EXHIBIT 4.3
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REGISTRATION RIGHTS AGREEMENT
Dated as of June 5, 1998
by and among
FINE AIR SERVICES CORP.
THE SUBSIDIARY GUARANTORS NAMED HEREIN
and
SBC WARBURG DILLON READ INC.
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This Registration Rights Agreement (the "AGREEMENT") is made and
entered into as of June 5, 1998 by and among FINE AIR SERVICES CORP. (the
"ISSUER"), the SUBSIDIARY GUARANTORS (as defined herein) and SBC WARBURG DILLON
READ INC. (the "INITIAL PURCHASER"). The execution and delivery of this
Agreement is a condition to the obligations of the Initial Purchaser to purchase
$200,000,000 of the 9-7/8% Senior Notes due 2008 of the Issuer under the
Purchase Agreement, dated as of June 2, 1998 (the "PURCHASE AGREEMENT"), by and
among the Issuer, the Subsidiary Guarantors and the Initial Purchaser.
The Issuer, the Subsidiary Guarantors and the Initial Purchaser hereby
agree as follows:
SECTION 1. DEFINITIONS.
As used in this Agreement, the following capitalized terms shall have
the following meanings:
ACT: The Securities Act of 1933, as amended, and the rules and
regulations promulgated by the Commission pursuant thereto.
ACTION: As defined in Section 8(c) of this Agreement.
BROKER-DEALER: Any broker or dealer registered under the Exchange Act.
BUSINESS DAY: As that term is defined in the Indenture.
CLOSING DATE: The date that the Old Notes are purchased by the Initial
Purchaser pursuant to the Purchase Agreement.
COMMISSION: The Securities and Exchange Commission.
CONSUMMATE: A Registered Exchange Offer shall be deemed "Consummated"
for purposes of this Agreement upon the occurrence of (i) the filing and
effectiveness under the Act of the Exchange Offer Registration Statement
relating to the Notes to be issued in the Exchange Offer, (ii) the maintenance
of such Registration Statement continuously effective and the keeping of the
Exchange Offer open for a period not less than the minimum period required
pursuant to Section 3(b) of this Agreement and (iii) the delivery by the Issuer
to the Registrar under the Indenture of New Notes in the same aggregate
principal amount as the aggregate principal amount of Old Notes that were
tendered prior to the expiration of the Exchange Offer.
DAMAGES PAYMENT DATE: With respect to the Notes, each Interest Payment
Date.
EFFECTIVENESS TARGET DATE: As defined in Section 5 of this Agreement.
EXCHANGE ACT: The Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated by the Commission pursuant thereto.
EXCHANGE OFFER: The registration under the Act by the Issuer and the
Subsidiary Guarantors of the New Notes pursuant to a Registration Statement
pursuant to which the Issuer and the Subsidiary Guarantors offer the Holders of
all outstanding Transfer Restricted Securities the opportunity to exchange all
such outstanding Old Notes that are Transfer Restricted Securities held by such
Holders for New Notes in an aggregate principal amount equal to the aggregate
principal amount of the Old Notes that are Transfer Restricted Securities
tendered in such exchange offer by such Holders.
EXCHANGE OFFER EFFECTIVE DATE: The date on which the Exchange Offer
Registration Statement is declared effective by the Commission.
EXCHANGE OFFER REGISTRATION STATEMENT: The Registration Statement
relating to the Exchange Offer, including the related Prospectus.
EXEMPT RESALES: The transactions in which the Initial Purchaser
proposes to sell the Notes to (i) certain "qualified institutional buyers," as
such term is defined in Rule 144A under the Act, and (ii) other eligible
purchasers pursuant to Regulation S under the Act.
HOLDERS: As defined in Section 2(b) of this Agreement.
INDENTURE: The Indenture, dated as of June 5, 1998, by and among the
Issuer, the Subsidiary Guarantors and The Bank of New York, as trustee (the
"TRUSTEE"), pursuant to which the Notes are to be issued, as such Indenture is
amended or supplemented from time to time in accordance with its terms.
INITIAL PURCHASER: SBC Warburg Dillon Read Inc.
INTEREST PAYMENT DATE: As defined in the Notes.
NASD: National Association of Securities Dealers, Inc.
NEW NOTES: The Series B 9-7/8% Senior Notes due 2008 of the Issuer to
be issued pursuant to the Indenture in connection with the Exchange Offer and
evidencing the same indebtedness as the Old Notes, including the guarantees by
the Subsidiary Guarantors.
NOTES: Old Notes and New Notes.
OLD NOTES: The Series A 9-7/8% Senior Notes due 2008 of the Issuer to
be issued pursuant to the Indenture on the Closing Date, including the
guarantees by the Subsidiary Guarantors.
PARTICIPATING BROKER DEALER: As defined in Section 6(a)(iii) of this
Agreement.
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PERSON: An individual, partnership, corporation, trust or
unincorporated organization, or a government or agency or political subdivision
thereof.
PROSPECTUS: The prospectus included in a Registration Statement, as
amended or supplemented by any prospectus supplement and by all other amendments
and supplements thereto, including post-effective amendments, and all material
incorporated by reference or deemed to be incorporated by reference, if any, in
such Prospectus.
REGISTRATION DEFAULT: As defined in Section 5 of this Agreement.
REGISTRATION STATEMENT: Any registration statement of the Issuer and
the Subsidiary Guarantors relating to (a) an offering of New Notes pursuant to
an Exchange Offer or (b) the registration for resale of Transfer Restricted
Securities pursuant to the Shelf Registration Statement that is filed pursuant
to the provisions of this Agreement, in each case, including the Prospectus
included therein, all amendments and supplements thereto (including pre- and
post-effective amendments) and all exhibits and material incorporated by
reference or deemed to be incorporated by reference, if any, therein.
SHELF FILING DEADLINE: As defined in Section 4(a) of this Agreement.
SHELF REGISTRATION STATEMENT: As defined in Section 4(a) of this
Agreement.
SUBSIDIARY: With respect to any Person, any other Person of which a
majority of the equity ownership or the voting securities is at the time owned,
directly or indirectly, by such Person or by one or more other subsidiaries of
such Person or a combination thereof.
SUBSIDIARY GUARANTORS: Each Subsidiary of the Issuer that, pursuant to
the Indenture, is, or is required to become, a guarantor of the obligations of
the Issuer under the Notes and the Indenture.
TIA: The Trust Indenture Act of 1939, as amended (15 U.S.C. Section
77aaa-77bbbb), as in effect on the date of the Indenture.
TRANSFER RESTRICTED SECURITIES: Each Old Note until the earliest to
occur of (i) the date on which each such Old Note has been exchanged by a person
other than a Broker-Dealer for a New Note in the Exchange Offer, (ii) following
the exchange by a Broker-Dealer in the Exchange Offer of an Old Note for a New
Note, the date on which such New Note is sold to a purchaser who receives from
such Broker-Dealer on or prior to the date of such sale a copy of the prospectus
contained in the Exchange Offer Registration Statement, (iii) the date on which
such Old Note has been effectively registered under the Act and disposed of in
accordance with the Shelf
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Registration Statement or (iv) the date on which such Old Note is saleable to
the public pursuant to Rule 144 under the Act or is sold pursuant to Rule 144(k)
under the Act.
UNDERWRITTEN REGISTRATION OR UNDERWRITTEN OFFERING: A registration in
which securities of the Issuer are sold to an underwriter for reoffering to the
public pursuant to an effective Registration Statement.
SECTION 2. SECURITIES SUBJECT TO THIS AGREEMENT.
(A) TRANSFER RESTRICTED SECURITIES. The securities entitled to the
benefits of this Agreement are the Transfer Restricted Securities.
(B) HOLDERS OF TRANSFER RESTRICTED SECURITIES. A Person is deemed to be
a holder of Transfer Restricted Securities (each, a "HOLDER") whenever such
Person beneficially owns Transfer Restricted Securities.
SECTION 3. REGISTERED EXCHANGE OFFER.
