EXHIBIT 4.2
EXECUTION COPY
REGISTRATION RIGHTS AGREEMENT
REGISTERED EXCHANGE OFFER
DRESSER-RAND GROUP INC.
$420,000,000 7 3/8% SENIOR SUBORDINATED NOTES DUE 2014
REGISTRATION RIGHTS AGREEMENT
October 29, 2004
Morgan Stanley & Co. Incorporated
Citigroup Global Markets Inc.
UBS Securities LLC
Bear, Stearns & Co. Inc.
Natexis Bleichroeder Inc.
Sovereign Securities Corporation, LLC
Daiwa Securities America Inc.
c/o Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
Ladies and Gentlemen:
Dresser-Rand Group Inc., a corporation organized under the laws of
Delaware (the "Company"), proposes to issue and sell to certain purchasers (the
"Placement Agents"), for whom Morgan Stanley & Co. Incorporated, Citigroup
Global Markets Inc., UBS Securities LLC, Bear, Stearns & Co. Inc., Natexis
Bleichroeder Inc., Sovereign Securities Corporation, LLC and Daiwa Securities
America Inc. (collectively, the "Representatives") are acting as
representatives, $420,000,000 aggregate principal amount of its 7 3/8% Senior
Subordinated Notes due 2014 (the "Notes") upon the terms set forth in the
Purchase Agreement among the Company and the Representatives, dated October 14,
2004 (the "Purchase Agreement"), relating to the initial placement (the "Initial
Placement") of the Notes. As of the date hereof, the Company's obligations under
the Notes will be guaranteed (the "Guarantees") by its direct and indirect
domestic subsidiaries that guarantee its obligations under the Credit Agreement
(as defined in the Indenture) (collectively, the "Guarantors"). References
herein to the "Issuers" refer to the Company and the Guarantors, collectively.
References herein to the "Securities" refer to the Notes and the Guarantees,
collectively. To induce the Placement Agents to enter into the Purchase
Agreement and to satisfy a condition to your obligations thereunder, the Issuers
agree with you for your benefit and the benefit of the holders from time to time
of the Securities (including the Placement Agents) (each a "Holder" and,
collectively, the "Holders"), as follows:
1. Definitions. Capitalized terms used herein without definition
shall have their respective meanings set forth in the Purchase Agreement. As
used in this Agreement, the following terms shall have the following meanings:
"Act" shall mean the Securities Act of 1933, as amended, and the
rules and regulations of the Commission promulgated thereunder.
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"Affiliate" shall have the meaning specified in Rule 405 under the
Act and the term "controlling" shall have a meaning correlative thereto.
"Broker-Dealer" shall mean any broker or dealer registered as such
under the Exchange Act.
"Business Day" shall mean a day other than a Saturday, a Sunday or a
legal holiday or day on which banking institutions or trust companies are
authorized or required by law to close in New York City.
"Closing Date" shall mean the date of the first issuance of the
Securities.
"Commission" shall mean the Securities and Exchange Commission.
"Company" shall have the meaning set forth in the preamble hereto.
"Deferral Period" shall have the meaning set forth in Section
4(k)(ii) hereof.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission promulgated
thereunder.
"Exchange Offer Registration Period" shall mean the period of 180
days following the consummation of the Registered Exchange Offer,
exclusive of any period during which any stop order shall be in effect
suspending the effectiveness of the Exchange Offer Registration Statement.
"Exchange Offer Registration Statement" shall mean a registration
statement of the Issuers on an appropriate form under the Act with respect
to the Registered Exchange Offer, all amendments and supplements to such
registration statement, including post-effective amendments thereto, in
each case including the Prospectus contained therein, all exhibits thereto
and all material incorporated by reference therein.
"Exchanging Dealer" shall mean any Holder (which may include any
Placement Agent) that is a Broker-Dealer and elects to exchange for New
Securities any Securities that it acquired for its own account as a result
of market-making activities or other trading activities (but not directly
from any Issuer or any Affiliate of any Issuer) for New Securities.
"Final Memorandum" shall mean the offering memorandum, dated October
14, 2004, relating to the Securities, including any and all exhibits
thereto and any information incorporated by reference therein as of such
date.
"Guarantee" shall have the meaning set forth in the preamble hereto.
"Guarantors" shall have the meaning set forth in the preamble
hereto.
"Holder" shall have the meaning set forth in the preamble hereto.
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"Indenture" shall mean that certain Indenture relating to the
Securities, dated as of October 29, 2004, among the Issuers and Citibank,
N.A., as trustee, as the same may be amended from time to time in
accordance with the terms thereof.
"Initial Placement" shall have the meaning set forth in the preamble
hereto.
"Losses" shall have the meaning set forth in Section 6(d) hereof.
"Majority Holders" shall mean, on any date, Holders of a majority of
the aggregate principal amount of Securities and New Securities registered
under a Registration Statement.
"Managing Underwriters" shall mean the investment banker or
investment bankers and manager or managers who administer an underwritten
offering, if any, under a Registration Statement.
"NASD Rules" shall mean the Conduct Rules and the By-laws of the
National Association of Securities Dealers, Inc.
"New Securities" shall mean debt securities of the Company and
Guarantees by the Guarantors, in each case identical in all material
respects to the Securities (except that the transfer restrictions shall be
modified or eliminated, as appropriate) to be issued under the New
Securities Indenture.
"New Securities Indenture" shall mean the Indenture or an indenture
among the Issuers and the New Securities Trustee, identical in all
material respects to the Indenture (except that the transfer restrictions
shall be modified or eliminated, as appropriate), which may be the
Indenture if in the terms thereof appropriate provision is made for the
New Securities.
"New Securities Trustee" shall mean the Trustee or a bank or trust
company reasonably satisfactory to the Placement Agents, as trustee with
respect to the New Securities under the New Securities Indenture.
"Notes" shall have the meaning set forth in the preamble hereto.
"Placement Agents" shall have the meaning set forth in the preamble
hereto.
"Prospectus" shall mean the prospectus included in any Registration
Statement (including, without limitation, a prospectus that discloses
information previously omitted from a prospectus filed as part of an
effective registration statement in reliance upon Rule 430A under the
Act), as amended or supplemented by any prospectus supplement, with
respect to the terms of the offering of any portion of the Securities or
the New Securities covered by such Registration Statement, and all
amendments and supplements thereto, including any and all exhibits thereto
and any information incorporated by reference therein.
"Purchase Agreement" shall have the meaning set forth in the
preamble hereto.
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"Registered Exchange Offer" shall mean the proposed offer of the
Issuers to issue and deliver to the Holders of the Securities that are not
prohibited by any law or policy of the Commission from participating in
such offer, in exchange for the Securities, a like aggregate principal
amount of the New Securities.
"Registrable Securities" shall mean (i) Securities other than those
that have been (A) registered under a Registration Statement and disposed
of in accordance therewith or (B) distributed to the public pursuant to
Rule 144 under the Act or any successor rule or regulation thereto that
may be adopted by the Commission and (ii) any New Securities the resale of
which by the Holder thereof requires compliance with the prospectus
delivery requirements of the Act.
