Exhibit 4.6
REGISTRATION RIGHTS AGREEMENT
Dated as of May 6, 2002
among
TEKNI-PLEX, INC.,
THE GUARANTORS NAMED HEREIN
and
LEHMAN BROTHERS INC.
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (the "Agreement") is dated as of May 6,
2002, by and among TEKNI-PLEX, INC., a corporation formed under the laws of the
State of Delaware (the "Company"), each of the Subsidiaries of the Company
listed on the signature pages hereto as a Guarantor (collectively, the
"Guarantors" and together with the Company, the "Issuers"), and LEHMAN BROTHERS
INC. (the "Initial Purchaser").
This Agreement is entered into in connection with the Purchase Agreement,
dated as of May 1, 2002, among the Company, certain subsidiaries of the Company,
the Guarantors and the Initial Purchaser (the "Purchase Agreement") relating to
the sale by the Company to the Initial Purchaser of $40,000,000 aggregate
principal amount of its 12 3/4% Senior Subordinated Notes due 2010 (the
"Notes") and the issuance by the Guarantors to the Initial Purchaser of
guarantees (the "Guarantees" and together with the Notes, the "Securities"). In
order to induce the Initial Purchaser to enter into the Purchase Agreement, the
Issuers have agreed to provide the registration rights set forth in this
Agreement for the benefit of the Initial Purchaser and its direct and indirect
transferees. The execution and delivery of this Agreement is a condition to the
Initial Purchaser's obligation to purchase the Securities under the Purchase
Agreement.
The parties hereby agree as follows:
1. Definitions
As used in this Agreement, the following terms shall have the following
meanings:
"Additional Interest": See Section 4.
"Advice": See Section 5.
"Applicable Period": See Section 2(b).
"Closing Date": The Closing Date as defined in the Purchase Agreement.
"Company": See the introductory paragraph to this Agreement.
"Consummation Date": The 250th day after the Closing.
"DTC": See Section 5(a).
"Effectiveness Date": The 180th day after the Closing Date.
"Effectiveness Period": See Section 3(a).
"Event Date": See Section 4(b).
"Exchange Act": The Securities Exchange Act of 1934, as amended, and the
rules and regulations of the SEC promulgated thereunder.
"Exchange Offer": See Section 2(a).
"Exchange Registration Statement": See Section 2(a).
"Exchange Securities": See Section 2(a).
"Filing Date": The 120th day after the Closing Date.
"Guarantors": See the introductory paragraph to this Agreement.
"Holder": Any record holder of Registrable Securities.
"Indemnified Person": See Section 7.
"Indemnifying Person": See Section 7.
"Indenture": The Indenture, dated as of June 21, 2000, among the Company,
the Guarantors and HSBC Bank USA, as trustee, pursuant to which the Notes are
being issued, as amended or supplemented from time to time in accordance with
the terms thereof.
"Initial Purchaser": See the introductory paragraph to this Agreement.
"Initial Shelf Registration": See Section 3(a).
"Inspectors": See Section 5(p).
"Issue Date": The original issue date of the Notes.
"Issuers": See the introductory paragraph to this Agreement.
"NASD": See Section 5(t).
"Notes": See the preamble to this Agreement.
"Participant": See Section 7.
"Participating Broker-Dealer": See Section 2(b).
"Person": An individual, corporation, limited or general partnership,
joint venture, association, joint stock company, trust, unincorporated
organization or government or any agency or political subdivision thereof.
"Private Exchange": See Section 2(b).
"Private Exchange Securities": See Section 2(b).
"Prospectus": The prospectus included in any Registration Statement
(including, without limitation, a prospectus that includes any information
previously omitted from a prospectus filed as part of an effective registration
statement in reliance upon Rule 430A
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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 Securities covered by such Registration Statement, and all
other amendments and supplements to the Prospectus, including post-effective
amendments, and all material incorporated by reference or deemed to be
incorporated by reference in such Prospectus.
"Records": See Section 5(p).
"Registrable Securities": The Securities, upon original issuance thereof
and at all times subsequent thereto, each Exchange Security as to which Section
2(c)(1)(i) hereof is applicable upon original issuance and at all times
subsequent thereto and, if issued, the Private Exchange Securities, until, in
the case of any such Securities, Exchange Securities or Private Exchange
Securities, as the case may be, (i) a Registration Statement (other than, with
respect to any Exchange Security as to which Section 2(c)(1)(i) hereof is
applicable, the Exchange Registration Statement) covering such Securities,
Exchange Securities or Private Exchange Securities has been declared effective
by the SEC and such Securities, Exchange Securities or Private Exchange
Securities, as the case may be, have been disposed of in accordance with such
effective Registration Statement, (ii) such Securities, Exchange Securities or
Private Exchange Securities, as the case may be, are sold in compliance with
Rule 144, or (iii) such Securities, Exchange Securities or Private Exchange
Securities, as the case may be, cease to be outstanding.
"Registration Statement": Any registration statement of the Company and
the Guarantors, including, but not limited to, the Exchange Registration
Statement, that covers any of the Registrable Securities pursuant to the
provisions of this Agreement, including the Prospectus, amendments and
supplements to such registration statement, including post-effective amendments,
all exhibits, and all material incorporated by reference or deemed to be
incorporated by reference in such registration statement.
"Rule 144": Rule 144 promulgated 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 SEC providing for offers and sales of
securities made in compliance therewith resulting in offers and sales by
subsequent holders that are not affiliates of an issuer of such securities being
free of the registration and prospectus delivery requirements of the Securities
Act.
"Rule 144A": Rule 144A promulgated 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 SEC.
"Rule 415": Rule 415 promulgated under the Securities Act, as such Rule
may be amended from time to time, or any similar rule or regulation hereafter
adopted by the SEC.
"SEC": The Securities and Exchange Commission.
"Securities Act": The Securities Act of 1933, as amended, and the rules
and regulations of the SEC promulgated thereunder.
"Shelf Notice": See Section 2(c).
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"Shelf Registration": See Section 3(b).
"Subsequent Shelf Registration": See Section 3(b).
"TIA": The Trust Indenture Act of 1939, as amended.
"Trustee": The trustee as defined in the Indenture and, if existent, the
trustee under any indenture governing the Exchange Securities and Private
Exchange Securities (if any).
