Exhibit 10.5
PREFERRED EXCHANGE AND REGISTRATION RIGHTS AGREEMENT
PREFERRED EXCHANGE AND REGISTRATION RIGHTS AGREEMENT, dated as of January
31, 1997, by and between NEXTLINK Communications, Inc., a corporation organized
under the laws of the State of Washington (the "Company"), and Merrill Lynch,
Pierce, Fenner & Smith Incorporated and Toronto Dominion Securities (USA) Inc.
(collectively, the "Initial Purchasers") of the Company's 14% Senior
Exchangeable Redeemable Preferred Shares ("Preferred Shares").
1. CERTAIN DEFINITIONS.
For purposes of this Agreement, the following terms shall have the following
respective meanings:
(a) "CERTIFICATE OF DESIGNATIONS" means the Certificate of Designation
of the Powers, Preferences and Relative, Participating, Optional and Other
Special Rights of the Preferred Shares and Qualifications, Limitations and
Restrictions Thereof.
(b) "CLOSING DATE" shall mean the date on which the Preferred Shares are
initially issued.
(c) "COMMISSION" shall mean the Securities and Exchange Commission, or
any other federal agency at the time administering the Exchange Act or the
Securities Act, whichever is the relevant statute for the particular purpose.
(d) "EFFECTIVE TIME", in the case of (i) an Exchange Offer, shall mean
the date on which the Commission declares the Exchange Offer registration
statement effective or on which such registration statement otherwise becomes
effective and (ii) a Shelf Registration, shall mean the date on which the
Commission declares the Shelf Registration effective or on which the Shelf
Registration otherwise becomes effective.
(e) "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934.
(f) "EXCHANGE OFFER" shall have the meaning assigned thereto in Section
2(a).
(g) "EXCHANGE SECURITIES" shall have the meaning assigned thereto in
Section 2(a).
(h) The term "HOLDER" shall mean each of the Initial Purchasers for so
long as it owns any Registrable Securities, and such of its respective
successors and assigns who acquire Registrable Securities, directly or
indirectly, from such person or from any successor or assign of such person, in
each case for so long as such person owns any Registrable Securities.
(i) "INDENTURE" shall mean the Indenture, relating to the Notes to be
entered into between the Company and United States Trust Company of New York, as
Trustee.
(j) "NOTES" means the Company's 14% Senior Subordinated Notes due
February 1, 2009, that may be issued at the election of the Company in exchange
for the Preferred Shares.
(k) The term "PERSON" shall mean a corporation, association,
partnership, organization, business, individual, government or political
subdivision thereof or governmental agency.
(l) "PURCHASE AGREEMENT" shall mean the Purchase Agreement dated
January 21, 1997 among the Company, NEXTLINK Communications, L.L.C. and the
Initial Purchasers.
(m) "REGISTRABLE SECURITIES" shall mean the Securities; PROVIDED,
HOWEVER, that such Securities shall cease to be Registrable Securities when
(i) except if prior to the consummation of the Exchange Offer existing
Commission interpretations are changed such that the Exchange Securities
received by holders in the Exchange Offer for Registrable Securities are not or
would not be, upon receipt, transferable by each such holder (other than a
Restricted Holder) without restriction under the Securities Act in the
circumstances contemplated by Section 2(a), the Exchange Offer is conducted as
contemplated in Section 2(a); PROVIDED, HOWEVER, that any such Securities that,
pursuant to the last two sentences of Section 2(a), are included in a prospectus
for use in connection with resales by broker-dealers shall be deemed to be
Registrable Securities with respect to Sections 5, 6 and 9 until resale of such
Exchange Securities has been effected within the 90-day period referred to in
Section 2(a); (ii) in the circumstances contemplated by Section 2(b), a
registration statement registering such Securities under the Securities Act has
been declared or becomes effective and such Securities have been sold or
otherwise transferred by the holder thereof pursuant to such effective
registration statement; (iii) such Securities are sold pursuant to Rule 144 (or
any successor provision) promulgated under the Securities Act under
circumstances in which any legend borne by such Securities relating to
restrictions on transferability thereof, under the Securities Act or otherwise,
is removed by the Company or pursuant to the Indenture or such Securities are
eligible to be sold pursuant to paragraph (k) of Rule 144; or (iv) such
Securities shall cease to be outstanding.
(n) "REGISTRATION DEFAULT" shall have the meaning assigned thereto in
Section 2(c) hereof.
(o) "REGISTRATION EXPENSES" shall have the meaning assigned thereto in
Section 4 hereof.
(p) "RESTRICTED HOLDER" shall mean (i) a holder that is an affiliate of
the Company within the meaning of Rule 405 under the Securities Act, (ii) a
holder who acquires Exchange Securities outside the ordinary course of such
holder's business or (iii) a holder who has arrangements or understandings with
any person to participate in the Exchange Offer for the purpose of distributing
Exchange Securities.
(q) "RULE 144", "RULE 405" AND "RULE 415" shall mean, in each case, such
rule promulgated under the Securities Act.
(r) "SECURITIES" shall mean, collectively, the Preferred Shares and the
Notes.
(s) "SECURITIES ACT" shall mean the Securities Act of 1933.
(t) "SHELF REGISTRATION" shall have the meaning assigned thereto in
Section 2(b) hereof.
(u) "SPECIAL DIVIDENDS" shall have the meaning assigned thereto in
Section 2(c) hereof.
(v) "SPECIAL INTEREST" shall have the meaning assigned thereto in
Section 2(c) hereof.
(w) "TRUST INDENTURE ACT" shall mean the Trust Indenture Act of 1939.
-2-
Unless the context otherwise requires, any reference herein to a
"Section" or "clause" refers to a Section or clause, as the case may be, of this
Agreement, and the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Agreement as a whole and not to any particular
Section or other subdivision. Unless the context otherwise requires, any
reference to a statute, rule or regulation refers to the same (including any
successor statute, rule or regulation thereto) as it may be amended from time to
time.