"Registration Default Damages" shall have the meaning set forth in
Section 8 hereof.
"Registration Statement" shall mean any Exchange Offer Registration
Statement or Shelf Registration Statement that covers any of the
Securities or the New Securities pursuant to the provisions of this
Agreement, any amendments and supplements to such registration statement,
including post-effective amendments (in each case including the Prospectus
contained therein), all exhibits thereto and all material incorporated by
reference therein.
"Securities" shall have the meaning set forth in the preamble
hereto.
"Shelf Registration Period" shall have the meaning set forth in
Section 3(b)(ii) hereof.
"Shelf Registration" shall mean a registration effected pursuant to
Section 3 hereof.
"Shelf Registration Statement" shall mean a "shelf" registration
statement of the Issuers pursuant to the provisions of Section 3 hereof
which covers some or all of the Securities or New Securities, as
applicable, on an appropriate form under Rule 415 under the Act, or any
similar rule that may be adopted by the Commission, amendments and
supplements to such registration statement, including post-effective
amendments, in each case including the Prospectus contained therein, all
exhibits thereto and all material incorporated by reference therein.
"Trust Indenture Act" shall mean the Trust Indenture Act of 1939, as
amended, and the rules and regulations of the Commission promulgated
thereunder.
"Trustee" shall mean the trustee with respect to the Securities
under the Indenture.
"Underwriter" shall mean any underwriter of Securities in connection
with an offering thereof under a Shelf Registration Statement.
2. Registered Exchange Offer. (a) The Issuers shall prepare and, not
later than 210 days following the Closing Date (or if such 210th day is not a
Business Day, the next
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succeeding Business Day), shall use commercially reasonable efforts to file with
the Commission the Exchange Offer Registration Statement with respect to the
Registered Exchange Offer. The Issuers shall use commercially reasonable efforts
to cause the Exchange Offer Registration Statement to become effective under the
Act within 270 days of the Closing Date (or if such 270th day is not a Business
Day, the next succeeding Business Day).
(b) Upon the effectiveness of the Exchange Offer Registration
Statement, the Issuers shall promptly commence the Registered Exchange Offer, it
being the objective of such Registered Exchange Offer to enable each Holder
electing to exchange Securities for New Securities (assuming that such Holder
(i) is not an Affiliate of any of the Issuers, (ii) acquires the New Securities
in the ordinary course of such Holder's business, (iii) has no arrangements with
any person to participate in the distribution of the New Securities, (iv) is not
prohibited by any law or policy of the Commission from participating in the
Registered Exchange Offer and (v) is not a Placement Agent holding Securities
that have the status of an unsold allotment remaining from the initial
distribution of the Securities) to trade such New Securities from and after
their receipt without any limitations or restrictions under the Act and without
material restrictions under the securities laws of a substantial proportion of
the several states of the United States.
(c) In connection with the Registered Exchange Offer, the Issuers
shall:
(i) mail or cause to be mailed to each Holder a copy of the
Prospectus forming part of the Exchange Offer Registration Statement,
together with an appropriate letter of transmittal and related documents;
(ii) keep the Registered Exchange Offer open for not less than 20
Business Days after the date notice thereof is mailed to the Holders (or,
in each case, longer if required by applicable law);
(iii) use their commercially reasonable efforts to keep the Exchange
Offer Registration Statement continuously effective under the Act,
supplemented and amended as required under the Act, to ensure that it is
available for sales of New Securities by Exchanging Dealers during the
Exchange Offer Registration Period;
(iv) utilize the services of a depositary for the Registered
Exchange Offer with an address in the Borough of Manhattan in New York
City, which may be the Trustee, the New Securities Trustee or an Affiliate
of either of them;
(v) permit Holders to withdraw tendered Securities at any time prior
to the close of business, New York time, on the last Business Day on which
the Registered Exchange Offer is open;
(vi) prior to effectiveness of the Exchange Offer Registration
Statement, provide a supplemental letter to the Commission (A) stating
that the Issuers are conducting the Registered Exchange Offer in reliance
on the position of the Commission in Exxon Capital Holdings Corporation
(pub. avail. May 13, 1988), Morgan Stanley & Co., Inc. (pub. avail. June
5, 1991) and (B) including a representation that the Issuers have not
entered into any arrangement or understanding with any person to
distribute the New Securities to be received in the Registered Exchange
Offer and that, to the best of
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the Issuers' information and belief, each Holder participating in the
Registered Exchange Offer is acquiring the New Securities in the ordinary
course of business and has no arrangement or understanding with any person
to participate in the distribution of the New Securities; and
(vii) comply in all respects with all laws applicable to the
Registered Exchange Offer.
(d) As soon as practicable after the close of the Registered
Exchange Offer, the Issuers shall:
(i) accept for exchange all Securities tendered and not validly
withdrawn pursuant to the Registered Exchange Offer;
(ii) deliver to the Trustee for cancellation in accordance with
Section 4(r) hereof all Securities so accepted for exchange; and
(iii) cause the New Securities Trustee promptly to authenticate and
deliver to each Holder of Securities a principal amount of New Securities
equal to the principal amount of the Securities of such Holder so accepted
for exchange.
(e) Each Holder hereby acknowledges and agrees that any
Broker-Dealer and any such Holder using the Registered Exchange Offer to
participate in a distribution of the New Securities (x) could not under
Commission policy as in effect on the date of this Agreement rely on the
position of the Commission in Exxon Capital Holdings Corporation (pub. avail.
May 13, 1988) and Morgan Stanley & Co., Inc. (pub. avail. June 5, 1991), as
interpreted in the Commission's letter to Shearman & Sterling dated July 2, 1993
and similar no-action letters and (y) must comply with the registration and
prospectus delivery requirements of the Act in connection with any secondary
resale transaction, which must be covered by an effective registration statement
containing the selling security holder information required by Item 507 or 508,
as applicable, of Regulation S-K under the Act if the resales are of New
Securities obtained by such Holder in exchange for Securities acquired by such
Holder directly from any Issuer or any Affiliate of any Issuer. Accordingly,
each Holder participating in the Registered Exchange Offer shall be required to
represent to the Issuers that, at the time of the consummation of the Registered
Exchange Offer:
(i) any New Securities received by such Holder shall be acquired in
the ordinary course of business;
(ii) such Holder shall have no arrangement or understanding with any
person to participate in the distribution within the meaning of the Act of
the Securities or the New Securities;
(iii) such Holder is not an Affiliate of any Issuer; and
(iv) if such Holder is an Exchanging Dealer, then such Holder will
deliver a Prospectus in connection with a sale of any New Securities
received by such Holder pursuant to the Registered Exchange Offer.
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(f) If any Placement Agent determines that it is not eligible to
participate in the Registered Exchange Offer with respect to the exchange of
Securities constituting any portion of an unsold allotment, at the request of
such Placement Agent, the Issuers shall issue and deliver to such Placement
Agent or the person purchasing New Securities registered under a Shelf
Registration Statement as contemplated by Section 3 hereof from such Placement
Agent, in exchange for such Securities, a like principal amount of New
Securities. The Issuers shall use their reasonable best efforts to cause the
CUSIP Service Bureau to issue the same CUSIP number and International Securities
Identification Number ("ISIN") for such New Securities as for New Securities
issued pursuant to the Registered Exchange Offer.
