which
section shall be reasonably acceptable to the Initial Purchasers or
another representative of the Participating Broker-Dealers and shall
contain a summary statement of the positions taken or policies made by
the staff of the SEC with respect to the potential "underwriter" status
of any broker-dealer that holds Registrable Notes acquired for its own
account as a result of market-making activities or other trading
activities and that will be the beneficial owner (as defined in Rule
13d-3 under the Exchange Act) of Exchange Notes to be received by such
broker-dealer in the Exchange Offer, whether such positions or policies
have been publicly disseminated by the staff of
10
the SEC or such positions or policies, in the reasonable judgment of
the Initial Purchasers and their counsel, represent the prevailing
views of the staff of the SEC, including a statement that any such
broker-dealer who receives Exchange Notes for Registrable Notes
pursuant to the Exchange Offer may be deemed a statutory underwriter
and must deliver a prospectus meeting the requirements of the 1933 Act
in connection with any resale of such Exchange Notes, (ii) furnish to
each Participating Broker-Dealer who has delivered to the Issuer the
notice referred to in Section 3(e), without charge, as many copies of
each Prospectus included in the Exchange Offer Registration Statement,
including any preliminary prospectus, and any amendment or supplement
thereto, as such Participating Broker-Dealer may reasonably request,
(iii) hereby consent to the use of the Prospectus forming part of the
Exchange Offer Registration Statement or any amendment or supplement
thereto, by any person subject to the prospectus delivery requirement
of the SEC, including all Participating Broker-Dealers, in connection
with the sale or transfer of the Exchange Notes covered by the
Prospectus or any amendment or supplement thereto, and (iv) include in
the transmittal letter or similar documentation to be executed by an
exchange offeree in order to participate in the Exchange Offer (x) the
following provision:
"if the exchange offeree is a broker-dealer holding
Registrable Notes acquired for its own account as a
result of market-making activities or other trading
activities, it will deliver a prospectus meeting the
requirements of the 1933 Act in connection with any
resale of Exchange Notes received in respect of such
Registrable Notes pursuant to the Exchange Offer;"
and
(y) a statement to the effect that by a broker-dealer making the
acknowledgment described in clause (x) and by delivering a Prospectus
in connection with the exchange of Registrable Notes, the broker-dealer
will not be deemed to admit that it is an underwriter within the
meaning of the 1933 Act;
(g) (i) in the case of an Exchange Offer, furnish counsel
for the Initial Purchasers and (ii) in the case of a Shelf
Registration, furnish counsel for the Holders of Registrable Notes,
copies of any comment letters received from the SEC or any other
request by the SEC or any state securities authority for amendments or
supplements to a Registration Statement and Prospectus or for
additional information;
(h) make every reasonable effort to obtain the withdrawal
of any order suspending the effectiveness of a Registration Statement
at the earliest possible moment;
(i) in the case of a Shelf Registration, furnish to the
Depositary, and each underwriter, if any, without charge, at least one
conformed copy of each Registration Statement and any post-effective
amendment thereto, including financial statements and schedules
(without documents incorporated therein by reference and all exhibits
thereto, unless requested);
11
(j) in the case of a Shelf Registration, cooperate with
the selling Holders of Registrable Notes to facilitate the timely
preparation and delivery of certificates representing Registrable Notes
to be sold and not bearing any restrictive legends; and enable such
Registrable Notes to be in such denominations (consistent with the
provisions of the Indenture) and registered in such names as the
selling Holders or the underwriters, if any, may reasonably request at
least three (3) business days prior to the closing of any sale of
Registrable Notes;
(k) in the case of a Shelf Registration, upon the
occurrence of any event or the discovery of any facts, each as
contemplated by Sections 3(e)(ii), 3(e)(iv), 3(e)(v) and 3(e)(vi)
hereof, use its best efforts to prepare a supplement or post-effective
amendment to the Registration Statement or the related Prospectus or
any document incorporated therein by reference or file any other
required document so that, as thereafter delivered to the purchasers of
the Registrable Notes or Participating Broker-Dealers, such Prospectus
will not contain at the time of such delivery any untrue statement of a
material fact or omit to state a material fact necessary to make the
