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EXCHANGE AND REGISTRATION RIGHTS AGREEMENT
among
D and W HOLDINGS, INC.
as Issuer,
and
THE PURCHASERS NAMED HEREIN
Dated as of October 25, 2000
Relating to:
$36,500,000 Aggregate Principal Amount of
15% Senior Pay-In-Kind Notes due 2010
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TABLE OF CONTENTS
Page
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1. Definitions..........................................................................................1
2. Exchange Offer.......................................................................................5
3. Shelf Registration...................................................................................9
4. Special Interest....................................................................................10
5. Registration Procedures.............................................................................12
6. Registration Expenses...............................................................................21
7. Indemnification.....................................................................................21
8. Underwritten Registrations..........................................................................24
9. Miscellaneous.......................................................................................25
(a) Remedies..................................................................................25
(b) No Inconsistent Agreements................................................................25
(c) Amendments and Waivers....................................................................25
(d) Notices...................................................................................26
(e) Successors and Assigns....................................................................26
(f) Counterparts..............................................................................26
(g) Headings..................................................................................26
(h) Governing Law.............................................................................27
(i) Severability..............................................................................27
(j) Notes Held by the Issuer or Its Affiliates................................................27
(k) Third-Party Beneficiaries.................................................................27
(l) Entire Agreement..........................................................................27
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EXCHANGE AND REGISTRATION RIGHTS AGREEMENT
EXCHANGE AND REGISTRATION RIGHTS AGREEMENT (the
"AGREEMENT") dated as of October 25, 2000, by and among D and W HOLDINGS,
INC., a Delaware corporation (together with its successors, the "ISSUER"),
and THE PURCHASERS NAMED ON THE SIGNATURE PAGES HEREIN (collectively, the
"PURCHASERS").
This Agreement is entered into in connection with the
Purchase Agreement, dated as of October 25, 2000, by and among the Issuer and
the Purchasers (the "PURCHASE AGREEMENT") relating to the sale by the Issuer
to the Purchasers of (i) $40.0 million aggregate principal amount of the
Issuer's 15% Senior Pay-In-Kind Notes due 2010, and (ii) 13,168,922 shares of
Series A common stock, $.01 par value per share, of the Issuer (the "SERIES A
COMMON STOCK") and 3,292,231 shares of Series B common stock , par value $.01
per share (the "SERIES B COMMON STOCK" and, together with the Series A Common
Stock and the Notes, the "SECURITIES"), of the Issuer. In order to induce the
Purchasers to enter into the Purchase Agreement, the Issuer has agreed to
provide the registration rights set forth in this Agreement for the benefit
of the holders of Registrable Notes (as defined), including, without
limitation, the Purchasers. The execution and delivery of this Agreement is a
condition to the Purchasers' obligation to purchase the Securities under the
Purchase Agreement. Capitalized terms used herein without definition shall
have their respective meanings set forth in the Purchase Agreement.
The parties hereby agree as follows:
1. DEFINITIONS
As used in this Agreement, the following terms shall have
the following meanings:
"ADVICE" is defined in the last paragraph of Section 5.
"AGREEMENT" is defined in the first introductory paragraph
to this Agreement.
"APPLICABLE PERIOD" is defined in Section 2(b).
"BLACKOUT PERIOD" means the period during which the Issuer
(i) may suspend the effectiveness of any Shelf Registration and/or suspend
the use of any related Prospectus and (ii) shall not be required to amend or
supplement any Shelf Registration, any related Prospectus or any document
incorporated therein by reference (other than an effective registration
statement being used for an underwritten offering), which period shall not
exceed an aggregate of 45 consecutive days, in the event that the Issuer
determines in its good faith judgment
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that the disclosure of an event at such time would have a material adverse
effect on the business, operations or prospects of the Issuer or that the
required disclosure otherwise relates to a material business transaction that
has not yet been publicly disclosed.
"BUSINESS DAY" means any day other than a Legal Holiday.
"CLOSING TIME" means the Closing Time as defined in the
Purchase Agreement.
"COMMISSION" means the Securities and Exchange Commission,
as from time to time constituted, created under the Exchange Act or, if at
any time after the execution of this Agreement such Commission is not
existing and performing the duties now assigned to it under the Exchange Act,
then the body performing such duties at such time.
"EFFECTIVENESS DATE" means the 150th day after the Closing
Time, in the case of the Exchange Registration Statement, and the earlier of
the 150th day after the delivery of the Shelf Notice and 60 days after the
date on which an Exchange Registration Statement would have had to be
declared effective hereunder, in the case of the Initial Shelf Registration.
"EFFECTIVENESS PERIOD" is defined in Section 3(a).
"EVENT DATE" is defined in Section 4(b).
"EXCHANGE ACT" means the Securities Exchange Act of 1934,
as amended, and the rules and regulations promulgated by the Commission
thereunder.
"EXCHANGE NOTES" is defined in Section 2(a).
"EXCHANGE OFFER" is defined in Section 2(a).
"EXCHANGE REGISTRATION STATEMENT" is defined in
Section 2(a).
"FILING DATE" means the 90th day after the Closing Time.
"GE ENTITY" means GE Investment Private Placement Parnters
II, a Limited Partnership, a Delaware limited partnership, its successors and
assigns and its Affiliates.
"HOLDER" means a Person in whose name a Note is registered
on the Issuer's register.
"INDEMNIFIED PERSON" is defined in Section 7(c).
"INDEMNIFYING PERSON" is defined in Section 7(c).
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"INDENTURE" is defined in Section 2(a).
"INITIAL SHELF REGISTRATION" is defined in Section 3(a).
"INSPECTORS" is defined in Section 5(m).
"ISSUER" is defined in the first introductory paragraph to
this Agreement.
"LEGAL HOLIDAY" means a Saturday, a Sunday or a day on
which banking institutions in The City of New York or San Francisco, CA, are
authorized by law, regulation or executive order to remain closed. If any
payment date in respect of the Notes is a Legal Holiday, then payment may be
made at that place on the next succeeding day that is not a Legal Holiday,
and no interest shall accrue for the intervening period.
"NASD" means the National Association of Securities
Dealers, Inc.
"NOTES" means the 15% Senior Pay-In-Kind Notes due 2010
that are issued under the Purchase Agreement, as amended or supplemented from
time to time, and such amount of additional Notes as may be paid as interest.
"PARTICIPANT" is defined in Section 7(a).
"PARTICIPATING BROKER-DEALER" is defined in Section 2(b).
"PERSON" means any individual, corporation (including,
without limitation, a business trust, professional corporation and insurance
company), limited liability company, partnership, joint venture, association,
joint-stock company, trust, unincorporated organization or government or any
agency or political subdivision thereof or any legally recognizable entity.
"PRIVATE EXCHANGE" is defined in Section 2(b).
"PRIVATE EXCHANGE NOTES" is defined in Section 2(b).
"PROSPECTUS" means the prospectus included in any
Registration Statement (including, without limitation, any prospectus subject
to completion and a prospectus that includes any information previously
omitted from a prospectus filed as part of an effective registration
statement in reliance upon Rule 430A promulgated under the Securities Act),
as amended or supplemented by any prospectus supplement, with respect to the
terms of the offering of any portion of the Registrable Notes covered by such
Registration Statement, and all other amendments and supplements to the
Prospectus, including post-effective amendments,
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and all material incorporated by reference or deemed to be incorporated by
reference in such Prospectus.
"PURCHASE AGREEMENT" is defined in the second introductory
paragraph to this Agreement.
"PURCHASERS" is defined in the first introductory paragraph
to this Agreement.
"RECORDS" is defined in Section 5(m).