2. REGISTRATION UNDER THE SECURITIES ACT.
(a) Except as set forth in Section 2(b) below, the Company agrees to use
its reasonable best efforts to file under the Securities Act no later than 45
days after the Closing Date, a registration statement relating to an offer to
exchange (the "Exchange Offer") any and all of the Registrable Securities for a
like aggregate liquidation preference and amount of preferred shares of the
Company and debt securities of the Company which are substantially identical to
the Preferred Shares and the Notes, respectively, (and, in the case of the debt
securities, which are entitled to the benefits of a trust indenture which is
substantially identical to the Indenture or is the Indenture and which has been
qualified under the Trust Indenture Act) except that they have been registered
pursuant to an effective registration statement under the Securities Act and
such new preferred shares and debt securities will not contain provisions for
additional dividends and additional interest, respectively, contemplated in
Section 2(c) below or provisions restricting transfer in the absence of
registration under the Securities Act (such new preferred shares and debt
securities hereinafter called "Exchange Securities"). The Company agrees to use
its reasonable best efforts to cause such registration statement to become
effective under the Securities Act as soon as practicable thereafter. The
Exchange Offer will be registered under the Securities Act on the appropriate
form and will comply in all material respects with all applicable tender offer
rules and regulations under the Exchange Act. The Company further agrees to
commence the Exchange Offer promptly after such registration statement has
become effective, hold the Exchange Offer open for at least 30 days and Exchange
Securities for all Registrable Securities that have been tendered and not
withdrawn on or prior to the expiration of the Exchange Offer. The Exchange
Offer will be deemed to have been completed only if the Exchange Securities
received by holders other than Restricted Holders in the Exchange Offer for
Registrable Securities are, upon receipt, transferable by each such holder
without restriction under the Securities Act and without material restrictions
under the blue sky or securities laws of a substantial majority of the States of
the United States of America, it being understood that broker-dealers receiving
Exchange Securities will be subject to certain prospectus delivery requirements
with respect to resale of the Exchange Securities. The Exchange Offer shall be
deemed to have been completed upon the earlier to occur of (i) the Company
having exchanged the Exchange Securities for all outstanding Registrable
Securities pursuant to the Exchange Offer and (ii) the Company having exchanged,
pursuant to the Exchange Offer, Exchange Securities for all Registrable
Securities that have been tendered and not withdrawn before the expiration of
the Exchange Offer, which shall be on a date that is at least 30 days following
the commencement of the Exchange Offer. The Company agrees (i) to include in the
registration statement a prospectus for use in connection with any resales by
any holder of Exchange Securities that is a broker-dealer and (ii) to keep such
registration statement effective for a period ending on the earlier of the 90th
day after the Exchange Offer has been completed or such time as such
broker-dealers no longer own any Registrable Securities. With respect to such
registration statement the Company and any such holder shall have the benefit
of, and shall each provide to the other, the rights of indemnification and
contribution set forth in Section 6 hereof.
-3-
(b) If on or prior to the consummation of the Exchange Offer existing
Commission interpretations are changed such that the Exchange Securities
received by holders other than Restricted Holders in the Exchange Offer for
Registrable Securities are not or would not be, upon receipt, transferable by
each such holder without restriction under the Securities Act, in lieu of
conducting the Exchange Offer contemplated by Section 2(a) the Company shall
file under the Securities Act a "shelf" registration statement providing for the
registration of, and the sale on a continuous or delayed basis by the holders
of, all of the Registrable Securities, pursuant to Rule 415 under the Securities
Act and/or any similar rule that may be adopted by the Commission (the "Shelf
Registration"). The Company agrees to use its reasonable best efforts to cause
the Shelf Registration to become or be declared effective and to keep such Shelf
Registration continuously effective for a period ending on the earlier of the
third anniversary of the Closing Date or such time as there are no longer any
Registrable Securities outstanding. The Company further agrees to supplement or
make amendments to the Shelf Registration, as and when required by the rules,
regulations or instructions applicable to the registration form used by the
Company for such Shelf Registration or by the Securities Act or rules and
regulations thereunder for shelf registration, and the Company agrees to furnish
to the holders of the Registrable Securities copies of any such supplement or
amendment prior to its being used and/or filed with the Commission.
(c) In the event that (i) the Company has not filed the registration
statement relating to the Exchange Offer (or, if applicable, the Shelf
Registration) on or before the 45th day after the Closing Date, or (ii) such
registration statement (or, if applicable, the Shelf Registration) has not
become effective or been declared effective by the Commission on or before the
120th day after the Closing Date, or (iii) the Exchange Offer has not been
completed within 30 business days after the initial effective date of the
registration statement (if the Exchange Offer is then required to be made) or
(iv) any registration statement required by Section 2(a) or 2(b) is filed and
declared effective but shall thereafter cease to be effective (except as
specifically permitted herein) without being succeeded promptly by an additional
registration statement filed and declared effective (each such event referred to
in clauses (i) through (iv), a "Registration Default"), then, as applicable,
either (i) dividends will accumulate (in addition to the stated dividends on the
Preferred Shares) at the rate of 0.25% per annum on the liquidation preference
of the Preferred Shares or (ii) interest will accrue (in addition to the stated
interest on the Notes) at the rate of 0.25% per annum on the principal amount of
the Notes, in each case for the period from and including the occurrence of the
Registration Default until such time as no Registration Default is in effect.
Such additional dividends (the "Special Dividends") will be payable quarterly in
arrears on February 1, May 1, August 1 and November 1 in accordance with the
Certificate of Designations, and such additional interest (the "Special
Interest") will be payable semi-annually in arrears on each February 1 and
August 1 in accordance with the Indenture. For each 90-day period that the
Registration Default continues, the per annum rate of Special Dividends or
Special Interest, as applicable, shall increase by an additional 0.25%, provided
that such rate shall in no event exceed 1.0% per annum in the aggregate. Special
Dividends or Special Interest, if any, will be computed on the basis of a 365 or
366 day year, as the case may be, and the number of days actually elapsed.
(d) Notwithstanding any other provisions of this Agreement, in the event
that the Notes are issued in exchange for the Preferred Shares prior to the time
when there are no outstanding Registrable Securities, then from the time of such
exchange (i) all references in this Section 2 and Section 3 to Securities,
Registrable Securities and Exchange Securities shall not include the Preferred
Shares or the preferred shares to be issued in exchange therefor in the Exchange
Offer, as applicable, and (ii) all requirements for action to be taken by the
Company in or pursuant to this Section 2 and Section 3 shall
-4-
apply only to the Notes and the debt securities to be issued in exchange
therefor in the Exchange Offer; PROVIDED, HOWEVER, that if the Preferred Shares
are accumulating Special Dividends at the time of such exchange of Preferred
Shares for Notes, the Notes shall upon their issuance accrue Special Interest at
the same per annum rate as the per annum rate of the Special Dividends at such
time.
3. REGISTRATION PROCEDURES.
If the Company files a registration statement pursuant to Section 2(a) or
Section 2(b), the following provisions shall apply:
(a) At or before the Effective Time of the Exchange Offer or the Shelf
Registration, as the case may be, the Company shall qualify the Indenture under
the Trust Indenture Act.
(b) In the event that such qualification would require the appointment
of a new trustee under the Indenture, the Company shall appoint a new trustee
thereunder pursuant to the applicable provisions of the Indenture.