statements therein, in light of the circumstances under which they were
made, not misleading; and notify each Holder to suspend use of the
Prospectus as promptly as practicable after the occurrence of such an
event, and each Holder hereby agrees to suspend use of the Prospectus
until such time as such Holder has received from the Issuer an amended
or supplemented Prospectus correcting such misstatement or omission;
(l) in the case of a Shelf Registration, a reasonable
time prior to the filing of any Registration Statement, any Prospectus,
any amendment to a Registration Statement or amendment or supplement to
a Prospectus or any document which is to be incorporated by reference
into a Registration Statement or a Prospectus after initial filing of a
Registration Statement, provide copies of such document to the Initial
Purchasers on behalf of such Holders; and make representatives of the
Issuer as shall be reasonably requested by the Holders of Registrable
Notes, or the Initial Purchasers on behalf of such Holders, available
for discussion of such document;
(m) obtain a CUSIP number for all Exchange Notes or
Registrable Notes, as the case may be, not later than the effective
date of a Registration Statement, and provide the Trustee with printed
certificates for the Exchange Notes or the Registrable Notes, as the
case may be, in a form eligible for deposit with the Depositary;
(n) (i) cause the Indenture to be qualified under the
Trust Indenture Act of 1939, as amended (the "TIA"), in connection with
the registration of the Exchange Notes or Registrable Notes, as the
case may be, (ii) cooperate with the Trustee and the Holders to effect
such changes to the Indenture as may be required for the Indenture to
be so qualified in accordance with the terms of the TIA and (iii)
execute, and use its best efforts to cause the Trustee to execute, all
documents as may be required to effect such changes, and all other
forms and documents required to be filed with the SEC to enable the
Indenture to be so qualified in a timely manner;
(o) in the case of a Shelf Registration, enter into
agreements (including underwriting agreements) and take all other
customary and appropriate actions in order to
12
expedite or facilitate the disposition of such Registrable Notes and in
such connection whether or not an underwriting agreement is entered
into and whether or not the registration is an underwritten
registration:
(i) make such representations and warranties to
the Holders of such Registrable Notes and the underwriters, if
any, in form, substance and scope as are customarily made by
issuers to underwriters in similar underwritten offerings as
may be reasonably requested by them;
(ii) obtain opinions of counsel to the Issuer and
updates thereof (which counsel and opinions (in form, scope
and substance) shall be reasonably satisfactory to the
managing underwriters, if any, and the holders of a majority
in principal amount of the Registrable Notes of each series
being sold) addressed to each selling Holder and the
underwriters, if any, covering the matters customarily covered
in opinions requested in sales of securities or underwritten
offerings and such other matters as may be reasonably
requested by such Holders and underwriters;
(iii) obtain "cold comfort" letters and updates
thereof from the independent certified public accountants who
have certified the financial statements and any other entity
included or incorporated by reference in the Registration
Statement addressed to the underwriters, if any, and use
reasonable efforts to have such letter addressed to the
selling Holders of Registrable Notes (to the extent consistent
with SAS 72), such letters to be in customary form and
covering matters of the type customarily covered in "cold
comfort" letters to underwriters in connection with similar
underwritten offerings;
(iv) enter into a securities sales agreement with
the Holders and an agent of the Holders providing for, among
other things, the appointment of such agent for the selling
Holders for the purpose of soliciting purchases of Registrable
Notes, which agreement shall be in form, substances and scope
customary for similar offerings;
(v) if an underwriting agreement is entered
into, cause the same to set forth indemnification provisions
and procedures substantially equivalent to the indemnification
provisions and procedures set forth in Sections 4 and 5 hereof
with respect to the underwriters and all other parties to be
indemnified pursuant to said Sections or, at the request of
any underwriters, in the form customarily provided to such
underwriters in similar types of transactions; and
(vi) deliver such documents and certificates as
may be reasonably requested and as are customarily delivered
in similar offerings to the Holders of a majority in principal
amount of the Registrable Notes of each series being sold and
the managing underwriters, if any.