"REGISTRABLE NOTES" means each Note upon original issuance
thereof and at all times subsequent thereto and each additional Note, issued
as interest on the Notes in accordance with the terms thereof and each
Exchange Note and each additional Note issued as interest on the Exchange
Notes in accordance with the terms thereof if upon original issuance thereof
such Exchange Note may not be sold without restriction under federal
securities laws (other than due solely to the status of such Holder as an
affiliate of the Issuer within the meaning of the Securities Act) (a
"RESTRICTED EXCHANGE NOTE") until, in the case of any such Note or Exchange
Note, as the case may be, the earliest to occur of (i) a Registration
Statement (other than with respect to any Restricted Exchange Note) covering
such Note or Exchange Note, as the case may be, has been declared effective
by the Commission and such Note or Exchange Note, as the case may be, has
been disposed of in accordance with such effective Registration Statement;
(ii) such Note or Exchange Note, as the case may be, may be sold in
compliance with Rule 144 without volume or manner of sale limitations; (iii)
in the case of any Note, such Note has been exchanged pursuant to the
Exchange Offer for an Exchange Note or Exchange Notes that may be resold
without restriction under federal securities laws; or (iv) such Note or
Exchange Note, as the case may be, ceases to be outstanding for purposes of
the Purchase Agreement.
"REGISTRATION STATEMENT" means any registration statement
of the Issuer, including, but not limited to, the Exchange Registration
Statement, that covers any of the Registrable Notes pursuant to the
provisions of this Agreement, including the Prospectus, amendments and
supplements to such registration statement, post-effective amendments, all
exhibits and all material incorporated by reference or deemed to be
incorporated by reference in such registration statement.
"REQUIRED HOLDERS" means Holders holding a majority of the
aggregate principal amount of the Registrable Notes.
"RESTRICTED EXCHANGE NOTES" is defined in the definition of
"Registrable Note."
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"RULE 144" means Rule 144 under the Securities Act, as such
Rule may be amended from time to time, or any similar rule (other than Rule
144A) or regulation hereafter adopted by the Commission providing for offers
and sales of securities made in compliance therewith resulting in offers and
sales by subsequent holders of such securities that are not affiliates of the
Issuer being free of the registration and prospectus delivery requirements of
the Securities Act.
"RULE 144A" means Rule 144A under the Securities Act, as
such Rule may be amended from time to time, or any similar rule (other than
Rule 144) or regulation hereafter adopted by the Commission.
"RULE 415" means Rule 415 under the Securities Act, as such
Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the Commission.
"SECURITIES" is defined in the second introductory
paragraph to this Agreement.
"SECURITIES ACT" means the Securities Act of 1933, as
amended, and the rules and regulations promulgated by the Commission
thereunder.
"SHELF EXCHANGE" is defined in Section 3(a).
"SHELF NOTICE" is defined in Section 2(c).
"SHELF REGISTRATION" is defined in Section 3(b).
"SPECIAL INTEREST" is defined in Section 4(a).
"SUBSEQUENT SHELF REGISTRATION" is defined in Section 3(b).
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C.
SECTIONS 77aaa-77bbbb).
"TRUSTEE" means the trustee under the Indenture.
"UNDERWRITTEN REGISTRATION OR UNDERWRITTEN OFFERING" means
a registration in which securities of the Issuer are sold to an underwriter
for reoffering to the public.
2. EXCHANGE OFFER
(a) The Issuer shall file a registration statement with
the Commission no later than the Filing Date, pursuant to which the Issuer shall
offer to exchange (the "EXCHANGE OFFER") any and all of the Registrable Notes
for a like aggregate principal amount of debt se-
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curities of the Issuer that are identical in all material respects to the
Notes (the "EXCHANGE NOTES") and that are entitled to the benefits of a trust
indenture (the "INDENTURE") (A) which complies with all requirements of the
Commission to effect or maintain the qualification thereof under the TIA and
that has been qualified under the TIA and (B) that is otherwise in the form
of Exhibit A to the Indenture, except that the Exchange Notes shall have been
registered pursuant to an effective Registration Statement under the
Securities Act and shall contain no restrictive legend thereon, except as
otherwise specifically required by the other provisions of this Agreement.
The Issuer shall not be obligated to effect more than one Exchange Offer. The
Exchange Offer shall be registered under the Securities Act on the
appropriate form (the "EXCHANGE REGISTRATION STATEMENT") and shall comply
with all applicable tender offer rules and regulations under the Exchange
Act. The Issuer agrees to use its reasonable best efforts to (i) file the
initial Exchange Registration Statement with the Commission on or prior to
the Filing Date; (ii) cause the Exchange Registration Statement to be
declared effective under the Securities Act on or before the Effectiveness
Date; (iii) keep the Exchange Offer open for at least 20 Business Days (or
longer if required by applicable law) after the date that notice of the
Exchange Offer is first mailed to Holders; and (iv) consummate the Exchange
Offer within 180 days of the Closing Time. If after such Exchange
Registration Statement is initially declared effective by the Commission, the
Exchange Offer or the issuance of the Exchange Notes thereunder is interfered
with by any stop order, injunction or other order or requirement of the
Commission or any other governmental agency or court, then such Exchange
Registration Statement shall be deemed not to have become effective for
purposes of this Agreement. Each Holder who participates in the Exchange
Offer will be required to represent that any Exchange Notes received by it
will be acquired in the ordinary course of its business, that at the time of
the consummation of the Exchange Offer such Holder will have no arrangement
or understanding with any Person to participate in the distribution of the
Exchange Notes, that such Holder is not an affiliate of the Issuer within the
meaning of the Securities Act and any additional representations that in the
written opinion of counsel to the Issuer are necessary under then-existing
interpretations of the Commission in order for the Exchange Registration
Statement to be declared effective. Upon consummation of the Exchange Offer
in accordance with this Section 2, the provisions of this Agreement shall
continue to apply, MUTATIS MUTANDIS, solely with respect to Registrable Notes
that are Exchange Notes held by Participating Broker-Dealers, and the Issuer
shall have no further obligation to register Registrable Notes (other than in
respect of any Restricted Exchange Notes) pursuant to Section 3 of this
Agreement. No securities other than the Exchange Notes shall be included in
the Exchange Registration Statement.
(b) The Issuer shall include within the Prospectus
contained in the Exchange Registration Statement a section entitled "Plan of
Distribution," reasonably acceptable to the Purchasers, which shall contain a
summary statement of the positions taken or policies made by the Commission
with respect to the potential "underwriter" status of any broker-
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dealer that is the beneficial owner (as defined in Rule 13d-3 under the
Exchange Act) of Exchange Notes received by such broker-dealer in the
Exchange Offer (a "PARTICIPATING BROKER-DEALER"), whether such positions or
policies have been publicly disseminated by the Commission or such positions
or policies, in the judgment of the Purchasers, represent the prevailing
views of the Commission. Such "Plan of Distribution" section shall also
allow, to the extent permitted by applicable policies and regulations of the
Commission, the use of the Prospectus by all Persons subject to the
prospectus delivery requirements of the Securities Act, including, to the
extent so permitted, all Participating Broker-Dealers and include a statement
describing the manner in which Participating Broker-Dealers may resell the
Exchange Notes.
The Issuer shall use its reasonable best efforts to keep
the Exchange Registration Statement effective and to amend and supplement the
Prospectus contained therein, in order to permit such Prospectus to be
lawfully delivered by all Persons subject to the prospectus delivery
requirements of the Securities Act for such period of time as such Persons
must comply with such requirements in connection with offers and sales of the
Exchange Notes, which period shall not exceed 180 days after the consummation
of the Exchange Offer (or such longer period if extended by the last
paragraph of Section 5 hereof) (the "APPLICABLE Period"). The Issuer shall
provide sufficient copies of the latest version of such Prospectus to such
Persons, promptly upon request, and in no event later than three (3) Business
Days after such request, at any time during such period.
If, prior to consummation of the Exchange Offer, the
Purchasers hold any Notes acquired by them and having, or that are reasonably
likely to be determined to have, the status of an unsold allotment in the
initial sale, the Issuer, upon the request of such Purchasers simultaneously
with the delivery of the Notes in the Exchange Offer, shall issue and deliver
to such Purchasers in exchange (the "PRIVATE EXCHANGE") for such Notes held
by the Purchasers a like principal amount of debt securities of the Issuer
that are identical in all material respects to the Exchange Notes (the
"PRIVATE EXCHANGE NOTES") (and that are issued pursuant to the same indenture
as the Exchange Notes), except for the placement of the restrictive legend on
such Private Exchange Securities. The Private Exchange Notes shall bear the
same CUSIP number as the Notes.
Interest on the Exchange Notes and the Private Exchange
Notes, if any, will accrue from the last interest payment date on which
interest was paid on the Notes surrendered in exchange therefor or, if no
interest has been paid on the Notes, then from the Closing Time.
