Exhibit 10.7
REGISTRATION RIGHTS AGREEMENT
among
IWO HOLDINGS, INC.
and
AIG ANNUITY INSURANCE COMPANY, SUNAMERICA LIFE INSURANCE COMPANY, THE VARIABLE
LIFE ANNUITY LIFE INSURANCE COMPANY, VALIC COMPANY II - STRATEGIC BOND FUND,
SUNAMERICA INCOME FUNDS - HIGH YIELD BOND FUND, SUNAMERICA SERIES TRUST - HIGH
YIELD BOND PORTFOLIO (POLARIS), SUNAMERICA INCOME FUNDS - STRATEGIC BOND FUND
AND VALIC COMPANY II - HIGH YIELD BOND FUND
--------------------------------------------------------------------------------
Dated: February 10, 2005
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TABLE OF CONTENTS
Page
1. Definitions.....................................................................................................1
2. General; Securities Subject to this Agreement...................................................................5
(a) Registrable Securities................................................................................6
(b) Holders of Registrable Securities.....................................................................6
3. Demand Registration.............................................................................................7
(a) Request for Demand Registration.......................................................................7
(b) Incidental or "Piggy-Back" Rights with Respect to a Demand Registration...............................7
(c) Effective Demand Registration.........................................................................8
(d) Expenses..............................................................................................8
(e) Underwriting Procedures...............................................................................8
(f) Selection of Underwriters.............................................................................9
4. Incidental or "Piggy-Back" Registration.........................................................................9
(a) Request for Incidental Registration...................................................................9
(b) Expenses.............................................................................................10
5. Form S-3 Registration..........................................................................................10
(a) Request for a Form S-3 Registration..................................................................10
(b) Form S-3 Underwriting Procedures.....................................................................11
(c) Limitations on Form S-3 Registrations................................................................11
(d) Expenses.............................................................................................12
6. Restrictions on Public Sale by the Company.....................................................................12
7. Registration Procedures........................................................................................12
(a) Obligations of the Company...........................................................................12
(b) Seller Information...................................................................................16
(c) Notice to Discontinue................................................................................16
(d) Registration Expenses................................................................................16
(e) Hedging Transactions.................................................................................17
8. Indemnification; Contribution..................................................................................18
(a) Indemnification by the Company.......................................................................18
(b) Indemnification by Holders...........................................................................18
(c) Conduct of Indemnification Proceedings...............................................................19
(d) Contribution.........................................................................................20
9. Rule 144.......................................................................................................20
10. Miscellaneous..................................................................................................20
(a) Recapitalizations, Exchanges, etc....................................................................20
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(b) No Inconsistent Agreements...........................................................................21
(c) Remedies.............................................................................................21
(d) Amendments and Waivers...............................................................................21
(e) Successors and Assigns; Third Party Beneficiaries....................................................21
(f) Counterparts.........................................................................................22
(g) Headings.............................................................................................22
(H) GOVERNING LAW; CONSENT TO JURISDICTION...............................................................22
(i) Severability.........................................................................................22
(j) Rules of Construction................................................................................22
(k) Entire Agreement.....................................................................................22
(l) Further Assurances...................................................................................22
(m) Other Agreements.....................................................................................23
(n) Notices..............................................................................................23
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REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT, dated February 10, 2005, by
and among IWO Holdings, Inc., a Delaware corporation (the "Company"), and AIG
Annuity Insurance Company, SunAmerica Life Insurance Company, The Variable Life
Annuity Life Insurance Company, VALIC Company II - Strategic Bond Fund,
SunAmerica Income Funds - High Yield Bond Fund, SunAmerica Series Trust - High
Yield Bond Portfolio (Polaris), SunAmerica Income Funds - Strategic Bond Fund
and VALIC Company II - High Yield Bond Fund (collectively, the "Initial
Holders").
WHEREAS, on January 4, 2005 the Company and its wholly
owned subsidiaries, Independent Wireless One Corporation and Independent
Wireless One Leased Realty Corporation, filed a pre-packaged Chapter 11 joint
plan of reorganization (the "Plan of Reorganization") with the United States
Bankruptcy Court for the District of Delaware (the "Bankruptcy Court");
WHEREAS the Plan of Reorganization provides, among other
things, that upon confirmation thereof by the Bankruptcy Court, the Company's
existing 14% Senior Notes due 2011 (the "Notes") will be cancelled and the
holders of such Notes will receive newly issued shares of Common Stock (as
defined below);
WHEREAS, the Company has agreed to provide the Holders (as
defined below) with certain registration rights with respect to their
Registrable Securities (as defined below), upon the terms and subject to the
conditions set forth herein; and
WHEREAS, on February 9, 2005 the Bankruptcy Court confirmed
the Plan of Reorganization.
NOW, THEREFORE, in consideration of the mutual covenants
and agreements set forth herein and for good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, the parties hereto agree
as follows:
1. Definitions. As used in this Agreement, and unless the
context requires a different meaning, the following terms have the meanings
indicated:
"Affiliate" shall mean any Person who is an "affiliate" as
defined in Rule 12b-2 of the General Rules and Regulations under the Exchange
Act.
"Agreement" means this Agreement as the same may be
amended, supplemented or modified in accordance with the terms hereof.
"Approved Underwriter" has the meaning set forth in Section
3(e) of this Agreement.
"Bankruptcy Court" has the meaning set forth in the
recitals to this Agreement.
"Board of Directors" means the Board of Directors or other
equivalent body of the Company.
"Business Day" means any day other than a Saturday, Sunday
or other day on which commercial banks in the State of New York are authorized
or required by law or executive order to close.
"Closing Price" means, with respect to the Registrable
Securities, as of the date of determination, (a) if the Registrable Securities
are listed on a national securities exchange, the closing price per share of a
Registrable Security on such date published in The Wall Street Journal (National
Edition) or, if no such closing price on such date is published in The Wall
Street Journal (National Edition), the average of the closing bid and asked
prices on such date, as officially reported on the principal national securities
exchange on which the Registrable Securities are then listed or admitted to
trading; or (b) if the Registrable Securities are not then listed or admitted to
trading on any national securities exchange but are designated as national
market system securities by the NASD, the last trading price per share of a
Registrable Security on such date; or (c) if there shall have been no trading on
such date or if the Registrable Securities are not designated as national market
system securities by the NASD, the average of the reported closing bid and asked
prices of the Registrable Securities on such date as shown by The Nasdaq Stock
Market, Inc. (or its successor) and reported by any member firm of The New York
Stock Exchange, Inc. selected by the Company; or (d) if none of (a), (b) or (c)
is applicable, a market price per share determined in good faith by the Board of
Directors or, if such determination is not satisfactory to the Holder for whom
such determination is being made, by a nationally recognized investment banking
firm selected by the Company and such Holder, the expenses for which shall be
borne equally by the Company and such Holder. If trading is conducted on a
continuous basis on any exchange, then the closing price shall be at 4:00 P.M.
New York City time.
"Commission" means the Securities and Exchange Commission
or any similar agency then having jurisdiction to enforce the Securities Act.
"Common Stock" means the Common Stock, par value $0.01 per
share, of the Company or any other capital stock of the Company into which such
stock is reclassified or reconstituted and any other common stock of the
Company.
"Company" has the meaning set forth in the preamble to this
Agreement.
"Company Underwriter" has the meaning set forth in Section
4(a) of this Agreement.
"Contemporaneous Company Offering" has the meaning set
forth in Section 5(b) of this Agreement.
"Demand Registration" has the meaning set forth in Section
3(a) of this Agreement.
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"Exchange Act" means the Securities Exchange Act of 1934
and the rules and regulations of the Commission thereunder.
"Exchange Act Registration Date" means the earliest
effective date of any registration statement under Section 12(b) or 12(g) of the
Exchange Act with respect to the Common Stock or any other equity security of
the Company.