13
The above shall be done at (i) the effectiveness of such Registration
Statement (and each post-effective amendment thereof) and (ii) each
closing under any underwriting or similar agreement as and to the
extent required thereunder;
(p) in the case of a Shelf Registration, make available
for inspection by representatives of the Holders of the Registrable
Notes and any underwriters participating in any disposition pursuant to
a Shelf Registration Statement and any counsel or accountant retained
by such Holders or underwriters, all financial and other records,
pertinent corporate documents and properties of the Issuer reasonably
requested by any such persons and use its reasonable best efforts to
cause the respective officers, directors, employees, and any other
agents of the Issuer to supply all information reasonably requested by
any such representative, underwriter, special counsel or accountant in
connection with a Registration Statement, and make such representatives
of the Issuer available for discussion of such documents as shall be
reasonably requested by the Initial Purchasers;
(q) (i) in the case of an Exchange Offer Registration
Statement, within a reasonable time prior to the filing of any Exchange
Offer Registration Statement, any Prospectus forming a part thereof,
any amendment to an Exchange Offer Registration Statement or amendment
or supplement to such Prospectus, provide copies of such document to
the Initial Purchasers and make such changes in any such document prior
to the filing thereof as the Initial Purchasers may reasonably request
and, except as otherwise required by applicable law, not file any such
document in a form to which the Initial Purchasers on behalf of the
Holders of Registrable Notes shall reasonably object; and
(ii) in the case of a Shelf Registration, within
a reasonable time prior to filing any Shelf Registration
Statement, any Prospectus forming a part thereof, any
amendment to such Shelf Registration Statement or amendment or
supplement to such Prospectus, provide copies of such document
to the Depositary, to the Initial Purchasers, to counsel on
behalf of the Holders and to the underwriter or underwriters
of an underwritten offering of Registrable Notes, if any, make
such changes in any such document prior to the filing thereof
as the Initial Purchasers, the counsel to the Holders or the
underwriter or underwriters reasonably request and not file
any such document in a form to which the Majority Holders or
the Initial Purchasers on behalf of the Holders of Registrable
Notes or any underwriter may reasonably object and make the
representatives of the Issuer available for discussion of such
document as shall be reasonably requested by the Holders of
Registrable Notes, the Initial Purchasers on behalf of such
Holders, or any underwriter.
(r) in the case of a Shelf Registration, use its
reasonable best efforts to cause all Registrable Notes to be listed on
any securities exchange on which similar debt securities issued by the
Issuer are then listed if requested by the Majority Holders, or if
requested by the underwriter or underwriters of an underwritten
offering of Registrable Notes, if any;
14
(s) in the case of a Shelf Registration, use its
reasonable best efforts to cause the Registrable Notes to be rated by
the appropriate rating agencies, if so requested by the Majority
Holders, or if requested by the underwriter or underwriters of an
underwritten offering of Registrable Notes, if any;
(t) otherwise comply with all applicable rules and
regulations of the SEC and make available to security holders, as soon
as reasonably practicable, an earnings statement covering at least 12
months which shall satisfy the provisions of Section 11(a) of the 1933
Act and Rule 158 thereunder;
(u) cooperate and assist in any filings required to be
made with the NASD and, in the case of a Shelf Registration, in the
performance of any due diligence investigation by any underwriter and
its counsel (including any "qualified independent underwriter" that is
required to be retained in accordance with the rules and regulations of
the NASD); and
(v) in the case of any Exchange Offer Registration
Statement, upon consummation of an Exchange Offer,
(A) obtain a customary opinion of counsel to the
Issuer addressed to the Trustee for the benefit of all Holders of
Registrable Notes participating in the Exchange Offer, and which
includes an opinion that (i) the Issuer has duly authorized, executed
and delivered the Exchange Notes and the related indenture and (ii)
each of the Exchange Notes and the Indenture constitute a legal, valid
and binding obligation of the Issuer, enforceable against the Issuer in
accordance with its respective terms (with customary exceptions); and
(B) deliver to the Initial Purchasers or to another
representative of the Participating Broker-Dealers, if requested by the
Initial Purchasers or such other representative of the Participating
Broker-Dealers, on behalf of the Participating Broker-Dealers (i) an
opinion of counsel or opinions of counsel substantially in the form
attached hereto as Exhibit A and (ii) an officers' certificate
substantially in the form customarily delivered in a public offering of
debt securities.