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In connection with the Exchange Offer, the Issuer shall:
(1) mail to each Holder a copy of the Prospectus forming
part of the Exchange Registration Statement, together with an
appropriate letter of transmittal and related documents;
(2) utilize the services of a depositary for the Exchange
Offer with an address in the Borough of Manhattan, The City of New
York, which may be the Trustee or an affiliate thereof;
(3) permit Holders to withdraw tendered Registrable Notes at
any time prior to the close of business, New York time, on the last
Business Day on which the Exchange Offer shall remain open; and
(4) otherwise comply in all material respects with all
applicable laws.
As soon as practicable after the close of the Exchange Offer,
the Issuer shall:
(1) accept for exchange all Registrable Notes validly
tendered and not validly withdrawn pursuant to the Exchange Offer;
(2) deliver to the Trustee for cancellation all Registrable
Notes so accepted for exchange; and
(3) cause the Trustee to authenticate and deliver promptly
to each Holder tendering such Registrable Notes, Exchange Notes, equal
in aggregate principal amount to the Notes of such Holder so accepted
for exchange.
The Exchange Notes and the Private Exchange Notes, if any,
will be issued under the Indenture, and the Exchange Notes, and the Notes, if
any, will vote and consent together on all matters as one class, and none of
the Exchange Notes or the Notes, if any, will have the right to vote or
consent as a separate class on any matter.
(c) In addition to conducting the Exchange Offer
provided for in Section 2(a) above, if (i) because of any change in law or in
currently prevailing interpretations of the Commission, the Issuer reasonably
determines in good faith, based upon written advice of qualified counsel
(including, without limitation, qualified in-house counsel), that it is not
permitted to effect the Exchange Offer; (ii) the Exchange Offer is not
commenced on or prior to the Effectiveness Date; (iii) the Exchange Offer is,
for any reason, not consummated on or prior to the 180th day after the
Closing Time; (iv) in the case of any Holder that participates in an Exchange
Offer, the Issuer receives an opinion of counsel (including, without
limitation, qualified in-house counsel) to such Holder reasonably acceptable
to the Issuer to the effect
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that such Holder did not receive Exchange Notes on the date of the exchange
that may be sold without restriction under federal securities laws; (v) any
Holder is an Affiliate of the Issuer; or (vi) the holders of Private Exchange
Notes so request at any time after the consummation of the Private Exchange,
then, (x) in the case of each of clause (i) through (iv) of this sentence,
the Issuer shall upon the request of the Required Holders, (y) in the case of
clause (v) of this sentence, the Issuer shall upon the request of any such
Holder and (z) in the case of clause (vi), the Issuer shall upon the request
of the Holders of Private Exchange Notes, promptly deliver to the Holders a
written notice thereof (the "SHELF NOTICE") and shall file a Shelf
Registration pursuant to Section 3; PROVIDED, HOWEVER, that the Issuer shall
not be required to effect more than one Shelf Registration pursuant to clause
(v) of this Section 2(c).
3. SHELF REGISTRATION
If a Shelf Notice is delivered as contemplated by Section
2(c), then:
(a) SHELF REGISTRATION. The Issuer shall (i) privately
exchange the Notes for Exchange Notes issued pursuant to the Indenture
(such Exchange Notes to contain any appropriate restrictive legends as
required by law) (a "SHELF EXCHANGE") and (ii) as promptly as
reasonably practicable file with the Commission a Registration
Statement for an offering to be made on a continuous basis pursuant to
Rule 415 covering all of the Registrable Notes issued in the Shelf
Exchange (the "INITIAL SHELF REGISTRATION"). The Issuer shall file with
the Commission the Initial Shelf Registration within 30 days of the
delivery of the Shelf Notice and shall use its reasonable best efforts
to cause such Shelf Registration to be declared effective,
supplemented, amended and current under the Securities Act on or prior
to the Effectiveness Date. The Initial Shelf Registration shall be on
Form S-1 or another appropriate form permitting registration of all
Exchange Notes constituting Registrable Notes for resale by Holders in
the manner or manners designated by them (including, without
limitation, one or more underwritten offerings). The Issuer shall not
permit any securities other than the Registrable Notes to be included
in any Shelf Registration. Subject to any Blackout Period, the Issuer
shall use its reasonable best efforts to keep the Initial Shelf
Registration continuously effective, supplemented, amended and current
under the Securities Act until the date that is two years from the
Closing Time (the "EFFECTIVENESS PERIOD") or such shorter period ending
when (i) all Registrable Notes covered by the Initial Shelf
Registration have been sold in the manner set forth and as contemplated
in the Initial Shelf Registration or (ii) a Subsequent Shelf
Registration (as defined) covering all of the Registrable Notes has
been declared effective under the Securities Act; PROVIDED, HOWEVER,
that the Effectiveness Period shall be extended by the number of days
in any Blackout Period. Any Exchange Notes issued under the Indenture
in connection with a Shelf Exchange will vote and consent together on
all matters as one class with Holders of Notes, Exchange Notes and
Private Exchange Notes, if any. Interest on Registrable
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Notes issued in the Shelf Exchange will accrue from the last interest
payment date on which interest was paid on the Notes surrendered in
exchange therefor or, if no interest has been paid on the Notes, then
from the Closing Time.
(b) SUBSEQUENT SHELF REGISTRATIONS. If the Initial Shelf
Registration or any Subsequent Shelf Registration (as defined) ceases
to be effective for any reason at any time during the Effectiveness
Period (other than because of the sale of all of the securities
registered thereunder or because of the existence of a Blackout
Period), then the Issuer shall use its reasonable best efforts to
obtain the prompt withdrawal of any order suspending the effectiveness
thereof and in any event shall within 30 days of such cessation of
effectiveness amend the Shelf Registration in a manner to obtain the
withdrawal of the order suspending the effectiveness thereof, or file
an additional "shelf" Registration Statement pursuant to Rule 415
covering all of the Registrable Notes (a "SUBSEQUENT SHELF
REGISTRATION"). If a Subsequent Shelf Registration is filed, then the
Issuer shall use its reasonable best efforts to cause the Subsequent
Shelf Registration to be declared effective as soon as practicable
after such filing and to keep such Subsequent Shelf Registration
continuously effective for a period equal to the number of days in the
Effectiveness Period less the aggregate number of days during which the
Initial Shelf Registration or any Subsequent Shelf Registrations was
previously continuously effective. As used herein the term "SHELF
REGISTRATION" means the Initial Shelf Registration and any Subsequent
Shelf Registration.
(c) SUPPLEMENTS AND AMENDMENTS. The Issuer shall promptly
supplement and amend any Shelf Registration if required by the rules,
regulations or instructions applicable to the registration form used
for such Shelf Registration, if required by the Securities Act, or if
reasonably requested by the Holders of a majority in aggregate
principal amount of the Registrable Notes covered by such Shelf
Registration or by any underwriter of such Registrable Notes, in each
case, with the Issuer's consent, which consent shall not be
unreasonably withheld or delayed.