3. Shelf Registration. (a) If (i) due to any change in law or
applicable interpretations thereof by the Commission's staff, the Issuers
determine upon advice of their outside counsel that they are not permitted to
effect the Registered Exchange Offer as contemplated by Section 2 hereof; (ii)
for any other reason the Registered Exchange Offer is not consummated within 300
days of the Closing Date; (iii) any Placement Agent so requests with respect to
Securities that are not eligible to be exchanged for New Securities in the
Registered Exchange Offer and that are held by it following consummation of the
Registered Exchange Offer; (iv) any Holder (other than a Placement Agent) is not
eligible to participate in the Registered Exchange Offer; or (v) in the case of
any Placement Agent that participates in the Registered Exchange Offer or
acquires New Securities pursuant to Section 2(f) hereof, such Placement Agent
does not receive freely tradeable New Securities in exchange for Securities
constituting any portion of an unsold allotment (it being understood that (x)
the requirement that a Placement Agent deliver a Prospectus containing the
information required by Item 507 or 508 of Regulation S-K under the Act in
connection with sales of New Securities acquired in exchange for such Securities
shall result in such New Securities being not "freely tradeable"; and (y) the
requirement that an Exchanging Dealer deliver a Prospectus in connection with
sales of New Securities acquired in the Registered Exchange Offer in exchange
for Securities acquired as a result of market-making activities or other trading
activities shall not result in such New Securities being not "freely
tradeable"), the Issuers shall file and use their commercially reasonable
efforts to cause to become and keep effective a Shelf Registration Statement in
accordance with subsection (b) below.
(b) (i) The Issuers shall as promptly as practicable, but in no
event later than 210 days after such filing obligation arises, use their
commercially reasonable efforts to file with the Commission and shall use their
commercially reasonable efforts to cause to be declared effective under the Act
within 270 days after such filing obligation arises, a Shelf Registration
Statement relating to the offer and sale of the Securities or the New
Securities, as applicable, by the Holders thereof from time to time in
accordance with the methods of distribution elected by such Holders and set
forth in such Shelf Registration Statement; provided, however, that no Holder
(other than a Placement Agent) shall be entitled to have the Securities held by
it covered by such Shelf Registration Statement unless such Holder agrees in
writing to be bound by all of the provisions of this Agreement applicable to
such Holder; and provided further that with respect to New Securities received
by a Placement Agent in exchange for Securities constituting any portion of an
unsold allotment, the Issuers may, if permitted by current interpretations by
the Commission's staff, file a post-effective amendment to the Exchange Offer
Registration Statement containing the information required by Item 507 or 508 of
Regulation S-K, as applicable, in satisfaction of their obligations under this
subsection with respect thereto, and any
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such Exchange Offer Registration Statement, as so amended, shall be referred to
herein as, and governed by the provisions herein applicable to, a Shelf
Registration Statement.
(ii) The Issuers shall use their commercially reasonable efforts to
keep the Shelf Registration Statement continuously effective, supplemented and
amended as required by the Act, in order to permit the Prospectus forming part
thereof to be usable by Holders for a period from the date the Shelf
Registration Statement is declared effective by the Commission until the
earliest of: (A) the second anniversary of the Closing Date, (B) the date upon
which all the Securities or New Securities, as applicable, covered by the Shelf
Registration Statement have been sold pursuant to the Shelf Registration
Statement or (C) the date upon which the Securities or New Securities, as
applicable, covered by the Shelf Registration Statement become eligible for
resale, without regard to volume, manner of sale or other restrictions contained
in Rule 144 under the Act pursuant to paragraph (k) thereof (in any such case,
the "Shelf Registration Period"). The Issuers shall be deemed not to have used
their commercially reasonable efforts to keep the Shelf Registration Statement
effective during the Shelf Registration Period if they voluntarily take any
action that would result in Holders of Securities covered thereby not being able
to offer and sell such Securities at any time during the Shelf Registration
Period, unless such action is (x) required by applicable law or otherwise taken
by the Issuers in good faith and for valid business reasons (not including
avoidance of the Issuers' obligations hereunder), including the acquisition or
divestiture of assets and (y) permitted pursuant to Section 4(k)(ii) hereof.
(iii) The Issuers shall cause the Shelf Registration Statement and
the related Prospectus and any amendment or supplement thereto, as of the
effective date of the Shelf Registration Statement or such amendment or
supplement, (A) to comply in all material respects with the applicable
requirements of the Act and (B) not to contain any untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary in order to make the statements therein (in the case of the
Prospectus, in the light of the circumstances under which they were made) not
misleading.
4. Additional Registration Procedures. In connection with any Shelf
Registration Statement and, to the extent applicable, any Exchange Offer
Registration Statement, the following provisions shall apply.
(a) The Issuers shall:
(i) furnish to counsel for the Representatives and to counsel
for the Holders, not less than two (2) Business Days prior to the
filing thereof with the Commission, a copy of any Exchange Offer
Registration Statement and any Shelf Registration Statement, and
each amendment thereof and each amendment or supplement, if any, to
the Prospectus included therein (including all documents
incorporated by reference therein after the initial filing) and
shall use their commercially reasonable efforts to reflect in each
such document, when so filed with the Commission, such comments as
counsel to the Holders or counsel for the Representatives reasonably
propose;
(ii) include the information set forth in Annex A hereto on
the facing page of the Exchange Offer Registration Statement, in
Annex B hereto in the
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forepart of the Exchange Offer Registration Statement in a section
setting forth details of the Exchange Offer, in Annex C hereto in
the underwriting or plan of distribution section of the Prospectus
contained in the Exchange Offer Registration Statement and in Annex
D hereto in the letter of transmittal delivered pursuant to the
Registered Exchange Offer;
(iii) if requested by a Placement Agent, include the
information required by Item 507 or 508, as applicable, of
Regulation S-K in the Prospectus contained in the Exchange Offer
Registration Statement or Shelf Registration Statement; and
(iv) in the case of a Shelf Registration Statement, include
the names of the Holders that propose to sell Securities pursuant to
the Shelf Registration Statement as selling security holders.
(b) The Issuers shall use their commercially reasonable efforts to
ensure that:
(i) any Registration Statement and any amendment thereto and
any Prospectus forming part thereof and any amendment or supplement
thereto complies in all material respects with the Act; and
(ii) any Registration Statement and any amendment thereto does
not, when it becomes effective, 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.