In the case of a Shelf Registration Statement, the Issuer may
(as a condition to such Holder's participation in the Shelf Registration)
require each Holder of Registrable Notes to furnish to the Issuer such
information regarding the Holder and the proposed distribution by such Holder of
such Registrable Notes as the Issuer may from time to time reasonably request in
writing for use in connection with any Shelf Registration Statement or
Prospectus included therein, including, without limitation, information
specified in Item 507 of Regulation S-K under the 1933 Act. Each Holder as to
which any Shelf Registration is being effected agrees to furnish promptly to the
Issuer all information required to be disclosed with respect to such Holder in
order to make any information with respect to such Holder previously furnished
to the Issuer by such Holder not materially misleading.
In the case of a Shelf Registration Statement, each Holder
agrees that, upon receipt of any notice directly or indirectly from the Issuer
of the happening of any event or the
15
discovery of any facts, each of the kind described in Section 3(e)(v) hereof,
such Holder will forthwith discontinue disposition of Registrable Notes pursuant
to a Registration Statement until such Holder's receipt of the copies of the
supplemented or amended Prospectus contemplated by Section 3(k) hereof, and, if
so directed by the Issuer, such Holder will deliver to the Issuer (at its
expense) all copies in such Holder's possession, other than permanent file
copies then in such Holder's possession, of the Prospectus covering such
Registrable Notes current at the time of receipt of such notice.
If any of the Registrable Notes covered by any Shelf
Registration Statement are to be sold in an underwritten offering, the
underwriter or underwriters and manager or managers that will manage such
offering will be selected by the Majority Holders of such Registrable Notes
included in such offering and shall be acceptable to the Issuer. No Holder of
Registrable Notes may participate in any underwritten registration hereunder
unless such Holder (a) agrees to sell such Holder's Registrable Notes on the
basis provided in any underwriting arrangements approved by the persons entitled
hereunder to approve such arrangements and (b) completes and executes all
questionnaires, powers of attorney, indemnities, underwriting agreements and
other documents required under the terms of such underwriting agreement.
4. Indemnification.
4.1 Indemnification by the Issuer. The Issuer agrees to
indemnify and hold harmless each Initial Purchaser, each Holder, each
Participating Broker-Dealer, each Person who participates as an underwriter (any
such Person being an "Underwriter") and each Person, if any, who controls any
Holder or Underwriter within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act against any and all losses, claims, damages or
liabilities, joint or several, to which they may become subject under the 1933
Act, the 1934 Act or other Federal or state statutory law or 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 any
Registration Statement pursuant to which Exchange Notes or Registrable Notes
were registered under the 1933 Act or any Prospectus, 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 (i) the Issuer will not be liable in any such 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 Issuer by any Initial Purchaser, Holder,
Participating Broker-Dealer or Underwriter with respect to such Initial
Purchaser, Holder, Participating Broker-Dealer or Underwriter, as the case may
be, specifically for inclusion therein, and (ii) such indemnity with respect to
any Registration Statement or Prospectus shall not inure to the benefit of any
Initial Purchaser, Holder, Participating Broker-Dealer or Underwriter from whom
the person asserting any such loss, claim, damage or liability purchased the
Exchange Notes or Registrable Notes concerned, to the extent that any such loss,
claim, damage or liability occurs under the circumstances where it shall have
been determined by a court of competent jurisdiction by final and nonappealable
judgment that (w) the Issuer has previously furnished copies of such
Registration Statement or
16
Prospectus, (x) the untrue statement or omission of a material fact contained in
such Registration Statement or Prospectus was corrected in an amendment or
supplement to such Registration Statement or Prospectus, (y) delivery of such
Registration Statement or Prospectus was required by the 1933 Act to be made to
such Person, and (z) there was not sent or given to such Person, at or prior to
the written confirmation of the sale of the Exchange Notes or Registrable Notes
to such Person, a copy of such Registration Statement or Prospectus, as amended
or supplemented. This indemnity agreement will be in addition to any liability
which the Issuer may otherwise have.