"Hedging Counterparty" means a broker-dealer registered
under Section 15(b) of the Exchange Act or an Affiliate thereof.
"Hedging Transaction" means any transaction involving a
security linked to the Registrable Class Securities or any security that would
be deemed to be a "derivative security" (as defined in Rule 16a-1(c) under the
Exchange Act) with respect to the Registrable Class Securities or transaction
(even if not a security) which would (were it a security) be considered such a
derivative security, or which transfers some or all of the economic risk of
ownership of the Registrable Class Securities, including, without limitation,
any forward contract, equity swap, put or call, put or call equivalent position,
collar, non-recourse loan, sale of exchangeable security or similar transaction.
For the avoidance of doubt, the following transactions shall be deemed to be
Hedging Transactions:
(a) transactions by a Holder in which a Hedging
Counterparty engages in short sales of Registrable Class Securities pursuant to
a prospectus and may use Registrable Securities to close out its short position;
(b) transactions pursuant to which a Holder sells short
Registrable Class Securities pursuant to a prospectus and delivers Registrable
Securities to close out its short position;
(c) transactions by a Holder in which the Holder delivers,
in a transaction exempt from registration under the Securities Act, Registrable
Securities to the Hedging Counterparty who will then publicly resell or
otherwise transfer such Registrable Securities pursuant to a prospectus or an
exemption from registration under the Securities Act; and
(d) a loan or pledge of Registrable Securities to a Hedging
Counterparty who may then become a selling stockholder and sell the loaned
shares or, in an event of default in the case of a pledge, then sell the pledged
shares, in each case, in a public transaction pursuant to a prospectus.
"Holder" means the Initial Holders and any transferee
(whether direct or indirect) of any of the foregoing to whom Registrable
Securities have been transferred in accordance with Section 10(e) of this
Agreement, other than a transferee to whom Registrable Securities have been
transferred pursuant to a Registration Statement under the Securities Act or
Rule 144 or Regulation S under the Securities Act (or any successor rule
thereto), but in each case only for as long as such Holder or transferee
continues to be a holder of Registrable Securities.
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"Holders' Counsel" has the meaning set forth in Section
7(a)(i) of this Agreement.
"Incidental Registration" has the meaning set forth in
Section 4(a) of this Agreement.
"Indemnified Party" has the meaning set forth in Section
8(c) of this Agreement.
"Indemnifying Party" has the meaning set forth in Section
8(c) of this Agreement.
"Initial Holder" has the meaning set forth in the preamble
to this Agreement.
"Initiating Holders" has the meaning set forth in Section
3(a) of this Agreement.
"Inspector" has the meaning set forth in Section 7(a)(viii)
of this Agreement.
"Liability" has the meaning set forth in Section 8(a) of
this Agreement.
"Market Price" means, on any date of determination, the
average of the daily Closing Price of the Registrable Securities for the
immediately preceding thirty (30) days on which the national securities
exchanges are open for trading.
"NASD" means the National Association of Securities
Dealers, Inc. or any successor agency thereto.
"Notes" has the meaning set forth in the recitals to this
Agreement.
"Person" means any individual, firm, corporation,
partnership, limited liability company, trust, incorporated or unincorporated
association, joint venture, joint stock company, limited liability company,
government (or an agency or political subdivision thereof) or other entity of
any kind, and shall include any successor (by merger or otherwise) of such
entity.
"Plan of Reorganization" has the meaning set forth in the
recitals to this agreement.
"Records" has the meaning set forth in Section 7(a)(viii)
of this Agreement.
"Registrable Class Securities" means securities of the
Company that are of the same class as the relevant Registrable Securities.
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"Registrable Securities" means each of the following: (a)
any and all shares of Common Stock received by a Holder pursuant to the Plan of
Reorganization, (b) any other shares of Common Stock acquired or owned by any
Holder and (c) any shares of Common Stock issued or issuable to any Holder with
respect to the Registrable Securities by way of stock dividend or stock split or
in connection with a combination of shares, recapitalization, merger,
consolidation or other reorganization or otherwise and any shares of Common
Stock issuable upon conversion, exercise or exchange thereof.
"Registration Expenses" has the meaning set forth in
Section 7(d) of this Agreement.
"Registration Statement" means a Registration Statement
filed pursuant to the Securities Act.
"Requested S-3 Registered Securities" has the meaning set
forth in Section 5(b) of this Agreement.
"Requisite Holders" means, (i) prior to the Exchange Act
Registration Date, (a) one or more Holders who hold more than 50% of the
aggregate number of the then outstanding Registrable Securities held by all
Holders, or (b) any Initial Holder and (ii) on or after the Exchange Act
Registration Date, one or more Holders.
"Restrictive Legend" has the meaning set forth in Section
2(d) of this Agreement.
"S-3 Initiating Holders" has the meaning set forth in
Section 5(a) of this Agreement.
S-3 Registered Securities" means, with respect to an S-3
Registration, any Registered Securities whose sale is registered pursuant to the
Registration Statement filed in connection with such S-3 Registration.
"S-3 Registration" has the meaning set forth in Section
5(a) of this Agreement.
"S-3 Requesting Holder" has the meaning set forth in
Section 5(b) of this Agreement.
"Securities Act" means the Securities Act of 1933, and the
rules and regulations of the Commission promulgated thereunder.
"Valid Business Reason" has the meaning set forth in
Section 3(a) of this Agreement.
2. General; Securities Subject to this Agreement.
(a) Grant of Rights. The Company hereby grants registration
rights to the Holders upon the terms and conditions set forth in this Agreement.
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(b) Registrable Securities. For the purposes of this
Agreement, Registrable Securities will cease to be Registrable Securities when
(i) a Registration Statement covering such Registrable Securities has been
declared effective under the Securities Act by the Commission and such
Registrable Securities have been disposed of pursuant to such effective
Registration Statement, (ii) the entire amount of the Registrable Securities
owned by the relevant Holder may be sold in a single sale, in the opinion of
counsel satisfactory to the Company and such Holder, each in their reasonable
judgment, pursuant to Rule 144 (or any successor provision then in effect) under
the Securities Act, (iii) the Registrable Securities are proposed to be sold or
distributed by a Person not entitled to the registration rights granted by this
Agreement or (iv) they cease to be outstanding. Notwithstanding the foregoing,
if a Person holds shares of Common Stock that were issued in connection with the
Plan of Reorganization that represent more than 10.0% of the total number of
outstanding shares of Common Stock, such shares of Common Stock shall be deemed
to be Registrable Securities.
(c) Holders of Registrable Securities. A Person is deemed
to be a holder of Registrable Securities whenever such Person owns of record
Registrable Securities, or holds an option to purchase, or a security
convertible into or exercisable or exchangeable for, Registrable Securities
whether or not such acquisition or conversion has actually been effected. If the
Company receives conflicting instructions, notices or elections from two or more
Persons with respect to the same Registrable Securities, the Company may act
upon the basis of the instructions, notice or election received from the
registered owner of such Registrable Securities. Registrable Securities issuable
upon exercise of an option or upon conversion of another security shall be
deemed outstanding for the purposes of this Agreement.
(d) Legends. Each Holder acknowledges that the legend (the
"Restrictive Legend") set forth below will appear on the certificates for the
Registrable Securities:
THE SHARES OF COMMON STOCK REPRESENTED BY THIS CERTIFICATE
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER
THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION AND MAY NOT BE SOLD,
OFFERED FOR SALE OR OTHERWISE TRANSFERRED UNLESS REGISTERED OR QUALIFIED UNDER
SUCH ACT AND APPLICABLE STATE SECURITIES LAWS OR UNLESS IWO HOLDINGS, INC.
RECEIVES AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO IT THAT SUCH
REGISTRATION OR QUALIFICATION IS NOT REQUIRED.