(c) The Issuers shall advise the Representatives, the Holders of
Securities covered by any Shelf Registration Statement and any Exchanging
Dealer under any Exchange Offer Registration Statement that has provided
in writing to the Issuers a telephone or facsimile number and address for
notices, and, if requested by any Representative or any such Holder or
Exchanging Dealer, shall confirm such advice in writing (which notice
pursuant to clauses (ii)-(v) hereof shall be accompanied by an instruction
to suspend the use of the Prospectus until the Issuers shall have remedied
the basis for such suspension):
(i) when a Registration Statement and any amendment thereto
has been filed with the Commission and when the Registration
Statement or any post-effective amendment thereto has become
effective;
(ii) of any request by the Commission after the effective date
for any amendment or supplement to the Registration Statement or the
Prospectus or for additional information;
(iii) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or the
institution of any proceeding for that purpose;
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(iv) of the receipt by any Issuer of any notification with
respect to the suspension of the qualification of the securities
included therein for sale in any jurisdiction or the institution or
threatening of any proceeding for such purpose; and
(v) of the happening of any event that requires any change in
the Registration Statement or the Prospectus so that, as of such
date, they (A) do not contain any untrue statement of a material
fact and (B) do not omit to state a material fact required to be
stated therein or necessary to make the statements therein (in the
case of the Prospectus, in the light of the circumstances under
which they were made) not misleading.
(d) The Issuers shall use their commercially reasonable efforts to
prevent the issuance of any order suspending the effectiveness of any
Registration Statement or the qualification of the securities therein for
sale in any jurisdiction and, if issued, to obtain as soon as possible the
withdrawal thereof.
(e) The Issuers shall furnish to each Holder of Securities covered
by any Shelf Registration Statement, without charge, at least one (1) copy
of such Shelf Registration Statement and any post-effective amendment
thereto, including all material incorporated therein by reference, and, if
the Holder so requests in writing, all exhibits thereto (including
exhibits incorporated by reference therein).
(f) The Issuers shall, during the Shelf Registration Period, deliver
to each Holder of Securities covered by any Shelf Registration Statement,
without charge, as many copies of the Prospectus (including the
Preliminary Prospectus) included in such Shelf Registration Statement and
any amendment or supplement thereto as such Holder may reasonably request.
The Issuers consent to the use of the Prospectus or any amendment or
supplement thereto by each of the selling Holders of Securities in
connection with the offering and sale of the Securities covered by the
Prospectus, or any amendment or supplement thereto, included in the Shelf
Registration Statement.
(g) The Issuers shall furnish to each Exchanging Dealer which so
requests, without charge, at least one (1) conformed copy of the Exchange
Offer Registration Statement and any post-effective amendments thereto,
including all material incorporated by reference therein, and, if the
Exchanging Dealer so requests in writing, all exhibits thereto (including
exhibits incorporated by reference therein).
(h) The Issuers shall promptly deliver to each Placement Agent, each
Exchanging Dealer and each other person required to deliver a Prospectus
during the Exchange Offer Registration Period, without charge, as many
copies of the Prospectus included in such Exchange Offer Registration
Statement and any amendments or supplements thereto as any such person may
reasonably request. The Issuers consent to the use of the Prospectus or
any amendments or supplements thereto by any Placement Agent, any
Exchanging Dealer and any such other person that may be required to
deliver a Prospectus following the Registered Exchange Offer in connection
with the offering
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and sale of the New Securities covered by the Prospectus, or any amendment
or supplement thereto, included in the Exchange Offer Registration
Statement.
(i) Prior to the Registered Exchange Offer or any other offering of
Securities pursuant to any Registration Statement, the Issuers shall
arrange, if necessary, for the registration or qualification of the
Securities or the New Securities for sale under the laws of such
jurisdictions as any Holder shall reasonably request and shall maintain
such qualification in effect so long as required; provided that in no
event shall any Issuer be obligated to qualify to do business in any
jurisdiction where it is not then so qualified or to take any action that
would subject it to service of process in suits, other than those arising
out of the Initial Placement, the Registered Exchange Offer or any
offering pursuant to a Shelf Registration Statement, in any such
jurisdiction where it is not then so subject or to subject itself to
taxation in excess of a nominal amount in respect of doing business in
such jurisdiction.
(j) The Issuers shall cooperate with the Holders of Securities to
facilitate the timely preparation and delivery of certificates
representing New Securities or Securities to be issued or sold pursuant to
any Registration Statement free of any restrictive legends and in such
denominations and registered in such names as Holders may request in
writing at least three (3) Business Days prior to the closing date of any
sales of New Securities.
(k) (i) Upon the occurrence of any event contemplated by subsections
(c) (ii) through (v) above, the Issuers shall promptly (or within the time
period provided for by clause (ii) of this subsection (k), if applicable)
prepare a post-effective amendment to the applicable Registration
Statement or an amendment or supplement to the related Prospectus or file
any other required document so that, as thereafter delivered to the
Placement Agents of the Securities included therein, the Prospectus shall
not include an untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they
were made, not misleading. In such circumstances, the period of
effectiveness of the Exchange Offer Registration Statement provided for in
Section 2 hereof shall be extended by the number of days from and
including the date of the giving of a notice of suspension pursuant to
Section 4(c) hereof to and including the date when the Placement Agents,
the Holders of the Securities and any known Exchanging Dealer shall have
received such amended or supplemented Prospectus pursuant to this Section
4(k).
(ii) Upon the occurrence or existence of any pending corporate
development or any other material event that, in the reasonable
judgment of the Issuers, makes it appropriate to suspend the
availability of a Shelf Registration Statement and the related
Prospectus, the Issuers shall give notice (without notice of the
nature or details of such events) to the Holders that the
availability of the Shelf Registration is suspended and, upon actual
receipt of any such notice, each Holder agrees not to sell any
Registrable Securities pursuant to the Shelf Registration until such
Holder's receipt of copies of the supplemented or amended Prospectus
provided for in Section 3(a)(i) hereof, or until it is advised in
writing
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by the Issuers that the Prospectus may be used, and has received
copies of any additional or supplemental filings that are
incorporated or deemed incorporated by reference in such Prospectus.
The period during which the availability of the Shelf Registration
and any Prospectus is suspended (the "Deferral Period") (1) shall
not exceed 60 consecutive days, (2) shall not occur more than three
(3) times during any calendar year and (3) shall extend the number
of days the Shelf Registration or any Prospectus is required to be
available by an amount equal to the Deferral Period. Any
Registration Default Damages payable pursuant to Section 8(a)(iii)
shall cease to accrue during any Deferral Period.
(l) Not later than the effective date of any Registration Statement,
the Issuers shall provide a CUSIP number and ISIN for the Securities or
the New Securities, as the case may be, registered under such Registration
Statement, and provide the Trustee with printed certificates for such
Securities or New Securities, in a form eligible for deposit with The
Depository Trust Company.
(m) The Issuers shall comply in all material respects with all
applicable rules and regulations of the Commission and shall make
generally available to their security holders earnings statements
satisfying the provisions of Section 11(a) of the Act as soon as
practicable after the effective date of the applicable Registration
Statement.
(n) The Issuers shall cause the Indenture or any New Securities
Indenture to be qualified under the Trust Indenture Act as required by
applicable law in a timely manner.
(o) The Issuers may require each Holder of Securities to be sold
pursuant to any Shelf Registration Statement to furnish to the Issuers
such information regarding the Holder and the distribution of such
Securities as the Issuers may from time to time reasonably require for
inclusion in such Registration Statement. The Issuers may exclude from
such Shelf Registration Statement the Securities of any Holder that fails
to furnish such information within a reasonable time after receiving such
request.