4.2 Indemnification by the Holders, Initial Purchasers,
Participating Broker-Dealers and Underwriters. Each Holder, each Initial
Purchaser, each Participating Broker-Dealer and each Underwriter severally, but
not jointly, agrees to indemnify and hold harmless the Issuer, each other
Initial Purchaser, each other Participating Broker-Dealer, each other
Underwriter and each other selling Holder, and each of their respective
directors and officers, and each Person, if any, who controls the Issuer, any
Initial Purchaser, any Participating Broker-Dealer, any Underwriter, or any
other selling Holder within the meaning of Section 15 of the 1933 Act or Section
20 of the 1934 Act to the same extent as the foregoing indemnity contained in
subsection 4.1 above, but only with reference to written information relating to
such Holder, Initial Purchaser, Participating Broker-Dealer or Underwriter
furnished to the Issuer by such Holder, Initial Purchaser, Participating
Broker-Dealer or Underwriter specifically for inclusion in the Shelf
Registration Statement or such Prospectus; provided, however, that no such
Holder, Initial Purchaser, Participating Broker-Dealer or Underwriter shall be
liable for any claims hereunder in excess of the amount of net proceeds received
by such Holder, Initial Purchaser, Participating Broker-Dealer or Underwriter
from the sale of Registrable Notes pursuant to such Shelf Registration
Statement. This indemnity agreement will be in addition to any liability which
such Holder, Initial Purchaser, Participating Broker-Dealer or Underwriter may
otherwise have.
4.3 Actions Against Parties; Notification. Promptly after
receipt by an indemnified party under this Section 4 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 4,
notify the indemnifying party in writing of the commencement thereof; but the
omission so to notify the indemnifying party (i) will not relieve it from any
liability under subsection 4.1 or 4.2 above unless and to the extent such
failure results in the loss 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 subsection 4.1 or 4.2 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
retained in the indemnified party's reasonable judgment), and the indemnifying
party shall bear the reasonable fees, costs and expenses of such separate
counsel if (i) the actual or potential defendants in, or targets of, any such
action include both the
17
indemnified party and the indemnifying party and the indemnified party shall
have reasonably concluded upon advice of counsel 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, or (ii) the
indemnifying party shall authorize the indemnified party to employ separate
counsel at the expense of the indemnifying party.
4.4 Settlement Without Consent. 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 (i) includes an unconditional
release of each indemnified party from all liability arising out of such claim,
action, suit or proceeding and (ii) does not include any statement as to, or any
admission of, fault, culpability or failure to act by or on behalf of any
indemnified party.
5. Contribution. In the event that the indemnity provided for
in Section 4 hereof is held by a court to be unavailable, in whole or in part,
to hold harmless an indemnified party for any reason, then each applicable
indemnifying party shall have several and not joint 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 offering of the Notes, the Exchange Notes or the Registrable
Notes and the Registration Statement which resulted in such Losses; provided,
however that in no case shall any Initial Purchaser (except as may be provided
in any agreement among the Initial Purchasers relating to the offering of the
Notes), Participating Broker-Dealer or subsequent Holder of any Note, Exchange
Note or Registrable Note, be responsible for any amount in excess of the
discounts or commissions received applicable to such Note, or in the case of an
Exchange Note or Registrable Note, applicable to the Note that was exchangeable
into such Exchange Note or Registrable Note, as set forth on the cover page of
the Offering 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 held by a court to be unavailable for any reason, the 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 of such indemnified party
on the other hand in connection with the statements or omissions that resulted
in such Losses as well as any other relevant equitable considerations. Benefits
received by the Issuer shall be deemed to be equal to the sum of (x) the total
net proceeds from the offering (before deducting expenses) as set forth on the
cover page of the Offering Memorandum and (y) the total amount of Interest (as
defined in Section 2.5) which the Issuer was not required to pay as a result of
registering the securities covered by the Registration Statement which resulted
in the Losses. Benefits received by the Initial Purchasers shall be deemed to be
equal to the total discounts and commissions as set forth on the cover page of
the Offering Memorandum, and benefits received by any other Holders shall be
deemed to be equal to the value of receiving Notes, Exchange Notes or
Registrable
18
Notes, as applicable, registered under the 1933 Act. Benefits received by any
Participating Broker-Dealer shall be deemed to be equal to the total commissions
relating to the market-making and exchange of Registrable Notes for Exchange
Notes. 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, among other
things, whether any untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
provided by the indemnifying party on the one hand or by the indemnified party
on the other hand, the intent of the parties and their relative knowledge,
access to information and opportunity to correct or prevent such untrue
statement or omission. The parties agree that it would not be just and equitable
if contribution were determined by pro rata allocation (even if the Holders were
treated as one entity for such purpose) or any other method of allocation that
does not take account of the equitable considerations referred to above.