(A) Unless, due to a change in law or Commission policy after the date
hereof, the Exchange Offer shall not be permissible under applicable federal law
or Commission policy, the Issuer and the Subsidiary Guarantors shall (i) cause
to be filed with the Commission as soon as practicable on or prior to 60 days
after the Closing Date, a Registration Statement under the Act relating to the
New Notes and the Exchange Offer and (ii) use their best efforts to cause such
Registration Statement to be declared effective by the Commission as soon as
practicable on or prior to 150 days after the Closing Date. In connection with
the foregoing, the Issuer and the Subsidiary Guarantors shall (A) file all
pre-effective amendments to such Registration Statement as may be necessary to
cause such Registration Statement to become effective, (B) if applicable, file a
post-effective amendment to such Registration Statement pursuant to Rule 430A
under the Act, (C) cause all necessary filings in connection with the
registration and qualification of the New Notes to be made under the Blue Sky
laws of such jurisdictions as are necessary to permit Consummation of the
Exchange Offer (PROVIDED, HOWEVER, that the Issuer and the Subsidiary Guarantors
shall not be obligated to qualify as foreign corporations in any jurisdiction in
which they are not so qualified or to take any action that would subject them to
general service of process or taxation in any jurisdiction where they are not so
subject, except service of process with respect to the offering and sale of the
Notes) and (D) upon the effectiveness of such Registration Statement, commence
the Exchange Offer and use their best efforts to issue on or prior to 45 days
after the Exchange Offer Effective Date, New Notes in exchange for all Old Notes
tendered in the Exchange Offer. The Exchange Offer shall be on the appropriate
form permitting registration of the New Notes to be offered in exchange for the
Transfer Restricted Securities and to permit resales of New Notes held by
Broker-Dealers as contemplated by Section 3(c) below. If, after such Exchange
Offer Registration Statement initially is declared effective by the Commission,
the Exchange Offer or the issuance of New Notes under the
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Exchange Offer or the resale of New Notes received by Broker-Dealers in the
Exchange Offer as contemplated by Section 3(c) below is interfered with by any
stop order, injunction or other order or requirement of the Commission or any
other governmental agency or court, such Registration Statement shall be deemed
not to have become effective for purposes of this Agreement during the period
that such stop order, injunction or other similar order or requirement shall
remain in effect.
(B) The Issuer and the Subsidiary Guarantors shall cause the Exchange
Offer Registration Statement to be effective continuously and shall keep the
Exchange Offer open for a period of not less than the minimum period required
under applicable federal and state securities laws to Consummate the Exchange
Offer; PROVIDED, HOWEVER, that in no event shall such period be less than 20
business days. The Issuer and the Subsidiary Guarantors shall cause the Exchange
Offer to comply with all applicable federal and state securities laws. The
Issuer and the Subsidiary Guarantors shall only offer to exchange New Notes for
Old Notes in the Exchange Offer, and only the New Notes shall be registered
under the Exchange Offer Registration Statement.
(C) The Issuer shall indicate in a "Plan of Distribution" section
contained in the Prospectus included in the Exchange Offer Registration
Statement that any Broker-Dealer that holds Old Notes that are Transfer
Restricted Securities and that were acquired for its own account as a result of
market-making activities or other trading activities (other than Transfer
Restricted Securities acquired directly from the Issuer), may exchange such Old
Notes pursuant to the Exchange Offer; PROVIDED, HOWEVER, that such Broker-Dealer
may be deemed to be an "underwriter" within the meaning of the Act and must,
therefore, deliver a prospectus meeting the requirements of the Act in
connection with any resales of the New Notes received by such Broker-Dealer in
the Exchange Offer. Such "Plan of Distribution" section shall allow the use of
the Prospectus by all Persons subject to the prospectus delivery requirements of
the Act, including Participating Broker-Dealers, and shall also contain all
other information with respect to such resales by Broker-Dealers that the
Commission may require to permit such resales pursuant thereto, but such "Plan
of Distribution" shall not name any such Broker-Dealer or disclose the amount of
Notes held by any such Broker-Dealer except to the extent required by the
Commission.
The Issuer and the Subsidiary Guarantors shall use their best efforts
to keep the Exchange Offer Registration Statement continuously effective,
supplemented and amended as required by the provisions of Section 6(c) below to
the extent necessary to ensure that it is available for resales of Notes
acquired by Broker-Dealers for their own accounts as a result of market-making
activities or other trading activities, and to ensure that it conforms with the
requirements of this Agreement, the Act and the policies, rules and regulations
of the Commission as announced from time to time for such period of time as such
Broker-Dealers must comply with prospectus delivery requirements of the Exchange
Act in order to resell the Notes, but in no event longer than 180 days. The
Issuer shall provide sufficient copies of the latest version of such Prospectus
to
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Broker-Dealers promptly upon request at any time during such period in order to
facilitate such resales.
SECTION 4. SHELF REGISTRATION.
(a) SHELF REGISTRATION. If (i) the Issuer and the Subsidiary Guarantors
are not required to file an Exchange Offer Registration Statement or to
consummate the Exchange Offer because the Exchange Offer is not permitted by
applicable law or Commission policy or (ii) any Holder of Transfer Restricted
Securities shall notify the Issuer within 20 business days of the commencement
of the Exchange Offer that such Holder (A) is prohibited by applicable law or
Commission policy from participating in the Exchange Offer, or (B) may not
resell the New Notes acquired by it in the Exchange Offer to the public without
delivering a prospectus and the Prospectus contained in the Exchange Offer
Registration Statement is not appropriate or available for such resales by such
Holder or (C) is a Broker-Dealer and holds Old Notes (including the Initial
Purchaser who holds Old Notes as part of an unsold allotment from the original
offering of the Notes) acquired directly from the Issuer or one of its
affiliates, then the Issuer and the Subsidiary Guarantors shall (x) cause to be
filed a shelf registration statement pursuant to Rule 415 under the Act, which
may be an amendment to the Exchange Offer Registration Statement (in either
event, the "SHELF REGISTRATION STATEMENT"), on or prior to the earliest to occur
of (1) the 60th day after the date on which the Issuer determines that it is not
required to file the Exchange Offer Registration Statement or (2) the 60th day
after the date on which the Issuer receives notice from a Holder of Transfer
Restricted Securities as contemplated by clause (ii) above (such earliest date
being the "SHELF FILING DEADLINE"), which Shelf Registration Statement shall
provide for resales of all Transfer Restricted Securities the Holders of which
shall have provided the information required pursuant to Section 4(b) of this
Agreement, and (y) use its best efforts to cause such Shelf Registration
Statement to be declared effective by the Commission on or before the 150th day
after the Shelf Filing Deadline. The Issuer and the Subsidiary Guarantors shall
use their best efforts to keep such Shelf Registration Statement continuously
effective, supplemented and amended as required by the provisions of Sections
6(b) and (c) of this Agreement to the extent necessary to ensure that it is
available for resales of Notes by the Holders of Transfer Restricted Securities
entitled to the benefit of this Section 4(a) and to ensure that it conforms with
the requirements of this Agreement, the Act and the policies, rules and
regulations of the Commission as announced from time to time, for a continuous
period of one year following the date on which such Shelf Registration Statement
becomes effective under the Act or such shorter period that will terminate when
all the Notes covered by the Shelf Registration Statement have been sold
pursuant to such Shelf Registration Statement.
(b) PROVISION BY HOLDERS OF CERTAIN INFORMATION IN CONNECTION WITH THE
SHELF REGISTRATION Statement. No Holder of Transfer Restricted Securities may
include any of its Transfer Restricted Securities in any Shelf Registration
Statement pursuant to this Agreement unless and until such Holder furnishes to
the Issuer in writing, within 15 business days after receipt of a request
therefor, such information regarding such Holder as the Issuer may reasonably
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request for use in connection with any Shelf Registration Statement or
Prospectus or preliminary Prospectus included in such Shelf Registration
Statement. Each Holder as to which any Shelf Registration Statement is being
effected agrees to furnish promptly to the Issuer all information required to be
disclosed to make the information previously furnished to the Issuer by such
Holder not materially misleading.