"Underwritten registration or underwritten offering": A registration in
connection with which securities are sold to an underwriter for reoffering to
the public pursuant to an effective Registration Statement.
2. Exchange Offer
(a) The Issuers agree to file with the SEC as soon as practicable
after the Closing Date, but in no event later than the Filing Date, an
offer to exchange (the "Exchange Offer") any and all of the Registrable
Securities for a like aggregate principal amount of debt securities of the
Company which are identical in all material respects to the Notes and
guaranteed by the Guarantors with terms identical in all material respects
to the Guarantees (the "Exchange Securities") (and which are entitled to
the benefits of a trust indenture which is identical in all material
respects to the Indenture (other than such changes as are necessary to
comply with any requirements of the SEC to effect or maintain the
qualification of such trust indenture under the TIA) and which has been
qualified under the TIA), except that the Exchange Securities shall have
been registered pursuant to an effective Registration Statement under the
Securities Act and shall contain no restrictive legend thereon. The
Issuers agree to use their reasonable best efforts to keep the Exchange
Offer open for at least 20 business days (or longer if required by
applicable law) after the date notice of the Exchange offer is mailed to
Holders and to consummate the Exchange Offer on or prior to the
Consummation Date. The Exchange Offer will be registered under the
Securities Act on the appropriate form (the "Exchange Registration
Statement") and will comply with all applicable tender offer rules and
regulations under the Exchange Act. If after such Exchange Registration
Statement is initially declared effective by the SEC, the Exchange Offer
or the issuance of the Exchange Securities thereunder is interfered with
by any stop order, injunction or other order or requirement of the SEC or
any other governmental agency or court 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
deemed to represent that any Exchange Securities 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
with any person to participate in the distribution of the Exchange
Securities in violation of the provisions of the Securities Act, and that
such Holder is not an affiliate of the Company within the meaning of Rule
501(b) of Regulation D under the Securities Act and such Holder has full
power and authority to exchange the Registrable Securities in exchange for
the Exchange Securities. 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
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respect to Registrable Securities that are Private Exchange Securities and
Exchange Securities held by Participating Broker-Dealers, and the Issuers
shall have no further obligation to register Registrable Securities (other
than Private Exchange Securities and other than Exchange Securities as to
which clause (c)(1)(i) hereof applies) pursuant to Section 3 of this
Agreement. No securities other than the Exchange Securities shall be
included in the Exchange Registration Statement.
(b) The Issuers shall include within the Prospectus contained in the
Exchange Registration Statement one or more section(s) reasonably
acceptable to the Initial Purchaser, which shall contain a summary
statement of the positions taken or policies made by the Staff of the SEC
(which are available to the Issuers) with respect to the potential
"underwriter" status of any broker-dealer that is the beneficial owner (as
defined in Rule 13d-3 under the Exchange Act) of Exchange Securities
received by such broker-dealer in the Exchange Offer (a "Participating
Broker-Dealer"), whether such positions or policies have been publicly
disseminated by the Staff of the SEC or such positions or policies, in the
reasonable judgment of the Initial Purchaser, represent the prevailing
views of the Staff of the SEC. Such section(s) shall also allow the use of
the prospectus by all persons subject to the prospectus delivery
requirements of the Securities Act, including all Participating
Broker-Dealers, and include a statement describing the means by which
Participating Broker-Dealers may resell the Exchange Securities.
The Issuers shall use their 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 order to resell the Exchange
Securities, provided that such period shall not exceed 180 days (or such
longer period if extended pursuant to the last paragraph of Section 5)
(the "Applicable Period").
If, prior to consummation of the Exchange Offer, the Initial
Purchaser holds any Notes acquired by it and having the status of an
unsold allotment in the initial distribution, the Company upon the request
of the Initial Purchaser shall, simultaneously with the delivery of the
Exchange Securities in the Exchange Offer, issue and deliver to the
Initial Purchaser, in exchange (the "Private Exchange") for the Securities
held by the Initial Purchaser, a like principal amount of debt securities
of the Company that are identical in all material respects to the Exchange
Securities (the "Private Exchange Securities") (and which are issued
pursuant to the same indenture as the Exchange Securities) except for the
placement of a restrictive legend on such Private Exchange Securities. If
possible, the Private Exchange Securities shall bear the same CUSIP number
as the Exchange Securities. Interest on the Exchange Securities and
Private Exchange Securities 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, from the Issue
Date.
Any indenture under which the Exchange Securities or the Private
Exchange Securities will be issued shall provide that the holders of any
of the Exchange Securities and the Private Exchange Securities will vote
and consent together on all matters (to
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which such holders are entitled to vote or consent) as one class and that none
of the holders of the Exchange Securities and the Private Exchange Securities
will have the right to vote or consent as a separate class on any matter (to
which such holders are entitled to vote or consent).
(c) If (1) prior to the consummation of the Exchange Offer, the
Company reasonably determines in good faith or Holders of at least a
majority in aggregate principal amount of the Registrable Securities
notify the Company that they have reasonably determined in good faith that
(i) in the opinion of counsel, the Exchange Securities would not, upon
receipt, be tradable by such Holders who are not affiliates of the Company
without restriction under the Securities Act and without restrictions
under applicable blue sky or state securities laws or (ii) in the opinion
of counsel, the SEC is unlikely to permit the consummation of the Exchange
Offer and/or (2) subsequent to the consummation of the Private Exchange,
holders of at least a majority in aggregate principal amount of the
Private Exchange Securities so request with respect to the Private
Exchange Securities and/or (3) the Exchange Offer is commenced and not
consummated prior to the 40th day following the Consummation Date for any
reason, then the Company shall promptly deliver to the Holders and the
Trustee notice thereof (the "Shelf Notice") and shall thereafter file an
Initial Shelf Registration as set forth in Section 3 (which only in the
circumstances contemplated by clause (2) of this sentence will relate
solely to the Private Exchange Securities). The parties hereto agree that,
following the delivery of a Shelf Notice to the Holders of Registrable
Securities (only in the circumstances contemplated by clauses (1) and/or
(3) of the preceding sentence), the Issuers shall not have any further
obligation to conduct the Exchange Offer or the Private Exchange under
this Section 2.