Notwithstanding the provisions of this Section 5, no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the ▇▇▇▇ ▇▇▇) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation.
For purposes of this Section 5, each person, if any, who
controls a Holder, an Initial Purchaser, a Participating Broker-Dealer or an
Underwriter, in each case, within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act, shall have the same rights to contribution as such
Holder, Initial Purchaser, Participating Broker-Dealer or Underwriter, as the
case may be, and each officer of the Issuer who shall have signed the
Registration Statement, each director of the Issuer and each person, if any, who
controls the Issuer within the meaning of Section 15 of the 1933 Act or Section
20 of the 1934 Act shall have the same rights to contribution as the Issuer.
6. Miscellaneous.
6.1 Rule 144 and Rule 144A. For so long as the Issuer is
subject to the reporting requirements of Section 13 or 15 of the 1934 Act, the
Issuer covenants that it will file the reports required to be filed by it under
the 1933 Act and Section 13(a) or 15(d) of the 1934 Act and the rules and
regulations adopted by the SEC thereunder. If the Issuer ceases to be so
required to file such reports, the Issuer covenants that it will upon the
request of any Holder of Registrable Notes (a) make publicly available such
information as is necessary to permit sales pursuant to Rule 144 under the 1933
Act, (b) deliver such information to a prospective purchaser as is necessary to
permit sales pursuant to Rule 144A under the 1933 Act, and (c) take such further
action that is reasonable in the circumstances, in each case, to the extent
required from time to time to enable such Holder to sell its Registrable Notes
without registration under the 1933 Act within the limitation of the exemptions
provided by (i) Rule 144 under the 1933 Act, as such Rule may be amended from
time to time, (ii) Rule 144A under the 1933 Act, as such Rule may be amended
from time to time, or (iii) any similar rules or regulations hereafter adopted
by the SEC. Upon the request of any Holder of Registrable Notes, the Issuer will
deliver to such Holder a written statement as to whether it has complied with
such requirements. The Issuer agrees to comply with the information obligations
to the extent that they are required by applicable law or regulation.
19
6.2 No Inconsistent Agreements. The Issuer has not entered
into and the Issuer will not after the date of this Agreement enter into any
agreement which is inconsistent with the rights granted to the Holders of
Registrable Notes in this Agreement or otherwise conflicts with the provisions
hereof. The rights granted to the Holders hereunder do not in any way conflict
with the rights granted to the Holders of the Issuer's other issued and
outstanding Notes under any such agreements.
6.3 Amendments and Waivers. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers of consents to departures from the provisions hereof
may not be given unless the Issuer has obtained the written consent of (i)
Holders of at least a majority in aggregate principal amount of the outstanding
Registrable Notes of each series and (ii) Participating Broker-Dealers holding a
majority in aggregate principal amount of the Exchange Notes held by all
Participating Broker-Dealers, in each case to the extent affected by such
amendment, modification, supplement, waiver or departure.
6.4 Notices. All notices and other communications provided for
or permitted hereunder shall be made in writing by hand delivery, registered
first-class mail, telex, telecopier, or any courier guaranteeing overnight
delivery (a) if to the Depositary, at ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
or if The Depository Trust Company is no longer the Depositary, at the most
current address given by the Depositary to the Issuer by means of a notice given
in accordance with the provisions of this Section 6.4; (b) if to a Holder, at
the most current address given by such Holder to the Issuer by means of a notice
given in accordance with the provisions of this Section 6.4, which address
initially is the address set forth in the Purchase Agreement with respect to the
Initial Purchasers; and (c) if to the Issuer initially at the Issuer's address
set forth in the Purchase Agreement, and thereafter at such other address of
which notice is given in accordance with the provisions of this Section 6.4.