SECTION 5. LIQUIDATED DAMAGES.
If (i) any of the Registration Statements required by this Agreement is
not filed with the Commission on or prior to the date specified for such filing
in this Agreement (or, if such date is not a Business Day, the next succeeding
Business Day), (ii) any of such Registration Statements has not been declared
effective by the Commission on or prior to the date specified for such
effectiveness in this Agreement (the "EFFECTIVENESS TARGET DATE"), (iii) the
Exchange Offer has not been Consummated within 195 days after the Closing Date
(or, if such date is not a Business Day, the next succeeding Business Day) or
(iv) any Registration Statement required by this Agreement is filed and declared
effective but shall thereafter cease to be effective or usable in connection
with resales of Transfer Restricted Securities during the periods required by
this Agreement (each such event referred to in clauses (i) through (iv), a
"REGISTRATION DEFAULT"), the Issuer and the Subsidiary Guarantors hereby agree,
jointly and severally, to pay liquidated damages to each Holder of Transfer
Restricted Securities with respect to the first 90-day period immediately
following the occurrence of such Registration Default, at a rate equal to $.05
per week per $1,000 principal amount of Old Notes constituting Transfer
Restricted Securities held by such Holder for the period of the Registration
Default. The amount of the liquidated damages shall increase by an additional
$.05 per week per $1,000 principal amount of Old Notes constituting Transfer
Restricted Securities with respect to each subsequent 90-day period until all
Registration Defaults have been cured, up to a maximum amount of liquidated
damages of $.30 per week per $1,000 principal amount of Old Notes constituting
Transfer Restricted Securities. Notwithstanding the foregoing, the Issuer and
the Subsidiary Guarantors shall not be required to pay liquidated damages to
each Holder of Transfer Restricted Securities if the Registration Default arises
from the failure of the Issuer and the Subsidiary Guarantors to file, or cause
to become effective, a Shelf Registration Statement within the time period
required by Section 4 of this Agreement and such Registration Default is by
reason of the failure of any Holder to provide the information regarding such
Holder reasonably requested by the Issuer, the NASD or any other regulatory
agency having jurisdiction over any of the Holders at least 10 business days
prior to such Registration Default. All accrued liquidated damages shall be paid
by the Issuer and the Subsidiary Guarantors on each Damages Payment Date to the
registered Holders by wire transfer of immediately available funds or by federal
funds check and to the registered Holders of certificated securities by mailing
a check to such Holders' registered addresses. Following the cure of all
Registration Defaults relating to any particular Transfer Restricted Securities,
the accrual of liquidated damages with respect to such Transfer Restricted
Securities will cease.
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All obligations of the Issuer and the Subsidiary Guarantors set forth
in the preceding paragraph that are outstanding with respect to any Transfer
Restricted Security at the time such security ceases to be a Transfer Restricted
Security shall survive until such time as all such obligations with respect to
such Transfer Restricted Security shall have been satisfied in full.
SECTION 6. REGISTRATION PROCEDURES.
(a) EXCHANGE OFFER REGISTRATION STATEMENT. In connection with the
Exchange Offer, the Issuer and the Subsidiary Guarantors shall comply with all
of the provisions of Section 6(c) below, shall use their best efforts to effect
such exchange to permit the sale of Transfer Restricted Securities being sold in
accordance with the intended method or methods of distribution thereof, and
shall comply with all of the following provisions:
(i) If, due to a change in law or Commission policy after the
date hereof, in the reasonable opinion of counsel to the Issuer there
is a question as to whether the Exchange Offer is permitted by
applicable federal law or Commission policy, the Issuer hereby agrees
to seek a no-action letter or other favorable decision from the
Commission allowing the Issuer and the Subsidiary Guarantors to
Consummate an Exchange Offer for the Old Notes. The Issuer hereby
agrees to pursue the issuance of such a no-action letter or favorable
decision to the Commission staff level but shall not be required to
take commercially unreasonable action to effect a change of Commission
policy. The Issuer hereby agrees, however, to (A) participate in
telephonic conferences with the Commission, (B) deliver to the
Commission an analysis prepared by special counsel to the Issuer
setting forth the legal bases, if any, upon which such counsel has
concluded that such an Exchange Offer should be permitted and (C)
diligently pursue a resolution (which need not be favorable) by the
Commission of such submission. The Initial Purchaser shall be given
prior notice of any action taken by the Issuer under this clause (i).
(ii) As a condition to its participation in the Exchange Offer
pursuant to the terms of this Agreement, each Holder of Transfer
Restricted Securities shall furnish, upon the request of the Issuer,
prior to the Consummation of the Exchange Offer, a written
representation to the Issuer (which may be contained in the letter of
transmittal contemplated by the Exchange Offer Registration Statement)
to the effect that (A) it is not an affiliate of the Issuer or any of
the Subsidiary Guarantors, (B) it is not engaged in, and does not
intend to engage in, and has no arrangement or understanding with any
person to participate in, a distribution of the New Notes to be issued
in the Exchange Offer and (C) it is acquiring the New Notes in its
ordinary course of business. In addition, all such Holders of Transfer
Restricted Securities shall otherwise cooperate in the Issuer's
preparations for the Exchange Offer.
(iii) The Issuer, the Subsidiary Guarantors and the Initial
Purchaser acknowledge that the staff of the Commission has taken the
position that any
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broker-dealer that owns New Notes that were received by such
broker-dealer for its own account in the Exchange Offer (a
"PARTICIPATING BROKER-DEALER") may be deemed to be an "underwriter"
within the meaning of the Act and must deliver a prospectus meeting the
requirements of the Act in connection with any resale of such New Notes
(other than a resale of an unsold allotment resulting from the original
offering of the Notes).
The Issuer, the Subsidiary Guarantors and the Initial Purchaser also
acknowledge that it is the Commission staff's position that if the Prospectus
contained in the Exchange Offer Registration Statement includes a plan of
distribution containing a statement to the above effect and the means by which
Participating Broker-Dealers may resell the New Notes, without naming the
Participating Broker-Dealers or specifying the amount of New Notes owned by
them, such Prospectus may be delivered by Participating Broker-Dealers to
satisfy their prospectus delivery obligations under the Act in connection with
resales of New Notes for their own accounts, so long as the Prospectus otherwise
meets the requirements of the Act.
(b) SHELF REGISTRATION STATEMENT. In the event that a Shelf
Registration Statement is required by this Agreement, the Issuer and the
Subsidiary Guarantors shall comply with all the provisions of Section 6(c) of
this Agreement and shall use their best efforts to effect such registration to
permit the sale of the Transfer Restricted Securities being sold in accordance
with the intended method or methods of distribution of such Transfer Restricted
Securities and, in connection therewith, the Issuer and the Subsidiary
Guarantors will as expeditiously as possible prepare and file with the
Commission a Shelf Registration Statement relating to the registration on any
appropriate form under the Act, which form shall be available for the sale of
the Transfer Restricted Securities in accordance with the intended method or
methods of distribution of such Transfer Restricted Securities.