4. SPECIAL INTEREST
(a) The Issuer and the Purchasers agree that the Holders
of Registrable Notes will suffer damages if the Issuer fails to fulfill its
obligations under Section 2 or Section 3 hereof and that it would not be
feasible to ascertain the extent of such damages with precision. Accordingly,
the Issuer agrees to pay, in cash, as liquidated damages, Special Interest on
the Registrable Notes ("SPECIAL INTEREST") under the circumstances and to the
extent set forth below (each of which shall be given independent effect):
(i) if (A) the Exchange Registration Statement has not been
filed on or prior to the Filing Date or (B) notwithstanding that the
Issuer has consummated or will
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consummate an Exchange Offer, the Issuer is required to file an
Initial Shelf Registration and such Shelf Registration is not filed on
or prior to the 90th day (or 30 days, if the Filing Date has occurred
prior to the Shelf Notice being given) after delivery of the Shelf
Notice, then, in the case of subclause (A), commencing on the day
after the Filing Date or, in the case of subclause (B), commencing on
the 91st day (or the 31st day if the Filing Date has occurred prior to
the Shelf Notice being given) following delivery of the Shelf Notice,
Special Interest shall accrue on the Registrable Notes over and above
the stated interest at a rate of 0.50% PER ANNUM of the aggregate
principal amount of the Registrable Notes for the first 90 days
immediately following the Filing Date or such 91st day (or the 31st day
if the Filing Date has occurred prior to the Shelf Notice being given),
as the case may be, such Special Interest rate increasing by an
additional 0.25% PER ANNUM of the aggregate principal amount of the
Registrable Notes at the beginning of each subsequent 90-day period;
(ii) if (A) the Exchange Registration Statement is not
declared effective on or prior to the Effectiveness Date applicable
thereto or (B) notwithstanding that the Issuer has consummated or will
consummate an Exchange Offer, the Issuer is required to file an Initial
Shelf Registration and such Shelf Registration is not declared
effective by the Commission on or prior to the applicable Effectiveness
Date, then, commencing on the day after such applicable Effectiveness
Date, Special Interest shall accrue on the Registrable Notes over and
above the stated interest at a rate of 0.50% PER ANNUM of the aggregate
principal amount of the Registrable Notes for the first 90 days
immediately following the day after the applicable Effectiveness Date,
such Special Interest rate increasing by an additional 0.25% PER ANNUM
of the aggregate principal amount of the Registrable Notes at the
beginning of each subsequent 90-day period; and
(iii) if (A) the Issuer has not exchanged Exchange Notes for
all Notes validly tendered in accordance with the terms of the Exchange
Offer 180 days after the Closing Time; (B) the Exchange Registration
Statement ceases to be effective prior to consummation of the Exchange
Offer; or (C) if applicable, a Shelf Registration has been declared
effective and such Shelf Registration ceases to be effective at any
time during the Effectiveness Period (other than during a Blackout
Period), then Special Interest shall accrue on the Registrable Notes
over and above the stated interest at a rate of 0.50% PER ANNUM of the
aggregate principal amount of the Registrable Notes for the first 90
days commencing on the (x) 91st day after such effective date in the
case of (A) above or (y) the day such Exchange Registration Statement
or Shelf Registration ceases to be effective in the case of (B) and (C)
above, such Special Interest rate increasing by an additional 0.25% PER
ANNUM of the aggregate principal amount of the Registrable Notes at the
beginning of each such subsequent 90-day period;
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PROVIDED, HOWEVER, that the Special Interest rate on the Registrable Notes
may not exceed in the aggregate 2.00% PER ANNUM of the aggregate principal
amount of the Registrable Notes; PROVIDED, FURTHER, that (1) upon the filing
of the Exchange Registration Statement or each Shelf Registration (in the
case of (i) above); (2) upon the effectiveness of the Exchange Registration
Statement or each Shelf Registration, as the case may be (in the case of (ii)
above); or (3) upon the exchange of Exchange Notes for all Registrable Notes
tendered (in the case of (iii)(A) above) or upon the effectiveness of an
Exchange Registration Statement or Shelf Registration that had ceased to
remain effective (in the case of (iii)(B) and (C) above), Special Interest on
any Registrable Notes then accruing Special Interest as a result of such
clause (or the relevant subclause thereof), as the case may be, shall cease
to accrue.
(b) The Issuer shall notify the Holders within three
business days after each and every date on which an event occurs in respect
of which Special Interest is required to be paid (an "EVENT DATE"). Any
amounts of Special Interest due pursuant to (a)(i), (a)(ii) or (a)(iii) of
this Section 4 will be payable in cash semi-annually on each April 15 and
October 15 (to the Holders of Registrable Notes of record on the regular
record date therefor (as specified in the Purchase Agreement) immediately
preceding such dates), commencing with the first such date occurring after
any such Special Interest commences to accrue. The amount of Special Interest
will be determined by applying the applicable Special Interest rate to the
aggregate principal amount of the Notes outstanding on a daily basis during
such period but utilizing a 360-day year comprised of twelve 30-day months.
Notwithstanding the fact that any Registrable Notes for which Special
Interest is due thereafter cease to be Registrable Notes, all obligations of
the Issuer to pay Special Interest with respect to such Registrable Notes
shall survive until such time as such obligations with respect to such
Registrable Notes shall have been satisfied in full.
(c) The parties hereto agree that the Special Interest
provided for in this Section 4 constitutes the sole and exclusive remedy for
a breach of Sections 2 and 3 hereof and is a reasonable estimate of the
damages that may be incurred by Holders of Registrable Notes in the
circumstances set forth in Section 4(a).
5. REGISTRATION PROCEDURES
In connection with the filing of any Registration Statement
pursuant to Sections 2 or 3 hereof, the Issuer shall effect such
registrations to permit the sale of such securities covered thereby in
accordance with the intended method or methods of disposition thereof, and
pursuant thereto and in connection with any Registration Statement filed by
the Issuer hereunder, the Issuer shall:
(a) Prepare and file with the Commission prior to the Filing
Date, the Exchange Registration Statement or Shelf Registration, as the
case may be, as prescribed
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by Section 2 or 3 and use its reasonable best efforts to cause each
such Registration Statement to become effective and remain effective
as provided herein; PROVIDED that, if (i) a Shelf Registration is
filed pursuant to Section 3 or (ii) a Prospectus contained in an
Exchange Registration Statement filed pursuant to Section 2 is required
to be delivered under the Securities Act by any Participating
Broker-Dealer who seeks to sell Exchange Notes during the Applicable
Period and has advised the Issuer that it is a Participating
Broker-Dealer, before filing any Registration Statement or Prospectus
or any amendments or supplements thereto, then the Issuer shall, if
requested, furnish to and afford the Holders of the Registrable Notes
to be registered pursuant to such Shelf Registration or each such
Participating Broker-Dealer, as the case may be, covered by such
Registration Statement, their counsel and the managing underwriters,
if any, a reasonable opportunity to review copies of all such
documents (including copies of any documents to be incorporated by
reference therein and all exhibits thereto) proposed to be filed (in
each case at least five (5) Business Days prior to such filing). The
Issuer shall not file any such Registration Statement or Prospectus or
any amendments or supplements thereto if the Holders of a majority in
aggregate principal amount of the Registrable Notes covered by such
Registration Statement, or any such Participating Broker-Dealer, as the
case may be, their counsel, or the managing underwriters, if any, shall
reasonably object within five (5) Business Days of their receipt of
such materials.
(b) Prepare and file with the Commission such amendments and
post-effective amendments to each Shelf Registration or Exchange
Registration Statement, as the case may be, as may be necessary to keep
such Registration Statement continuously effective for the
Effectiveness Period or the Applicable Period, as the case may be;
cause the related Prospectus to be supplemented by any Prospectus
supplement required by applicable law, and as so supplemented to be
filed pursuant to Rule 424 (or any similar provisions then in force)
under the Securities Act; and comply with the provisions of the
Securities Act and the Exchange Act applicable to it with respect to
the disposition of all securities covered by such Registration
Statement as so amended or in such Prospectus as so supplemented and
with respect to the subsequent resale of any securities being sold by a
Participating Broker-Dealer covered by any such Prospectus. The Issuer
shall be deemed not to have used its reasonable best efforts to keep a
Registration Statement effective during the Applicable Period if it
voluntarily takes any action that would result in selling Holders of
the Registrable Notes covered thereby or Participating Broker-Dealers
seeking to sell Exchange Notes not being able to sell such Registrable
Notes or such Exchange Notes during that period unless such action is
required by applicable law, rule or regulation or unless the Issuer
complies with this Agreement, including, without limitation, the
provisions of paragraph 5(j) hereof and the last paragraph of
Section 5.