3. Shelf Registration
If a Shelf Notice is delivered as contemplated by Section 2(c), then:
(a) Initial Shelf Registration. The Issuers shall as promptly as
reasonably practicable prepare and file with the SEC a Registration
Statement for an offering to be made on a continuous basis pursuant to
Rule 415 covering all of the Registrable Securities (the "Initial Shelf
Registration"). If the Issuers shall have not yet filed an Exchange Offer,
the Issuers shall use their reasonable best efforts to file with the SEC
the Initial Shelf Registration on or prior to the Filing Date. Otherwise,
the Issuers shall use their reasonable best efforts to file with the SEC
the Initial Shelf Registration within 45 days of the delivery of the Shelf
Notice. The Initial Shelf Registration shall be on Form S-1 or another
appropriate form permitting registration of such Registrable Securities
for resale by such holders in the manner or manners designated by them
(including, without limitation, one or more underwritten offerings). The
Issuers shall not permit any securities other than the Registrable
Securities to be included in the Initial Shelf Registration or any
Subsequent Shelf Registration. The Issuers shall use their reasonable best
efforts to cause the Initial Shelf Registration to be declared effective
under the Securities Act on or prior to the 90th day after the filing
thereof with the Commission and to keep the Initial Shelf Registration
continuously effective under the Securities Act until the date on which
the Securities are no longer "restricted securities"
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(within the meaning of Rule 144 under the Act) (subject to extension
pursuant to the last paragraph of Section 5 hereof) (the "Effectiveness
Period"), or such shorter period ending when (i) all Registrable
Securities covered by the Initial Shelf Registration have been sold in the
manner set forth and as contemplated in the Initial Shelf Registration,
(ii) the second anniversary of the Closing Date occurs or (iii) a
Subsequent Shelf Registration covering all of the Registrable Securities
has been declared effective under the Securities Act.
(b) Subsequent Shelf Registrations. If the Initial Shelf
Registration or any Subsequent Shelf Registration 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), the
Issuers shall use their reasonable best efforts to obtain the prompt
withdrawal of any order suspending the effectiveness thereof, and in any
event shall within 45 days of such cessation of effectiveness amend the
Shelf Registration in a manner reasonably expected 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 Securities (a "Subsequent Shelf Registration"). If
a Subsequent Shelf Registration is filed, the Issuers shall use their
reasonable best efforts to cause the Subsequent Shelf Registration to be
declared effective as soon as practicable after such filing and to keep
such Registration Statement 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 Registration 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 Issuers shall promptly
supplement and amend the 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 Securities covered by such Registration
Statement or by any underwriter of such Registrable Securities.
4. Additional Interest
(a) The Issuers and the Initial Purchasers agree that the Holders of
Registrable Securities will suffer damages if the Issuers fail to fulfill
their 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 Issuers, jointly and severally, agree to pay, as
liquidated damages, additional interest on the Registrable Securities
("Additional Interest") under the circumstances and to the extent set
forth below (each of which shall be given independent effect and shall not
be duplicative except as otherwise provided below):
(i) if neither the Exchange Registration Statement nor the
Initial Shelf Registration has been filed on or prior to the Filing
Date, Additional Interest shall accrue on the Registrable Securities
over and above the stated interest at a rate of .25% per annum for
the first 90 days immediately following the Filing Date, such
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Additional Interest rate increasing by an additional .25% per annum
at the beginning of each subsequent 90-day period;
(ii) if neither the Exchange Registration Statement nor the
Initial Shelf Registration is declared effective by the SEC on or
prior to the Effectiveness Date, Additional Interest shall be
accrued on the Registrable Securities included or which should have
been included in such Registration Statement over and above the
stated interest at a rate of .25% per annum for the first 90 days
immediately following the day after the Effectiveness Date, such
Additional Interest rate increasing by an additional .25% per annum
at the beginning of each subsequent 90-day period; and
(iii) if (A) the company has not exchanged Exchange Securities
for all Securities validly tendered in accordance with the terms of
the Exchange Offer on or prior to the Consummation Date or (B) the
Exchange Registration Statement ceases to be effective at any time
prior to the time that the Exchange Offer is consummated or (C) if
applicable, the Shelf Registration has been declared effective and
such Shelf Registration ceases to be effective at any time during
the Effectiveness Period, then Additional Interest shall be accrued
on the Registrable Securities (over and above any interest otherwise
payable on the Registrable Securities) at a rate of .25% per annum
for the first 90 days commencing on the (x) 251st day after the
Issue Date, in the case of (A) above, or (y) the day the Exchange
Registration Statement ceases to be effective in the case of (B)
above, or (z) the day such Shelf Registration ceases to be effective
in the case of (C) above, such Additional Interest rate increasing
by an additional .25% per annum at the beginning of each such
subsequent 90-day period;
provided, however, that the Additional Interest rate on the Registrable
Securities may not exceed at any one time in the aggregate 1.0% per annum; and
provided, further, that (1) upon the filing of the Exchange Registration
Statement or a Shelf Registration as required hereunder (in the case of clause
(i) of this Section 4(a)), (2) upon the effectiveness of the Exchange
Registration Statement or the Shelf Registration as required hereunder (in the
case of clause (ii) of this Section 4(a)), or (3) upon the exchange of Exchange
Securities for all Notes tendered (in the case of clause (iii)(A) of this
Section 4(a)), or upon the effectiveness of the Exchange Registration Statement
which had ceased to remain effective (in the case of (iii)(B) of this Section
4(a)), or upon the effectiveness of the Shelf Registration which had ceased to
remain effective (in the case of (iii)(C) of this Section 4(a)), Additional
Interest on the Registrable Securities as a result of such clause (or the
relevant subclause thereof), as the case may be, shall cease to accrue. It is
understood and agreed that, notwithstanding any provision to the contrary, so
long as any Registrable Security is then covered by an effective Shelf
Registration Statement, no Additional Interest shall accrue on such Registrable
Security.