(c) GENERAL PROVISIONS. In connection with any Registration Statement
and any Prospectus required by this Agreement to permit the sale or resale of
Transfer Restricted Securities (including, without limitation, any Registration
Statement and the related Prospectus, to the extent that the same are required
to be available to permit resales of Notes by Broker-Dealers), the Issuer and
the Subsidiary Guarantors shall:
(i) use their best efforts to keep such Registration Statement
continuously effective for the applicable time period required
hereunder and provide all requisite financial statements (including, if
required by the Act or any regulation thereunder, financial statements
of the Subsidiary Guarantors) for the period specified in Section 3 or
4 of this Agreement, as applicable; upon the occurrence of any event
that would cause any such Registration Statement or the Prospectus
contained therein (A) to contain a material misstatement or omission or
(B) with respect to the Shelf Registration Statement, not to be
effective and usable for resale of Transfer Restricted Securities
during the period required by this Agreement, the Issuer shall promptly
notify the Holders to suspend use of the Prospectus, and the Holders
shall suspend use of the Prospectus, and such Holders
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shall not communicate non-public information to any third party, in
violation of the securities laws, until the Issuer and the Subsidiary
Guarantors have made an appropriate amendment to such Registration
Statement, in the case of clause (A), correcting any such material
misstatement or omission, and, in the case of either clause (A) or (B),
the Issuer and the Subsidiary Guarantors shall use their best efforts
to cause such amendment to be declared effective and such Registration
Statement and the related Prospectus to become usable for their
intended purpose(s) as soon as practicable thereafter;
(ii) prepare and file with the Commission such amendments and
post-effective amendments to such Registration Statement as may be
necessary to keep the Registration Statement effective for the
applicable period set forth in Section 3 or 4 of this Agreement, as
applicable, or such shorter period as will terminate when all Transfer
Restricted Securities covered by such Registration Statement have been
sold; cause the Prospectus to be supplemented by any required
Prospectus supplement, and as so supplemented to be filed pursuant to
Rule 424 under the Act during the applicable time period required
hereunder and to comply fully with the applicable provisions of Rules
424 and 430A under the Act in a timely manner; and comply with the
provisions of the Act and the Exchange Act with respect to the
disposition of all Transfer Restricted Securities covered by such
Registration Statement during such period in accordance with the
intended method or methods of distribution by the sellers of such
securities set forth in such Registration Statement as so amended or in
such Prospectus as so supplemented;
(iii) advise the underwriter(s), if any, the Initial
Purchaser, and, in the case of a Shelf Registration Statement, each of
the selling Holders promptly and, if requested by such Persons, to
confirm such advice in writing, (A) when the Prospectus or any
prospectus supplement or post-effective amendment has been filed and,
with respect to any Registration Statement or any post-effective
amendment thereto, when the same has become effective, (B) of any
request by the Commission for amendments to the Registration Statement
or amendments or supplements to the Prospectus or for additional
information relating to such Registration Statement or Prospectus, (C)
of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement under the Act or of the
suspension by any state securities commission of the qualification of
the Transfer Restricted Securities for offering or sale in any
jurisdiction, or the initiation of any proceeding for any of the
preceding purposes, (D) of the existence of any condition, the
happening of any event or any information becoming known that makes any
statement of a material fact made in the Registration Statement, the
Prospectus, any amendment or supplement to such Registration Statement
or Prospectus, as the case may be, or any document incorporated by
reference in such Registration Statement or Prospectus untrue in any
material respect, or that requires the making of any additions to or
changes in the Registration Statement or the Prospectus so 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
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therein not misleading and that in the case of the 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 the light of the circumstances under which
they were made, not misleading. If at any time the Commission shall
issue any stop order suspending the effectiveness of the Registration
Statement, or any state securities commission or other regulatory
authority shall issue an order suspending the qualification or
exemption from qualification of the Transfer Restricted Securities
under state securities or Blue Sky laws, the Issuer and the Subsidiary
Guarantors shall use their best efforts to obtain the withdrawal or
lifting of such order at the earliest possible time;
(iv) furnish to each of the underwriter(s), if any, the
Initial Purchaser and, in the case of a Shelf Registration Statement,
each of the selling Holders before filing with the Commission, copies
of any Registration Statement or any Prospectus included in such
Registration Statement or Prospectus or any amendments or supplements
to any such Registration Statement or Prospectus (including all
documents incorporated by reference after the initial filing of such
Registration Statement), which documents will be subject to the
reasonable review of such underwriter(s), if any, the Initial
Purchaser, and such Holders for a period of at least five business
days, and the Issuer and the Subsidiary Guarantors will not file any
such Registration Statement or Prospectus or any amendment or
supplement to any such Registration Statement or Prospectus, as the
case may be, (including all such documents incorporated by reference)
to which any underwriter, Initial Purchaser or selling Holder shall
reasonably object within five business days after the receipt of such
Registration Statement or Prospectus. A selling Holder or underwriter,
if any, shall be deemed to have reasonably objected to such filing if
such Registration Statement, Prospectus, amendment or supplement, as
applicable, as proposed to be filed, contains a material misstatement
or omission;
(v) make available at reasonable times for inspection by the
selling Holders, any underwriter participating in any disposition
pursuant to such Registration Statement and any attorney or accountant
retained by such selling Holders or any of the underwriter(s), if any,
at the offices where normally kept, during reasonable business hours,
all relevant financial and other records, pertinent corporate documents
and properties of the Issuer and the Subsidiary Guarantors and cause
the Issuer's and the Subsidiary Guarantors' officers, directors and
employees to supply all information reasonably requested by any such
Holder, underwriter, attorney or accountant in connection with such
Registration Statement subsequent to the filing thereof and prior to
its effectiveness; PROVIDED, HOWEVER, that such persons shall first
agree in writing with the Issuer that any information that is
reasonably and in good faith designated by the Issuer in writing as
confidential at the time of delivery of such information shall be kept
confidential by such persons, unless and to the extent that (i)
disclosure of such information is required by court or administrative
order or is necessary to respond to inquiries of regulatory
authorities, (ii) disclosure of such information is required by law
(including any disclosure
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requirements pursuant to federal securities laws in connection with the
filing of the Shelf Registration Statement or the use of any
Prospectus), (iii) such information becomes generally available to the
public other than as a result of a disclosure or failure to safeguard
such information by such person or (iv) such information becomes
available to such person from a source other than the Issuer and its
Subsidiaries and such source is not bound by a confidentiality
agreement;
(vi) if requested by a majority in aggregate principal amount
of Transfer Restricted Securities being sold in connection with an
underwritten offering or the underwriter(s), if any, promptly
incorporate in any Registration Statement or Prospectus, pursuant to a
supplement or post-effective amendment if necessary, such information
relating to such selling Holders or such underwriters as such selling
Holders and underwriter(s), if any, may reasonably request to have
included therein, including, without limitation, information relating
to the "Plan of Distribution" of the Transfer Restricted Securities,
information with respect to the principal amount of Transfer Restricted
Securities being sold to such underwriter(s), the purchase price being
paid for Transfer Restricted Securities and any other terms of the
offering of the Transfer Restricted Securities to be sold in such
offering; and make all required filings of such Prospectus supplement
or post-effective amendment as soon as practicable after the Issuer is
notified of the matters to be incorporated in such Prospectus
supplement or post-effective amendment; PROVIDED, HOWEVER, that the
Issuer shall not be required to take any action pursuant to this
Section 6(c)(vii) that would, in the opinion of counsel for the Issuer,
violate applicable law;
(vii) furnish to each underwriter, if any, the Initial
Purchaser and upon request to the Issuer, to a selling Holder without
charge, at least one conformed copy of the Registration Statement, as
first filed with the Commission, and of each amendment thereto,
including, upon the request of such Person, all documents incorporated
by reference therein and all exhibits to the extent requested
(including exhibits incorporated therein by reference);
(viii) deliver to each selling Holder, each of the
underwriter(s), if any, and the Initial Purchaser, without charge, as
many copies of the Prospectus (including each preliminary prospectus)
and any amendment or supplement thereto as such Persons may reasonably