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(c) If (i) a Shelf Registration is filed pursuant to Section 3
or (ii) a Prospectus contained in an Exchange Registration Statement
filed pursuant to Section 2 is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Notes during the Applicable Period from whom the Issuer has
received written notice that it will be a Participating Broker-Dealer,
notify the selling Holders of Registrable Notes and each such
Participating Broker-Dealer, their counsel and the managing
underwriters, if any, promptly (but in any event within three Business
Days), and confirm such notice in writing, (A) when a Prospectus or any
Prospectus supplement or post-effective amendment has been filed, and,
with respect to a Registration Statement or any post-effective
amendment, when the same has become effective (including in such notice
a written statement that any Holder may, upon request, obtain, without
charge, one conformed copy of such Registration Statement or
post-effective amendment including financial statements and schedules,
documents incorporated or deemed to be incorporated by reference and
exhibits); (B) of the issuance by the Commission of any stop order
suspending the effectiveness of a Registration Statement or of any
order preventing or suspending the use of any preliminary prospectus or
the initiation of any proceedings for that purpose; (C) of the receipt
by the Issuer of any notification with respect to the suspension of the
qualification or exemption from qualification of a Registration
Statement or any of the Registrable Notes or the Exchange Notes to be
sold by any Participating Broker-Dealer for offer or sale in any
jurisdiction, or the initiation or threatening of any proceeding for
such purpose; (D) of the happening of any event, the existence of any
condition or any information becoming known that makes any statement
made in such Registration Statement or related Prospectus or any
document incorporated or deemed to be incorporated therein by reference
untrue in any material respect or that requires the making of any
changes in, or amendments or supplements to, such Registration
Statement, Prospectus or documents 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 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; and (E) of the Issuer's reasonable determination that a
post-effective amendment to a Registration Statement would be
appropriate.
(d) If (i) a Shelf Registration is filed pursuant to Section 3
or (ii) a Prospectus contained in an Exchange Registration Statement
filed pursuant to Section 2 is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Notes during the Applicable Period, use its reasonable best
efforts to prevent the issuance of any order suspending the
effectiveness of a Registra-
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tion Statement or of any order preventing or suspending the use of a
Prospectus or suspending the qualification (or exemption from
qualification) of any of the Registrable Notes or the Exchange Notes to
be sold by any Participating Broker-Dealer, for sale in any
jurisdiction, and, if any such order is issued, to use its reasonable
best efforts to obtain the withdrawal of any such order at the earliest
possible date.
(e) If a Shelf Registration is filed pursuant to Section 3 and
if requested by the managing underwriters, if any, or the Holders of a
majority in aggregate principal amount of the Registrable Notes being
sold in connection with an underwritten offering, (i) as promptly as
practicable incorporate in a prospectus supplement or post-effective
amendment such information or revisions to information therein relating
to such underwriters or selling Holders as the managing underwriters,
if any, or such Holders or their counsel reasonably request to be
included or made therein; (ii) make all required filings of such
prospectus supplement or such post-effective amendment as soon as
practicable after the Issuer has received notification of the matters
to be incorporated in such prospectus supplement or post-effective
amendment and (iii) supplement or make amendments to such Registration
Statement.
(f) If (i) a Shelf Registration is filed pursuant to Section 3
or (ii) a Prospectus contained in an Exchange Registration Statement
filed pursuant to Section 2 is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Notes during the Applicable Period, furnish to each selling
Holder of Registrable Notes and to each such Participating
Broker-Dealer who so requests and to counsel and each managing
underwriter, if any, without charge, one conformed copy of the
Registration Statement or Registration Statements and each
post-effective amendment thereto, including financial statements and
schedules, and, if requested, all documents incorporated or deemed to
be incorporated therein by reference and all exhibits.
(g) If (i) a Shelf Registration is filed pursuant to Section 3
or (ii) a Prospectus contained in an Exchange Registration Statement
filed pursuant to Section 2 is required to be delivered under the
Securities Act by any Participating Broker-Dealer, deliver to each
selling Holder of Registrable Notes or each such Participating
Broker-Dealer, as the case may be, their respective counsel, and the
underwriters, if any, without charge, as many copies of the Prospectus
or Prospectuses (including each form of preliminary prospectus) and
each amendment or supplement thereto and any documents incorporated by
reference therein as such Persons may reasonably request; and, subject
to the last paragraph of this Section 5, the Issuer hereby consents to
the use of such Prospectus and each amendment or supplement thereto by
each of the selling Holders of Registrable Notes and each Participating
Broker-Dealer, and the underwriters or agents, if any, and dealers (if
any), in connection with the offering and sale of
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the Registrable Notes covered by, or the sale by Participating
Broker-Dealers of the Exchange Notes pursuant to, such Prospectus and
any amendment or supplement thereto.
(h) Prior to any public offering of Registrable Notes or any
delivery of a Prospectus contained in the Exchange Registration
Statement by any Participating Broker-Dealer who seeks to sell Exchange
Notes during the Applicable Period, use its reasonable best efforts to
register or qualify, and cooperate with the selling Holders of
Registrable Notes and each such Participating Broker-Dealer, the
underwriters, if any, and their respective counsel in connection with
the registration or qualification (or exemption from such registration
or qualification) of such Registrable Notes or Exchange Notes, as the
case may be, for offer and sale under the securities or Blue Sky laws
of such jurisdictions within the United States as any selling Holder,
Participating Broker-Dealer, or the managing underwriter or
underwriters, if any, reasonably request in writing; PROVIDED that
where Exchange Notes held by Participating Broker-Dealers or
Registrable Notes are offered pursuant to an underwritten offering,
counsel to the underwriters shall, at the cost and expense of the
Issuer, perform the Blue Sky investigations and file registrations and
qualifications required to be filed pursuant to this Section 5(h); keep
each such registration or qualification (or exemption therefrom)
effective during the period such Registration Statement is required to
be kept effective and do any and all other acts or things reasonably
necessary or advisable to enable the disposition in such jurisdictions
of the Exchange Notes by Participating Broker-Dealers or the
Registrable Notes covered by the applicable Registration Statement;
PROVIDED that the Issuer shall not be required to (i) qualify generally
to do business in any jurisdiction where it is not then so qualified;
(ii) take any action that would subject it to general service of
process in any such jurisdiction where it is not then so subject; or
(iii) subject itself to taxation in excess of a nominal dollar amount
in any such jurisdiction where it is not then so subject.
(i) If a Shelf Registration is filed pursuant to Section 3,
cooperate with the selling Holders of Registrable Notes, any
Participating Broker-Dealer and the managing underwriter or
underwriters, if any, to facilitate the timely preparation and delivery
of certificates representing Registrable Notes 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 Registrable Notes to be in such denominations and registered in
such names as the managing underwriter or underwriters, if any, or
Holders may reasonably request.
(j) If (i) a Shelf Registration is filed pursuant to Section 3
or (ii) a Prospectus contained in an Exchange Registration Statement
filed pursuant to Section 2 is required to be delivered under the
Securities Act by any Participating Broker-Dealer
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who seeks to sell Exchange Notes during the Applicable Period, upon the
occurrence of any event contemplated by paragraph 5(c)(D) or 5(c)(E)
hereof, as promptly as practicable prepare and (subject to Section 5(a)
hereof and other than during a Balckout Period) file with the
Commission, at the Issuer's sole expense, a supplement or
post-effective amendment to the Registration Statement or a supplement
to the related Prospectus or any document incorporated or deemed to be
incorporated therein by reference, or file any other required document
so that, as thereafter delivered to the purchasers of the Registrable
Notes being sold thereunder or to the purchasers of the Exchange Notes
to whom such Prospectus will be delivered by a Participating
Broker-Dealer, any such Prospectus will not contain an untrue statement
of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading.
(k) Prior to the effective date of the first Registration
Statement relating to the Registrable Notes, (i) provide the Trustee
with certificates for the Registrable Notes in a form eligible for
deposit with The Depository Trust Company; (ii) provide a CUSIP number
for the Registrable Notes; and (iii) provide copies of the form of
Indenture to the Trustee and the Holders.