(b) The Company shall notify the Trustee within one business day
after each and every date on which an event occurs in respect of which
Additional Interest is required to be paid (an "Event Date"). The Issuers
shall pay the Additional Interest due on the Registrable Securities by
depositing with the Trustee, in trust, for the benefit of the
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Holders thereof, on or before the applicable semi-annual interest payment
date, immediately available funds in sums sufficient to pay the Additional
Interest then due to Holders of Registrable Securities. The Additional
Interest amount due shall be payable on each interest payment date to the
record Holder of Registrable Securities entitled to receive the interest
payment to be made on such date as set forth in the Indenture. The amount
of Additional Interest will be determined by multiplying the applicable
Additional Interest rate by the principal amount of the affected
Registrable Securities of such Holders, multiplied by a fraction, the
numerator of which is the number of days such Additional Interest rate was
applicable during such period (determined on the basis of a 360-day year
comprised of twelve 30-day months and, in the case of a partial month, the
actual number of days elapsed including the first day but excluding the
last day of such period), and, the denominator of which is 360. Each
obligation to pay Additional Interest shall be deemed to accrue
immediately following the occurrence of the applicable Event Date. The
parties hereto agree that the Additional Interest provided for in this
Section 4 constitutes a reasonable estimate of the damages that may be
incurred by Holders of Registrable Securities by reason of the failure of
a Shelf Registration or Exchange Offer to be filed or declared effective,
or a Shelf Registration to remain effective, as the case may be, in
accordance with this Section 4.
5. Registration Procedures
In connection with the registration of any Registrable Securities pursuant
to Sections 2 or 3 hereof, the Issuers shall effect such registrations to permit
the sale of such Registrable Securities in accordance with the intended method
or methods of disposition thereof, and pursuant thereto the Issuers shall:
(a) Use their reasonable best efforts to prepare and file with the
SEC, as soon as practicable after the date hereof but in any event prior
to the Filing Date in the case of the Exchange Registration Statement and
the 45th day following the Consummation Date in the case of the Shelf
Registration Statement, a Registration Statement or Registration
Statements as prescribed by Section 2 or 3, and to use their reasonable
best efforts to cause each such Registration Statement to become effective
and remain effective as provided herein, provided that, if (1) such filing
is pursuant to Section 3, or (2) 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 Securities during the Applicable Period, before
filing any Registration Statement or Prospectus or any amendments or
supplements thereto, the Issuers shall upon written request furnish to and
afford the Holders of the Registrable Securities (which in the case of
Registrable Securities in the form of global certificates shall be The
Depository Trust Company ("DTC")) and 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.
(b) Prepare and file with the SEC such amendments and post-effective
amendments to each Shelf Registration or Exchange Registration Statement,
as the case
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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 required Prospectus supplement, 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, the Exchange Act and the rules and regulations of the SEC promulgated
thereunder 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 Issuers shall not be deemed to have used their
reasonable best efforts to keep a Registration Statement effective during
the Applicable Period if either of them voluntarily takes any action that
would result in selling Holders of the Registrable Securities covered
thereby or Participating Broker-Dealers seeking to sell Exchange
Securities not being able to sell such Registrable Securities or such
Exchange Securities during that period unless such action is required by
applicable law or unless the Issuers comply with this Agreement, including
without limitation, the provisions of paragraph 5(k) hereof and the last
paragraph of this Section 5.
(c) If (1) a Shelf Registration is filed pursuant to Section 3, or
(2) 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 Securities
during the Applicable Period, notify the selling Holders of Registrable
Securities, or each such Participating Broker-Dealer, as the case may be,
their counsel and the managing underwriters, if any, who have provided the
Issuers with their names and addresses promptly (but in any event within
two business days), and confirm such notice in writing, (i) 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 under the
Securities Act (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), (ii) of the issuance by the SEC
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, (iii) of
the receipt by the Company of any notification with respect to the
suspension of the qualification or exemption from qualification of a
Registration Statement or any of the Registrable Securities or the
Exchange Securities 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, (iv) of the happening of any event 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 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
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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 (v) of the Company's reasonable
determination that a post-effective amendment to a Registration Statement
would be appropriate.
(d) If (1) a Shelf Registration is filed pursuant to Section 3, or
(2) 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 Securities
during the Applicable Period, use their reasonable best efforts to prevent
the issuance of any order suspending the effectiveness of a Registration
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 Securities or the Exchange Securities to be sold by any
Participating Broker-Dealer, for sale in any jurisdiction, and, if any
such order is issued, to use their reasonable best efforts to obtain the
withdrawal of any such order at the earliest possible moment.
(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 Securities being
sold in connection with an underwritten offering, (i) promptly incorporate
in a prospectus supplement or post-effective amendment such information as
the managing underwriters, if any, or such Holders or counsel reasonably
request to be included therein, or (ii) make all required filings of such
prospectus supplement or such post-effective amendment as soon as
practicable after the Company has received notification of the matters to
be incorporated in such prospectus supplement or post-effective amendment
provided that the Company shall not be required to take any action
pursuant to this Section 5(e) that would, in the opinion of counsel for
the Company, violate applicable law.
(f) If (1) a Shelf Registration is filed pursuant to Section 3, or
(2) 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 Securities
during the Applicable Period, furnish to each selling Holder of
Registrable Securities 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 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 (1) a Shelf Registration is filed pursuant to Section 3, or
(2) 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 Securities
during the Applicable Period, deliver to each selling Holder of
Registrable Securities, or each such Participating Broker-Dealer, as the
case may be, their counsel, and the underwriters, if any, without charge,
as many copies of the Prospectus or Prospectuses (including each form of
preliminary prospectus) and each
11
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 Issuers hereby consent to the
use of such Prospectus and each amendment or supplement thereto by each of
the selling holders of Registrable Securities or each such Participating
Broker-Dealer, as the case may be, and the underwriters or agents, if any,
and dealers (if any), in connection with the offering and sale of the
Registrable Securities covered by or the sale by Participating
Broker-Dealers of the Exchange Securities pursuant to such Prospectus and
any amendment or supplement thereto.
(h) Prior to any public offering of Registrable Securities or any
delivery of a Prospectus contained in the Exchange Registration Statement
by any Participating Broker-Dealer who seeks to sell Exchange Securities
during the Applicable Period, to use their reasonable best efforts to
register or qualify, and to cooperate with the selling Holders of
Registrable Securities or each such Participating Broker-Dealer, as the
case may be, 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 Securities 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 underwriters reasonably request in writing,
provided that where Exchange Securities held by Participating
Broker-Dealers or Registrable Securities are offered other than through an
underwritten offering, the Issuers agree, if requested, to cause their
counsel to perform 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 reasonable acts or things necessary or
advisable to enable the disposition in such jurisdictions of the Exchange
Securities held by Participating Broker-Dealers or the Registrable
Securities covered by the applicable Registration Statement, provided that
neither of the Issuers shall be required to (A) qualify generally to do
business in any jurisdiction where it is not then so qualified, (B) take
any action that would subject it to general service of process in any such
jurisdiction where it is not then so subject or (C) subject itself to
taxation in excess of a nominal dollar amount in any such jurisdiction.