(c) In connection with the Company's obligations with respect to the Shelf
Registration, if applicable, the Company shall use its reasonable best efforts
to effect or cause the Shelf Registration to permit the sale of the Registrable
Securities by the holders thereof in accordance with the intended method or
methods of distribution thereof described in the Shelf Registration. In
connection therewith, the Company shall:
(i) prepare and file with the Commission a registration statement with
respect to the Shelf Registration on any form which may be utilized by the
Company and which shall permit the disposition of the Registrable
Securities in accordance with the intended method or methods thereof, as
specified in writing to the Company by the holders of the Registrable
Securities;
(ii) as soon as reasonably possible, prepare and file with the
Commission such amendments and supplements to such registration statement
and the prospectus included therein as may be necessary to effect and
maintain the effectiveness of such registration statement for the period
specified in Section 2(b) hereof and as may be required by the applicable
rules and regulations of the Commission and the instructions applicable to
the form of such registration statement;
(iii) as soon as reasonably possible, comply with the provisions of the
Securities Act applicable to the Company in connection with the disposition
of all of the Registrable Securities covered by such registration statement
in accordance with the intended methods of disposition by the holders
thereof, set forth in such registration statement;
(iv) provide (A) the holders of the Registrable Securities to be
included in such registration statement and not more than one counsel for
all the holders of such Registrable Securities, (B) the underwriters (which
term, for purposes of this Agreement, shall include a person deemed to be
an underwriter within the meaning of Section 2(11) of the Securities Act),
if any, thereof, (C) the sales or placement agent, if any, therefor, and
(D) one counsel for such underwriters or agents, if any, reasonable
opportunity to participate in the preparation of such registration
statement, each prospectus included therein or filed with the Commission,
and each amendment or supplement thereto;
-5-
(v) for a reasonable period prior to the filing of such registration
statement, and throughout the period specified in Section 2(b), make
available at reasonable times at the Company's principal place of business
or such other reasonable place for inspection by the persons referred to in
Section 3(c)(iv) who shall certify to the Company that they have a current
intention to sell the Registrable Securities pursuant to the Shelf
Registration such financial and other information and books and records of
the Company, and cause the officers, employees, counsel and independent
certified public accountants of the Company to respond to such inquiries,
as shall be reasonably necessary, in the judgment of the respective counsel
referred to in such Section, to conduct a reasonable investigation within
the meaning of Section 11 of the Securities Act; PROVIDED, HOWEVER, that
each such party shall be required to maintain in confidence and not to
disclose to any other person any information or records reasonably
designated by the Company as being confidential, until such time as (A)
such information becomes a matter of public record (whether by virtue of
its inclusion in such registration statement or otherwise, except by
disclosure by such party in breach of this Agreement), or (B) such person
shall be required so to disclose such information pursuant to the subpoena
or order of any court or other governmental agency or body having
jurisdiction over the matter (subject to, and only to the extent required
by, the requirements of such order, and only after such person shall have
given the Company prompt prior written notice of such requirement), or (C)
such information is required to be set forth in such registration statement
or the prospectus included therein or in an amendment to such registration
statement or an amendment or supplement to such prospectus in order that
such registration statement, prospectus, amendment or supplement, as the
case may be, does not contain an untrue statement of a material fact or
omit to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading in light of the
circumstances then existing;
(vi) promptly notify the selling holders of Registrable Securities, the
sales or placement agent, if any, therefor and the managing underwriter or
underwriters, if any, thereof and confirm such advice in writing, (A) when
such registration statement or the prospectus included therein or any
prospectus amendment or supplement or post-effective amendment has been
filed, and, with respect to such registration statement or any
post-effective amendment, when the same has become effective, (B) of any
comments by the Commission and by the Blue Sky or securities commissioner
or regulator of any state with respect thereto or any request by the
Commission for amendments or supplements to such registration statement or
prospectus or for additional information, (C) of the issuance by the
Commission of any stop order suspending the effectiveness of such
registration statement or the initiation or threatening of any proceedings
for that purpose, (D) if at any time the representations and warranties of
the Company contemplated by Section 3(c)(xv) or Section 5 cease to be true
and correct in all material respects, (E) of the receipt by the Company of
any notification with respect to the suspension of the qualification of the
Registrable Securities for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose, or (F) at any time when a
prospectus is required to be delivered under the Securities Act, that such
registration statement, prospectus, prospectus amendment or supplement or
post-effective amendment, or any document incorporated by reference in any
of the foregoing, contains an untrue statement of a material fact or omits
to state any material fact required to be stated therein or necessary to
make the statements therein not misleading in light of the circumstances
then existing;
(vii) use its reasonable best efforts to obtain the withdrawal of any
order suspending the effectiveness of such registration statement or any
post-effective amendment thereto at the earliest practicable date;
-6-
(viii) if requested in writing by any managing underwriter or
underwriters, any placement or sales agent or counsel for the holders of
Registrable Securities, promptly incorporate in a prospectus supplement or
post-effective amendment such information as is required by the applicable
rules and regulations of the Commission and as such managing underwriter or
underwriters, such agent or such holder specifies should be included
therein relating to the terms of the sale of such Registrable Securities,
including, without limitation, information with respect to the amount of
Registrable Securities being sold by any holder or agent or to any
underwriters, the name and description of such holder, agent or
underwriter, the offering price of such Registrable Securities and any
discount, commission or other compensation payable in respect thereof, the
purchase price being paid therefor by such underwriters and with respect to
any other terms of the offering of the Registrable Securities, to be sold
by such holder or agent or to such underwriters; and make all required
filings of such prospectus supplement or post-effective amendment promptly
after notification of the matters to be incorporated in such prospectus
supplement or post-effective amendment;
(ix) furnish to each holder of Registrable Securities, each placement or
sales agent, if any, therefor, each underwriter, if any, thereof and the
respective counsel referred to in Section 3(c)(iv) an executed copy of such
registration statement, each such amendment and supplement thereto (in each
case including all exhibits thereto and documents incorporated by reference
therein) and such number of copies of such registration statement
(excluding exhibits thereto and documents incorporated by reference therein
unless specifically so requested by such holder, agent or underwriter, as
the case may be) and of the prospectus included in such registration
statement (including each preliminary prospectus and any summary
prospectus), in conformity with the requirements of the Securities Act, and
such other documents, as such holder, agent, if any, and underwriter, if
any, may reasonably request in order to facilitate the offering and
disposition of the Registrable Securities owned by such holder, offered or
sold by such agent or underwritten by such underwriter and to permit such
holder, agent and underwriter to satisfy the prospectus delivery