(p) In the case of any Shelf Registration Statement, upon the
request of the Majority Holders, the Issuers shall enter into customary
agreements (including, if requested, one underwriting agreement in
customary form) and take all other appropriate actions, if any, as the
Majority Holders shall reasonably request in order to expedite or
facilitate the registration or the disposition of the Securities, and in
connection therewith, if an underwriting agreement is entered into, cause
the same to contain indemnification provisions and procedures no less
favorable than those set forth in Section 6 hereof.
(q) In the case of any Shelf Registration Statement, the Issuers
shall:
(i) make reasonably available for inspection at a location
where they are normally kept and during normal business hours by the
Majority Holders of Securities to be registered thereunder, any
underwriter participating in any disposition pursuant to such
Registration Statement and any attorney, accountant or other agent
retained by such Holders or any such underwriter all relevant
-13-
financial and other records and pertinent corporate documents of the
Issuers and their subsidiaries;
(ii) use its commercially reasonable efforts to cause its
officers, directors, employees, accountants and auditors to supply
all relevant information reasonably requested by the Holders or any
such underwriter, attorney, accountant or agent (each, an
"Inspector") in connection with any such Registration Statement as
is customary for similar due diligence examinations; provided,
however, that such Inspector shall first agree in writing with the
Issuers that any information that is reasonably and in good faith
designated by the Issuers in writing as confidential at the time of
delivery of such information shall be kept confidential by such
Inspector, unless (1) disclosure of such information is required by
court or administrative order or is necessary to respond to
inquiries of regulatory authorities, (2) disclosure of such
information is required by law (including any disclosure
requirements pursuant to federal securities laws in connection with
the filing of such Registration Statement or the use of any
Prospectus), (3) such information becomes generally available to the
public other than as a result of a disclosure or failure to
safeguard such information by such person or (4) such information
becomes available to such Inspector from a source other than the
Issuers and such source is not known, after due inquiry, by the
relevant Holder to be bound by a confidentiality agreement or is not
otherwise under a duty of trust to the Issuers;
(iii) make such representations and warranties to the Holders
of Securities registered thereunder and the underwriters, if any, in
form, substance and scope as are customarily made by issuers to
underwriters in primary underwritten offerings;
(iv) obtain opinions of counsel to the Issuers and updates
thereof (which counsel and opinions (in form, scope and substance)
shall be reasonably satisfactory to the Managing Underwriters, if
any) addressed to each selling Holder and the underwriters, if any,
covering such matters as are customarily covered in opinions
requested in underwritten offerings and such other matters as may be
reasonably requested by such Holders and underwriters;
(v) obtain "comfort" letters and updates thereof from the
independent certified public accountants of Holdings (and, if
necessary, any other independent certified public accountants of any
subsidiary of Holdings or of any business acquired by Holdings for
which financial statements and financial data are, or are required
to be, included in the Registration Statement), addressed to each
selling Holder of Securities registered thereunder and the
underwriters, if any, in customary form and covering matters of the
type customarily covered in "comfort" letters in connection with
primary underwritten offerings; and
(vi) deliver such documents and certificates as may be
reasonably requested by the Majority Holders or the Managing
Underwriters, if any, including those to evidence compliance with
Section 4(k) hereof and with any
-14-
customary conditions contained in the underwriting agreement or
other agreement entered into by the Issuers.
(r) If a Registered Exchange Offer is to be consummated, upon
delivery of the Securities by Holders to the Company (or to such other
person as directed by the Company) in exchange for the New Securities, the
Company shall mark, or caused to be marked, on the Securities so exchanged
that such Securities are being cancelled in exchange for the New
Securities. In no event shall the Securities be marked as paid or
otherwise satisfied.
(s) The Issuers shall use their commercially reasonable best efforts
to take all other steps necessary to effect the registration of the
Securities or the New Securities, as the case may be, covered by a
Registration Statement.
5. Registration Expenses. The Issuers shall bear all expenses
incurred in connection with the performance of their obligations under Sections
2, 3 and 4 hereof and, in the event of any Shelf Registration Statement, shall
reimburse the Holders for the reasonable fees and disbursements of one firm or
counsel (which shall initially be Shearman & Sterling LLP, but which may be
another nationally recognized law firm experienced in securities matters
designated by the Majority Holders) to act as counsel for the Holders in
connection therewith, and, in the case of any Exchange Offer Registration
Statement, shall reimburse the Placement Agents for the reasonable fees and
disbursements of counsel acting in connection therewith, in each case which
counsel shall be approved by the Issuer (such approval not to be unreasonably
withheld). Each Holder shall pay all expenses of its counsel other than as set
forth in the preceding sentence, underwriting discounts and commissions and
transfer taxes, if any, relating to the sale or disposition of such Holder's
Securities or New Securities.
6. Indemnification and Contribution. (a) The Issuers, jointly and
severally, agree to indemnify and hold harmless each Holder of Securities or New
Securities, as the case may be, covered by any Registration Statement, each
Placement Agent and, with respect to any Prospectus delivery as contemplated in
Section 4(h) hereof, each Exchanging Dealer, the directors, officers and
Affiliates of each such Holder, Placement Agent or Exchanging Dealer and each
person who controls any such Holder, Placement Agent or Exchanging Dealer within
the meaning of either the Act or the Exchange Act against any and all losses,
claims, damages or liabilities, joint or several, to which they or any of them
may become subject under the Act, the Exchange Act or other federal or state
statutory law or regulation, at common law or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement as originally filed or in any
amendment thereof, or in any preliminary Prospectus or the Prospectus, or in any
amendment thereof or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein (in the case of any
preliminary Prospectus or the Prospectus, in the light of the circumstances
under which they were made) not misleading, and agree (subject to the
limitations set forth in the provisos to this sentence) to reimburse each such
indemnified party, as incurred, for any legal or other expenses reasonably
incurred by it in connection with investigating or defending any such loss,
claim, damage, liability or action; provided, however, that the Issuers will not
be liable in any such case to the
-15-
extent that any such loss, claim, damage or liability arises out of or is based
upon any such untrue statement or alleged untrue statement or omission or
alleged omission made therein in reliance upon and in conformity with written
information furnished to the Issuers by or on behalf of the party claiming
indemnification specifically for inclusion therein; provided further that with
respect to any such untrue statement or alleged untrue statement or omission or
alleged omission from any preliminary Prospectus, the indemnity agreement
contained in this paragraph (a) shall not inure to the benefit of any Holder,
Placement Agent or Exchanging Dealer or any of their respective directors,
officers and Affiliates or control persons, from whom such person asserting such
loss, claim, damage or liability purchased the New Securities concerned, to the
extent that both (i) a copy of the final Prospectus was not sent or given to
such person at or prior to the written confirmation of the sale of the
Securities or New Securities to such person and (ii) the untrue statement in or
omission from such preliminary Prospectus was corrected in the final Prospectus
unless, in either case, such failure to deliver the final Prospectus was a
result of non-compliance by the Issuer with the provisions of Section 4 hereof.
This indemnity agreement shall be in addition to any liability that the Issuers
may otherwise have. The Issuers shall not be liable under this Section 6 to any
indemnified party regarding any settlement or compromise or consent to the entry
of any judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified parties are actual or potential
parties to such claim or action) unless such settlement, compromise or consent
is consented to by the Issuers, which consent shall not be unreasonably
withheld.