(l) In connection with an underwritten offering of Registrable
Notes pursuant to a Shelf Registration, enter into an underwriting
agreement as is customary in underwritten offerings of debt securities
similar to the Notes and take all such other actions as are reasonably
requested by the managing underwriter or underwriters in order to
expedite the registration or the disposition of such Registrable Notes
and, in such connection, (i) make such representations and warranties
to the underwriters, with respect to the business of the Issuer and its
subsidiaries and the Registration Statement, Prospectus and documents,
if any, incorporated or deemed to be incorporated by reference therein,
in each case, as are customarily made by companies to underwriters in
underwritten offerings of debt securities similar to the Notes and
confirm the same in writing if and when reasonably requested; (ii)
obtain the opinion of counsel to the Issuer and updates thereof in form
and substance reasonably satisfactory to the managing underwriter or
underwriters, addressed to the underwriters covering the matters
customarily covered in opinions requested in underwritten offerings of
debt securities similar to the Notes; (iii) obtain "cold comfort"
letters and updates thereof in form and substance reasonably
satisfactory to the managing underwriter or underwriters 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 for
which financial statements and financial data are, or are required to
be, included in the Registration Statement), addressed to each of
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the underwriters, such letters to be in customary form and covering
matters of the type customarily covered in "cold comfort" letters in
connection with underwritten offerings of debt securities similar to
the Notes; (iv) if an underwriting agreement is entered into, the same
shall contain indemnification provisions and procedures substantially
no less favorable than those set forth in Section 7 hereof (or such
other provisions and procedures acceptable to Holders of a majority in
aggregate principal amount of Registrable Notes covered by such
Registration Statement, the managing underwriter or underwriters or
agents and the Issuer) with respect to all parties to be indemnified
pursuant to such Section 7; and (v) deliver such other documents and
certificates as may be reasonably requested by the managing underwriter
or underwriters or selling Holders to evidence compliance with the
matters covered in clauses (i) through (iv) above and with any
customary conditions contained in any underwriting agreement entered
into by the Issuer pursuant to this clause (l).
(m) If (i) a Shelf Registration is filed pursuant to Section 3
or (ii) a Prospectus contained in an Exchange Registration Statement
filed pursuant to Section 2 is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Notes during the Applicable Period, make available for
inspection by any selling Holder of such Registrable Notes being sold,
and each Participating Broker-Dealer, any underwriter participating in
any such disposition of Registrable Notes, if any, and any attorney,
accountant or other agent retained by any such selling Holder, each
Participating Broker-Dealer, as the case may be, or underwriter
(collectively, the "INSPECTORS"), at the offices where normally kept,
during reasonable business hours, all financial and other records,
pertinent corporate documents and properties of the Issuer and its
subsidiaries (collectively, the "RECORDS") as shall be reasonably
necessary to enable them to exercise any applicable due diligence
responsibilities, and cause the officers, directors and employees of
the Issuer and its subsidiaries to supply all information reasonably
requested by any such Inspector in connection with such Registration
Statement. Records that the Issuer determines, in good faith, to be
confidential and any Records that it notifies the Inspectors are
confidential shall not be disclosed by the Inspectors unless (i) the
disclosure of such Records is necessary to avoid or correct a
misstatement or omission in such Registration Statement; (ii) the
release of such Records is ordered pursuant to a subpoena or other
order from a court of competent jurisdiction; (iii) the information in
such Records has been made generally available to the public other than
as a result of a disclosure or failure to safeguard by such Inspector;
or (iv) disclosure of such information is, in the opinion of counsel
for any Inspector, necessary in connection with any action, claim, suit
or proceeding, directly or indirectly, involving or potentially
involving such Inspector and arising out of, based upon, related to, or
involving this Agreement, or any transactions contemplated hereby or
arising hereunder. Each selling Holder of such Registrable
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Notes and each Participating Broker-Dealer will be required to agree
that information obtained by it as a result of such inspections shall
be deemed confidential and shall not be used by it as the basis for any
market transactions in the securities of the Issuer unless and until
such is made generally available to the public. Each inspector, each
selling Holder of such Registrable Notes and each Participating
Broker-Dealer will be required to further agree that it will, upon
learning that disclosure of such Records is sought in a court of
competent jurisdiction pursuant to clauses (ii) or (iv) of the previous
sentence or otherwise, give notice to the Issuer and allow the Issuer,
at the Issuer's expense, to undertake appropriate action to obtain a
protective order or otherwise prevent disclosure of the Records deemed
confidential.
(n) Provide an indenture trustee for the Registrable Notes or
the Exchange Notes, as the case may be, and cause the Indenture or the
trust indenture provided for in Section 2(a) and 3(a), as the case may
be, to be qualified under the TIA not later than the effective date of
the Exchange Offer or the first Registration Statement relating to the
Registrable Notes; and in connection therewith, cooperate with the
trustee under any such indenture and the Holders of the Registrable
Notes, to effect such changes to such indenture as may be required from
time to time for such indenture to be so qualified in accordance with
the terms of the TIA; and execute, and use its reasonable best efforts
to cause such trustee to execute, all documents as may be required to
effect such changes and all other forms and documents required to be
filed with the Commission to enable such indenture to be so qualified
in a timely manner.
(o) Comply with all applicable rules and regulations of the
Commission and make generally available to its securityholders earning
statements satisfying the provisions of Section 11(a) of the Securities
Act and Rule 158 thereunder (or any similar rule promulgated under the
Securities Act) no later than 45 days after the end of any twelve-month
period (or 90 days after the end of any twelve-month period if such
period is a fiscal year) (i) commencing at the end of any fiscal
quarter in which Registrable Notes are sold to underwriters in a firm
commitment or best efforts underwritten offering and (ii) if not sold
to underwriters in such an offering, commencing on the first day of the
first fiscal quarter of the Issuer after the effective date of a
Registration Statement, which statements shall cover said twelve-month
periods.
(p) Upon consummation of the Exchange Offer or a Shelf
Exchange, obtain an opinion of counsel to the Issuer, in a form
customary for underwritten transactions, addressed to the Trustee for
the benefit of all Holders of Registrable Notes participating in the
Exchange Offer or the Shelf Exchange, that the Exchange Notes or
Registrable Notes, as the case may be, and the related indenture
constitute legally valid and binding obligations of the Issuer,
enforceable against the Issuer in accordance with their respective
terms.
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(q) If the Exchange Offer or the Shelf Exchange is to be
consummated, upon delivery of the Registrable Notes by Holders to the
Issuer (or to such other Person as directed by the Issuer) in exchange
for the Exchange Notes or Registrable Notes, as the case may be, the
Issuer shall mark, or cause to be marked, on the Registrable Notes
being delivered for cancellation, that such Registrable Notes are being
cancelled in exchange for the Exchange Notes or Registrable Notes
issued in the Shelf Exchange, as the case may be; in no event shall
Registrable Notes being delivered for cancellation be marked as paid or
otherwise satisfied.
(r) Cooperate with each seller of Registrable Notes covered by
any Registration Statement and each underwriter, if any, participating
in the disposition of such Registrable Notes and their respective
counsel in connection with any filings required to be made with the
National Association of Securities Dealers, Inc.
(s) Use its reasonable best efforts to take all other steps
necessary or advisable to effect the registration of the Registrable
Notes covered by a Registration Statement contemplated hereby.
The Issuer may require each seller of Registrable Notes as
to which any registration is being effected to furnish to the Issuer such
information regarding such seller and the distribution of such Registrable
Notes as the Issuer may, from time to time, reasonably request. The Issuer
may exclude from such registration the Registrable Notes of any seller who
fails to furnish such information within twenty (20) Business Days after
receiving such request. With respect to a Shelf Registration, no Holder who
has failed to furnish such information shall be entitled to the Special
Interest provided for in Section 4 that would otherwise have accrued or be
payable during the period of time commencing with the end of such
twenty-Business Day period ending on the date such requested information is
received by the Issuer. Each seller as to which any Shelf Registration
Statement is being effected agrees to furnish promptly to the Issuer all
information required to be disclosed in order to make the information
previously furnished to the Issuer by such seller not materially misleading.
Each Holder of Registrable Notes and each Participating
Broker-Dealer agrees by acquisition of such Registrable Notes or Exchange
Notes to be sold by such Participating Broker-Dealer, as the case may be,
that, upon receipt of any notice from the Issuer of the happening of any
event of the kind described in Section 5(c)(B), 5(c)(D), 5(c)(E), or 5(c)(F),
such Holder will forthwith discontinue disposition of such Registrable Notes
covered by such Registration Statement or Prospectus or Exchange Notes to be
sold by such Holder or Participating Broker-Dealer, as the case may be, and,
in each case, dissemination of such Prospectus until such Holder's or
Participating Broker-Dealer's receipt of the copies of the supplemented or
amended Prospectus contemplated by Section 5(k), or until it is advised in
writing (the "ADVICE") by the Issuer that the use of the applicable
Prospectus may be resumed, and has re-
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ceived copies of any amendments or supplements thereto. In the event the
Issuer shall give any such notice, each of the Effectiveness Period and the
Applicable Period shall be extended by the number of days during such periods
from and including the date of the giving of such notice to and including the
date when each seller of Registrable Notes covered by such Registration
Statement or Exchange Notes to be sold by such Participating Broker-Dealer,
as the case may be, shall have received (i) the copies of the supplemented or
amended Prospectus contemplated by Section 5(j) or (ii) the Advice.