requirements of the Securities Act; and the Company hereby consents to the
use of such prospectus (including such preliminary and summary prospectus)
and any amendment or supplement thereto by each such holder and by any such
agent and underwriter, in each case in the form most recently provided to
such party by the Company, in connection with the offering and sale of the
Registrable Securities covered by the prospectus (including such
preliminary and summary prospectus) or any supplement or amendment thereto;
(x) use its reasonable best efforts to (A) register or qualify the
Registrable Securities to be included in such registration statement under
such securities laws or blue sky laws of such jurisdictions as any holder
of such Registrable Securities and each placement or sales agent, if any,
therefor and underwriter, if any, thereof shall reasonably request, (B)
keep such registrations or qualifications in effect and comply with such
laws so as to permit the continuance of offers, sales and dealings therein
in such jurisdictions during the period the Shelf Registration is required
to remain effective under Section 2(b) above and for so long as may be
necessary to enable any such holder, agent or underwriter to complete its
distribution of Securities pursuant to such registration statement and (C)
take any and all other actions as may be reasonably necessary or advisable
to enable each such holder, agent, if any, and underwriter, if any, to
consummate the disposition in such jurisdictions of Registrable Securities;
PROVIDED, HOWEVER, that the Company shall not be required for any such
purpose to (1) qualify as a corporation in any jurisdiction wherein it
would not otherwise be required to qualify but for the requirements of this
Section 3(c)(x), (2) consent to general service of process in any such
jurisdiction, (3) subject itself to taxation in any jurisdiction where the
-7-
Company is not already subject to taxation or (4) make any changes to the
Company's articles of incorporation or by-laws or any other agreement
between it and its shareholders;
(xi) use its reasonable best efforts to obtain the consent or approval
of each governmental agency or authority, whether federal, state or local,
which may be required to effect the Shelf Registration or the offering or
sale in connection therewith or to enable the selling holder or holders to
offer, or to consummate the disposition of, their Registrable Securities;
(xii) cooperate with the holders of the Registrable Securities and the
managing underwriters, if any, to facilitate the timely preparation and
delivery of certificates representing Registrable Securities to be sold,
which certificates shall be printed, lithographed or engraved, or produced
by any combination of such methods, and which shall not bear any
restrictive legends; and, in the case of an underwritten offering, enable
such Registrable Securities to be in such denominations and registered in
such names as the managing underwriters may request at least two business
days prior to any sale of the Registrable Securities;
(xiii) provide a CUSIP number for all Registrable Securities, not later
than the effective date of the Shelf Registration;
(xiv) enter into one or more underwriting agreements, engagement
letters, agency agreements or similar agreements, as appropriate, including
(without limitation) provisions relating to indemnification and
contribution substantially the same as those set forth in Section 6 hereof,
and take such other actions in connection therewith as any holders of
Registrable Securities aggregating at least 25% of the Registrable
Securities included in such Shelf Registration shall request in order to
expedite or facilitate the disposition of such Registrable Securities;
provided, that the Company shall not be required to enter into any such
agreement more than once with respect to all of the Registrable Securities
and may delay entering into such agreement until the consummation of any
underwritten public offering which the Company shall have then undertaken;
(xv) whether or not an agreement of the type referred to in Section
(3)(c)(xiv) hereof is entered into and whether or not any portion of the
offering contemplated by such registration statement is an underwritten
offering or is made through a placement or sales agent or any other entity,
(A) make such representations and warranties to the holders of such
Registrable Securities and the placement or sales agent, if any, therefor
and the underwriters, if any, thereof substantially the same as those set
forth in Section 1 of the Purchase Agreement and such other representations
and warranties as are customarily made with respect to the offering of debt
securities pursuant to a shelf registration statement on the applicable
form under the Act; (B) obtain an opinion or opinions of counsel to the
Company substantially the same as the opinions provided for in Section 5 of
the Purchase Agreement, addressed to such holder or holders and the
placement or sales agent, if any, therefor and the underwriters, if any,
thereof and dated the effective date of such registration statement (and if
such registration statement contemplates an underwritten offering of a part
or all of the Registrable Securities, dated the date of the closing under
the underwriting agreement relating thereto) (it being agreed that the
matters to be covered by such opinion shall also include, without
limitation, the due incorporation of the Company and its subsidiaries; the
qualification of the Company and its subsidiaries to transact business as
foreign corporations, limited liability companies or limited partnerships,
as the case may be; the due authorization, execution and delivery of the
relevant agreement of the type referred to in Section (3)(c)(xiv) hereof,
the due authorization, execution,
-8-
authentication and issuance, and the validity and enforceability, of the
Securities; the absence of material legal or governmental proceedings
involving the Company; the absence of a breach by the Company or any of its
subsidiaries of, or a default under, material agreements binding upon the
Company or any subsidiary of the Company; the absence of governmental
approvals required to be obtained in connection with the Shelf
Registration, the offering and sale of the Registrable Securities, this
Agreement or any agreement of the type referred to in Section (3)(c)(xiv)
hereof, except such approvals as may be required under state securities or
blue sky laws; and the compliance as to form of such registration statement
and any documents incorporated by reference therein and of the Indenture
with the requirements of the Securities Act and the Trust Indenture Act,
respectively; and, such opinion shall also state that such counsel has no
reason to believe that, as of the date of the opinion and of the
registration statement or most recent post-effective amendment thereto, as
the case may be, such registration statement and the prospectus included
therein, as then amended or supplemented, and the documents incorporated by
reference therein (in each case other than the financial statements and
other financial information contained therein) contains or contained an
untrue statement of a material fact or omits or omitted to state therein a
material fact necessary to make the statements therein not misleading (in
the case of such documents, in the light of the circumstances existing at
the time that such documents were filed with the Commission under the
Exchange Act)); (C) obtain a "cold comfort" letter or letters from the
independent certified public accountants of the Company addressed to the
selling holders of Registrable Securities, the placement or sales agent, if
any, therefor and the underwriters, if any, thereof, dated (i) the
effective date of such registration statement and (ii) the effective date
of any prospectus supplement to the prospectus included in such
registration statement or post-effective amendment to such registration
statement which includes unaudited or audited financial statements as of a
date or for a period subsequent to that of the latest such statements
included in such prospectus (and, if such registration statement
contemplates an underwritten offering pursuant to any prospectus
supplement to the prospectus included in such registration statement or
post-effective amendment to such registration statement which includes
unaudited or audited financial statements as of a date or for a period
subsequent to that of the latest such statements included in such
prospectus, dated the date of the closing under the underwriting agreement
relating thereto), such letter or letters to be in customary form and
covering such matters of the type customarily covered by letters of such
type; (D) deliver such other documents and certificates, including
officers' certificates, as may be reasonably requested by any holders of at