(b) Each Holder of securities covered by a Registration Statement
(including each Placement Agent that is a Holder, in such capacity) severally
and not jointly agrees to indemnify and hold harmless the Issuers, each of their
respective directors, each of their respective officers who sign such
Registration Statement and each person who controls any Issuer within the
meaning of either the Act or the Exchange Act, to the same extent as the
foregoing indemnity from the Issuers to each such Holder, but only with
reference to written information relating to such Holder furnished to the
Issuers by or on behalf of such Holder specifically for inclusion in the
documents referred to in the foregoing indemnity. This indemnity agreement will
be in addition to any liability that any such Holder may otherwise have.
(c) Promptly after receipt by an indemnified party under this
Section 6 or notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under this Section, notify the indemnifying party in writing of the commencement
thereof; but the failure to so notify the indemnifying party (i) will not
relieve it from liability under paragraph (a) or (b) above unless and to the
extent it did not otherwise learn of such action and such failure results in the
forfeiture by the indemnifying party of substantial rights and defenses; and
(ii) will not, in any event, relieve the indemnifying party from any obligations
to any indemnified party other than the indemnification obligation provided in
paragraph (a) or (b) above. The indemnifying party shall be entitled to appoint
counsel (including local counsel) of the indemnifying party's choice at the
indemnifying party's expense to represent the indemnified party in any action
for which indemnification is sought (in which case the indemnifying party shall
not thereafter be responsible for the fees and expenses of any separate counsel,
other than local counsel if not appointed by the indemnifying party, retained by
the indemnified party or parties except as set forth below); provided, however,
that
-16-
such counsel shall be reasonably satisfactory to the indemnified party.
Notwithstanding the indemnifying party's election to appoint counsel (including
local counsel) to represent the indemnified party in an action, the indemnified
party shall have the right to employ separate counsel (including local counsel),
and the indemnifying party shall bear the reasonable fees, costs and expenses of
such separate counsel if (i) the use of counsel chosen by the indemnifying party
to represent the indemnified party would present such counsel with a conflict of
interest (based on the advice of counsel to the indemnified person); (ii) such
action includes both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded (based on the advice of
counsel to the indemnified person) that there may be legal defenses available to
it and/or other indemnified parties that are different from or additional to
those available to the indemnifying party; (iii) the indemnifying party shall
not have employed counsel reasonably satisfactory to the indemnified party to
represent the indemnified party within a reasonable time after notice of the
institution of such action; or (iv) the indemnifying party shall authorize the
indemnified party to employ separate counsel at the expense of the indemnifying
party. It is understood and agreed that the indemnifying party shall not, in
connection with any proceeding or related proceeding in the same jurisdiction,
be liable for the reasonable fees and expenses of more than one separate firm
(in addition to any local counsel) for all indemnified parties. Any such
separate firm for any Placement Agent, its directors, officers and Affiliates
and any control person shall be designated in writing by CGMI and any such
separate firm for any of the Issuers, its respective directors, officers and
Affiliates and any control person shall be designated in writing by the Company.
An indemnifying party will not, without the prior written consent of the
indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified parties are actual or potential
parties to such claim or action) unless such settlement, compromise or consent
includes an unconditional release of each indemnified party from all liability
arising out of such claim, action, suit or proceeding and does not include any
statement as to, or any concessions of, fault, culpability or failure to act by
or on behalf of any indemnified party.
(d) In the event that the indemnity provided in paragraph (a) or (b)
of this Section is unavailable to or insufficient to hold harmless an
indemnified party for any reason, then each applicable indemnifying party shall
have a joint and several obligation to contribute to the aggregate losses,
claims, damages and liabilities (including legal or other expenses reasonably
incurred in connection with investigating or defending any loss, claim,
liability, damage or action) (collectively "Losses") to which such indemnified
party may be subject in such proportion as is appropriate to reflect the
relative benefits received by such indemnifying party, on the one hand, and such
indemnified party, on the other hand, from the Initial Placement and the
Registration Statement which resulted in such Losses; provided, however, that in
no case shall any Placement Agent be responsible, in the aggregate, for any
amount in excess of the purchase discount or commission applicable to such
Security, or in the case of a New Security, applicable to the Security that was
exchangeable into such New Security, as set forth in the Final Memorandum, nor
shall any underwriter be responsible for any amount in excess of the
underwriting discount or commission applicable to the securities purchased by
such underwriter under the Registration Statement which resulted in such Losses.
If the allocation provided by the immediately preceding sentence is unavailable
for any reason, the indemnifying party and the indemnified party shall
contribute in such proportion as is appropriate to reflect not only such
-17-
relative benefits but also the relative fault of such indemnifying party, on the
one hand, and such indemnified party, on the other hand, in connection with the
statements or omissions which resulted in such Losses as well as any other
relevant equitable considerations. Benefits received by the Issuers shall be
deemed to be equal to the total net proceeds from the Initial Placement (before
deducting expenses) as set forth in the Final Memorandum. Benefits received by
the Placement Agents shall be deemed to be equal to the total purchase discounts
and commissions as set forth on the cover page of the Final Memorandum, and
benefits received by any other Holders shall be deemed to be equal to the value
of receiving Securities or New Securities, as applicable, registered under the
Act. Benefits received by any underwriter shall be deemed to be equal to the
total underwriting discounts and commissions, as set forth on the cover page of
the Prospectus forming a part of the Registration Statement which resulted in
such Losses. Relative fault shall be determined by reference to, among other
things, whether any untrue or any alleged untrue statement of a material fact or
omission or alleged omission to state a material fact relates to information
provided by the indemnifying party, on the one hand, or by the indemnified
party, on the other hand, the intent of the parties and their relative
knowledge, access to information and opportunity to correct or prevent such
untrue statement or omission and any other equitable considerations appropriate
in the circumstances. The parties agree that it would not be just and equitable
if the amount of such contribution were determined by pro rata allocation (even
if the Holders were treated as one entity for such purpose) or any other method
of allocation which does not take account of the equitable considerations
referred to above. Notwithstanding the provisions of this paragraph (d), no
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. For purposes of this Section, each
person who controls a Holder within the meaning of either the Act or the
Exchange Act and each director, officer, employee and agent of such Holder shall
have the same rights to contribution as such Holder, and each person who
controls any Issuer within the meaning of either the Act or the Exchange Act,
each officer of any Issuer who shall have signed the Registration Statement and
each director of any Issuer shall have the same rights to contribution as the
Issuers, subject in each case to the applicable terms and conditions of this
paragraph (d).
(e) The provisions of this Section will remain in full force and
effect, regardless of any investigation made by or on behalf of any Holder or
the Issuers or any of the indemnified persons referred to in this Section 6, and
will survive the sale by a Holder of securities covered by a Registration
Statement.