All such notices and communications shall be deemed to have
been duly given: at the time delivered by hand, if personally delivered; two (2)
business days after being deposited in the mail, postage prepaid, if mailed;
when answered back, if telexed; when receipt is acknowledged, if telecopied; and
on the next business day if timely delivered to an air courier guaranteeing
overnight delivery.
Copies of all such notices, demands, or other communications
shall be concurrently delivered by the person giving the same to the Trustee
under the Indenture, at the address specified in such Indenture.
6.5 Successor and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors, assigns and transferees of each
of the parties, including without limitation and without the need for an express
assignment, subsequent Holders and Participating Broker-Dealers; provided that
nothing herein shall be deemed to permit any assignment, transfer or other
disposition of Registrable Notes in violation of the terms of the Purchase
Agreement. If any transferee of any Holder shall acquire Registrable Notes, in
any manner, whether by operation of law or otherwise, such Registrable Notes
shall be held subject to all of the terms of this Agreement, and by taking any
holding such Registrable Notes such person shall be conclusively deemed to have
agreed to be bound by and to perform all of the terms and
20
provisions of this Agreement, including the restrictions on resale set forth in
this Agreement and, if applicable, the Purchase Agreement, and such person shall
be entitled to receive the benefits hereof.
6.6 Third Party Beneficiaries. The Initial Purchasers (even if
the Initial Purchasers are not Holders of Registrable Notes) shall be third
party beneficiaries to the agreements made hereunder between the Issuer, on the
one hand, and the Holders, on the other hand, and shall have the right to
enforce such agreements directly to the extent it deems such enforcement
necessary or advisable to protect its rights or the rights of Holders hereunder.
Each Holder of Registrable Notes shall be a third party beneficiary to the
agreements made hereunder between the Issuer, on the one hand, and the Initial
Purchasers, on the other hand, and shall have the right to enforce such
agreements directly to the extent it deems such enforcement necessary or
advisable to protect its rights hereunder.
6.7 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.
6.8 Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
6.9 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO
THE PRINCIPLES OF CONFLICT OF LAWS THEREOF.
6.10 Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstance, is
held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions contained herein shall not be affected or impaired thereby.
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IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
THE CLEVELAND ELECTRIC ILLUMINATING
COMPANY,
as Issuer
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Assistant Treasurer
Confirmed and accepted as
of the date first above written:
BARCLAYS CAPITAL INC.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INCORPORATED
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Executive Director
Acting as representatives of the Initial Purchasers.
S-1
Exhibit A
Form of Opinion of Counsel
We are of the opinion that the Exchange Offer Registration
Statement and the Prospectus (other than the financial statements, notes or
schedules thereto and other financial data and supplemental schedules included
or incorporated by reference therein or omitted therefrom and the Form T-1, as
to which we need express no opinion), comply as to form in all material respects
with the requirements of the 1933 Act and the applicable rules and regulations
promulgated under the 1933 Act.
In addition, we have participated in conferences with officers
and other representatives of the Issuer, representatives of the independent
public accountants of the Issuer and representatives of the Initial Purchasers,
at which the contents of the Registration Statement and the Prospectus and
related matters were discussed and, although we are not passing upon, and do not
assume any responsibility for, the accuracy, completeness or fairness of the
statements contained in the Registration Statement and the Prospectus and have
not made any independent check or verification thereof, during the course of
such participation, no facts came to our attention that caused us to believe
that the Registration Statement or any amendment thereto, at the time the
Registration Statement or any such amendment became effective, contained an
untrue statement of a material fact or omitted to state a material fact required
to be stated therein or necessary to make the statements therein not misleading,
or that the Prospectus or any amendment or supplement thereto, at the time the
Prospectus was issued, at the time any such amended or supplemented Prospectus
was issued or at the Closing Date, included or includes an untrue statement of a
material fact or omitted or omits to state a material fact necessary in order to
make the statements therein, in light of the circumstances under which they were
made, not misleading; it being understood that we express no belief with respect
to the financial statements and schedules and other financial data included in
the Registration Statement and the Prospectus.