(i) If a Shelf Registration is filed pursuant to Section 3,
reasonably cooperate with the selling Holders of 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 not bear any restrictive
legends and shall be in a form eligible for deposit with DTC; and enable
such Registrable Securities to be registered in such names as the managing
underwriter or underwriters, if any, or Holders may request at least two
business days prior to any sale of Registrable Securities.
(j) Use their reasonable best efforts to cause the Registrable
Securities covered by the Registration Statement to be registered with or
approved by such other United States governmental agencies or authorities
of the United States as may be necessary to enable the seller or sellers
thereof or the underwriters, if any, to consummate the disposition of such
Registrable Securities, except as may be required solely as a consequence
of the nature of such selling Holder's business, in which case the Issuers
12
will cooperate in all reasonable respects with the filing of such
Registration Statement and the granting of such approvals.
(k) If (1) a Shelf Registration is filed pursuant to Section 3, or
(2) 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 Securities
during the Applicable Period, upon the occurrence of any event
contemplated by paragraph 5(c)(iv) or 5(c)(v) above, as promptly as
practicable prepare and (subject to Section 5(a) above) file with the SEC,
solely at the expense of the Issuers, 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 Securities being
sold thereunder or to the purchasers of the Exchange Securities 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.
(l) Use their reasonable best efforts to cause the Registrable
Securities covered by a Registration Statement or the Exchange Securities,
as the case may be, to be rated, or, if previously rated, updated, with
the appropriate rating agencies, if so requested by the Holders of a
majority in aggregate principal amount of Registrable Securities covered
by such Registration Statement or the Exchange Securities, as the case may
be, or the managing underwriters, if any.
(m) Prior to the effective date of the first Registration Statement
relating to the Registrable Securities, (i) provide the Trustee with
printed certificates for the Registrable Securities in a form eligible for
deposit with DTC and (ii) provide a CUSIP number for the Registrable
Securities.
(n) Use their best efforts to cause all Registrable Securities
covered by such Registration Statement or the Exchange Securities, as the
case may be, to be (i) listed on each securities exchange, if any, on
which similar securities issued by the Company are then listed, or (ii)
authorized to be quoted on the National Association of Securities Dealers
Automated Quotation System ("NASDAQ") or the National Market System of
NASDAQ if similar securities of the Company are so authorized.
(o) In connection with an underwritten offering of Registrable
Securities pursuant to a Shelf Registration, enter into an underwriting
agreement as is customary in underwritten offerings and take all such
other actions as are reasonably requested by the managing underwriters in
order to expedite or facilitate the registration or the disposition of
such Registrable Securities, and in such connection, (i) make such
representations and warranties to the underwriters, with respect to the
business of the Company and its subsidiaries, if any, 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 issuers to underwriters in underwritten offerings, and confirm the
13
same if and when reasonably requested; (ii) obtain an opinion of counsel
to the Issuers and updates thereof in form and substance reasonably
satisfactory to the managing underwriters (if any), addressed to the
underwriters covering the matters customarily covered in opinions
requested in underwritten offerings and such other matters as may be
reasonably requested by underwriters; (iii) obtain "cold comfort" letters
and updates thereof in form and substance reasonably satisfactory to the
managing underwriters from the independent certified public accountants of
the Company (and, if necessary, any other independent certified public
accountants of any subsidiary of the Company or of any business acquired
by the Company for which financial statements and financial data are, or
are required to be, included in the Registration Statement), addressed to
each of 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 and such other matters as may be
reasonably requested by underwriters; and (iv) if an underwriting
agreement is entered into, the same shall contain indemnification
provisions and procedures 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
Securities covered by such Registration Statement and the managing
underwriters or agents) with respect to all parties to be indemnified
pursuant to said Section provided that, the Company shall not be required
to enter into any underwritten offering more than once with respect to all
Registrable Securities and provided further that the Company may delay
entering into an underwritten offering until the consummation of any
underwritten offering the Company shall have undertaken.
(p) If (1) a Shelf Registration is filed pursuant to Section 3, or
(2) 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 Securities
during the Applicable Period, make available for inspection by any selling
Holder of such Registrable Securities being sold, or each such
Participating Broker-Dealer, as the case may be, any underwriter
participating in any such disposition of Registrable Securities, if any,
and any attorney, accountant or other agent retained by any such selling
holder or each such 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 Company and
its subsidiaries, if any (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 Company and its subsidiaries, if any to supply all
information in each case reasonably requested by any such Inspector in
connection with such Registration Statement; provided that such Inspectors
shall first agree in writing with the Company that any information
reasonably designated by the Company in good faith in writing as
confidential at the time of delivery of such information shall be kept
confidential by such Inspector (and such Inspector shall enter into
reasonable confidentiality agreements, and observe other customary
confidentiality procedures, as the Company may reasonably request), except
to the extent that (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 or (iii)
the information in such Records has been made generally available to
14
the public. Each selling Holder of such Registrable Securities and each
such 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 Company unless and until such is
made generally available to the public. Each selling Holder of such
Registrable Securities and each such 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, give notice
to the Company and allow the Company at its expense to undertake
appropriate action to prevent disclosure of the Records deemed
confidential.
(q) Provide an indenture trustee for the Registrable Securities or
the Exchange Securities, as the case may be, and cause the Indenture or
the trust indenture provided for in Section 2(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 Securities; and in connection therewith, cooperate with the
trustee under any such indenture and the holders of the Registrable
Securities, to effect such changes to such indenture as may be required
for such indenture to be so qualified in accordance with the terms of the
TIA; and execute, and use their 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
SEC to enable such indenture to be so qualified in a timely manner.
(r) Comply in all material respects with all applicable rules and
regulations of the SEC and make generally available to their security
holders 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 90 days after the end
of any 12-month period (i) commencing at the end of any fiscal quarter in
which Registrable Securities 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 Company after the effective date of a Shelf Registration
Statement, which statements shall cover said 12-month periods.