request; the Issuer and the Subsidiary Guarantors hereby consent to the
use of the Prospectus and any amendment or supplement to the Prospectus
by each of the selling Holders and each of the underwriter(s), if any,
in connection with the offering and the sale of the Transfer Restricted
Securities in accordance with the terms thereof and with U.S. Federal
securities laws and Blue Sky laws covered by the Prospectus or any
amendment or supplement thereto;
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(ix) enter into such agreements (including an underwriting
agreement in form, scope and substance as is customary in underwritten
offerings of securities of this type) and take all such other
reasonable actions in connection therewith in order to expedite or
facilitate the disposition of the Transfer Restricted Securities
pursuant to any Registration Statement contemplated by this Agreement,
all as may be reasonably requested by any Holder of Transfer Restricted
Securities or the underwriter(s), if any, in connection with any sale
or resale of Transfer Restricted Securities pursuant to any
Registration Statement contemplated by this Agreement; and whether or
not an underwriting agreement is entered into and whether or not the
registration is an Underwritten Registration, the Issuer and the
Subsidiary Guarantors shall (i) make such representations and
warranties to the Holders of such Transfer Restricted Securities and
the underwriters, if any, with respect to the business of the Issuer
and its Subsidiaries (including with respect to businesses or assets
acquired or to be acquired by any of them), and the Shelf Registration
Statement, Prospectus and documents, if any, incorporated or deemed to
be incorporated by reference therein, in each case, in form, substance
and scope as are customarily made by Issuer to underwriters in
underwritten offerings, and confirm the same if and when customarily
requested; (ii) obtain opinions of counsel to the Issuer and the
Subsidiary Guarantors and updates thereof (which counsel and opinions
(in form, scope and substance) shall be reasonably satisfactory to the
underwriters, if any, and special counsel to the Holders of the
Transfer Restricted Securities being sold), addressed to each selling
Holder of Transfer Restricted Securities and each of the underwriters,
if any, covering the matters customarily covered in opinions requested
in underwritten offerings and such other matters as may be reasonably
requested by such underwriters, if any, and special counsel to Holders
of Transfer Restricted Securities; (iii) use their best efforts to
obtain customary "cold comfort" letters and updates thereof from the
independent certified public accountants of the Issuer (and, if
necessary, any other independent certified public accountants of any
subsidiary of the Issuer or of any business acquired by the Issuer or
any such subsidiary for which financial statements and financial data
is, or is required to be, included in the Registration Statement),
addressed (where reasonably possible) to each selling Holder of
Transfer Restricted Securities and each of the underwriters, if any,
such letters to be in customary form and covering matters of the type
customarily covered in "cold comfort" letters in connection with
underwritten offerings; (iv) if an underwriting agreement is entered
into, the same shall contain indemnification provisions and procedures
no less favorable to the selling Holders and the underwriters, if any,
than those set forth in Section 8 hereof (or such other provisions and
procedures acceptable to Holders of a majority in aggregate principal
amount of Transfer Restricted Securities covered by such Shelf
Registration Statement and the underwriters, if any); and (v) deliver
such documents and certificates as may be reasonably requested by the
Holders of a majority in aggregate principal amount of the Transfer
Restricted Securities being sold and the underwriters, if any, to
evidence the continued validity of the representations and warranties
made pursuant to clause (i) above and to evidence compliance with any
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customary conditions contained in the underwriting agreement or other
agreement entered into by the Issuer;
If at any time the representations and warranties of the
Issuer and the Subsidiary Guarantors contemplated in clause (x)(i)
above cease to be true and correct, the Issuer shall so advise the
Initial Purchaser and the underwriter(s), if any, and each selling
Holder promptly and, if requested by any of them, shall confirm such
advice in writing;
(x) prior to any public offering of Transfer Restricted
Securities, cooperate with and cause the Subsidiary Guarantors to
cooperate with the selling Holders, the underwriter(s), if any, and
their respective counsel in connection with the registration and
qualification (or exemption from such registration or qualification) of
the Transfer Restricted Securities for offer and sale under the
securities or Blue Sky laws of such jurisdictions as the selling
Holders and underwriter(s), if any, may reasonably request in writing
and do any and all other acts or things necessary or advisable to
enable the disposition in such jurisdictions of the Transfer Restricted
Securities covered by the Registration Statement; PROVIDED, HOWEVER,
that neither the Issuer nor the Subsidiary Guarantors shall be required
to register or qualify as a foreign corporation where it is not now so
qualified or to take any action that would subject it to the service of
process or to taxation, other than as to matters and transactions
relating to the Registration Statement, in any jurisdiction where it is
not now so subject;
(xi) if a Shelf Registration is filed pursuant to Section
2(b), cooperate with the selling Holders of Registrable Securities and
the managing Underwriters, if any, to facilitate the timely preparation
and delivery of certificates representing Transfer Restricted
Securities to be sold, which certificates shall not bear any
restrictive legends and shall be in a form eligible for deposit with
The Depository Trust Company; and enable such Transfer Restricted
Securities to be in such denominations and registered in such names as
the managing Underwriters, if any, or Holders may reasonably request;
(xii) in connection with any sale or transfer of Transfer
Restricted Securities that will result in such securities no longer
being Transfer Restricted Securities, cooperate with and cause the
Subsidiary Guarantors to cooperate with the selling Holders and the
underwriter(s), if any, to facilitate the timely preparation and
delivery of certificates representing Transfer Restricted Securities to
be sold and not bearing any restrictive legends; and enable such
Transfer Restricted Securities to be in such denominations and
registered in such names as the Holders or the underwriter(s), if any,
may request at least two business days prior to any sale of Transfer
Restricted Securities made by such underwriter(s);
(xiii) use their best efforts to cause the Transfer Restricted
Securities covered by the Registration Statement to be registered with
or approved by such other governmental
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agencies or authorities as may be necessary to enable the seller or
sellers of such Transfer Restricted Securities or the underwriter(s),
if any, to consummate the disposition of such Transfer Restricted
Securities, subject to the proviso contained in clause (xi) above;
(xiv) if any fact or event contemplated by Section
6(c)(iii)(D) of this Agreement shall exist or have occurred, prepare a
supplement or post-effective amendment to the Registration Statement or
related Prospectus or any document incorporated in such Registration
Statement or Prospectus by reference or file any other required
document so that, as thereafter delivered to the purchasers of Transfer
Restricted Securities, the Registration Statement will not contain an
untrue statement of a material fact or omit to state any material fact
necessary to make the statements therein not misleading and the
Prospectus will not contain an untrue statement of a material fact or
omit to state any material fact required to be stated therein or
necessary to make the statements contained therein, in the light of the
circumstances under which they were made, not misleading;
(xv) provide a CUSIP number for all Transfer Restricted
Securities not later than the effective date of the Registration
Statement and provide the Trustee under the Indenture with printed
certificates for the Transfer Restricted Securities that are in a form
eligible for deposit with The Depository Trust Company;
(xvi) cooperate and assist in any filings required to be made
with the NASD and in the performance of any due diligence investigation
by any underwriter (including any "qualified independent underwriter"
that is required to be retained in accordance with the rules and
regulations of the NASD);
(xvii) otherwise use their best efforts to comply with all
applicable rules and regulations of the Commission in regard to any
Registration Statement, and make generally available to its
securityholders, as soon as practicable, a consolidated earning
statement of the Issuer meeting the requirements of Rule 158 (which
need not be audited) for the twelve-month period (A) commencing at the
end of any fiscal quarter in which Transfer Restricted Securities are
sold to underwriters in a firm commitment or reasonable best efforts
Underwritten Offering or (B) if not sold to underwriters in such an
offering, beginning with the first month of the Issuer's first fiscal
quarter commencing after the effective date of the Registration
Statement; and
(xviii) cause the Indenture to be qualified under the TIA not
later than the effective date of the first Registration Statement
required by this Agreement, and, in connection therewith, cooperate
with the Trustee and the Holders to effect such changes to the
Indenture, if any, as may be required for such Indenture to be so
qualified in accordance with the terms of the TIA; and execute, and use
its best efforts to cause the Trustee to execute, all customary
documents that may be required to effect such changes
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and all other forms and documents required to be filed with the
Commission to enable such Indenture to be so qualified in a timely
manner.