6. REGISTRATION EXPENSES
All reasonable fees and expenses incident to the
performance of or compliance with this Agreement by the Issuer shall be borne
by the Issuer whether or not the Exchange Offer or a Shelf Registration is
filed or becomes effective, including, without limitation, (i) all
registration and filing fees (including, without limitation, (A) fees with
respect to filings required to be made with the NASD in connection with an
underwritten offering and (B) fees and expenses of compliance with federal
securities and state securities or Blue Sky laws (including, without
limitation, reasonable fees and disbursements of one counsel in connection
with Blue Sky qualifications of the Registrable Notes or Exchange Notes and
determination of the eligibility of the Registrable Notes or Exchange Notes
for investment under the laws of such jurisdictions (x) where the holders of
Registrable Notes are located, in the case of the Exchange Notes, or (y) as
provided in Section 5(h) hereof, in the case of Registrable Notes or Exchange
Notes to be sold by a Participating Broker-Dealer during the Applicable
Period)); (ii) printing expenses, including, without limitation, expenses of
printing certificates for Registrable Notes or Exchange Notes in a form
eligible for deposit with The Depository Trust Company; (iii) fees and
disbursements of all independent certified public accountants referred to in
Section 5(m)(iii) (including, without limitation, the expenses of any "cold
comfort" letters required by or incident to such performance); (iv) fees and
expenses of all other Persons retained by the Issuer (including fees and
expenses of the Trustee); (v) internal expenses of the Issuer (including,
without limitation, all salaries and expenses of officers and employees of
the Issuer performing legal or accounting duties); (vi) the expenses relating
to printing, word processing and distributing all Registration Statements,
underwriting agreements, securities sales agreements, indentures and any
other documents necessary in order to comply with this Agreement, but
excluding any fees and disbursements of underwriters, including, without
limitation, underwriting discounts, commissions and transfer taxes
attributable to the sale of each Registrable Note; (vii) any fees associated
with making the Registrable Notes or Exchange Notes eligible for trading
through The Depository Trust Company; and (viii) fees and disbursements of
one special counsel for the Purchasers and Sellers of Registrable Notes in
connection with the transactions contemplated by this Agreement.
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7. INDEMNIFICATION
(a) The Issuer agrees to indemnify and hold harmless
each Holder of Registrable Notes and each Participating Broker-Dealer, the
officers, directors, employees and agents of each such Person, and each
Person, if any, who controls any such Person within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act (each, a
"PARTICIPANT"), from and against any and all losses, claims, damages and
liabilities (including, without limitation, the reasonable legal fees and
other reasonable expenses actually incurred in connection with investigating
or defending any suit, action or proceeding or any claim asserted) caused by,
arising out of or based upon any untrue statement or alleged untrue statement
of a material fact contained in any Registration Statement or Prospectus (as
amended or supplemented if the Issuer shall have furnished any amendments or
supplements thereto) or caused by, 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, in the light of the
circumstances under which they were made, not misleading, except insofar as
such losses, claims, damages or liabilities are caused by any untrue
statement or omission or alleged untrue statement or omission made in
reliance upon and in conformity with information relating to any Participant
furnished to the Issuer in writing by or on behalf of such Participant
expressly for use therein; PROVIDED, HOWEVER, that the Issuer shall not be
liable if such untrue statement or omission or alleged untrue statement or
omission was contained or made in any preliminary prospectus and corrected in
the Prospectus or any amendment or supplement thereto and the Prospectus does
not contain any other untrue statement or omission or alleged untrue
statement or omission of a material fact that was the subject matter of the
related proceeding and any such loss, liability, claim, damage or expense
suffered or incurred by the Participants resulted from any action, claim or
suit by any Person who purchased Registrable Notes or Exchange Notes that are
the subject thereof from such Participant and it is established in the
related proceeding that such Participant failed to deliver or provide a copy
of the Prospectus (as amended or supplemented) to such Person with or prior
to the confirmation of the sale of such Registrable Notes or Exchange Notes
sold to such Person if required by applicable law, unless such failure to
deliver or provide a copy of the Prospectus (as amended or supplemented) was
a result of noncompliance by the Issuer with Section 5 of this Agreement.
(b) Each Participant will be required to agree,
severally and not jointly, to indemnify and hold harmless the Issuer, its
directors and officers and each Person who controls the Issuer within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act
to the same extent as the foregoing indemnity from the Issuer to each
Participant, but only with reference to information relating to such
Participant furnished to the Issuer in writing by such Participant expressly
for use in any Registration Statement or Prospectus, any amendment or
supplement thereto, or any preliminary prospectus. The liability of any
Par-
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ticipant under this paragraph shall in no event exceed the proceeds received
by such Participant from sales of Registrable Notes or Exchange Notes giving
rise to such obligations.
(c) Each indemnified party shall give prompt notice to
each indemnifying party of any action commenced against it in respect of
which indemnity may be sought hereunder, enclosing a copy of all papers
properly served on such indemnified party, but failure to so notify an
indemnifying party shall not relieve such indemnifying party from any
liability which it may have other than on account of this indemnity
agreement. An indemnifying party may participate at its own expense in the
defense of any such action. If an indemnifying party so elects within a
reasonable time after receipt of such notice, then such indemnifying party,
jointly with any other indemnifying party, may assume the defense of such
action with counsel chosen thereby and approved by the indemnified parties
defendant in such action (such approval not to be unreasonably withheld);
PROVIDED that if any such indemnified party reasonably determines, based on
advice of counsel, that there may be legal defenses available to such
indemnified party which are different from or in addition to those available
to such indemnifying party or that representation of such indemnifying party
and any indemnified party by the same counsel would present a conflict of
interest, then such indemnifying party or parties shall not be entitled to
assume such defense. After notice from the indemnifying party to such
indemnified party of its election to so assume the defense thereof and
approval by such indemnified party of counsel appointed to defend such
action, the indemnifying party will not be liable for the costs and expenses
of any settlement of such action effected by such indemnified party without
the prior written consent of the indemnifying party (which consent shall not
be unreasonably withheld), unless such indemnified party waived in writing
its rights under this Section 7 in which case the indemnified party may
effect such a settlement without such consent. If an indemnifying party is
not entitled to assume the defense of such action as a result of the proviso
to the preceding sentence, then counsel for such indemnifying party shall be
entitled to conduct the defense of such indemnifying party and counsel for
each indemnified party or parties shall be entitled to conduct the defense of
such indemnified party or parties. If an indemnifying party assumes the
defense of an action in accordance with and as permitted by the provisions of
this paragraph, then such indemnifying party shall not be liable for any fees
and expenses of counsel for the indemnified parties incurred thereafter in
connection with such action. In no event shall the indemnifying party or
parties be liable for the fees and expenses of more than one counsel (in
addition to any local counsel), separate from its own counsel, for all
indemnified parties in connection with any one action or separate but similar
or related actions in the same jurisdiction arising out of the same general
allegations or circumstances.
(d) If the indemnification provided for in the first
and second paragraphs of this Section 7 is legally unavailable to, and
accordingly insufficient to hold harmless, an indemnified party in respect of
any losses, claims, damages or liabilities referred to therein, then
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each indemnifying party under such paragraphs, in lieu of indemnifying such
indemnified party thereunder and in order to provide for just and equitable
contribution, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities
in such proportion as is appropriate to reflect the relative fault of the
indemnifying party or parties on the one hand and the indemnified party or
parties on the other in connection with the statements or omissions (or
alleged statements or omissions) that resulted in such losses, claims,
damages or liabilities (or actions in respect thereof) as well as any other
relevant equitable considerations. The relative fault of the parties 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 on the
one hand or by the Participants or such other indemnified party, as the case
may be, on the other, the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission
and any other equitable considerations appropriate under the circumstances.