(s) If an Exchange Offer or a Private Exchange is to be consummated,
upon delivery of the Registrable Securities by Holders to the Company (or
to such other Person as directed by the Company) in exchange for the
Exchange Securities or the Private Exchange Securities, as the case may
be, the Company shall mark, or caused to be marked, on such Registrable
Securities that such Registrable Securities are being cancelled in
exchange for the Exchange Securities or the Private Exchange Securities,
as the case may be; in no event shall such Registrable Securities be
marked as paid or otherwise satisfied.
(t) Reasonably cooperate with each seller of Registrable Securities
covered by any Registration Statement and each underwriter, if any,
participating in the disposition of such Registrable Securities and their
respective counsel in connection with any filings required to be made with
the National Association of Securities Dealers, Inc. (the "NASD").
15
(u) Use their reasonable best efforts to take all other steps
necessary to effect the registration of the Registrable Securities covered
by a Registration Statement contemplated hereby.
(v) Upon consummation of an Exchange Offer or a Private Exchange,
obtain an opinion of counsel to the Company and the Guarantors, in a form
customary for underwritten offerings of debt securities similar to the
Notes, addressed to the Trustee solely for the benefit of the Trustee, and
not for the benefit of Holders of Registrable Securities participating in
the Exchange Offer or the Private Exchange, as the case may be, and which
includes an opinion that (i) each of the Company and the Guarantors has
duly authorized, executed and delivered the Exchange Securities and
Private Exchange Securities and the related indenture and (ii) each of the
Exchange Securities or the Private Exchange Securities, as the case may
be, and related indenture constitute a legal, valid and binding obligation
of each of the Company and the Guarantors, enforceable against each of the
Company and the Guarantors in accordance with its respective terms (with
customary exceptions).
The Issuers may require each seller of Registrable Securities or
Participating Broker-Dealer as to which any registration is being effected to
furnish to the Issuers such in formation regarding such seller or Participating
Broker-Dealer and the distribution of such Registrable Securities or Exchange
Securities to be sold by such Participating Broker-Dealer, as the case may be,
as the Issuers may, from time to time, reasonably request. The Issuers may
exclude from such registration the Registrable Securities of any seller or
Participating Broker-Dealer who unreasonably fails to furnish such information
within a reasonable time after receiving such request. Each seller as to which
any Shelf Registration is being effected is deemed to agree to furnish promptly
to the Issuers all information required to be disclosed in order to make the
information previously furnished to the Issuers by such seller not materially
misleading.
Each Holder of Registrable Securities and each Participating Broker-Dealer
agrees by acquisition of such Registrable Securities or Exchange Securities to
be sold by such Participating Broker-Dealer, as the case may be, that, upon
receipt of any notice from the Company of the happening of any event of the kind
described in Section 5(c)(ii), 5(c)(iii), 5(c)(iv), or 5(c)(v), such Holder will
forthwith discontinue disposition of such Registrable Securities covered by such
Registration Statement or Prospectus or Exchange Securities to be sold by such
Participating Broker-Dealer, as the case may be, until such holder'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 Company that the
use of the applicable Prospectus may be resumed, and has received copies of any
amendments or supplements thereto. In the event the Company 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 Securities covered by such Registration Statement or Exchange
Securities to be sold by such Participating Broker-Dealer, as the case may be,
shall have received (x) the copies of the supplemented or amended Prospectus
contemplated by Section 5(k) or (y) the Advice.
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6. Registration Expenses
(a) All fees and expenses incident to the performance of or
compliance with this Agreement by the Issuers shall be borne by the
Issuers, jointly and severally, 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 state securities or Blue Sky laws (including, without
limitation, reasonable fees and disbursements of counsel in connection
with Blue Sky qualifications of the Registrable Securities or Exchange
Securities and determination of the eligibility of the Registrable
Securities or Exchange Securities for investment under the laws of such
jurisdictions in the United States (x) where the holders of Registrable
Securities are located, in the case of the Exchange Securities, or (y) as
provided in Section 5(h), in the case of Registrable Securities or
Exchange Securities to be sold by a Participating Broker-Dealer during the
Applicable Period)), (ii) printing expenses (including, without
limitation, expenses of printing certificates for Registrable Securities
or Exchange Securities in a form eligible for deposit with DTC and of
printing prospectuses if the printing of prospectuses is requested by the
managing underwriters, if any, or, in respect of Registrable Securities or
Exchange Securities to be sold by any Participating Broker-Dealer during
the Applicable Period, by the Holders of a majority in aggregate principal
amount of the Registrable Securities included in any Registration
Statement or of such Exchange Securities, as the case may be), (iii)
messenger, telephone and delivery expenses, (iv) fees and disbursements of
counsel for the Issuers and fees and disbursements of special counsel for
the sellers of Registrable Securities (subject to the provisions of
Section 6(b)), (v) fees and disbursements of all independent certified
public accountants referred to in Section 5(o)(iii) (including, without
limitation, the expenses of any special audit and "cold comfort" letters
required by or incident to such performance), (vi) rating agency fees,
(vii) Securities Act liability insurance, if the Issuers desire such
insurance, (viii) fees and expenses of all other Persons retained by
either of the Issuers, (ix) internal expenses of the Issuers (including,
without limitation, all salaries and expenses of officers and employees of
the Issuers performing legal or accounting duties), (x) the expense of any
annual audit, (xi) the fees and expenses incurred in connection with the
listing of the securities to be registered on any securities exchange, if
applicable, (xii) 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, and (xiii) fees and expenses of
the Trustee (including reasonable fees and expenses of counsel to the
Trustee).
(b) In connection with any Shelf Registration hereunder, the Issuers
shall reimburse the Holders of the Registrable Securities being registered
in such registration for the fees and disbursements of not more than one
counsel (in addition to appropriate local counsel) chosen by the Holders
of a majority in aggregate principal amount of the Registrable Securities
to be included in such Registration Statement. Such Holders shall be
responsible for any and all other out-of-pocket expenses of the Holders of
Registrable Securities incurred in connection with the registration of the
Registrable Securities.