least 25% of the Registrable Securities included in such Shelf Registration
or the placement or sales agent, if any, therefor and the managing
underwriters, if any, thereof to evidence the accuracy of the
representations and warranties made pursuant to clause (A) above or those
contained in Section 5(a) hereof and the compliance with or satisfaction of
any agreements or conditions contained in the underwriting agreement or
other agreement entered into by the Company; and (E) undertake such
obligations relating to expense reimbursement, indemnification and
contribution as are provided in Section 6 hereof;
(xvi) notify in writing each holder of Registrable Securities of any
proposal by the Company to amend or waive any provision of this Agreement
pursuant to Section 9(h) hereof and of any amendment or waiver effected
pursuant thereto, each of which notices shall contain the text of the
amendment or waiver proposed or effected, as the case may be;
(xvii) in the event that any broker-dealer registered under the Exchange
Act shall underwrite any Registrable Securities or participate as a member
of an underwriting syndicate or selling group or "assist in the
distribution" (within the meaning of the Rules of Conduct of the National
Association
-9-
of Securities Dealers, Inc. ("NASD") or any successor thereto, as amended
from time to time) thereof, whether as a holder of such Registrable
Securities or as an underwriter, a placement or sales agent or a broker or
dealer in respect thereof, or otherwise, assist such broker-dealer in
complying with the requirements of such Rules of Conduct, including,
without limitation, by (A) if such Rules of Conduct shall so require,
engaging a "qualified independent underwriter" (as defined in such Rules of
Conduct) to participate in the preparation of the registration statement
relating to such Registrable Securities, to exercise usual standards of due
diligence in respect thereto and, if any portion of the offering
contemplated by such registration statement is an underwritten offering or
is made through a placement or sales agent, to recommend the yield of such
Registrable Securities, (B) indemnifying any such qualified independent
underwriter to the extent of the indemnification of underwriters provided
in Section 6 hereof, and (C) providing such information to such
broker-dealer as may be required in order for such broker-dealer to comply
with the requirements of the Rules of Conduct of the NASD; and
(xviii)comply with all applicable rules and regulations of the
Commission, and make generally available to its security holders as soon as
practicable but in any event not later than eighteen months after the
effective date of such registration statement, an earning statement of the
Company and its subsidiaries complying with Section 11(a) of the Securities
Act (including, at the option of the Company, Rule 158 thereunder).
(d) In the event that the Company would be required, pursuant to Section
3(c)(vi)(F) above, to notify the selling holders of Registrable Securities, the
placement or sales agent, if any, therefor and the managing underwriters, if
any, thereof, the Company shall without delay prepare and furnish to each such
holder, to each placement or sales agent, if any, and to each underwriter, if
any, a reasonable number of copies of a prospectus supplemented or amended so
that, as thereafter delivered to purchasers of Registrable Securities, such
prospectus shall 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 not misleading in light of the circumstances then existing.
Each holder of Registrable Securities agrees that upon receipt of any notice
from the Company pursuant to Section 3(c)(vi)(F) hereof, such holder shall
forthwith discontinue the disposition of Registrable Securities, pursuant to the
registration statement applicable to such Registrable Securities until such
holder shall have received copies of such amended or supplemented prospectus,
and if so directed by the Company, such holder shall deliver to the Company (at
the Company's expense) all copies, other than permanent file copies, then in
such holder's possession of the prospectus covering such Registrable Securities
at the time of receipt of such notice.
(e) The Company may require each holder of Registrable Securities as to
which any registration is being effected to furnish in writing to the Company
such information regarding such holder and such holder's intended method of
distribution of such Registrable Securities as the Company may from time to time
reasonably request in writing, but only to the extent that such information is
required in order to comply with the Securities Act. Each such holder agrees to
notify the Company as promptly as practicable of any inaccuracy or change in
information previously furnished by such holder to the Company or of the
occurrence of any event in either case as a result of which any prospectus
relating to such registration contains or would contain an untrue statement of a
material fact regarding such holder or such holder's intended method of
distribution of such Registrable Securities or omits to state any material fact
regarding such holder or such holder's intended method of distribution of such
Registrable Securities required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances then existing,
and promptly to furnish to the Company any additional information required to
correct and
-10-
update any previously furnished information or required so that such prospectus
shall not contain, with respect to such holder or the distribution of such
Registrable Securities, an untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances then existing.
Each such holder shall comply with the provisions of the Securities Act
applicable to such holder with respect to the disposition by such holder of
Registrable Securities covered by such registration statement in accordance with
the intended methods of disposition by such holder set forth in such
registration statement.
(f) Until three years after the Closing Date, the Company will not, and
will not permit any of its "affiliates" (as defined in Rule 144) to, resell any
of the Securities which constitute "restricted securities" under Rule 144 that
have been reacquired by any of them except pursuant to an effective registration
statement under the Securities Act or any exemption therefrom; PROVIDED,
HOWEVER, that, for purposes of this paragraph, "affiliates" shall not include
the Initial Purchasers or any of their affiliates other than the Company and its
subsidiaries, officers, managers and directors.
4. REGISTRATION EXPENSES.
If the Company files a registration statement pursuant to Section 2(a) or
Section 2(b), the following provisions shall apply:
The Company agrees to bear and to pay or cause to be paid all expenses
incident to the Company's performance of or compliance with this Agreement,
including, without limitation, (a) all Commission and any NASD registration and
filing fees and expenses, (b) all fees and expenses in connection with the
qualification of Registrable Securities for offering and sale under the State
securities and blue sky laws referred to in Section 3(c)(x) hereof, including
reasonable fees and disbursements of counsel for the placement or sales agent,
if any, or underwriters, if any, in connection with such qualifications, (c) all
expenses relating to the preparation, printing, distribution and reproduction of
each registration statement required to be filed hereunder, each prospectus
included therein or prepared for distribution pursuant hereto, each amendment or
supplement to the foregoing, and the certificates representing the Exchange
Securities, (d) messenger and delivery expenses, (e) fees and expenses of the
registrar and transfer agent for the Preferred Shares, the Trustee under the
Indenture and any escrow agent or custodian, (f) internal expenses (including,
without limitation, all salaries and expenses of the Company's officers and
employees performing legal or accounting duties), (g) fees, disbursements and
expenses of counsel and independent certified public accountants of the Company
(including the expenses of any opinions or "cold comfort" letters required by or
incident to such performance and compliance), (h) fees, disbursements and
expenses of any "qualified independent underwriter" engaged pursuant to Section
3(c)(xvii) hereof, (i) fees, disbursements and expenses of one counsel for the
holders of Registrable Securities retained in connection with a Shelf
Registration, as selected by the holders of at least a majority of the
Registrable Securities being registered, and fees, expenses and disbursements of
any other persons, including special experts, retained by the Company in
connection with such registration (collectively, the "Registration Expenses").