Each Holder agrees by acquisition of a Transfer Restricted Security
that, upon receipt of any notice from the Issuer of the existence of any fact of
the kind described in Section 6(c)(iii)(D) of this Agreement, such Holder will
forthwith discontinue disposition of Transfer Restricted Securities pursuant to
the applicable Registration Statement until such Holder's receipt of the copies
of the supplemented or amended Prospectus contemplated by Section 6(c)(xv) of
this Agreement, or until it is advised in writing (the "ADVICE") by the Issuer
that the use of the Prospectus may be resumed, and has received copies of any
additional or supplemental filings that are incorporated by reference in the
Prospectus. If so directed by the Issuer, each Holder will deliver to the Issuer
(at the Issuer's expense) all copies, other than permanent file copies then in
such Holder's possession, of the Prospectus covering such Transfer Restricted
Securities that was current at the time of receipt of such notice. In the event
that the Issuer shall give any such notice, the time period regarding the
effectiveness of such Registration Statement set forth in Section 3 or 4 of this
Agreement, as applicable, shall be extended by the number of days during the
period from and including the date of the giving of such notice pursuant to
Section 6(c)(iii)(D) of this Agreement to and including the date when each
selling Holder covered by such Registration Statement shall have received the
copies of the supplemented or amended Prospectus contemplated by Section
6(c)(xv) of this Agreement or shall have received the Advice.
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SECTION 7. REGISTRATION EXPENSES.
(a) All fees and expenses incident to the Issuer and the Subsidiary
Guarantors' performance of or compliance with this Agreement will be borne by
the Issuer regardless of whether a Registration Statement becomes effective,
including without limitation: (i) all registration and filing fees and expenses
(including filings made with the NASD); (ii) all fees and expenses of compliance
with federal securities and state Blue Sky or securities laws; (iii) all
expenses of printing (including printing certificates for the New Notes to be
issued in the Exchange Offer and printing of Prospectuses); (iv) all fees and
disbursements of counsel for the Issuer, the Subsidiary Guarantors and, subject
to Section 7(b) below, the Holders of Transfer Restricted Securities; and (v)
all fees and disbursements of independent certified public accountants of the
Issuer and the Subsidiary Guarantors (including the expenses of any special
audit and comfort letters required by or incident to such performance).
The Issuer and the Subsidiary Guarantors will, in any event, bear their
internal expenses (including, without limitation, all salaries and expenses of
their officers and employees performing legal or accounting duties), the
expenses of any annual audit and the fees and expenses of any Person, including
special experts, retained by them.
Notwithstanding the foregoing or anything in this Agreement to the
contrary, each Holder of Transfer Restricted Notes shall pay all underwriting
discounts and commissions of any underwriters with respect to any Notes sold by
or on behalf of it.
(b) In connection with any Registration Statement required by this
Agreement (including, without limitation, the Exchange Offer Registration
Statement and the Shelf Registration Statement), the Issuer will reimburse the
Initial Purchaser and the Holders of Transfer Restricted Securities being
tendered in the Exchange Offer and/or resold pursuant to the "Plan of
Distribution" contained in the Exchange Offer Registration Statement or
registered pursuant to the Shelf Registration Statement, as applicable, for the
reasonable fees (not to exceed $25,000) and disbursements of not more than one
counsel, who shall be Piper & Marbury L.L.P. or such other counsel as may be
chosen by the Holders of a majority in principal amount of the Transfer
Restricted Securities for whose benefit such Registration Statement is being
prepared.
SECTION 8. INDEMNIFICATION.
(A) Each of the Issuer and the Subsidiary Guarantors, on a joint and
several basis, agrees to indemnify and hold harmless (i) the Initial Purchaser,
each Holder of Transfer Restricted Securities and each Participating Broker
Dealer, (ii) each person, if any, who controls any of the foregoing within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act (any of the
persons referred to in this clause (ii) being hereinafter referred to as a
"CONTROLLING PERSON") and (iii) its agents, employees, officers and directors
and the agents, employees, officers and directors of any such controlling person
(collectively, the "INDEMNIFIED PERSONS") from and
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against any and all losses, liabilities, claims, damages and expenses whatsoever
(including but not limited to reasonable attorneys' fees and any and all
reasonable expenses whatsoever incurred in investigating, preparing or defending
against any litigation, commenced or threatened, or any claim whatsoever, and
any and all reasonable amounts paid in settlement of any claim or litigation) to
which they or any of them may become subject under the Act, the Exchange Act or
otherwise, insofar as such losses, liabilities, claims, damages or expenses (or
actions in respect thereof) arise out of or are based upon any untrue statement
or alleged untrue statement of a material fact contained in the Registration
Statement or Prospectus, or in any amendment thereof or supplement thereto, or
arise out of or are based upon the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; PROVIDED, HOWEVER, that the Issuer and the Subsidiary
Guarantors will not be liable in any such case to the extent, but only to the
extent, that any such loss, liability, claim, damage or expense 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 or on behalf of any Indemnified Person
relating to such Indemnified Person expressly for use therein; PROVIDED FURTHER,
that such indemnity with respect to any preliminary prospectus shall not inure
to the benefit of any Indemnified Person if the person asserting such loss,
claim, damage or liability purchased the Notes which are the subject thereof and
did not receive a copy of a final prospectus (or a final prospectus as amended
or supplemented) at or prior to the confirmation of the sale of such Notes to
such person (and a final prospectus or any such amended or supplemented final
prospectus, as applicable, shall have been delivered by the Issuer to any
Indemnified Person a reasonable amount of time prior to the mailing or delivery,
as applicable, of such confirmation and any such untrue statement or omission or
alleged untrue statement or omission of a material fact contained in such
preliminary prospectus was corrected in the final prospectus or the final
prospectus as amended or supplemented). This indemnity agreement will be in
addition to any liability that the Issuer and the Subsidiary Guarantors may
otherwise have, including, but not limited to, liability under this Agreement.
If any action is brought against any Indemnified Persons or any such
person in respect of which indemnity may be sought against the Issuer and the
Subsidiary Guarantors pursuant to the foregoing paragraph, such Indemnified
Persons or such person shall promptly notify the indemnifying party in writing
of the institution of such action and the indemnifying party shall assume the
defense of such action, including the employment of counsel reasonably
satisfactory to such indemnified party and payment of all fees and expenses;
PROVIDED, HOWEVER, except to the extent that the indemnifying party shall be
materially prejudiced thereby (through the forfeiture of substantive rights or
defenses), that the omission to so notify the indemnifying party shall not
relieve the indemnifying party from any liability which they may have to the
Indemnified Persons or any such person or otherwise. Such Indemnified Persons
shall have the right to employ its own counsel in any such case, but the fees
and expenses of such counsel shall be at the expense of such Indemnified Persons
unless the employment of such counsel shall have been authorized in writing by
the indemnifying party in connection with the defense of such action or the
indemnifying party shall not have employed counsel to have charge of the defense
of such action or such indemnified party or parties shall have reasonably
concluded that there may be defenses available to it or them which are different
from or additional to those available to the indemnifying party (in which case
the indemnifying party
- 18 -
shall not have the right to direct the defense of such action on behalf of the
indemnified party or parties, but the indemnified parties may employ counsel and
participate in the defense thereof, but the fees and expenses of such counsel
shall be at the expense of the indemnifying parties), in any of which events
such fees and expenses shall be borne by the indemnifying party and paid as
incurred (it being understood, however, that the indemnifying party shall not be
liable for the expenses of more than one separate counsel (together with
appropriate local counsel) in any one action or series of related actions in the
same jurisdiction representing the indemnified parties who are parties to such
action). The indemnifying party shall not be liable for any settlement of any
such claim or action effected without its written consent but if settled with
the written consent of the indemnifying party, the indemnifying party agrees to
indemnify and hold harmless any Indemnified Persons and any such person from and
against any loss or liability by reason of such settlement. Notwithstanding the
foregoing sentence, if at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and expenses of
counsel as contemplated by the second sentence of this paragraph, then the
indemnifying party agrees that it shall be liable for any settlement of any
proceeding effected without its written consent if (i) such settlement is
entered into more than 60 business days after receipt by such indemnifying party
of the aforesaid request, (ii) such indemnifying party shall not have reimbursed
the indemnified party in accordance with such request prior to the date of such
settlement and (iii) such indemnified party shall have given the indemnifying
party at least 30 days' prior written notice of its intention to settle. No
indemnifying party shall, without the prior written consent of the indemnified
party, effect any settlement of any pending or threatened proceeding in respect
of which any indemnified party is or could have been a party and indemnity could
have been sought hereunder by such indemnified party, unless such settlement
includes an unconditional release of such indemnified party from all liability
on claims that are the subject matter of such proceeding.