17
7. Indemnification
The Issuers agree, jointly and severally, to indemnify and hold harmless
each Holder of Registrable Securities and each Participating Broker-Dealer
selling Exchange Securities during the Applicable Period, the officers and
directors 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 expenses actually incurred in connection with
any suit, action or proceeding or any claim asserted) caused by any untrue
statement or alleged untrue statement of a material fact contained in any
Registration Statement (or any amendment thereto) or Prospectus (as amended or
supplemented if the Issuers shall have furnished any amendments or supplements
thereto) or any preliminary prospectus, or caused by any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, 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 Company in writing by
such Participant expressly for use therein; provided that the foregoing
indemnity with respect to any preliminary prospectus shall not inure to the
benefit of any Participant (or to the benefit of any person controlling such
Participant) from whom the person asserting any such losses, claims, damages or
liabilities purchased Registrable Securities or Exchange Securities if such
untrue statement or omission or alleged untrue statement or omission made in
such preliminary prospectus is eliminated or remedied in the related Prospectus
(as amended or supplemented if the Issuers shall have furnished any amendments
or supplements thereto) and a copy of the related Prospectus (as so amended or
supplemented) shall not have been furnished to such person at or prior to the
sale of such Registrable Securities or Exchange Securities, as the case may be,
to such person.
Each Participant will be required to agree, severally and not jointly, to
indemnify and hold harmless the Issuers, their directors, their officers and
each person who controls the Issuers 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 Issuers to each Participant, but only with
reference to information relating to such Participant furnished to the Company
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 Participant under this paragraph shall in no
event exceed the proceeds received by such Participant from sales of Registrable
Securities giving rise to such obligations.
If any suit, action, proceeding (including any governmental or regulatory
investigation), claim or demand shall be brought or asserted against any person
in respect of which indemnity may be sought pursuant to either of the two
preceding paragraphs, such person (the "Indemnified Person") shall promptly
notify the person against whom such indemnity may be sought (the "Indemnifying
Person") in writing, and the Indemnifying Person, upon request of the
Indemnified Person, shall retain counsel reasonably satisfactory to the
Indemnified Person to represent the Indemnified Person and any others the
Indemnifying Person may designate in such proceeding and shall pay the
reasonable fees and expenses actually incurred by such counsel related to such
proceeding, provided that the failure to so notify the Indemnifying Person shall
18
not relieve it of any obligation or liability which it may have hereunder or
otherwise (unless and only to the extent that such failure directly results in
the loss or compromise of any material rights or defenses). In any such
proceeding, any Indemnified Person shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such Indemnified Person unless (i) the Indemnifying Person and the Indemnified
Person shall have mutually agreed in writing to the contrary, (ii) the
Indemnifying Person has failed within a reasonable time to retain counsel
reasonably satisfactory to the Indemnified Person or (iii) the named parties in
any such proceeding (including any impleaded parties) include both the
Indemnifying Person and the Indemnified Person and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the Indemnifying Person
shall not, in connection with any proceeding or related proceeding in the same
jurisdiction, be liable for the fees and expenses of more than one separate firm
(in addition to any local counsel) for all Indemnified Persons, and that all
such fees and expenses shall be reimbursed as they are incurred. Any such
separate firm for the Participants and such control persons of Participants
shall be designated in writing by Participants who sold a majority in interest
of Registrable Securities sold by all such Participants and any such separate
firm for the Issuers, their directors, their officers and such control persons
of the Issuers shall be designated in writing by the Company. The Indemnifying
Person shall not be liable for any settlement of any proceeding effected without
its written consent, but if settled with such consent or if there be a final
non-appealable judgment for the plaintiff, the Indemnifying Person agrees to
indemnify any Indemnified Person from and against any loss or liability by
reason of such settlement or judgment. Notwithstanding the foregoing sentence,
if at any time an Indemnified Person shall have requested in writing the chief
legal officer or, if no chief legal officer exists, to the chief executive
officer of an Indemnifying Person to reimburse the Indemnified Person for
reasonable fees and expenses actually incurred by counsel as contemplated by the
third sentence of this paragraph, the Indemnifying Person agrees that it shall
be liable for any settlement of any proceeding effected without its written
consent if (i) such settlement is entered into more than 60 days after receipt
by such Indemnifying Person of the aforesaid request and (ii) a second such
written request shall have been sent to and received by the chief legal officer
or, if no chief legal officer exists, by the chief executive officer of the
Indemnifying Person at least 30 days after the first such request but at least
15 days prior to the date of such settlement, and (iii) with respect to such
request, such Indemnifying Person shall not have reimbursed the Indemnified
Person for all reasonable fees and expenses of such counsel in accordance with
such request prior to the date of such settlement; provided, however, that the
Indemnifying Person shall not be liable for any settlement effected without its
consent pursuant to this sentence if the Indemnifying Party is contesting, in
good faith, the request for reimbursement. No Indemnifying Person shall, without
the prior written consent of the Indemnified Person, effect any settlement of
any pending or threatened proceeding in respect of which any Indemnified Person
is or could have been a party and indemnity could have been sought hereunder by
such Indemnified Person, unless such settlement includes an unconditional
release of such Indemnified Person from all liability on claims that are the
subject matter of such proceeding.
If the Indemnification provided for in the first and second paragraphs of
this Section 7 is unavailable to an Indemnified Person in respect of any losses,
claims, damages or liabilities referred to therein, then each Indemnifying
Person under such paragraph, in lieu of indemnifying such Indemnified Person
thereunder, shall contribute to the amount paid or payable by such Indemnified
Person as a result of such losses, claims, damages or liabilities in such
19
proportion as is appropriate to reflect the relative fault of the Issuers on the
one hand and the Participants on the other in connection with the statements or
omissions that resulted in such losses, claims, damages or liabilities, as well
as any other relevant equitable considerations. The relative fault of the
Issuers on the one hand and the Participants on the other 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 Issuers or by the Participants and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.
The parties shall 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 Person 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 Person 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 Securities
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.
The indemnity and contribution agreements contained in this Section 7 will
be in addition to any liability which the Indemnifying Persons may otherwise
have to the Indemnified Persons referred to above.