To the extent that any Registration Expenses are incurred, assumed or paid by
any holder of Registrable Securities or any placement or sales agent therefor or
underwriter thereof, the Company shall reimburse such person for the full amount
of the Registration Expenses so incurred, assumed or paid promptly after receipt
of a written request therefor. Notwithstanding the foregoing, the holders of the
Registrable Securities being registered shall pay all agency or brokerage fees
and commissions and underwriting discounts and commissions attributable to the
sale of such Registrable Securities and the fees and disbursements of any
counsel or other advisors or experts retained by such holders (severally or
jointly),
-11-
other than the counsel and experts specifically referred to above, transfer
taxes on resale of any of the Registrable Securities by such holders and any
advertising expenses incurred by or on behalf of such holders in connection with
any offers they may make.
5. REPRESENTATIONS AND WARRANTIES.
The Company represents and warrants to, and agrees with, each Initial
Purchaser and each of the holders from time to time of Registrable Securities
that:
(a) Each registration statement covering Registrable Securities and each
prospectus (including any preliminary or summary prospectus) contained
therein or furnished pursuant to Section 3(c)(ix) hereof and any further
amendments or supplements to any such registration statement or prospectus,
when it becomes effective or is filed with the Commission, as the case may
be, and, in the case of an underwritten offering of Registrable Securities,
at the time of the closing under the underwriting agreement relating
thereto, will conform in all material respects to the requirements of the
Securities Act and the Trust Indenture Act and any such registration
statement and any amendment thereto 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 not misleading and any
such prospectus or any amendment or supplement thereto 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
not misleading in light of the circumstances then existing; and at all times
subsequent to the Effective Time of any such registration statement when a
prospectus would be required to be delivered under the Securities Act, other
than from (i) such time as a notice has been given to holders of Registrable
Securities pursuant to Section 3(c)(vi)(F) hereof until (ii) such time as
the Company furnishes an amended or supplemented prospectus pursuant to
Section 3(d) hereof, each such registration statement, and each prospectus
(including any summary prospectus) contained therein or furnished pursuant
to Section 3(c)(ix) hereof, as then amended or supplemented, will conform in
all material respects to the requirements of the Securities Act and the
Trust Indenture Act and 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 not misleading in the light of the
circumstances then existing; PROVIDED, HOWEVER, that this representation and
warranty shall not apply to any statements or omissions made in reliance
upon and in conformity with information furnished in writing to the Company
by a holder of Registrable Securities or any placement or sales agent
therefor or underwriter thereof expressly for use therein.
(b) Any documents incorporated by reference in any prospectus referred
to in Section 5(a) hereof, when they become or became effective or are or
were filed with the Commission, as the case may be, will conform or
conformed in all material respects to the requirements of the Securities Act
or the Exchange Act, as applicable, and none of such documents will contain
or contained an untrue statement of a material fact or will omit or omitted
to state a material fact required to be stated therein or necessary to make
the statements therein not misleading; PROVIDED, HOWEVER, that this
representation and warranty shall not apply to any statements or omissions
made in reliance upon and in conformity with information furnished in
writing to the Company by a holder of Registrable Securities expressly for
use therein.
(c) The compliance by the Company with all of the provisions of this
Agreement and the consummation of the transactions herein contemplated will
not conflict with or result in a breach of
-12-
any of the terms or provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Company or any subsidiary of the Company is a party
or by which the Company or any subsidiary of the Company is bound or to
which any of the property or assets of the Company or any subsidiary of the
Company is subject, nor will such action result in any violation of the
provisions of the articles of incorporation or by-laws of the Company, in
each case, as in effect at the applicable time, or any statute or any order,
rule or regulation of any court or governmental agency or body having
jurisdiction over the Company or any subsidiary of the Company or any of
their properties; and no consent, approval, authorization, order,
registration or qualification of or with any such court or governmental
agency or body is required for the consummation by the Company of the
transactions contemplated by this Agreement, except the registration under
the Securities Act of the Registrable Securities, qualification of the
Indenture under the Trust Indenture Act and such consents, approvals,
authorizations, registrations or qualifications as may be required under
State securities or blue sky laws in connection with the offering and
distribution of the Registrable Securities and the Exchange Securities.
(d) This Agreement has been duly authorized, executed and delivered by
the Company.
6. INDEMNIFICATION.
(a) INDEMNIFICATION BY THE COMPANY. Upon the registration of the Registrable
Securities pursuant to Section 2 hereof, and in consideration of the agreements
of the Initial Purchasers contained herein, and as an inducement to the Initial
Purchasers to purchase the Securities, the Company shall, and hereby agrees to,
(i) indemnify and hold harmless each of the holders of Registrable Securities to
be included in such registration, and each person who participates as a
placement or sales agent or as an underwriter in any offering or sale of such
Registrable Securities against any losses, claims, damages or liabilities, joint
or several, to which such holder, agent or underwriter may become subject under
the Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in any
registration statement under which such Registrable Securities were registered
under the Securities Act, or any preliminary, final or summary prospectus
contained therein or furnished by the Company to any such holder, agent or
underwriter, or any amendment or supplement thereto, or arise out of or are
based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, and (ii) reimburse such holder, such agent and such underwriter for
any legal or other expenses reasonably incurred by them in connection with
investigating or defending any such action or claim as such expenses are
incurred; PROVIDED, HOWEVER, that the Company shall not be liable to any such
person in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in any such registration
statement, or preliminary, final or summary prospectus, or amendment or
supplement thereto, in reliance upon and in conformity with written information
furnished to the Company by any holders of Registrable Securities or any
placement or sales agent thereof or underwriter thereof expressly for use
therein;
(b) INDEMNIFICATION BY THE HOLDERS AND ANY AGENTS AND UNDERWRITERS. The
Company may require, as a condition to including any Registrable Securities in
any registration statement filed pursuant to Section 2 hereof and to entering
into any placement or underwriting agreement with respect thereto, that the
Company shall have received an undertaking reasonably satisfactory to them from
the holder of such Registrable Securities and from each placement agent or
underwriter named in any such placement
-13-
agreement or underwriting agreement, severally and not jointly, to (i) indemnify
and hold harmless the Company, and all other holders of Registrable Securities,
against any losses, claims, damages or liabilities to which the Company or such
other holders of Registrable Securities may become subject, under the Securities
Act or otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon an untrue statement
or alleged untrue statement of a material fact contained in such registration
statement, or any preliminary, final or summary prospectus contained therein or
furnished by the Company to any such holder, agent or underwriter, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, in each case
to the extent, but only to the extent, that such untrue statement or alleged
untrue statement or omission or alleged omission was made in reliance upon and
in conformity with written information furnished to the Company by such holder,
agent or underwriter expressly for use therein, and (ii) reimburse the Company
for any legal or other expenses reasonably incurred by the Company in connection
with investigating or defending any such action or claim as such expenses are
incurred; PROVIDED, HOWEVER, that no such holder shall be required to undertake
liability to any person under this Section 6(b) for any amounts in excess of the
dollar amount of the proceeds to be received by such holder from the sale of
such holder's Registrable Securities pursuant to such registration.