7. Underwritten Registrations. (a) If any of the Securities or New
Securities, as the case may be, covered by any Shelf Registration Statement are
to be sold in an underwritten offering, the Managing Underwriters, if any, shall
be selected by the Majority Holders subject to the consent of the Issuer (which
shall not be unreasonably withheld), and the Holders of Securities or New
Securities covered by such Shelf Registration Statement shall be responsible for
all underwriting commissions and discounts.
(b) No person may participate in any underwritten offering pursuant
to any Shelf Registration Statement, unless such person (i) agrees to sell such
person's Securities or New Securities, as the case may be, on the basis
reasonably 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
-18-
agreements and other documents reasonably required under the terms of such
underwriting arrangements.
8. Registration Defaults. (a) If any of the following events shall
occur, then the Company shall pay liquidated damages (the "Registration Default
Damages") to the Holders of Securities in respect of the Securities as follows:
(i) if (a) neither (x) the Registered Exchange Offer is completed
within 300 days of the Closing Date, nor (y) if required, the Shelf
Registration Statement is declared effective within 270 days of the date
the filing obligation arises with respect to such Shelf Registration
Statement, then Registration Default Damages shall accrue on the
Registrable Securities at a rate of 0.25% per annum on the principal
amount of such Registrable Securities for the first 90 days from and
including such specified date and increasing by an additional 0.25% per
annum at the beginning of each subsequent 90-day period thereafter;
provided that Registration Default Damages in the aggregate under this
Section 8 may not exceed 1.0% per annum of the principal amount of such
Registrable Securities; or
(ii) subject to the last sentence of Section 4(k)(ii) above, if the
Shelf Registration Statement required by Section 3(a) of this Agreement
has been declared effective but thereafter ceases to be effective at any
time at which it is required to be effective under this Agreement and such
failure to remain effective exists for more than 30 consecutive days or
more than 60 days (whether or not consecutive) during the period for which
the Shelf Registration Statement is required, then commencing on the 31st
day or 61st day, as applicable, following the date on which such Shelf
Registration Statement ceases to be effective, Registration Default
Damages shall accrue on the Registrable Securities at a rate of 0.25% per
annum of the principal amount of such Registrable Securities for the first
90 days from and including such 31st day or 61st day, as applicable,
following the date on which such Shelf Registration Statement ceases to be
effective and increasing by an additional 0.25% per annum at the beginning
of each subsequent 90-day period thereafter; provided that Registration
Default Damages in the aggregate under this Section 8 may not exceed 1.0%
per annum of the principal amount of such Registrable Securities;
provided, however, that upon (1) the completion of the Exchange Offer (in the
case of paragraph (i) above) and (2) the effectiveness of the Shelf Registration
Statement which had ceased to remain effective (in the case of paragraph (ii)
above), Registration Default Damages shall cease to accrue.
(b) The Issuers shall notify the Trustee within one Business Day
after each and every date on which an event occurs in respect of which
Registration Default Damages are required to be paid and within one Business Day
after such Registration Default Damages cease to accrue. Any amounts of
Registration Default Damages due pursuant to paragraphs (i) or (ii) of this
Section 8(a) will be payable in cash on each interest payment date specified by
the Indenture to the record holder entitled to receive the interest payment to
be made on such date, commencing with the first such date occurring after any
such Registration Default Damages commences to accrue.
-19-
(c) The parties hereto agree that the liquidated damages in the form
of Registration Default Damages provided for in this Section 8 constitute a
reasonable estimate of and are intended to constitute the sole damages payable
under this Agreement that will be suffered by Holders of Securities by reason of
the failure of (i) the Registered Exchange Offer to be completed; (ii) the Shelf
Registration Statement, if required hereby, to be declared effective, or (iii)
the Shelf Registration Statement to remain effective (and the prospectus
contained therein to remain usable), in each case to the extent required by this
Agreement.
9. No Inconsistent Agreements. No Issuer has entered into, and each
Issuer agrees not to enter into, any agreement with respect to its securities
that is inconsistent with the rights granted to the Holders herein or that
otherwise conflicts with the provisions hereof.
10. Amendments and Waivers. The provisions of this Agreement may not
be amended, qualified, modified or supplemented, and waivers or consents to
departures from the provisions hereof may not be given, unless the Issuers have
obtained the written consent of the Holders of a majority of the aggregate
principal amount of the Registrable Securities outstanding; provided that, with
respect to any matter that directly or indirectly affects the rights and
obligations of any Placement Agent hereunder, the Issuers shall obtain the
written consent of each such Placement Agent against which such amendment,
qualification, supplement, waiver or consent is to be effective; provided
further that no amendment, qualification, supplement, waiver or consent with
respect to Section 8 hereof shall be effective as against any Holder of
Registered Securities unless consented to in writing by such Holder; and
provided further that the provisions of this Article 10 may not be amended,
qualified, modified or supplemented, and waivers or consents to departures from
the provisions hereof may not be given, unless the Issuers have obtained the
written consent of the Placement Agents and each Holder. Notwithstanding the
foregoing (except the foregoing provisos), a waiver or consent to depart from
the provisions hereof with respect to a matter that relates exclusively to the
rights of Holders whose Securities or New Securities, as the case may be, are
being sold pursuant to a Registration Statement and that does not directly or
indirectly affect the rights of other Holders may be given by the Majority
Holders, determined on the basis of Securities or New Securities, as the case
may be, being sold rather than registered under such Registration Statement.
11. Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, first-class mail,
telex, telecopier or air courier guaranteeing overnight delivery:
(a) if to a Holder, at the most current address given by such Holder
to the Issuers in accordance with the provisions of this Section 11, which
address initially is, with respect to each Holder, the address of such
Holder maintained by the Registrar (as such term is defined in the
Indenture) under the Indenture;
(b) if to the Representatives, initially at the address or addresses
set forth in the Purchase Agreement; and
(c) if to any Issuer, initially at its address set forth in the
Purchase Agreement.
-20-
All such notices and communications shall be deemed to have been
duly given when received.
The Placement Agents or the Issuers by notice to the other parties
may designate additional or different addresses for subsequent notices or
communications.
12. Remedies. Each Holder, in addition to being entitled to exercise
all rights provided to it herein, in the Indenture or in the Purchase Agreement
or granted by law, including recovery of liquidated or other damages, will be
entitled to specific performance of its rights under this Agreement. The Issuers
agree that monetary damages would not be adequate compensation for any loss
incurred by reason of a breach by them of the provisions of this Agreement and
hereby agree to waive in any action for specific performance the defense that a
remedy at law would be adequate.
13. Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the parties hereto, their respective successors
and assigns, including, without the need for an express assignment or any
consent by the Issuers thereto, subsequent Holders of Securities and the New
Securities, and the indemnified persons referred to in Section 6 hereof. The
Issuers hereby agree to extend the benefits of this Agreement to any Holder of
Securities and the New Securities, and any such Holder may specifically enforce
the provisions of this Agreement as if an original party hereto.
14. Counterparts. This Agreement may be signed in one or more
counterparts which may be delivered in original form or by telecopier, each of
which when so executed shall constitute an original and all of which together
shall constitute one and the same agreement.
15. Headings. The section headings used herein are for convenience
only and shall not affect the construction hereof.