The Company shall, at the request of any Holder, remove from each certificate
evidencing Registrable Securities the Restrictive Legend if the Company is
reasonably satisfied (based upon an opinion of counsel or other evidence) that
the securities evidenced thereby may be publicly sold without registration under
the Securities Act or that the securities evidenced thereby are no longer
Registrable Securities.
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3. Demand Registration.
(a) Request for Demand Registration. If the Requisite
Holders make a written request to the Company (such Requisite Holders making
such request, the "Initiating Holders"), the Company shall register under the
Securities Act, in accordance with the terms of this Agreement, on the
appropriate form (a "Demand Registration") the issuance and sale of the number
of Registrable Securities stated in such request; provided, however, that the
Company shall not be obligated to effect a Demand Registration if the Initiating
Holders propose to sell their Registrable Securities at an anticipated aggregate
offering price (calculated based upon the Market Price of the Registrable
Securities on the date of filing of the Registration Statement with respect to
such Registrable Securities) to the public (net of underwriting commissions and
discounts) of less than $10,000,000. If the Board of Directors, in its good
faith judgment, determines that any registration of Registrable Securities
should not be made or continued because it would materially interfere with any
material financing, acquisition, corporate reorganization or merger or other
material transaction involving the Company (a "Valid Business Reason"), the
Company may (x) postpone filing a Registration Statement relating to a Demand
Registration until such Valid Business Reason no longer exists, but in no event
for more than ninety (90) days, and (y) in case a Registration Statement has
been filed relating to a Demand Registration, the Company, upon the approval of
a majority of the Board of Directors, may cause such Registration Statement to
be withdrawn and its effectiveness terminated or may postpone amending or
supplementing such Registration Statement. The Company shall give written notice
to all Holders of its determination to postpone or withdraw a Registration
Statement and of the fact that the Valid Business Reason for such postponement
or withdrawal no longer exists, in each case, promptly after the occurrence
thereof. If the Company gives notice of its determination to withdraw a
Registration Statement pursuant to this Section 3(a), the Company shall extend
the period during which such Registration Statement shall be maintained
effective pursuant to this Agreement (including, without limitation, the period
referred to in Section 3(c)) by the number of days during the period from and
including the date of the giving of such notice pursuant to this Section 3(a) to
and including the date when sellers of such Registrable Securities under such
Registration Statement shall have received the copies of the supplemented or
amended prospectus contemplated by and meeting the requirements of Section
7(a)(vi). Notwithstanding anything to the contrary contained herein, the Company
may not postpone or withdraw a filing under this Section 3(a) or Section 5(c)
due to a Valid Business Reason more than once in any twelve (12) month period.
Each request for a Demand Registration by the Initiating Holders shall state the
amount of the Registrable Securities proposed to be sold and the intended method
of disposition thereof.
(b) Incidental or "Piggy-Back" Rights with Respect to a
Demand Registration. Each of the Holders (other than Initiating Holders which
have requested a registration under Section 3(a)) may offer such Holder's
Registrable Securities under any Demand Registration pursuant to this Section
3(b). Within five Business Days after the receipt of a request for a Demand
Registration from an Initiating Holder, the Company shall (i) give written
notice thereof to all of the Holders (other than Initiating Holders), which
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notice shall specify the number of Registrable Securities subject to the Demand
Request and the names and notice information of the Initiating Holders, and (ii)
subject to Section 3(e), include in the Registration Statement filed pursuant to
such Demand Registration all of the Registrable Securities requested by such
Holders for inclusion in such Registration Statement from whom the Company has
received a written request for inclusion therein within ten 10 Business Days
after the receipt by such Holders of such written notice referred to in clause
(i) above. Each such request by such Holders shall specify the number of
Registrable Securities proposed to be registered, and the relevant Holder shall
send a copy of such request to the Initiating Holders. The failure of any Holder
to respond within such 10 Business Day period referred to in clause (ii) above
shall be deemed to be a waiver of such Holder's rights under this Section 3(b)
with respect to such Demand Registration. Any Holder may waive its rights under
this Section 3(b) prior to the expiration of such 10-Business Day period by
giving written notice to the Company, with a copy to the Initiating Holders. If
a Holder sends the Company a written request for inclusion of part or all of
such Holder's Registrable Securities in a registration, such Holder shall not be
entitled to withdraw or revoke such request without the prior written consent of
the Company in its sole discretion unless, as a result of facts or circumstances
arising after the date on which such request was made relating to the Company or
to market conditions, such Holder reasonably determines that participation in
such registration would have a material adverse effect on such Holder.
(c) Effective Demand Registration. The Company shall use
its reasonable best efforts to cause any such Demand Registration to become and
remain effective as promptly as practicable but in no event later than 75 days
after it receives a request under Section 3(a) hereof. A registration shall not
constitute a Demand Registration until it has become effective and remains
continuously effective for the lesser of (i) the period during which all
Registrable Securities registered in the Demand Registration are sold and (ii)
180 days; provided, however, that a registration shall not constitute a Demand
Registration if (x) after such Demand Registration has become effective, such
registration or the related offer, sale or distribution of Registrable
Securities thereunder is interfered with by any stop order, injunction or other
order or requirement of the Commission or other governmental agency or court for
any reason not attributable to the Initiating Holders and such interference is
not thereafter eliminated or (y) the conditions specified in the underwriting
agreement, if any, entered into in connection with such Demand Registration are
not satisfied or waived, other than by reason of a failure by the Initiating
Holder or other Holder of Registrable Securities included in such Demand
Registration.
(d) Expenses. The Company shall pay all Registration
Expenses in connection with a Demand Registration, whether or not such Demand
Registration becomes effective.
(e) Underwriting Procedures. If the Company or the
Initiating Holders holding a majority of the Registrable Securities held by all
of the Initiating Holders so elect, the Company shall use its reasonable best
efforts to cause the public offering made pursuant to such Demand Registration
8
to be in the form of a firm commitment underwritten offering, and the managing
underwriter or underwriters selected for such offering shall be an investment
banking firm of national reputation to act as the managing underwriter of the
offering (the "Approved Underwriter") selected in accordance with Section 3(f).
In connection with any Demand Registration under this Section 3 involving an
underwritten offering, none of the Registrable Securities held by any Holder
making a request for inclusion of such Registrable Securities pursuant to
Section 3(b) hereof shall be included in such underwritten offering unless such
Holder accepts the terms of the offering as agreed upon by the Company, the
Initiating Holders and the Approved Underwriter, and then only in such quantity
as will not, in the opinion of the Approved Underwriter, jeopardize the success
of such offering by the Initiating Holders. If the Approved Underwriter advises
the Company that the aggregate amount of such Registrable Securities requested
to be included in such offering is sufficiently large to have a material adverse
effect on the success of such offering, then the Company shall include in such
registration only the aggregate amount of Registrable Securities that the
Approved Underwriter believes may be sold without any such material adverse
effect and shall reduce the amount of Registrable Securities to be included in
such registration, first as to the equity securities offered by the Company for
its own account, second as to the Registrable Securities of Holders who are not
Initiating Holders as a group, if any, and third as to Registrable Securities of
the Initiating Holders as a group, pro rata within each group based on the
number of Registrable Securities owned by each such party.
(f) Selection of Underwriters. If an offering of
Registrable Securities made pursuant to any Demand Registration is in the form
of an underwritten offering, the Initiating Holders holding a majority of the
Registrable Securities held by all of the Initiating Holders shall select the
Approved Underwriter; provided, however, that the Approved Underwriter shall, in
any case, also be reasonably acceptable to the Company.