(B) In connection with any Registration Statement pursuant to which a
Holder of Transfer Restricted Securities offers or sells Transfer Restricted
Securities, such Holder agrees, severally and not jointly, to indemnify and hold
harmless the Issuer and the Subsidiary Guarantors, their respective directors
and officers and any person controlling the Issuer or any Subsidiary Guarantor
within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act, and each of their agents, employees, officers and directors and
the agents, employees, officers and directors of such controlling person from
and against any losses, liabilities, claims, damages and expenses whatsoever
(including but not limited to reasonable attorneys' fees and any and all
reasonable expenses whatsoever incurred in investigating, preparing or defending
against any litigation, commenced or threatened, or any claim whatsoever and any
and all reasonable amounts paid in settlement of any claim or litigation) to
which they or either of them may become subject under the Act, the Exchange Act
or otherwise insofar as such losses, liabilities, claims, damages or expenses
(or actions in respect thereof) arise out of or are based upon any untrue
- 19 -
statement or alleged untrue statement of a material fact contained in the
Registration Statement, or in any amendment thereof or supplement thereto, or
arise out of or are based upon the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, in each case to the extent, but only to the extent, that
any such loss, liability, claim, damage or expense arises out of or is based
upon any untrue statement or alleged untrue statement or omission or alleged
omission made therein in reliance upon and in conformity with written
information relating to such Holder furnished to the Issuer by such Holder
expressly for use in such Registration Statement. This indemnity agreement will
be in addition to any liability that a Holder may otherwise have, including, but
not limited to, liability under this Agreement.
If any action is brought against the Issuer or the Subsidiary
Guarantors or any such person in respect of which indemnity may be sought
against any Holder of Transfer Restricted Securities pursuant to foregoing
paragraph, the Issuer, the Subsidiary Guarantors or such person shall promptly
notify such Holder in writing of the institution of such action and such Holder
shall assume the defense of such action, including the employment of counsel
reasonably satisfactory to such indemnified party and payment of all fees and
expenses; PROVIDED, HOWEVER, except to the extent that the indemnifying party
shall be materially prejudiced thereby (through the forfeiture of substantive
rights or defenses), that the omission to so notify such Holder shall not
relieve such Holder from any liability which they may have to the Issuer the
Subsidiary Guarantors or any such person or otherwise. The Issuer, the
Subsidiary Guarantors or such person shall have the right to employ its own
counsel in any such case, but the fees and expenses of such counsel shall be at
the expense of the Issuer or such person unless the employment of such counsel
shall have been authorized in writing by such Holder of Transfer Restricted
Securities in connection with the defense of such action or such Holder shall
not have employed counsel to have charge of the defense of such action or such
indemnified party or parties shall have reasonably concluded that there may be
defenses available to it or them which are different from or additional to those
available to such Holder (in which case such Holder shall not have the right to
direct the defense of such action on behalf of the indemnified party or parties,
but such Holder may employ counsel and participate in the defense thereof but
the fees and expenses of such counsel shall be at the expense of such Holder),
in any of which events such fees and expenses shall be borne by such Holder and
paid as incurred (it being understood, however, that such Holder shall not be
liable for the expenses of more than one separate counsel (together with
appropriate local counsel) in any one action or series of related actions in the
same jurisdiction representing the indemnified parties who are parties to such
action). Anything in this paragraph to the contrary notwithstanding, any Holder
of Transfer Restricted Securities shall not be liable for any settlement of any
such claim or action effected without the written consent of such Holder but if
settled with the written consent of such Holder, such Holder agrees to indemnify
and hold harmless the Issuer, the Subsidiary Guarantors and any such person from
and against any loss or liability by reason of such settlement. Notwithstanding
the foregoing sentence, if at any time an indemnified party shall have requested
an indemnifying party to reimburse the indemnified party for fees and expenses
of
- 20 -
counsel as contemplated by the second sentence of this paragraph, then the
indemnifying party agrees that it shall be liable for any settlement of any
proceeding effected without its written consent if (i) such settlement is
entered into more than 60 business days after receipt by such indemnifying party
of the aforesaid request, (ii) such indemnifying party shall not have reimbursed
the indemnifying party in accordance with such request prior to the date of such
settlement and (iii) such indemnified party shall have given the indemnifying
party at least 30 days' prior notice of its intention to settle. No indemnifying
party shall, without the prior written consent of the indemnified party, effect
any settlement of any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such proceeding.
(C) In order to provide for contribution in circumstances in which the
indemnification provided for in paragraphs (a) and (b) of this Section 8 is for
any reason held to be unavailable from the indemnifying party, or is
insufficient to hold harmless a party indemnified under this Section 8, the
Issuer, the Subsidiary Guarantors and the Indemnified Parties shall contribute
to the aggregate losses, claims, damages, liabilities and expenses of the nature
contemplated by such indemnification provision (including any investigation,
legal and other expenses incurred in connection with, and any amount paid in
settlement of, any action or any claims asserted) to which the Issuer and/or the
Subsidiary Guarantors and the Indemnified Parties may be subject, (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Issuer and the Subsidiary Guarantors, on the one hand, and the Indemnified
Parties, on the other hand, from the offering of the Old Notes or, (ii) if such
allocation is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Issuer and the Subsidiary Guarantors,
on the one hand, and the Indemnified Parties, on the other hand, in connection
with the statements or omissions that resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Issuer and the Subsidiary Guarantors, on
the one hand, and the Indemnified Parties, on the other hand, shall be deemed to
be in the same proportion as the total proceeds from the offering of Old Notes
(net of discounts but before deducting expenses) received by the Issuer as set
forth in the table on the cover page of the Offering Memorandum bear to the
total proceeds received by such Holder with respect to its sale of Transfer
Restricted Securities or New Notes. The relative fault of the Issuer and the
Subsidiary Guarantors, on the one hand, and the Indemnified Parties, on the
other hand, shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the Issuer,
the Subsidiary Guarantors or the Indemnified Parties and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.
The Issuer, the Subsidiary Guarantors and the Initial Purchaser agree
that it would not be just and equitable if contribution pursuant to this
paragraph (c) of this Section 8 were determined
- 21 -
by pro rata allocation or by any other method of allocation that does not take
into account the equitable considerations referred to above. Notwithstanding the
provisions of paragraph (c) of this Section 8, (i) in no case shall an
Indemnified Party be required to contribute any amount in excess of the amount
by which the total received by such Indemnified Party with respect to its sale
of its Transfer Restricted Securities or New Notes, as the case may be, exceeds
the amount of any damages that such Indemnified Party has otherwise been
required to pay by reason of any untrue or alleged untrue statement or omission
or alleged omission and (ii) no person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this paragraph (c) of this Section 8, each
person, if any, who controls an Indemnified Party within the meaning of Section
15 of the Act or Section 20 of the Exchange Act shall have the same rights to
contribution as such Indemnified Party, and each person, if any, who controls
the Issuer or the Subsidiary Guarantors within the meaning of Section 15 of the
Act or Section 20 of the Exchange Act shall have the same rights to contribution
as the Issuer or the Subsidiary Guarantors, subject in each case to clauses (i)
and (ii) of this paragraph. Any party entitled to contribution will, promptly
after receipt of notice of commencement of any Action against such party in
respect of which a claim for contribution may be made against another party or
parties under this paragraph 8(c), notify such party or parties from whom
contribution may be sought, but, except to the extent that the indemnifying
party shall be materially prejudiced thereby (through the forfeiture of
substantive rights and defenses), the omission to so notify such party or
parties shall not relieve the party or parties from whom contribution may be
sought from any obligation it or they may have under this paragraph (c) or
otherwise. No party shall be liable for contribution with respect to any action
or claim settled without its written consent; PROVIDED, HOWEVER, that such
written consent was not unreasonably withheld.