(e) The parties agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by PRO
RATA allocation (even if the Participants were treated as one entity for such
purpose) or by any other method of allocation that does not take account of
the equitable considerations referred to in the immediately preceding
paragraph. The amount paid or payable by an indemnified party as a result of
the losses, claims, damages and liabilities referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations
set forth above, any reasonable legal or other expenses actually incurred by
such indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Section 7, in no
event shall a Participant be required to contribute any amount in excess of
the amount by which proceeds received by such Participant from sales of
Registrable Notes or Exchange Notes, as the case may be, exceeds the amount
of any damages that such Participant has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. 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.
(f) The indemnity and contribution agreements
contained in this Section 7 will be in addition to any liability that the
indemnifying parties may otherwise have to the indemnified parties referred
to above.
8. UNDERWRITTEN REGISTRATIONS
If any of the Registrable Notes covered by any Shelf
Registration are to be sold in an underwritten offering, then the investment
banker or investment bankers and manager or managers that will manage the
offering will be selected by the Holders of a majority in aggre-
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gate principal amount of such Registrable Notes included in such offering and
reasonably acceptable to the Issuer; PROVIDED, HOWEVER, that the Issuer shall
be entitled to select one co-lead manager to administer such offering, which
co-lead manager shall be reasonably acceptable to the Holders of a majority
in aggregate principal amount of such Registrable Notes included in such
offering PROVIDED, HOWEVER, that to the extent a GE Entity participates in
the offering, it shall have the right to approve or disapprove of any
underwriter in which General Electric Company has a direct or indirect
interest of 5% or more.
No Holder of Registrable Notes may participate in any
underwritten registration hereunder unless such Holder (a) agrees to sell
such Holder's Registrable Notes on the basis provided in any underwriting
arrangements approved by the Persons entitled hereunder to approve such
arrangements and (b) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents required
under the terms of such underwriting arrangements.
9. MISCELLANEOUS
(a) REMEDIES. Except as otherwise specifically
provided herein, in the event of a breach by the Issuer of any of its
obligations under this Agreement, each Holder of Registrable Notes and each
Participating Broker-Dealer holding Exchange Notes, in addition to being
entitled to exercise all rights provided herein, in the Indenture or, in the
case of a Purchaser, in the Purchase Agreement, or granted by law, including
recovery of damages, will be entitled to specific performance of its rights
under this Agreement. Except as otherwise specifically provided herein, the
Issuer agrees that monetary damages would not be adequate compensation for
any loss incurred by reason of a breach by it of any of the provisions of
this Agreement and hereby further agrees that, in the event of any action for
specific performance in respect of such breach, it shall waive the defense
that a remedy at law would be adequate.
(b) NO INCONSISTENT AGREEMENTS. The Issuer has not
entered into, as of the date hereof, and shall not enter into, after the date
of this Agreement, any agreement with respect to any of its securities that
is inconsistent with the rights granted to the Holders of Registrable Notes
in this Agreement or otherwise conflicts with the provisions hereof. The
Issuer has not entered into and shall not enter into any agreement with
respect to any of the Issuer's securities which will grant to any Person
piggy-back rights with respect to a Registration Statement.
(c) AMENDMENTS AND WAIVERS. 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, otherwise
than with the prior written consent of (i) the Holders of not less than a
majority in aggregate principal amount of the then outstanding Registrable
Notes and (ii) in circumstances that would adversely affect Participating
Broker-Dealers, the
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Participating Broker-Dealers holding not less than a majority in aggregate
principal amount of the Exchange Notes held by all Participating
Broker-Dealers; PROVIDED, HOWEVER, that Section 7 and this Section 10(c) may
not be amended, modified or supplemented without the prior written consent of
each Holder and each Participating Broker-Dealer (including any Person who
was a Holder or Participating Broker-Dealer of Registrable Notes or Exchange
Notes, as the case may be, disposed of pursuant to any Registration
Statement). Notwithstanding the foregoing, a waiver or consent to depart from
the provisions hereof with respect to a matter that relates exclusively to
the rights of Holders of Registrable Notes whose securities are being
tendered pursuant to the Exchange Offer or sold pursuant to a Registration
Statement and that does not directly or indirectly affect, impair, limit or
compromise the rights of other Holders of Registrable Notes may be given by
Holders of at least a majority in aggregate principal amount of the
Registrable Notes being tendered or being sold by such Holders pursuant to
such Registration Statement.
(d) NOTICES. All notices and other communications
provided for or permitted hereunder shall be made in writing by
hand-delivery, registered first-class mail, next-day air courier or
telecopier:
(i) if to a Holder of Registrable Notes, at the most current
address of such Holder set forth on the records of the Issuer or the
registrar under the Indenture, as the case may be; and
(ii) if to the Issuer c/o Atrium Holdings, Inc. at 1341 West
Mockingbird Lane, Suite 1200W, Dallas, Texas 75247, attention of Jeff
Hull, with a copy to Paul, Hastings, Janofsky and Walker LLP, 399 Park
Avenue, New York, NY 10022, Attention: Joel Simon, Esq. and Marie
Censoplano, Esq., or at such other address as the Issuer shall have
specified to each Holder in writing.
All such notices and communications shall be deemed to have
been duly given: when delivered by hand, if personally delivered; five
business days after being deposited in the mail, postage prepaid, if mailed;
one business day after being timely delivered to a next-day air courier
guaranteeing overnight delivery; and when receipt is acknowledged by the
addressee, if telecopied.
Copies of all such notices, demands or other communications
shall be concurrently delivered by the Person giving the same to the Trustee
under the Indenture at the address specified in such Indenture.
(e) SUCCESSORS AND ASSIGNS. This Agreement shall inure
to the benefit of and be binding upon the successors and assigns of each of
the parties hereto and the Holders; PROVIDED, HOWEVER, that this Agreement
shall not inure to the benefit of or be binding upon a
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successor or assign of a Holder unless and to the extent such successor or
assign holds Registrable Notes.
(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. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS
APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK,
EXCLUDING CHOICE-OF-LAW PRINCIPLES OF THE LAW OF SUCH STATE THAT WOULD
REQUIRE THE APPLICATION OF THE LAWS OF A JURISDICTION OTHER THAN SUCH STATE.
EACH OF THE PARTIES HERETO AGREES TO SUBMIT TO THE JURISDICTION OF THE COURTS
OF THE STATE OF NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT.
(i) SEVERABILITY. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction to
be invalid, illegal, void or unenforceable, then the remainder of the terms,
provisions, covenants and restrictions set forth herein shall remain in full
force and effect and shall in no way be affected, impaired or invalidated,
and the parties hereto shall use their best efforts to find and employ an
alternative means to achieve the same or substantially the same result as
that contemplated by such term, provision, covenant or restriction. It is
hereby stipulated and declared to be the intention of the parties that they
would have executed the remaining terms, provisions, covenants and
restrictions without including any of such that may be hereafter declared
invalid, illegal, void or unenforceable.
(j) NOTES HELD BY THE ISSUER OR ITS AFFILIATES.
Whenever the consent or approval of Holders of a specified percentage of
Registrable Notes is required hereunder, Registrable Notes held by the Issuer
or its affiliates (as such term is defined in Rule 405 under the Securities
Act) shall not be counted in determining whether such consent or approval was
given by the Holders of such required percentage.
(k) THIRD-PARTY BENEFICIARIES. Holders of Registrable
Notes and Participating Broker-Dealers are intended third-party beneficiaries
of this Agreement and this Agreement may be enforced by such Persons.
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(l) ENTIRE AGREEMENT. This Agreement, together with
the Purchase Agreement is intended by the parties as a final and exclusive
statement of the agreement and understanding of the parties hereto in respect
of the subject matter contained herein and therein and any and all prior oral
or written agreements, representations, or warranties, contracts,
understandings, correspondence, conversations and memoranda between the
Purchasers on the one hand and the Issuer on the other, or between or among
any agents, representatives, parents, subsidiaries, affiliates, predecessors
in interest or successors in interest with respect to the subject matter
hereof and thereof are merged herein and replaced hereby.
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IN WITNESS WHEREOF, the parties have caused this
Registration Rights and Stockholders Agreement to be duly executed as of the
date first written above.
D and W HOLDINGS, INC.
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