4. Incidental or "Piggy-Back" Registration.
(a) Request for Incidental Registration. At any time, if
the Company proposes to file a Registration Statement with respect to an
offering of equity securities by the Company for its own account (other than (i)
a Registration Statement on Form S-4 or S-8 or any successor thereto or (ii) a
Registration Statement relating to the issuance of securities as consideration
in any acquisition by the Company) or for the account of any stockholder of the
Company other than the Holders, then the Company shall give written notice of
such proposed filing to each of the Holders at least 15 Business Days before the
anticipated filing date, and such notice shall describe the proposed
registration, offering price (or reasonable range thereof), distribution
arrangements and any other information that at the time would be appropriate to
include in such notice and offer such Holders the opportunity to register the
number of Registrable Securities as each such Holder may request (an "Incidental
Registration"). The Company shall use its reasonable best efforts (within 10
Business Days after the notice provided for in the preceding sentence) to cause
the managing underwriter or underwriters in the case of a proposed underwritten
offering (the "Company Underwriter") to permit each of the Holders who have
9
requested in writing within five Business Days after the giving of notice by the
Company to participate in the Incidental Registration to include such Holder's
Registrable Securities in such offering on the same terms and conditions as the
securities of the Company or the account of such other stockholder, as the case
may be, included therein. Such request by the Holders shall specify the number
of Registrable Securities to be included pursuant to this Section 4(a). In
connection with any Incidental Registration under this Section 4(a) involving an
underwritten offering, the Company shall not be required to include any
Registrable Securities in such underwritten offering unless the Holders thereof
accept the terms of the underwritten offering as agreed upon between the
Company, such other stockholders, if any, and the Company Underwriter, and then
only in such quantity as the Company Underwriter believes will not jeopardize
the success of the offering by the Company. If the Company Underwriter
determines that the registration of all or part of the Registrable Securities
which the Holders have requested to be included would materially adversely
affect the success of such offering, then the Company shall include in such
Incidental Registration only the aggregate amount of Registrable Securities that
the Company Underwriter believes may be sold without any such material adverse
effect and shall reduce the amount of Registrable Securities to be included in
such registration by, first, any other equity securities requested to be
included in such offering, second, the Registrable Securities to be offered for
the account of the Holders pursuant to this Section 4, pro rata based on the
number of Registrable Securities owned by each such Holder, and third, all of
the equity securities to be offered for the account of the Company.
(b) Expenses. The Company shall bear all Registration
Expenses in connection with any Incidental Registration pursuant to this Section
4, whether or not such Incidental Registration becomes effective.
5. Form S-3 Registration.
(a) Request for a Form S-3 Registration. Upon the Company
becoming eligible for use of Form S-3 (or any successor form thereto) under the
Securities Act in connection with a secondary public offering of its securities,
if the Company receives from one or more Holders (the "S-3 Initiating Holders")
a written request that the Company register, under the Securities Act on Form
S-3 (or any successor form then in effect) (an "S-3 Registration"), the sale of
all or a portion of the Registrable Securities owned by such S-3 Initiating
Holders, the Company shall give written notice of such request to all of the
Holders (other than the Initiating Holders) as far in advance as possible (but
not less than ten Business Days) before the anticipated filing date of such Form
S-3, and such notice shall describe the proposed registration and offer such
Holders the opportunity to register the number of Registrable Securities as each
such Holder may request in writing to the Company, given within five Business
Days after their receipt from the Company of the written notice of such
registration. The Company shall register on a Registration Statement on Form S-3
the sale of all of the Registrable Securities requested to be registered by the
S-3 Initiating Holders and the Registrable Securities that other Holders have
requested to be included in such Registration Statement, in accordance with the
10
terms of this Agreement. Such S-3 Registration shall be for an offering on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act. With
respect to each S-3 Registration, the Company shall, use its reasonable best
efforts to cause such registration pursuant to this Section 5(a) to become and
remain effective as soon as practicable, but in any event not later than 45 days
after it receives a request therefor.
(b) Form S-3 Underwriting Procedures. Upon written request
by a Holder of S-3 Registered Securities (the "S-3 Requesting Holder"), which
request shall specify the amount of such S-3 Requesting Holder's S-3 Registered
Securities to be sold (the "Requested S-3 Registered Securities"), the Company
shall use its reasonable best efforts to cause the sale of such S-3 Requesting
Holder's Requested S-3 Registered Securities to be in the form of a firm
commitment underwritten offering if the anticipated aggregate offering price
(calculated based upon the Market Price of the Registrable Securities on the
date of such written request) equals or exceeds $5,000,000 (including, without
limitation, causing to be produced and filed any necessary prospectuses or
prospectus supplements with respect to such offering). The managing underwriter
or underwriters selected for such offering shall be selected by the S-3
Requesting Holder and shall be reasonably acceptable to the Company.
Notwithstanding the foregoing, in connection with any offering of Requested S-3
Registered Securities involving an underwritten offering that occurs or is
scheduled to occur within 30 days of a proposed registered underwritten public
offering of equity securities for the Company's own account (a "Contemporaneous
Company Offering"), the Company shall not be required to cause such offering of
Requested S-3 Registered Securities to take the form of an underwritten public
offering but shall instead offer the S-3 Requesting Holder the ability to
include its Requested S-3 Registered Securities in the Contemporaneous Company
Offering pursuant to Section 4 hereof.
(c) Limitations on Form S-3 Registrations. If the Board of
Directors has a Valid Business Reason, the Company may (x) postpone filing a
Registration Statement relating to a S-3 Registration until such Valid Business
Reason no longer exists, but in no event for more than ninety (90) days, and (y)
in case a Registration Statement has been filed relating to a S-3 Registration,
the Company, upon the approval of a majority of the Board of Directors, may
cause such Registration Statement to be withdrawn and its effectiveness
terminated, may postpone amending or supplementing such Registration Statement
or may postpone taking actions pursuant to Section 5(b) hereof. The Company
shall give written notice to all Holders of its determination to postpone or
withdraw a Registration Statement and of the fact that the Valid Business Reason
for such postponement or withdrawal no longer exists, in each case, promptly
after the occurrence thereof. Notwithstanding anything to the contrary contained
herein, the Company may not postpone or withdraw a filing due to a Valid
Business Reason under this Section 5(c) or Section 3(a) more than once in any
twelve (12) month period. In addition, the Company shall not be required to
effect any registration pursuant to Section 5(a), (i) within ninety (90) days
after the effective date of any other Registration Statement of the Company,
(ii) if within the 12-month period preceding the date of such request, the
Company has effected two registrations on Form S-3 pursuant to Section 5(a), or
11
(iii) if the S-3 Initiating Holders, together with the Holders (other than S-3
Initiating Holders) registering Registrable Securities in such registration,
propose to sell their Registrable Securities at an aggregate anticipated
offering price to the public of less than $5,000,000.
(d) Expenses. The Company shall bear all Registration
Expenses in connection with any S-3 Registration pursuant to this Section 5,
whether or not such S-3 Registration becomes effective.
6. Restrictions on Public Sale by the Company With respect
to any Demand Registration, the Company shall not (except as part of such
registration) effect any public sale or distribution of any of its equity
securities, or any securities convertible into or exchangeable or exercisable
for such equity securities (except pursuant to (i) a Registration Statement on
Form S-4 or S-8 or any successor thereto or (ii) a Registration Statement
relating to the issuance of securities as consideration in any acquisition by
the Company), during the period beginning on the effective date of any
Registration Statement in which the Holders of Registrable Securities are
participating and ending on the earlier of (i) the date on which all Registrable
Securities registered on such Registration Statement are sold and (ii) 180 days
after the effective date of such Registration Statement. With respect to any
offering of Requested S-3 Registered Securities that takes the form of an
underwritten public offering, the Company shall not (except as part of such
offering) effect any public sale or distribution of any of its equity
securities, or any securities convertible into or exchangeable or exercisable
for such equity securities (except pursuant to (i) a Registration Statement on
Form S-4 or S-8 or any successor thereto or (ii) a Registration Statement
relating to the issuance of securities as consideration in any acquisition by
the Company), during the period beginning on the date the S-3 Requesting Holder
delivers its request pursuant to the first sentence of Section 5(b) hereof and
ending on the date on which all Requested S-3 Registered Securities have been
sold.