(c) NOTICES OF CLAIMS, ETC. Promptly after receipt by an indemnified party
under subsection (a) or (b) above of written notice of the commencement of any
action, such indemnified party shall, if a claim in respect thereof is to be
made against an indemnifying party pursuant to the indemnification provisions of
or contemplated by this Section 6, notify such indemnifying party in writing of
the commencement of such action; but the omission so to notify the indemnifying
party shall not relieve it from any liability which it may have to any
indemnified party other than under the indemnification provisions of or
contemplated by Section 6(a) or 6(b) hereof. In case any such action shall be
brought against any indemnified party and it shall notify an indemnifying party
of the commencement thereof, such indemnifying party shall be entitled to
participate therein and, to the extent that it shall wish, jointly with any
other indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying party), and,
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, such indemnifying party shall not be
liable to such indemnified party for any legal expenses of other counsel or any
other expenses, in each case subsequently incurred by such indemnified party, in
connection with the defense thereof other than reasonable costs of
investigation. No indemnifying party shall, without the written consent of the
indemnified party, effect the settlement or compromise of, or consent to the
entry of any judgment with respect to, any pending or threatened action or claim
in respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified party is an actual or potential party to such
action or claim) unless such settlement, compromise or judgment (i) includes an
unconditional release of the indemnified party from all liability arising out of
such action or claim and (ii) does not include a statement as to or an admission
of fault, culpability or a failure to act by or on behalf of any indemnified
party. No indemnifying party shall be liable for the cost of any settlement
effected by an indemnified party without the written consent of such
indemnifying party, which consent shall not be unreasonably withheld. In no
event shall any indemnifying party be liable for the fees and expenses of more
than one firm or counsel (except to the extent that local counsel, in addition
to such firm or counsel, is required for effective representation) to represent
all indemnified parties with respect to a single action or separate but
substantially similar actions in the same jurisdiction arising out of the same
general allegations.
-14-
(d) CONTRIBUTION. If for any reason the indemnification provisions
contemplated by Section 6(a) or Section 6(b) are unavailable to or insufficient
to hold harmless an indemnified party in respect of any losses, claims, damages
or liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect not
only (i) the relative benefits received by the holders of the Registrable
Securities, on the one hand, and any agents or underwriters, on the other, from
any offering or sale of the Registrable Securities, but also (ii) the relative
fault of the indemnifying party and the indemnified party in connection with the
statements or omissions which resulted in such losses, claims, damages or
liabilities (or actions in respect thereof), as well as any other relevant
equitable considerations. The relative benefits received by the holders of the
Registrable Securities on the one hand and any agents or underwriters on the
other shall be deemed to be in the same proportion as the total net proceeds
from any offering or sale thereof (before deducting expenses) received by such
holders bear to the total discounts and commissions received by any such agents
or underwriters with respect to such offer or sale. The relative fault of such
indemnifying party and indemnified party shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or omission or alleged omission to state a material fact relates to
information supplied by such indemnifying party or by such indemnified party,
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The parties hereto
agree that it would not be just and equitable if contributions pursuant to this
Section 6(d) were determined by pro rata allocation (even if the holders or any
agents or underwriters or all of them were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to in this Section 6(d). The amount paid or
payable by an indemnified party as a result of the losses, claims, damages, or
liabilities (or actions in respect thereof) referred to above shall be deemed to
include any legal or other fees or expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this Section 6(d), no holder shall
be required to contribute any amount in excess of the amount by which the dollar
amount of the proceeds received by such holder from the sale of any Registrable
Securities (after deducting any fees, discounts and commissions applicable
thereto) exceeds the amount of any damages which such holder has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission, and no underwriter or agent shall be required to contribute
any amount in excess of the amount by which the total price at which the
Registrable Securities placed or underwritten by it and distributed to the
public were offered to the public exceeds the amount of any damages which such
underwriter or agent 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. The holders' and any underwriters'
or agent's obligations in this Section 6(d) to contribute shall be several in
proportion to the amount of Registrable Securities registered, underwritten or
placed, as the case may be, by them and not joint.
(e) The obligations of the Company under this Section 6 shall be in addition
to any liability which the Company may otherwise have and shall extend, upon the
same terms and conditions, to each officer, director and partner of each holder,
agent and underwriter and each person, if any, who controls any holder, agent or
underwriter within the meaning of the Securities Act; and the obligations of the
holders and any agents or underwriters contemplated by this Section 6 shall be
in addition to any liability which the respective holder, agent or underwriter
may otherwise have and shall extend, upon the same terms and conditions, to each
officer and director of the Company (including any person who, with his consent,
-15-
is named in any registration statement as about to become a director of the
Company) and to each person, if any, who controls the Company within the meaning
of the Securities Act.
7. UNDERWRITTEN OFFERINGS.
(a) SELECTION OF UNDERWRITERS. If any of the Registrable Securities covered
by the Shelf Registration are to be sold pursuant to an underwritten offering,
the managing underwriter or underwriters thereof shall be designated by the
holders of at least a majority of the Registrable Securities to be included in
such offering, provided that such designated managing underwriter or
underwriters is or are reasonably acceptable to the Company.
(b) PARTICIPATION BY HOLDERS. Each holder of Registrable Securities hereby
agrees with each other such holder that no such holder may participate in any
underwritten offering hereunder unless such holder (i) agrees to sell such
holder's Registrable Securities on the basis provided in any underwriting
arrangements approved by the persons entitled hereunder to approve such
arrangements and (ii) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents reasonably
required under the terms of such underwriting arrangements.