SECTION 9. RULE 144A.
The Issuer and the Subsidiary Guarantors shall use their best efforts,
for so long as any Transfer Restricted Securities remain outstanding, to make
available to any Holder or beneficial owner of Transfer Restricted Securities in
connection with any sale of such securities and any prospective purchaser of
such Transfer Restricted Securities from such Holder or beneficial owner, the
information required by Rule 144A(d)(4) under the Act in order to permit resales
of such Transfer Restricted Securities pursuant to Rule 144A.
SECTION 10. PARTICIPATION IN UNDERWRITTEN REGISTRATIONS.
No Holder may participate in any Underwritten Registration under this
Agreement unless such Holder (a) agrees to sell such Holder's Transfer
Restricted Securities on the basis provided in any underwriting arrangements
approved by the Persons entitled under this Agreement to approve such
arrangements and (b) completes and executes all reasonable questionnaires,
powers of attorneys, indemnities, underwriting agreements, lock-up letters and
other documents required under the terms of such underwriting arrangements.
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SECTION 11. SELECTION OF UNDERWRITERS.
The Holders of Transfer Restricted Securities covered by the Shelf
Registration Statement who desire to do so may sell such Transfer Restricted
Securities in an Underwritten Offering. In any such Underwritten Offering, the
investment banker or investment bankers and manager or managers that will
administer the offering will be selected by the Holders of a majority in
aggregate principal amount of the Transfer Restricted Securities included in
such offering; PROVIDED, that such investment bankers and managers must be
reasonably satisfactory to the Issuer.
SECTION 12. MISCELLANEOUS.
(A) REMEDIES. Each Holder, in addition to being entitled to exercise
all rights provided in this Agreement, in the Indenture, the Purchase Agreement
or granted by law, including recovery of liquidated or other damages, will be
entitled to specific performance of its rights under this Agreement. The Issuer
and the Subsidiary Guarantors agree 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 agree to waive the defense in any Action for
specific performance that a remedy at law would be adequate. The obligations of
the Issuer and the Subsidiary Guarantors under this Agreement are joint and
several and, in any proceedings against any of such Persons arising out of this
Agreement, it shall not be necessary to join any other such Person.
(B) NO INCONSISTENT AGREEMENTS. Each of the Issuer and the Subsidiary
Guarantors will not on or after the date of this Agreement enter into any
agreement with respect to its securities that is inconsistent with the rights
granted to the Holders in this Agreement or otherwise conflicts with the
provisions of this Agreement. The rights granted to the Holders under this
Agreement do not in any way conflict with and are not inconsistent with the
rights granted to the holders of the securities of the Issuer under any
agreement in effect on the date of this Agreement.
(C) ADJUSTMENTS AFFECTING THE NOTES. Without the written consent of the
Holders of a majority in aggregate principal amount of outstanding Transfer
Restricted Notes, the Issuer and the Subsidiary Guarantors will not take any
action, or permit any change to occur, with respect to the Notes that would
materially and adversely affect the ability of the Holders to Consummate any
Exchange Offer.
(D) AMENDMENTS AND WAIVERS. The provisions of this Agreement may not be
amended, modified or supplemented, and waivers or consents to or departures from
the provisions of this Agreement may not be given unless the Issuer has obtained
the written consent of Holders of a majority of the outstanding principal amount
of Transfer Restricted Securities.
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Notwithstanding the foregoing, a waiver or consent to departure from the
provisions of this Agreement that relates exclusively to the rights of Holders
whose securities are being sold or tendered pursuant to a Registration Statement
and that does not affect directly or indirectly the rights of other Holders
whose securities are not being sold or tendered pursuant to such Registration
Statement may be given by the Holders of a majority of the outstanding principal
amount of Transfer Restricted Securities being so sold or tendered.
(E) NOTICES. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivering, first-class
mail (registered or certified, return receipt requested), telex, telecopier or
air courier guaranteeing overnight delivery:
(I) if to a Holder, at the address set forth on the records of
the Registrar under the Indenture, with a copy to the Registrar under
the Indenture; and
(II) if to the Issuer or the Subsidiary Guarantors, at:
Fine Air Services Corp.
▇▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chief Financial Officer
with a copy to:
▇▇▇▇▇▇▇▇▇ Traurig ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇▇▇, P.A.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esquire
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(iii) if to the Initial Purchaser, at:
SBC Warburg Dillon Read Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Corporate Finance Department
with a copy to:
Piper & Marbury L.L.P.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esquire
All such notices and communications shall be deemed to have been duly
given: (i) at the time delivered by hand, if personally delivered; (ii) five
business days after being deposited in the mail, postage prepaid, if mailed;
(iii) when answered back, if telexed; (iv) when receipt acknowledged, if
telecopied; and (v) on the next business day, if timely delivered to an air
courier guaranteeing overnight delivery.
Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the Trustee at the
address specified in the Indenture.
(F) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the benefit
of and be binding upon the successors and permitted assigns of each of the
parties, including without limitation and without the need for an express
assignment, subsequent Holders of Transfer Restricted Securities.
(G) COUNTERPARTS. This Agreement may be executed in any number of
counterparts and by the parties to this Agreement 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.
(H) CAPTIONS. The captions included in this Agreement are included
solely for convenience of reference and are not to be considered a part of this
Agreement.
(I) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE
CONFLICT OF LAW RULES THEREOF.
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(J) SUBMISSION TO JURISDICTION. The Issuer and the Subsidiary
Guarantors irrevocably submit to the nonexclusive jurisdiction of any State or
Federal court sitting in New York over any suit, action or proceeding arising
out of or relating to this agreement. The Issuer and the Subsidiary Guarantors
irrevocably waive, to the fullest extent permitted by law, any objection it may
now or thereafter have to the laying of venue of any such court and any claim
that any such suit, action or proceeding brought in such a court has been
brought in an inconvenient forum. The Issuer and the Subsidiary Guarantors agree
that a final judgment in any such suit, action or proceeding brought in any such
court shall be conclusive and binding upon the Issuer and the Subsidiary
Guarantors and may be enforced in any other courts to the jurisdiction of which
the Issuer and the Subsidiary Guarantors are or may be subject, by suit upon
such judgment. The Issuer and the Subsidiary Guarantors hereby appoint, without
power of revocation, CT Corporation System as its agent to accept and
acknowledge on its behalf service of any and all process which may be served in
any suit, action or proceeding arising out of or relating to this letter.
(K) SEVERABILITY. In the event that any one or more of the provisions
contained in this Agreement, or the application of any such provision 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 in this Agreement shall not be affected or
impaired thereby.
(L) ENTIRE AGREEMENT. This Agreement together with the other Operative
Documents (as defined in the Purchase 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 to this Agreement in
respect of the subject matter contained in this Agreement. There are no
restrictions, promises, warranties or undertakings, other than those set forth
or referred to in this Agreement with respect to the registration rights granted
by the Issuer with respect to the Transfer Restricted Securities. This Agreement
supersedes all prior agreements and understandings between the parties with
respect to such subject matter.
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IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
FINE AIR SERVICES CORP.
By: /S/ ▇▇▇▇▇ ▇. FINE
--------------------------------------------
Name: ▇▇▇▇▇ ▇. Fine
Title: President and Chief Executive Officer
SUBSIDIARY GUARANTORS:
FINE AIR SERVICES, INC.
AGRO AIR ASSOCIATES, INC.
By: /S/ ▇▇▇▇▇ ▇. FINE
--------------------------------------------
Name: ▇▇▇▇▇ ▇. Fine
Title: President and Chief Executive Officer
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SBC WARBURG DILLON READ INC.
By: /S/ ▇▇▇▇▇▇▇ ▇▇
--------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇
Title: Executive Director
By: /S/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
--------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Associate Director
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