7. Registration Procedures.
(a) Obligations of the Company. Whenever registration of
Registrable Securities has been requested pursuant to Section 3, Section 4 or
Section 5 of this Agreement, the Company shall use its reasonable best efforts
to effect the registration and sale of such Registrable Securities in accordance
with the intended method of distribution thereof as quickly as practicable, and
in connection with any such request, the Company shall, as expeditiously as
possible:
(i) prepare and file with the Commission a Registration
Statement on any form for which the Company then qualifies or which counsel for
the Company shall deem appropriate and which form shall be available for the
sale of such Registrable Securities in accordance with the intended method of
distribution thereof, and use its reasonable best efforts to cause such
Registration Statement to become effective; provided, however, that (x) before
filing a Registration Statement or prospectus or any amendments or supplements
thereto, the Company shall provide one counsel selected by the Holders holding a
majority of the Registrable Securities being registered in such registration
12
("Holders' Counsel") and any other Inspector with an adequate and appropriate
opportunity to review and comment on such Registration Statement and each
prospectus included therein (and each amendment or supplement thereto) to be
filed with the Commission, subject to such documents being under the Company's
control, and (y) the Company shall notify the Holders' Counsel and each seller
of Registrable Securities pursuant to such Registration Statement of any stop
order issued or threatened by the Commission and take all action required to
prevent the entry of such stop order or to remove it if entered;
(ii) prepare and file with the Commission such amendments
and supplements to such Registration Statement and the prospectus used in
connection therewith as may be reasonably necessary to keep such Registration
Statement effective for the lesser of (x) 180 days and (y) such shorter period
which will terminate when all Registrable Securities covered by such
Registration Statement have been sold; provided, that if the S-3 Initiating
Holders have requested that an S-3 Registration be for an offering on a
continuous basis pursuant to Rule 415 under the Securities Act, then the Company
shall keep such Registration Statement effective until all Registrable
Securities covered by such Registration Statement have been sold; and shall
comply with the provisions of the Securities Act with respect to the disposition
of all securities covered by such Registration Statement during such period in
accordance with the intended methods of disposition by the sellers thereof set
forth in such Registration Statement;
(iii) furnish to each seller of Registrable Securities,
prior to filing a Registration Statement, at least one copy of such Registration
Statement as is proposed to be filed, and thereafter such number of copies of
such Registration Statement, each amendment and supplement thereto (in each case
including all exhibits thereto), and the prospectus included in such
Registration Statement (including each preliminary prospectus) and any
prospectus filed under Rule 424 under the Securities Act as each such seller may
reasonably request in order to facilitate the disposition of the Registrable
Securities owned by such seller;
(iv) register or qualify such Registrable Securities under
such other securities or "blue sky" laws of such jurisdictions as any seller of
Registrable Securities may reasonably request, and to continue such registration
or qualification in effect in such jurisdiction for as long as permissible
pursuant to the laws of such jurisdiction, or for as long as any such seller
reasonably requests or until all of such Registrable Securities are sold,
whichever is shortest, and do any and all other acts and things which may be
reasonably necessary or advisable to enable any such seller to consummate the
disposition in such jurisdictions of the Registrable Securities owned by such
seller; provided, however, that the Company shall not be required to (x) qualify
generally to do business in any jurisdiction where it would not otherwise be
required to qualify but for this Section 7(a)(iv), (y) subject itself to
taxation in any such jurisdiction or (z) consent to general service of process
in any such jurisdiction;
(v) notify each seller of Registrable Securities: (A) when
a prospectus, any prospectus supplement, a Registration Statement or a
post-effective amendment to a Registration Statement has been filed with the
13
Commission, and, with respect to a Registration Statement or any post-effective
amendment, when the same has become effective; (B) of any request by the
Commission or any other federal or state governmental authority for amendments
or supplements to a Registration Statement or related prospectus or for
additional information; (C) of the issuance by the Commission or any other
federal or state governmental authority of any stop order suspending the
effectiveness of a Registration Statement or the initiation or threatening of
any proceedings for that purpose; (D) of the receipt by the Company of any
notification with respect to the suspension of the qualification or exemption
from qualification of any of the Registrable Securities for sale in any
jurisdiction or the initiation or threatening of any proceedings for such
purpose; (E) of the existence of any fact or happening of any event of which the
Company has knowledge which makes any statement of a material fact in such
Registration Statement or related prospectus or any document incorporated or
deemed to be incorporated therein by reference untrue or which would require the
making of any changes in the Registration Statement or prospectus in order that,
in the case of the Registration Statement, it will not contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein not misleading, and
that in the case of such prospectus, it will not contain any untrue statement of
a material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading; and (F) of the determination by counsel of
the Company that a post-effective amendment to a Registration Statement is
advisable;
(vi) upon the occurrence of any event contemplated by
Section 7(a)(v)(E) or, subject to Sections 3(a) and 5(c) hereof, the existence
of a Valid Business Reason, as promptly as practicable, prepare a supplement or
amendment to such Registration Statement or related prospectus and furnish to
each seller of Registrable Securities a reasonable number of copies of such
supplement to or an amendment of such Registration Statement or prospectus as
may be necessary so that, after delivery to the purchasers of such Registrable
Securities, in the case of the Registration Statement, it will not contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein not misleading,
and that in the case of such prospectus, it will not contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading;
(vii) enter into and perform customary agreements
(including an underwriting agreement and cause each of its directors and
officers to enter into a lock-up agreement, in each case, in customary form with
the Approved Underwriter or Company Underwriter, if any, selected as provided in
Section 3, Section 4 or Section 5, as the case may be) and take such other
actions as are prudent and reasonably required in order to expedite or
facilitate the disposition of such Registrable Securities, including causing its
officers to participate in "road shows" and other information meetings organized
by the Approved Underwriter or Company Underwriter, if applicable;
14
(viii) make available at reasonable times for inspection by
any seller of Registrable Securities, any managing underwriter participating in
any disposition of such Registrable Securities pursuant to a Registration
Statement, Holders' Counsel and any attorney, accountant or other agent retained
by any such seller or any managing underwriter (each, an "Inspector" and
collectively, the "Inspectors"), all financial and other records, pertinent
corporate documents and properties of the Company and its subsidiaries
(collectively, the "Records") as shall be reasonably necessary to enable them to
exercise their due diligence responsibility, and cause the Company's and its
subsidiaries' officers, directors and employees, and the independent public
accountants of the Company, to supply all information reasonably requested by
any such Inspector in connection with such Registration Statement. Records that
the Company determines, in good faith, to be confidential and which it notifies
the Inspectors are confidential shall not be disclosed by the Inspectors (and
the Inspectors shall confirm their agreement in writing in advance to the
Company if the Company shall so request) unless (x) the disclosure of such
Records is necessary, in the Company's judgment, to avoid or correct a
misstatement or omission in the Registration Statement, (y) the release of such
Records is ordered pursuant to a subpoena or other order from a court of
competent jurisdiction after exhaustion of all appeals therefrom or (z) the
information in such Records was known to the Inspectors on a non-confidential
basis prior to its disclosure by the Company or has been made generally
available to the public. Each seller of Registrable Securities agrees that it
shall, upon learning that disclosure of such Records is sought in a court of
competent jurisdiction, give notice to the Company and allow the Company, at the
Company's expense, to undertake appropriate action to prevent disclosure of the
Records deemed confidential;
(ix) if such sale is pursuant to an underwritten offering,
obtain a "cold comfort" letter dated the effective date of the Registration
Statement and the date of the closing under the underwriting agreement from the
Company's independent public accountants in customary form and covering such
matters of the type customarily covered by "cold comfort" letters as Holders'
Counsel or the managing underwriter reasonably requests;
(x) furnish, at the request of any seller of Registrable
Securities on the date such securities are delivered to the underwriters for
sale pursuant to such registration or, if such securities are not being sold
through underwriters, on the date the Registration Statement with respect to
such securities becomes effective, an opinion, dated such date, of counsel
representing the Company for the purposes of such registration, addressed to the
underwriters, if any, and to the seller making such request, covering such legal
matters with respect to the registration in respect of which such opinion is
being given as the underwriters, if any, and such seller may reasonably request
and are customarily included in such opinions;
(xi) comply with all applicable rules and regulations of
the Commission, and make generally available to its security holders, as soon as
reasonably practicable but no later than 15 months after the effective date of
the Registration Statement, an earnings statement covering a period of 12 months
15
beginning after the effective date of the Registration Statement, in a manner
which satisfies the provisions of Section 11(a) of the Securities Act and Rule
158 thereunder;
(xii) cause all such Registrable Securities to be listed on
each securities exchange on which similar securities issued by the Company are
then listed, provided that the applicable listing requirements are satisfied;
(xiii) keep Holders' Counsel advised in writing as to the
initiation and progress of any registration under Section 3, Section 4 or
Section 5 hereunder; provided, that the Company shall provide Holder's Counsel
with all correspondence with the Commission in connection with any Registration
Statement filed hereunder;
(xiv) cooperate with each seller of Registrable Securities
and each underwriter participating in the disposition of such Registrable
Securities and their respective counsel in connection with any filings required
to be made with the NASD; and
(xv) take all other steps reasonably necessary to effect
the registration of the Registrable Securities contemplated hereby.