16. Applicable Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York applicable to
contracts made and to be performed in the State of New York. The parties hereto
each hereby waive any right to trial by jury in any action, proceeding or
counterclaim arising out of or relating to this Agreement.
17. Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstances, is
held invalid, illegal or unenforceable in any respect for any reason, the
validity, legality and enforceability of any such provision in every other
respect and of the remaining provisions hereof shall not be in any way impaired
or affected thereby, it being intended that all of the rights and privileges of
the parties shall be enforceable to the fullest extent permitted by law.
18. Securities Held by any Issuer, etc. Whenever the consent or
approval of Holders of a specified percentage of principal amount of Securities
or New Securities is required hereunder, Securities or New Securities, as
applicable, held by any Issuer or their Affiliates (other than subsequent
Holders of Securities or New Securities if such subsequent Holders are deemed to
be Affiliates solely by reason of their holdings of such Securities or New
Securities) shall not be counted in determining whether such consent or approval
was given by the Holders of such required percentage.
[Signature pages follow.]
-22-
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this letter and your acceptance shall represent a binding agreement by and among
the Issuers and the several Placement Agents.
Very truly yours,
DRESSER-RAND GROUP INC.
By: /s/ Elizabeth C. Powers
----------------------------------------
Name: Elizabeth C. Powers
Title: Vice President
DRESSER-RAND LLC
By: /s/ Elizabeth C. Powers
----------------------------------------
Name: Elizabeth C. Powers
Title: Vice President
DRESSER-RAND COMPANY
By: /s/ Elizabeth C. Powers
----------------------------------------
Name: Elizabeth C. Powers
Title: Vice President
DRESSER-RAND POWER LLC
By: /s/ Elizabeth C. Powers
----------------------------------------
Name: Elizabeth C. Powers
Title: Vice President
DRESSER-RAND GLOBAL SERVICES, LLC
By: /s/ Elizabeth C. Powers
----------------------------------------
Name: Elizabeth C. Powers
Title: Vice President
-23-
The foregoing Agreement is hereby confirmed and
accepted as of the date first above written:
Morgan Stanley & Co. Incorporated
Citigroup Global Markets Inc.
UBS Securities LLC
Bear, Stearns & Co. Inc.
Natexis Bleichroeder Inc.
Sovereign Securities Corporation, LLC
Daiwa Securities America Inc.
As Representatives of the Placement Agents
By: Morgan Stanley & Co. Incorporated
By: /s/ Bryan W. Andrzejewski
----------------------------------------
Name: Bryan W. Andrzejewski
Title: Executive Director
ANNEX A
Each broker-dealer that receives New Securities for its own account
pursuant to the Exchange Offer must acknowledge that it shall deliver a
prospectus in connection with any resale of such New Securities. The Letter of
Transmittal states that by so acknowledging and by delivering a Prospectus, a
broker-dealer shall not be deemed to admit that it is an "underwriter" within
the meaning of the Act. This prospectus, as it may be amended or supplemented
from time to time, may be used by a broker-dealer in connection with resales of
New Securities received in exchange for Securities where such Securities were
acquired by such broker-dealer as a result of market-making activities or other
trading activities. The Issuers have agreed that, for a period of 180 days after
consummation of the Registered Exchange Offer, they shall make this Prospectus
available to any broker-dealer for use in connection with any such resale. See
"Plan of Distribution."
A-1
ANNEX B
Each broker-dealer that receives New Securities for its own account
in exchange for Securities, where such Securities were acquired by such
broker-dealer as a result of market-making activities or other trading
activities, must acknowledge that it shall deliver a Prospectus in connection
with any resale of such New Securities. See "Plan of Distribution."
B-1
ANNEX C
PLAN OF DISTRIBUTION
Each broker-dealer that receives New Securities for its own account
pursuant to the Registered Exchange Offer must acknowledge that it will deliver
a Prospectus in connection with any resale of such New Securities. This
Prospectus, as it may be amended or supplemented from time to time, may be used
by a broker-dealer in connection with resales of New Securities received in
exchange for Securities where such Securities were acquired as a result of
market-making activities or other trading activities. The Issuers have agreed
that, for a period of 180 days after the consummation of the Registered Exchange
Offer, they will make this Prospectus, as amended or supplemented, available to
any broker-dealer for use in connection with any such resale. In addition, until
__________, 20___, all dealers effecting transactions in the New Securities may
be required to deliver a Prospectus.
The Issuers will not receive any proceeds from any sale of New
Securities by brokers-dealers. New Securities received by broker-dealers for
their own account pursuant to the Registered Exchange Offer may be sold from
time to time in one or more transactions in the over-the-counter market, in
negotiated transactions, through the writing of options on the New Securities or
a combination of such methods of resale, at market prices prevailing at the time
of resale, at prices related to such prevailing market prices or negotiated
prices. Any such resale may be made directly to purchasers or to or through
brokers or dealers who may receive compensation in the form of commissions or
concessions from any such broker-dealer and/or the purchasers of any such New
Securities. Any broker-dealer that resells New Securities that were received by
it for its own account pursuant to the Registered Exchange Offer and any broker
or dealer that participates in a distribution of such New Securities may be
deemed to be an "underwriter" within the meaning of the Act and any profit of
any such resale of New Securities and any commissions or concessions received by
any such persons may be deemed to be underwriting compensation under the Act.
The Letter of Transmittal states that by acknowledging that it will deliver and
by delivering a Prospectus, a broker-dealer will not be deemed to admit that it
is an "underwriter" within the meaning of the Act.
For a period of 180 days after the consummation of the Registered
Exchange Offer, the Issuers will promptly send additional copies of this
Prospectus and any amendments or supplements to this Prospectus to any
broker-dealer that requests such documents in the Letter of Transmittal. The
Issuers have agreed to pay all expenses incident to the Registered Exchange
Offer (including the expenses of one counsel for the holder of the Securities)
other than commissions or concessions of any brokers or dealers and will
indemnify the holders of the Securities (including any broker-dealers) against
certain liabilities, including liabilities under the Act.
[If applicable, add information required by Regulation S-K Items 507
and/or 508.]
C-1
ANNEX D
LANGUAGE TO BE INCLUDED IN LETTER OF TRANSMITTAL
1. PLEASE FILL IN YOUR NAME AND ADDRESS BELOW IF YOU ARE A BROKER-DEALER AND
WISH TO RECEIVE 10 ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF
ANY AMENDMENTS OR SUPPLEMENTS THERETO.
Name: ___________________________
Address: ___________________________
___________________________
2. If the undersigned is not a Broker-Dealer, the undersigned represents that
it acquired the New Securities in the ordinary course of its business, it
is not engaged in, and does not intend to engage in, a distribution of New
Securities and it has no arrangements or understandings with any person to
participate in a distribution of the New Securities. If the undersigned is
a Broker-Dealer that will receive New Securities for its own account in
exchange for Securities, it represents that the Securities to be exchanged
for New Securities were acquired by it as a result of market-making
activities or other trading activities and acknowledges that it shall
deliver a Prospectus in connection with any resale of such New Securities;
however, by so acknowledging and by delivering a Prospectus, the
undersigned shall not be deemed to admit that it is an "underwriter"
within the meaning of the Act.
D-1