(c) CONSOLIDATED EARNING STATEMENTS. In the event of an underwritten
offering, the Company agrees to make generally available to its securityholders
as soon as practicable, but in any event not later than eighteen months after
the effective date of the applicable registration statement (as defined in
Rule 158(c) under the Act), a consolidated earning statement of the Company
(which need not be audited) complying with Section 11(a) of the Act and the
rules and regulations of the Commission thereunder (including, at the option of
the Company, Rule 158 under the Act).
8. RULE 144.
The Company covenants to the holders of Registrable Securities that to the
extent it shall be required to do so under the Exchange Act, the Company shall
timely file the reports required to be filed by it under the Exchange Act or the
Securities Act (including, but not limited to, the reports under Section 13 and
15(d) of the Exchange Act referred to in subparagraph (c)(1) of Rule 144 adopted
by the Commission under the Securities Act) and the rules and regulations
adopted by the Commission thereunder, and shall take such further action as any
holder of Registrable Securities may reasonably request, all to the extent
required from time to time to make Rule 144 available to such holder for the
sale of Registrable Securities without registration under the Securities Act
within the limitations of the exemption provided by Rule 144 under the
Securities Act, as such Rule may be amended from time to time, or any similar or
successor rule or regulation hereafter adopted by the Commission. Upon the
request of any holder of Registrable Securities in connection with that holder's
sale pursuant to Rule 144, the Company shall deliver to such holder a written
statement as to whether they have complied with such requirements.
Notwithstanding the foregoing, nothing in this Section 8 shall be deemed to
require the Company to register any of its securities under the Exchange Act.
9. MISCELLANEOUS.
(a) NO INCONSISTENT AGREEMENTS. The Company represents, warrants, covenants
and agrees that it has not granted, and, until either the consummation of the
Exchange Offer or, with respect to the Shelf Registration, the period referred
to in Section 2(b), as applicable, will not grant, registration rights with
-16-
respect to Registrable Securities or any other securities that would limit or
interfere with the exercise of the rights granted, or the obligations of the
Company under, this Agreement.
(b) SPECIFIC PERFORMANCE. The parties hereto acknowledge that there would be
no adequate remedy at law if any party fails to perform any of its obligations
hereunder and that each party may be irreparably harmed by any such failure, and
accordingly agree that each party, in addition to any other remedy to which it
may be entitled at law or in equity, shall be entitled to compel specific
performance of the obligations of any other party under this Agreement in
accordance with the terms and conditions of this Agreement, in any court of the
United States or any State thereof having jurisdiction.
(c) NOTICES. All notices, requests, claims, demands, waivers and other
communications hereunder shall be in writing and shall be deemed to have been
duly given when delivered by hand, if delivered personally or by courier, or
three days after being deposited in the mail (registered or certified mail,
postage prepaid, return receipt requested) as follows: If to the Company, at
155 108th Avenue N.E., Bellevue, Washington 98004, Attention: Secretary, and if
to a holder, to the address of such holder set forth in the security register or
other records of the Company, or to such other address as any party may have
furnished to the others in writing in accordance herewith, except that notices
of change of address shall be effective only upon receipt.
(d) PARTIES IN INTEREST. All the terms and provisions of this Agreement
shall be binding upon, shall inure to the benefit of and shall be enforceable by
the respective successors and assigns of the parties hereto. In the event that
any transferee of any holder of Registrable Securities shall become a holder of
Registrable Securities, in any manner, whether by gift, bequest, purchase,
operation of law or otherwise, such transferee shall, without any further
writing or action of any kind, be deemed a party hereto for all purposes and
such Registrable Securities shall be held subject to all of the terms of this
Agreement, and by taking and holding such Registrable Securities such transferee
shall be entitled to receive the benefits of and be conclusively deemed to have
agreed to be bound by and to perform all of the terms and provisions of this
Agreement. If the Company shall so request, any such successor, assign or
transferee shall agree in writing to acquire and hold the Registrable Securities
subject to all of the terms hereof.
(e) SURVIVAL. The respective indemnities, agreements, representations,
warranties and each other provision set forth in this Agreement or made pursuant
hereto shall remain in full force and effect regardless of any investigation (or
statement as to the results thereof) made by or on behalf of any holder of
Registrable Securities, any director, officer or partner of such holder, any
agent or underwriter or any director, officer or partner thereof, or any
controlling person of any of the foregoing, and shall survive delivery of and
payment for the Registrable Securities pursuant to the Purchase Agreement and
the transfer and registration of Registrable Securities by such holder and the
consummation of an Exchange Offer.
(f) LAW GOVERNING. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
(g) HEADINGS. The descriptive headings of the several Sections and
paragraphs of this Agreement are inserted for convenience only, do not
constitute a part of this Agreement and shall not affect in any way the meaning
or interpretation of this Agreement.
-17-
(h) ENTIRE AGREEMENT; AMENDMENTS. This Agreement and the other writings
referred to herein (including the Certificate of Designations, the Indenture and
the forms of Securities) or delivered pursuant hereto which form a part hereof
contain the entire understanding of the parties with respect to its subject
matter. This Agreement supersedes all prior agreements and understandings
between the parties with respect to its subject matter. This Agreement may be
amended and the observance of any term of this Agreement may be waived (either
generally or in a particular instance and either retroactively or prospectively)
only by a written instrument duly executed by the Company and the holders of at
least 66-2/3 percent of the Registrable Securities at the time outstanding. Each
holder of any Registrable Securities at the time or thereafter outstanding shall
be bound by any amendment or waiver effected pursuant to this Section 9(h),
whether or not any notice, writing or marking indicating such amendment or
waiver appears on such Registrable Securities or is delivered to such holder.
(i) INSPECTION. For so long as this Agreement shall be in effect, this
Agreement and a complete list of the names and addresses of all the holders of
Registrable Securities shall be made available for inspection and copying on any
business day by any holder of Registrable Securities at the offices of the
Company at the address thereof set forth in Section 9(c) above or at the office
of the Trustee under the Indenture.
(j) COUNTERPARTS. This agreement may be executed by the parties in
counterparts, each of which shall be deemed to be an original, but all such
respective counterparts shall together constitute one and the same instrument.
-18-
Agreed to and accepted as of the date referred to above.
NEXTLINK COMMUNICATIONS, INC.
By: /s/ R. Bruce Easter, Jr.
----------------------------
Name: R. Bruce Easter, Jr.
Title: Vice President, General Counsel
and Secretary
MERRILL LYNCH, PIERCE, FENNER &
SMITH INCORPORATED
By: /s/ Marcy Becker
----------------------------
Name: Marcy Becker
Title: Vice President
TORONTO DOMINION SECURITIES (USA) INC.
By: /s/ Gordon Paris
----------------------------
Name: Gordon Paris
Title: Managing Director