(b) Seller Information. The Company may require each seller
of Registrable Securities as to which any registration is being effected to
furnish, and such seller shall furnish, to the Company such information
regarding the distribution of such securities as the Company may from time to
time reasonably request in writing.
(c) Notice to Discontinue. Each Holder agrees that, upon
receipt of any notice from the Company of the happening of any event of the kind
described in Section 7(a)(v)(E) or the existence of a Valid Business Reason,
such Holder shall forthwith discontinue disposition of Registrable Securities
pursuant to the Registration Statement covering such Registrable Securities
until such Holder's receipt of the copies of the supplemented or amended
prospectus contemplated by Section 7(a)(vi) and, if so directed by the Company,
such Holder shall deliver to the Company (at the Company's expense) all copies,
other than permanent file copies then in such Holder's possession, of the
prospectus covering such Registrable Securities which is current at the time of
receipt of such notice. If the Company shall give any such notice, the Company
shall extend the period during which such Registration Statement shall be
maintained effective pursuant to this Agreement (including, without limitation,
the period referred to in Section 7(a)(ii)) by the number of days during the
period from and including the date of the giving of such notice pursuant to
Section 7(a)(v)(E) to and including the date when sellers of such Registrable
Securities under such Registration Statement shall have received the copies of
the supplemented or amended prospectus contemplated by and meeting the
requirements of Section 7(a)(vi).
(d) Registration Expenses. The Company shall pay all
expenses arising from or incident to its performance of, or compliance with,
this Agreement, including, without limitation, (i) Commission, stock exchange
and NASD registration and filing fees, (ii) all fees and expenses incurred in
16
complying with securities or "blue sky" laws (including reasonable fees, charges
and disbursements of counsel to any underwriter incurred in connection with
"blue sky" qualifications of the Registrable Securities as may be set forth in
any underwriting agreement), (iii) all printing, messenger and delivery
expenses, (iv) the fees, charges and expenses of Holder's Counsel, any necessary
counsel with respect to state securities law matters, counsel to the Company,
and of its independent public accountants and any other accounting fees, charges
and expenses incurred by the Company (including, without limitation, any
expenses arising from any "cold comfort" letters or any special audits incident
to or required by any registration or qualification) and any legal fees, charges
and expenses incurred by the Initiating Holders, the S-3 Initiating Holders or
the S-3 Requesting Holders, as the case may be, and (v) any liability insurance
or other premiums for insurance obtained in connection with any Demand
Registration or piggy-back registration thereon, Incidental Registration or S-3
Registration pursuant to the terms of this Agreement, regardless of whether such
Registration Statement is declared effective. All of the expenses described in
the preceding sentence of this Section 7(d) are referred to herein as
"Registration Expenses." The Holders of Registrable Securities sold pursuant to
a Registration Statement shall bear the expense of any broker's commission or
underwriter's discount or commission relating to registration and sale of such
Holders' Registrable Securities and, subject to clause (iv) above, shall bear
the fees and expenses of their own counsel.
(e) Hedging Transactions.
(i) The Company agrees that, in connection with any
proposed Hedging Transaction, if, in the reasonable judgment of Holders'
Counsel, it is necessary or desirable to register under the Securities Act such
Hedging Transactions or sales or transfers (whether short or long) of
Registrable Class Securities in connection therewith, then the Company shall use
its reasonable best efforts to take such actions (which may include, among other
things, the filing of a post-effective amendment to a Registration Statement to
include additional or changed information that is material or is otherwise
required to be disclosed, including, without limitation, a description of such
Hedging Transaction, the name of the Hedging Counterparty, identification of the
Hedging Counterparty or its Affiliates as underwriters or potential
underwriters, if applicable, or any change to the plan of distribution) as may
reasonably be required to register such Hedging Transactions or sales or
transfers of Registrable Class Securities in connection therewith under the
Securities Act in a manner consistent with the rights and obligations of the
Company hereunder with respect to the registration of Registrable Securities.
Any information regarding the Hedging Transaction included in a Registration
Statement or prospectus pursuant to this Section 7(e) shall be deemed to be
information provided by the Holders selling Registrable Securities pursuant to
such Registration Statement for purposes of Section 7(b).
(ii) All Registration Statements in which Holders may
include Registrable Securities under this Agreement shall be subject to the
provisions of this Section 7(e), and the registration of Registrable Class
Securities thereunder pursuant to this Section 7(e) shall be subject to the
provisions of this Agreement applicable to any such Registration Statements;
17
provided, however, that the selection of any Hedging Counterparty shall not be
subject to Section 3(f) hereof, but the Hedging Counterparty shall be selected
by the Holders of a majority of the Registrable Class Securities subject to the
Hedging Transaction that are proposed to be included in such Registration
Statement.
(iii) If in connection with a Hedging Transaction, a
Hedging Counterparty or any Affiliate thereof is (or may be considered) an
underwriter or selling stockholder, then it shall be required to provide
customary indemnities to the Company regarding the Plan of Distribution and like
matters.
(iv) The Company further agrees to include, under the
caption "Plan of Distribution" (or the equivalent caption), in each Registration
Statement, and any related prospectus (to the extent such inclusion is permitted
under applicable Commission regulations and is consistent with comments received
from the Commission during any Commission review of the Registration Statement),
language substantially in the form of Annex A hereto and to include in each
prospectus supplement filed in connection with any proposed Hedging Transaction
language mutually agreed upon by the Company, the relevant Holders and the
Hedging Counterparty describing such Hedging Transaction.
8. Indemnification; Contribution.
(a) Indemnification by the Company. The Company agrees to
indemnify and hold harmless each Holder, its partners, directors, members,
officers, Affiliates and each Person who controls (within the meaning of Section
15 of the Securities Act) such Holder from and against any and all losses,
claims, damages, liabilities and expenses (including reasonable costs of
investigation) (each, a "Liability" and collectively, "Liabilities"), arising
out of or based upon any untrue, or allegedly untrue, statement of a material
fact contained in any Registration Statement, prospectus or preliminary
prospectus or notification or offering circular (as amended or supplemented if
the Company shall have furnished any amendments or supplements thereto) or
arising out of or based upon any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading in light of the circumstances under which such statements
were made, except insofar as such Liability arises out of or is based upon any
untrue statement or alleged untrue statement or omission or alleged omission
contained in such Registration Statement, preliminary prospectus or final
prospectus in reliance and in conformity with information concerning such Holder
furnished in writing to the Company by such Holder expressly for use therein,
including, without limitation, the information furnished to the Company pursuant
to Section 8(b). The Company shall also provide customary indemnities to any
underwriters of the Registrable Securities, their officers, directors and
employees and each Person who controls such underwriters (within the meaning of
Section 15 of the Securities Act) to the same extent as provided above with
respect to the indemnification of the Holders of Registrable Securities.