8. Rule 144 and Rule 144A
Each of the Issuers shall use their reasonable best efforts to file the
reports required to be filed by it under the Securities Act and the Exchange Act
and the rules and regulations adopted by the SEC thereunder in a timely manner
and, if at any time the Issuers are not required to file such reports, they
shall, upon the request of any Holder of Registrable Securities, make publicly
available other information so long as necessary to permit sales pursuant to
Rule 144 and Rule 144A under the Securities Act. The Issuers shall use their
reasonable best efforts to take such further action as any Holder of Registrable
Securities may reasonably request, all to the extent required from time to time
to enable such holder to sell Registrable Securities without registration under
the Securities Act within the limitation of the exemptions provided by (a) Rule
144 and Rule 144A under the Securities Act, as such Rules may be amended from
time to time, or (b) any similar rule or regulation hereafter adopted by the
SEC. Notwithstanding the foregoing, nothing in this Section 8 shall be deemed to
require the Issuers to register any of their securities pursuant to the Exchange
Act.
20
9. Underwritten Registrations
If any of the Registrable Securities covered by any Shelf Registration are
to be sold in an underwritten offering, 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 aggregate principal amount of such Registrable
Securities included in such offering and reasonably acceptable to the Company.
No Holder of Registrable Securities may participate in any underwritten
registration hereunder unless such Holder (a) 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 (b)
completes and executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents required under the terms of such
underwriting arrangements.
10. Miscellaneous
(a) Remedies. In the event of a breach by the Issuers of any of
their obligations under this Agreement, each Holder of Registrable
Securities, in addition to being entitled to exercise all rights provided
herein, in the Indenture or, in the case of the Initial Purchasers, in the
Purchase Agreement or granted by law, including recovery of damages, will
be entitled to specific performance of its rights under this Agreement.
The Issuers agree that monetary damages would not be adequate compensation
for any loss incurred by reason of a breach by them of any of the
provisions of this Agreement and hereby further agree that, in the event
of any action for specific performance in respect of such breach, they
shall waive the defense that a remedy at law would be adequate.
(b) No Inconsistent Agreements. The Issuers have not, as of the date
hereof, entered and shall not, after the date of this Agreement, enter
into any agreement with respect to any of their securities that is
inconsistent with the rights granted to the Holders of Registrable
Securities in this Agreement or otherwise conflicts with the provisions
hereof. The Issuers have not entered and will not enter into any agreement
with respect to any of their securities which will grant to any Person
piggy-back rights with respect to a Registration Statement.
(c) Adjustments Affecting Registrable Securities. The Issuers shall
not, directly or indirectly, take any action with respect to the
Registrable Securities as a class that would adversely affect the ability
of the Holders of Registrable Securities to include such Registrable
Securities in a registration undertaken pursuant to this Agreement.
(d) Amendments and Waivers. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions
hereof may not be given, unless the Company has obtained the written
consent of Holders of at least a majority of the then outstanding
aggregate principal amount of Registrable Securities. 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 Securities whose
21
securities are being 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 Securities may be given by Holders
of at least a majority in aggregate principal amount of the Registrable
Securities being sold by such Holders pursuant to such Registration
Statement, provided that the provisions of this sentence may not be
amended, modified or supplemented except in accordance with the provisions
of the immediately preceding sentence.
(e) Notices. All notices and other communications (including without
limitation any notices or other communications to the Trustee) provided
for or permitted hereunder shall be made in writing by hand-delivery,
registered first-class mail, next-day air courier or telecopy:
(i) if to a Holder of Registrable Securities, at the most
current address given by the Trustee to the Company; and
(ii) if to the Issuers, at Tekni-Plex, Inc., 201 Industrial
Parkway, Somerville, New Jersey 08876, Attention: Dr. F. Patrick
Smith; with a copy to Davis Polk & Wardwell, 450 Lexington Avenue,
New York, New York 10017, Attention: Winthrop Conrad, Esq..
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; 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.
(f) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each of the
parties, including without limitation and without the need for an express
assignment, subsequent Holders of Registrable Securities; provided, that,
with respect to the indemnity and contribution agreements in Section 7,
each Holder of Registrable Securities subsequent to the Initial Purchaser
shall be bound by the terms thereof if such Holder elects to include
Registrable Securities in a Shelf Registration; provided, however, that
this Agreement shall not inure to the benefit of or be binding upon a
successor or assign of a Holder unless and to the extent such successor or
assign holds Registrable Securities.
(g) 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.
(h) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
22
(i) 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, WITHOUT REGARD
TO PRINCIPLES OF CONFLICTS OF LAW. 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.
(j) Severabilitv. If any term, provision, covenant or restriction of
this Agreement is held by a court of competent jurisdiction to be invalid,
illegal, void or un enforceable, 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.
(k) Entire Agreement. This Agreement is intended by the parties as a
final expression of their agreement, and is intended to be a complete and
exclusive statement of the agreement and understanding of the parties
hereto in respect of the subject matter contained herein.
(l) Securities Held by the Company or Its Affiliates. Whenever the
consent or approval of holders of a specified percentage of Registrable
Securities is required hereunder, Registrable Securities held by the
Company 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.
(m) Subsidiary Guarantor a Party. Immediately upon the designation
of any subsidiary of the Company as a Guarantor (as defined in the
Indenture), the Company shall cause such Guarantor to guarantee the
obligations of the Company hereunder (including, without limitation, the
obligation to pay Additional Interest, if any, pursuant to the terms of
Section 4 hereof), by executing and delivering to the Initial Purchaser an
appropriate amendment to this Agreement.
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IN WITNESS WHEREOF, the parties have executed this Registration Rights
Agreement as of the date first written above.
TEKNI-PLEX, INC.
By: /s/ JAMES E. CONDON
-------------------------
Name: James E. Condon
Title: Chief Financial Officer
PURETEC CORPORATION
PLASTIC SPECIALTIES AND TECHNOLOGIES, INC.
PLASTIC SPECIALTIES AND TECHNOLOGIES
INVESTMENTS, INC.
BURLINGTON RESINS, INC.
DISTRIBUTORS RECYCLING INC.
REI DISTRIBUTORS, INC.
ALUMET SMELTING CORP.
NATVAR HOLDINGS, INC.
TRI-SEAL HOLDINGS, INC.
PURE TECH RECYCLING OF CALIFORNIA
COAST RECYCLING NORTH, INC.
PURE TECH APR, INC.
TPI Acquisition Subsidiary, Inc.
collectively, the Guarantors
By: /s/ KENNETH BAKER
--------------------------------------------
Name: Kenneth Baker
Title: President
LEHMAN BROTHERS INC.
By: /s/ MICHAEL KONIGSBERG
--------------------------------------------
Name: Michael Konigsberg
Title: Managing Director