18
(b) Indemnification by Holders. In connection with any
Registration Statement in which a Holder is participating pursuant to Section 3,
Section 4 or Section 5 hereof, each such Holder shall promptly furnish to the
Company in writing such information with respect to such Holder as the Company
may reasonably request or as may be required by law for use in connection with
any such Registration Statement or prospectus and all information required to be
disclosed in order to make the information previously furnished to the Company
by such Holder not materially misleading or necessary to cause such Registration
Statement not to omit a material fact with respect to such Holder necessary in
order to make the statements therein not misleading. Each Holder agrees to
indemnify and hold harmless the Company, any underwriter retained by the Company
and each Person who controls the Company or such underwriter (within the meaning
of Section 15 of the Securities Act) to the same extent as the foregoing
indemnity from the Company to the Holders, but only if such untrue statement or
alleged untrue statement or omission or alleged omission was made in reliance
upon and in conformity with information with respect to such Holder furnished in
writing to the Company by such Holder expressly for use in such Registration
Statement or prospectus, including, without limitation, the information
furnished to the Company pursuant to this Section 8(b); provided, however, that
the total amount to be indemnified by such Holder pursuant to this Section 8(b)
shall be limited to the net proceeds (after deducting the underwriters'
discounts and commissions) received by such Holder in the offering to which the
Registration Statement or prospectus relates.
(c) Conduct of Indemnification Proceedings. Any Person
entitled to indemnification hereunder (the "Indemnified Party") agrees to give
prompt written notice to the indemnifying party (the "Indemnifying Party") after
the receipt by the Indemnified Party of any written notice of the commencement
of any action, suit, proceeding or investigation or threat thereof made in
writing for which the Indemnified Party intends to claim indemnification or
contribution pursuant to this Agreement; provided, however, that the failure to
so notify the Indemnifying Party shall not relieve the Indemnifying Party of any
Liability that it may have to the Indemnified Party hereunder (except to the
extent that the Indemnifying Party forfeits substantive rights or defenses by
reason of such failure). If notice of commencement of any such action is given
to the Indemnifying Party as above provided, the Indemnifying Party shall be
entitled to participate in and, to the extent it may wish, jointly with any
other Indemnifying Party similarly notified, to assume the defense of such
action at its own expense, with counsel chosen by it and reasonably satisfactory
to such Indemnified Party. The Indemnified Party shall have the right to employ
separate counsel in any such action and participate in the defense thereof, but
the fees and expenses of such counsel shall be paid by the Indemnified Party
unless (i) the Indemnifying Party agrees to pay the same, (ii) the Indemnifying
Party fails to assume the defense of such action with counsel reasonably
satisfactory to the Indemnified Party or (iii) the named parties to any such
action (including any impleaded parties) include both the Indemnifying Party and
the Indemnified Party and such parties have been advised by such counsel that
either (x) representation of such Indemnified Party and the Indemnifying Party
by the same counsel would be inappropriate under applicable standards of
professional conduct or (y) there may be one or more legal defenses available to
19
the Indemnified Party which are different from or additional to those available
to the Indemnifying Party. In any of such cases, the Indemnifying Party shall
not have the right to assume the defense of such action on behalf of such
Indemnified Party, it being understood, however, that the Indemnifying Party
shall not be liable for the fees and expenses of more than one separate firm of
attorneys (in addition to any local counsel) for all Indemnified Parties. No
Indemnifying Party shall be liable for any settlement entered into without its
written consent, which consent shall not be unreasonably withheld. No
Indemnifying Party shall, without the written consent of such Indemnified Party,
effect any settlement of any pending or threatened proceeding in respect of
which such Indemnified Party is a party and indemnity has been sought hereunder
by such Indemnified Party, unless such settlement includes an unconditional
release of such Indemnified Party from all liability for claims that are the
subject matter of such proceeding.
(d) Contribution. If the indemnification provided for in
this Section 8 from the Indemnifying Party is unavailable to an Indemnified
Party hereunder in respect of any Liabilities referred to herein, then the
Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall
contribute to the amount paid or payable by such Indemnified Party as a result
of such Liabilities in such proportion as is appropriate to reflect the relative
fault of the Indemnifying Party and Indemnified Party in connection with the
actions which resulted in such Liabilities, as well as any other relevant
equitable considerations. The relative faults of such Indemnifying Party and
Indemnified Party shall be determined by reference to, among other things,
whether any action in question, including any untrue or alleged untrue statement
of a material fact or omission or alleged omission to state a material fact, has
been made by, or relates to information supplied by, such Indemnifying Party or
Indemnified Party, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such action. The amount paid
or payable by a party as a result of the Liabilities referred to above shall be
deemed to include, subject to the limitations set forth in Sections 8(a), 8(b)
and 8(c), any legal or other fees, charges or expenses reasonably incurred by
such party in connection with any investigation or proceeding; provided that the
total amount to be contributed by such Holder shall be limited to the net
proceeds (after deducting the underwriters' discounts and commissions) received
by such Holder in the offering.
The parties hereto agree that it would not be just and
equitable if contribution pursuant to this Section 8(d) were determined by pro
rata allocation or by any other method of allocation which does not take account
of the equitable considerations referred to in the immediately preceding
paragraph. 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.
9. Rule 144. The Company covenants that from and after the
Exchange Act Registration Date it shall (a) file any reports required to be
filed by it under the Exchange Act and (b) take such further action as each
Holder may reasonably request (including providing any information necessary to
comply with Rule 144 under the Securities Act), all to the extent required from
time to time to enable such Holder to sell Registrable Securities without
20
registration under the Securities Act within the limitation of the exemptions
provided by (i) Rule 144 under the Securities Act, as such rule may be amended
from time to time, or Regulation S under the Securities Act or (ii) any similar
rules or regulations hereafter adopted by the Commission. The Company shall,
upon the request of any Holder, deliver to such Holder a written statement as to
whether it has complied with such requirements.
10. Miscellaneous.
(a) Recapitalizations, Exchanges, etc. The provisions of
this Agreement shall apply to the full extent set forth herein with respect to
(i) the shares of Common Stock, (ii) any and all shares of voting common stock
of the Company into which the shares of Common Stock are converted, exchanged or
substituted in any recapitalization or other capital reorganization by the
Company and (iii) any and all equity securities of the Company or any successor
or assign of the Company (whether by merger, consolidation, sale of assets or
otherwise) which may be issued in respect of, in conversion of, in exchange for
or in substitution of, the shares of Common Stock and shall be appropriately
adjusted for any stock dividends, splits, reverse splits, combinations,
recapitalizations and the like occurring after the date hereof. The Company
shall cause any successor or assign (whether by merger, consolidation or
otherwise) to assume this Agreement or enter into a new registration rights
agreement with the Holders on terms substantially the same as this Agreement as
a condition of any such transaction.
(b) No Inconsistent Agreements. The Company represents and
warrants that it has not granted to any Person the right to request or require
the Company to register any securities issued by the Company, other than the
rights granted to the Holders herein. The Company shall not enter into any
agreement with respect to its securities that is inconsistent with the rights
granted to the Holders in this Agreement or grant any additional registration
rights to any Person or with respect to any securities which are not Registrable
Securities which are prior in right to or inconsistent with the rights granted
in this Agreement.
(c) Remedies. The Holders, in addition to being entitled to
exercise all rights granted by law, including recovery of damages, shall be
entitled to specific performance of their rights under this Agreement. The
Company agrees that monetary damages would not be adequate compensation for any
loss incurred by reason of a breach by it of the provisions of this Agreement
and hereby agrees to waive in any action for specific performance the defense
that a remedy at law would be adequate.
(d) Amendments and Waivers. Except as otherwise provided
herein, the provisions of this Agreement may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given unless consented to in writing by (i) the Company and (ii)
Holders holding a majority of the Registrable Securities held by all of the
Holders; provided, that if any such amendment, modification, supplement, waiver,
consent or departure would adversely affect the rights, preferences or
privileges of any Holder disproportionately with respect to the rights,
21
preferences and privileges of the other Holders, such Holder's consent in
writing shall be required.
(e) Successors and Assigns; Third Party Beneficiaries. This
Agreement shall inure to the benefit of and be binding upon the successors and
permitted assigns of the parties hereto as hereinafter provided. The rights of
the Holders contained in this Agreement shall be automatically transferred to
the transferee of any Registrable Security provided that (i) such transferee
agrees to become a party to this Agreement and be fully bound by, and subject
to, all of the terms and conditions of the Agreement as though an original party
hereto and (ii) such transferee would hold Registrable Securities after the
completion of such transfer. All of the obligations of the Company hereunder
shall survive any such transfer. Except as provided in Section 8, no Person
other than the parties hereto and their successors and permitted assigns is
intended to be a beneficiary of this Agreement.
(f) Counterparts. This Agreement may be executed in any
number of counterparts and by the parties hereto in separate counterparts, each
of which when so executed shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement.
(g) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(H) GOVERNING LAW; CONSENT TO JURISDICTION. THIS AGREEMENT
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK WITHOUT REGARD TO ANY PRINCIPLES OF CONFLICTS OF LAW THEREOF THAT WOULD
INDICATE THE APPLICATION OF THE LAWS OF ANY OTHER JURISDICTION. The parties
hereto irrevocably submit to the exclusive jurisdiction of any state or federal
court sitting in the County of New York, in the State of New York over any suit,
action or proceeding arising out of or relating to this Agreement or the affairs
of the Company. To the fullest extent they may effectively do so under
applicable law, the parties hereto irrevocably waive and agree not to assert, by
way of motion, as a defense or otherwise, any claim that they are not subject to
the jurisdiction of any such court, any objection that they may now or hereafter
have to the laying of the venue of any such suit, action or proceeding brought
in any such court and any claim that any such suit, action or proceeding brought
in any such court has been brought in an inconvenient forum.
(i) Severability. If any one or more of the provisions
contained herein, or the application thereof in any circumstance, 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, unless the
provisions held invalid, illegal or unenforceable shall substantially impair the
benefits of the remaining provisions hereof.
22
(j) Rules of Construction. Unless the context otherwise
requires, references to sections or subsections refer to sections or subsections
of this Agreement.
(k) Entire Agreement. This Agreement is intended by the
parties as a final expression of their agreement and intended to be a complete
and exclusive statement of the agreement and understanding of the parties hereto
with respect to the subject matter contained herein. There are no restrictions,
promises, representations, warranties or undertakings with respect to the
subject matter contained herein, other than those set forth or referred to
herein. This Agreement supersedes all prior agreements and understandings among
the parties with respect to such subject matter.
(l) Further Assurances. Each of the parties shall execute
such documents and perform such further acts as may be reasonably required or
desirable to carry out or to perform the provisions of this Agreement.
(m) Other Agreements. Nothing contained in this Agreement
shall be deemed to be a waiver of, or release from, any obligations any party
hereto may have under, or any restrictions on the transfer of Registrable
Securities or other securities of the Company imposed by, any other agreement.
(n) Notices. All notices, demands and other communications
provided for or permitted hereunder shall be made in writing and shall be made
by registered or certified first-class mail, return receipt requested,
telecopier, courier service or personal delivery:
(i) if to the Company:
IWO Holdings, Inc.
ββ βββββββββ ββββββ
ββββββ, βββ ββββ βββββ
Telecopy: [ ]
Attention: βββββββ ββββββ
with a copy to:
ββββ, Weiss, Rifkind, βββββββ & ββββββββ LLP
ββββ ββββββ ββ βββ ββββββββ
βββ ββββ, βββ ββββ βββββ-ββββ
Telecopy: (βββ) βββ-ββββ
Attention: βββββ β. βββββββββ, Esq.
ββββββββ β. Wee, Esq.
23
(ii) if to the Initial Holders
c/o AIG High Yield
ββββ βββββ βββββββ - ββββ βββββ
βββββββ, βββββ βββββ
Telecopy: (βββ) βββ-ββββ
Attention: ββββ βββββββ
(iii) if to any other Holder, at its address as it appears
on the record books of the Company.
All such notices, demands and other communications shall be deemed to have been
duly given when delivered by hand, if personally delivered; when delivered by
courier, if delivered by commercial courier service; five (5) Business Days
after being deposited in the mail, postage prepaid, if mailed; and when receipt
is mechanically acknowledged, if telecopied. Any party may by notice given in
accordance with this Section 10(n) designate another address or Person for
receipt of notices hereunder.
[Remainder of page intentionally left blank]
24
IN WITNESS WHEREOF, the undersigned have executed, or have
caused to be executed, this Registration Rights Agreement on the date first
written above.
IWO HOLDINGS, INC.
By: /s/ βββββββ ββββββ
--------------------------------------------------
Name: βββββββ ββββββ
Title: Vice President and Chief Financial Officer
25
AIG ANNUITY INSURANCE COMPANY
SUNAMERICA LIFE INSURANCE COMPANY
THE VARIABLE ANNUITY LIFE INSURANCE COMPANY
By: AIG Global Investment Corp.,
investment adviser
By: /s/ ββββ βββββββ
---------------------------------------------
Name: ββββ βββββββ
Title: Managing Director
VALIC COMPANY II - STRATEGIC BOND FUND
SUNAMERICA INCOME FUNDS - HIGHYIELD BOND FUND
SUNAMERICA INCOME FUNDS - STRATEGIC BOND FUND
VALIC COMPANY II - HIGH YIELD BOND FUND
By: AIG Global Investment Corp.
investment sub-adviser
By: /s/ βββ ββββ
---------------------------------------------
Name: βββ ββββ
Title: Managing Director
SUNAMERICA SERIES TRUST - SUNAMERICA HIGHYIELD
BOND PORTFOLIO
By: AIG SunAmerica Asset Management Corp.
investment adviser
By: /s/ βββ ββββ
---------------------------------------------
Name: βββ ββββ
Title: Managing Director
26
Annex A
PLAN OF DISTRIBUTION
A selling stockholder may also enter into hedging and/or
monetization transactions. For example, a selling stockholder may:
(a) enter into transactions with a broker-dealer or affiliate of a broker-dealer
or other third party in connection with which that other party will become a
selling stockholder and engage in short sales of the common stock under this
prospectus, in which case the other party may use shares of common stock
received from the selling stockholder to close out any short positions;
(b) itself sell short common stock under this prospectus and use shares of
common stock held by it to close out any short position;
(c) enter into options, forwards or other transactions that require the selling
stockholder to deliver, in a transaction exempt from registration under the
Securities Act, common stock to a broker-dealer or an affiliate of a
broker-dealer or other third party who may then become a selling stockholder and
publicly resell or otherwise transfer that common stock under this prospectus;
or
(d) loan or pledge common stock to a broker-dealer or affiliate of a
broker-dealer or other third party who may then become a selling stockholder and
sell the loaned shares or, in an event of default in the case of a pledge,
become a selling stockholder and sell the pledged shares, under this prospectus.